Why the Concurrent Closing Strategy Is Usually Extremely Hard to Implement

Another popular property-flipping strategy that is being taught today is concurrent closings, which are better known as simultaneous closings, double closings, and double escrows.

Under a typical concurrent closing scenario, Buyer A signs a purchase agreement to buy a property from Seller B; in the meantime, Buyer A turns around and signs a purchase agreement to sell the property to Buyer C at the same time Buyer A buys the property from Seller B.

In theory, this sounds as easy as boiling water, but in reality, it is next to impossible to pull off, especially when there are lenders involved in the transaction, because, nowadays, almost all lenders issue closing instructions to title and escrow agents doing concurrent closings, which require: Read more…

April 5th, 2008 | Buying & Selling | No Comments

 

8 Specific Advantages to Investing in Real Estate

There are several advantages to invest in real estate over other investment vehicles.

Financial Leverage

Leverage is simply the extent to which debt is used to finance real estate. Successful real estate investors optimize (not maximize!) their leverage. The general rule is “Borrow to buy, sell for cash.” More leverage can make a good investment a great investment. Wise real estate investors generally look for those properties that provide the most financing. To optimize leverage, many investors have a specific strategy that they use in identifying investment opportunities. This involves acquisition strategies that minimize the cash necessary to get into a project and divestiture strategies that look to all cash exits. Read more…

March 30th, 2008 | Basic Knowledge | No Comments

What Determines a Home’s Value?

When it comes down to the nitty-gritty, your home is worth what someone is willing to pay for it. In a super hot market with several buyers bidding against each other, the value can escalate in minutes to thousands of dollars over the starting price.

In fact, buyers in some markets know they have to start thousands of dollars over asking price just to play in the game. Buying a home can get ugly as more buyers chase fewer properties in a market that seems to increasingly defy gravity.

In a normal market where the numbers of buyers and sellers are more balanced and homes aren’t selling before the seller finishes pounding a sign in the turf, the usual valuation rules apply. The five most important are: Read more…

March 19th, 2008 | Valuation & Appraisal | 1 Comment

 

How to Find and Work with a Professional

Home showcasing, fueled by television reality shows, is rapidly becoming a real estate industry. Agents, interior decorators, home renovators, and anyone with a yen to decorate are hanging out their shingle. That means the professional quality runs the gamut from scammer to excellent.

So how do you find the best talent? The same way you find it shopping for an agent or contractor. Some sources are: Agents, title people, the Web, open houses, builders, and booths at home shows. Make sure you: Read more…

March 1st, 2008 | Rental Property | No Comments

Ten Steps to Closing a Home Purchase

Everyone knows when a real estate deal closes: It’s when you get the keys to the house and the sellers get their money. But when does the closing process actually begin? In truth, it starts when you make an offer to purchase. How that offer is written up determines what steps you have to take in order to eventually receive possession of your new home.

There are many steps involved in the closing. These can include getting financing, clearing contingencies and title, and paying closing costs. There also can be many stumbling blocks. For example, your lender or escrow company may charge excessive garbage fees or may refuse to fund, or the escrow holder may make mistakes, or clouds (defects) may appear on the title. Or it could go quickly and smoothly.

To get started, it’s important that you have a sense of what’s involved in a typical residential real estate closing. So here it is, step by step: Read more…

February 28th, 2008 | Buying & Selling | No Comments

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