Investing Journals

Property Prices Leveling Out
The double-digit home price increases over the past couple of years are substantially over in most markets. Expectations for 2014 are increases of 3% to 5%, and this is predicted to be the norm for years, possibly even until 2021.

Mortgage Rates Having Little Effect on Demand
Mortgage rate increases aren’t having a major effect on regular buyer demand, as they just aren’t in the market right now. However, there has been an increase in ARMs being used by the buyers out there who are able to qualify and want the most house for the money.

December Sales Down Sharply

Sometimes in life, when faced with a given situation, we say things simply as a matter of reflex. For example:

“What an adorable baby!”

“You have a lovely home here.”

“You’re a great gal, I’ll call you sometime. Now can you help me find my pants?”

Things are no different in the tax world. As advisors, we keep an army of axioms always at the ready to be used in response to client queries. Take, for example, the client who contemplates the type of entity that should be used to hold a piece of real estate. For most tax practitioners, this would elicit the following Pavlovian reaction:

“You should NEVER put real estate inside a corporation.”

On television, real estate investing is often presented as a sure thing in getting rich quick. However, they forget to tell the viewers that the successful home buyers and flippers they talk about are professionals, and they all have years of experience. Those who try to get rich quick in this business without learning the ropes or without

experience, they get in over their heads. The first thing that an investor should do is learning the market conditions on where they plan to invest.

Chinese developers have been purchasing big real estate projects in the world’s most important cities in the past year. They will continue the shopping spree this year, with other Chinese groups to follow the trend soon, according to real estate analysts.

Greenland Holding Group Co., a state-owned developer that built one of China’s tallest towers, on Tuesday bought the historic Ram Brewery Site in southwest London. The Shanghai-based company said it plans to spend $1billon to purchase and develop the place. Separately, it announced plans to invest another $1 billion in a residential tower in the Canary Wharf financial district.

Chinese Billionaire Wang Jianlin's Hong Kong-Listed Real Estate Business Seeks $318 Mln In Stock Sale
Russell Flannery,Russell&Flannery
Forbes Staff

There could be a stage when you begin contemplating buying a second home as a form of investment. There is no doubt that a home that can generate supplemental income for you is an attractive proposition, but before you dive into this investment, you need to consider certain factors to see whether buying a second home as an investment is a prudent decision.

Buying new home for investment-image Courtesy of ddpavumba / FreeDigitalPhotos.net

Is a Second Home in Your Budget?

Looking back through history, many financial pundits would tell you that home demand and prices rise when the stock market is doing well. It’s easy to buy into that as a constant when we look at the housing boom from 2000 into late 2006.
Large financial institutions enjoy a large portion of their income from the stock and bond markets. When they’re doing well, mortgage products are freely offered, and regular home buyers can buy that dream home more easily. In times past, regular buyers were also in the stock market, both in retirement and personal accounts. This isn’t as common anymore.

The basic calculations that underlie all real estate investments are, of course, the numbers. You certainly will not make an investment decision on any rental property without conducting a full real estate analysis that reveals the cash flows, rates of return, and profitability of any property. This goes without saying.

Nonetheless, there are some other bits of valuable information about the property you will need to gather in order to feed the correct data into your real estate analysis and ultimately (hopefully) help you to make a wise and profitable investment decision.

Investment

FHFA House Price Index
The Federal Housing Finance Agency released the index report for November this week. Prices were up nationally by 0.1%. Six of nine census divisions were up or slightly flat. Down were East South Central, New England, and Middle Atlantic.

Home Prices Slowing Down
The Case-Shiller Home Price Index is reporting its first month-over-month decline in 10 months this week. Rising mortgage rates are reported to be the biggest factor.

More Moving Back Home
Rising home prices, higher mortgage rates, rising student loan debt and fewer jobs are all combining to dash younger Americans’ hopes of buying a home. Rising rents are now pushing them back into their parents’ homes.

I've done several comps in areas I have researched to be hot or up and coming. I have found that houses are being sold at an average of 225.665 a square foot. The low was 196.650 the high was 262.725. Based on these numbers I suspect that a house for 299,000 and having 1305 square feet is being sold at 228 a square foot. Does this mean I could potentially sell it for 262 a square foot netting 44,404.00
To me the answer is yes I now need to find out how to make money on the deal. Such as buyers agreement and reassignment clause. Then I need to find out how to protect the initial offer from seller to me to the new buyer. Any thoughts, suggestions

Ive been on this site for a while. Ive been back and forth. This time I will do what's necessary. Went over Dean's book and taking action today.