Tools of the Trade: Blanket Loan

Featured | Posted by Rita

A blanket loan is a loan or mortgage used to fund the purchase of 2 or more pieces of real estate (Wikipedia, Investopedia). The real estate is held as collateral for the mortgage, but the individual pieces of property may be sold without retiring the entire mortgage. Builders and developers, investors in multiple apartment communities, or investors in more than on single family rental property use blanket loans to buy a large tract of land to subdivide or multiple properties to manage as a business. The rental investor may sell one property without redoing the mortgage on the other properties. The developer can create many individual parcels to be sold one at a time without securing a new mortgage each time the sale of a parcel is made.

The blanket loan has a release clause that allows the owner to sell a portion of the secured property and make a corresponding payment on the loan. The outstanding balance on the loan is adjusted accordingly without being completely redone or retired. Most single-house traditional mortgages contain a “due-on-sale clause,” which means the entire outstanding debt is due when the securing property is sold. If this is the type of mortgage a developer or an investor with multiple rental properties has, then each time they sell a property they have to redo all the paperwork to remake the mortgage.

Benefits

The financial benefits for an investor include

Only have to pay the fees and costs of one loan rather than applying for and closing multiple mortgages.
Negotiated terms, such as the monthly payment may be better under the blanket mortgage, freeing up capital for further investment.
Acquiring more than one house to fix-n-flip under one loan when several come on the market at the same time would allow a flipper to take advantage of the opportunity to buy multiple properties all at once (saving time and fees) while still being able to sell them one at a time after they are refurbished.

Danger

The danger to the owner is that if he or she defaults on the mortgage, the lender may seek control of all the properties secured by the loan.

Give me a call or send an e-mail and I will help you to move quickly, get the best deal, and start making money sooner. Patrick@InvestorsLendingSource.com

512-214-2271 Austin, Texas

References:

Kagan, Julia, Investopedia, Defining a Blanket Mortgage, March 8, 2018. https://www.investopedia.com/terms/b/blanket_mortgage.asp

Wikipedia, Blanket Loan. https://en.wikipedia.org/wiki/Blanket_loan

Photo by Dimitry Anikin on Pexels.comPhoto by Frans Van Heerden on Pexels.com

Funding the Gap

Posted on July 31, 2019 by Patrick StCin

There are several reasons why a fix-n-flip investor might want to secure a fast loan to cover a gap. A gap loan, as the name implies, is a loan that bridges a span of time. It helps you gain control of a property quickly even if you are still scrambling to get all your paperwork done for a full rehabilitation loan.

A Buyer in a Hurry
At some time or other, you might face a seller in a hurry. One situation that puts a seller in a hurry is foreclosure. Many property owners in this situation are in denial so they wait until the last week or so, or even days, before the foreclosure sale to act on saving their credit. To save their credit, they must pay the bank all they owe on the mortgage right now. The house might actually be worth much more than what they owe if they have been paying on the loan a long time or put a large payment down on it. But, a foreclosure on their record will ruin their credit. So, for them, it is better to sell at a discount and survive to buy another house another day.

In this scenario, an owner in foreclosure has agreed to sell the property to you at a steep discount, but they need to close the deal quickly. You, the investor, want to buy this property and you make an offer. However, the competition is extremely stiff, and another investor is sitting in the wings waiting to obtain the property. Your offer locks up control of the property temporarily. You need to move quickly to secure a loan. Normally the loan process takes a minimum of 7 working days and typically takes 10-15 working days.

A Nonrefundable Deposit

Another reason you might need funding in a hurry is that you have stumbled upon a wholesale purchase with a tight deadline to close, perhaps 2 to 5 days. The property is ideal for your purposes and you want to make an offer. However, if you don’t get the deal closed by the deadline, you will lose the nonrefundable deposit you are required to put down and control of the property you are seeking.

Getting Control of the Property

Here is where obtaining a gap loan is useful. A gap loan allows you to purchase the property as is while you are in the process of obtaining a rehab loan. The gap loan can be secured in 2 to 3 days typically. Your strategy is to obtain control of the property through this gap loan, begin paperwork to refinance the loan immediately and eventually complete the rehab and offer the property for sale.

REI Capital Resources has funds available for fix-n-flip loans with terms up to 6 to 9 months with a minimum of 3 months.

E-mail or call for more information on minimum and maximum loan amounts, interest rates, terms, and fees for specific project. I can help you with first liens only and these loans are limited to the Austin, DFW, Houston, and San Antonio Metro areas.

Pat St.Cin

Patrick@reicapital.cash

512-213-2271

Austin, Texas

reposted

Beauty of a Hard Money Loan

Posted on July 25, 2019 by Patrick StCin

Like an old tin roof and gingerbread trim, hard money loans have a beauty all there own in the right hands. Hard money loans are short-term loans secured by real estate and used by fix-n-flippers to purchase and renovate property. They have high interest rates but only for a short time. These loans usually finance the purchase of the property and the renovations.

Secured by Real Estate

REI Capital Resources hard money loans finance up to 90 percent of the purchase price of the home, up to 100% of the renovation costs, and a maximum of 70% of the after-repair value (ARV). An appraisal is required.

High Interest Rates but for a Short Term

Hard money loans are intended to be paid back quickly (in 24 months) so the high interest rate does not hurt for long and is included in your budget calculations. Hard money loans usually do not have a prepayment penalty. REI Capital Resources interest rates start at 9.5%.

Lender fees, permit costs, property assessment fees, loan originating fees, loan processing fees, inspection fees, points, interest, closing costs are taken out of the loan. REI Capital Resources points are as low as 2.5%.

Payments

Monthly interest-only payments are made during the loan and the principal repayment is made at the end of the loan term when the renovated house sells.

Borrower Qualifications

REI Capital Resources hard money loans carry minimum qualifications of a credit score of a minimum of 600, debt to income ratio of 35% – 45%, and experience that includes two to three past renovation projects or a licensed contractor budgeted to help.

More is Better

More experience and higher credit scores may qualify for lower rates and fees and higher borrowing limits.

REI Capital Resources

REI Capital Resources is a hard money lender and is able to help you fund your project based on your experience, the value of the property, and its after renovation value. We have money to lend, and you need money quickly. A perfect fit is out there.

We are focused on funding Your Success.

Patrick StCin

Call me at 512-213-2271

e-mail: patrick@REICapital.cash

Cloud on Title

Posted on July 24, 2019 by Patrick StCin

A cloud on title is something odd about a deed for real property that has been recorded that might invalidate or impair the title. It usually stems from unresolved issues with the property. Buyers should proceed with caution because there is something about the deed that requires closer attention.

Some examples of a cloud on a title include:

A wrong spelling of the property’s address in a deed conveying title.
Foreclosure proceedings underway by mortgager in response to a borrower defaulting on payment.
Failure to transfer certain property rights to the former owner, such as mineral rights.
A mortgage lien whose repayment has not been officially recorded with a local record office.
Covenants are rules, conditions, or restrictions place on a property by a subdivider or other landowner to create uniformity of building and uses within tracts of land or groups of lots.
Probate matters that involve estates and inheritance can create a cloud on title. If a property owner dies without a will defining who gains control of their estate, the property title may become in doubt as heirs challenge each other in court.
A fraudulent title recorded would create legal confusion and a cloud on the title.
An encumbrance is a claim or right held by some party other than the owner or a claim that is not a lien that limits the ownership of the property such as conditions, restrictions, easements, reservations, etc.
A mechanics lien placed on the property for construction work contracted. The lien remains on the property and does not follow the owner, forcing a buyer to assume responsibility for repayment.
Any pending lawsuit before a court of law over ownership of the property.

Title Insurance

Title insurance protects the insured and their heirs from loss or damage due to defects, liens, or encumbrances in the title or actual ownership of the property as of the date of the policy.

A Clear Title

A clear title is one without any kind of impairment, lien, or levy from other parties and poses no question of legal ownership.

In most cases problems with a title can be cleared up when proper documents are submitted to the local record office. This lifts the cloud on the title. This is not complete legal advice. Please be sure to consult your real estate agent and attorney.

Closing Delays

One thing is sure: a cloud on the title will slow down the paperwork associated with buying and selling property.

Patience may be a virtue, but it is one that is often tested when you are eager to close a loan and get on with your project. To save your dream and your nerves, Clean up the title ASAP.

REI Capital Resources

REI Capital Resources built its reputation on finding private funding for investors for quick turn purchases and difficult situations. This is still true today.

Give me a call or send an e-mail and share with me your plans and needs, and I’ll see what lending solution I can generate for you.

Patrick St.Cin

W – 512-213-2271
Patrick@REICapital.cash
Info@REICapital.cash a hand an

Austin, Texas

References

https://www.investopedia.com/terms/c/cloud_on_title.asp

https://en.wikipedia.org/wiki/Cloud_on_title

http://www.realestateproarticles.com/Art/25272/263/What-You-Need-To-Know-About-A-Cloud-On-A-Title.html

Partners in Private Funding

Posted on July 23, 2019 by Patrick StCin

I know a banker and his partner who recently purchased and remodeled a building that was once a doctor’s office. They turned the space into 7 small suites, a conference room and a kitchenette. They advertised for occupants with an ad looking for entrepreneurs with ideas for a business who needed some space in which to grow and offered seed loans for the startups. His motive is multifaceted, to rebuild the downtown business section of the town he lives in and to put some of his money to work for his community. He also wants his hometown to be vibrant and is offended when someone says, there is nothing going on in that downtown. Like all good investors, the partners are also interested in putting their money to work to make more money in the form of income.

These partners specialize in fix-n-rent business investments. Most recently the duo closed on a property that they will remodel from a Victorian house on the corner of a small downtown into a used bookstore, bar, and coffee shop with an outdoor patio area. The purchaser? A publisher who still loves physical books more than online articles.

What else has these small town fix-n-flip investors been up to? They remodeled a ballet studio into a financial investment office with a family psychologist renting a back office with a separate entrance, turned an insurance office into a yoga studio, turned a paint store into a gift and DIY furniture rehab shop, and helped a daughter purchase her mother’s restaurant business lock, stock, and liquor license.

If you are interested in putting your money to good work in your community, become a private lender and work with me. I am focused on funding success, both yours, and the buyers.

Competition for good rental properties is stiff, and in order to buy a property in a climate of competition a buyer need funds fast. As a broker, I help people find funds for their fix-n-flip and fix-n-rent project. Be a private lender with me and put your money to work for you.

Call me and let’s set up a meeting.

Patrick StCin, 512-213-2271

e-mail: patrick@REICapital.cash

55+

Posted on July 22, 2019 by Patrick StCin

Renting and “aging in place,” but not alone, is a growing preference for aging baby boomers and seniors and offers a unique opportunity for investors who want to invest in and operate multifamily units.

Baby boomers are defined as those born between 1946 and 1964 while seniors are defined as those born before 1946.

According to research done by ARBOR, an increasing number of senior renters now live with unrelated adults across all multifamily property types. Small apartment buildings (5-49 units) have slightly higher shares of senior renters with roommates compared to large multifamily properties (50+ units). However, the co-living senior renter segment is growing the fastest in large-asset multifamily.

Co-living among seniors is highest in the single-family rental (6.1%), then the duplex/quadruplex (5%), next small-asset multifamily rentals (4.6%), and last, large-asset multifamily rentals (3.2%). To put this in perspective, among Millennial renters, the share of renters living with a roommate in a small-asset multifamily situation is 14.4%.

Sharing is motivated primarily as much by social connection as by income needs. According to Psychology Today, “20% of people over 60 frequently feel intensely lonely.” Loneliness can be a risk for heart disease, Type 2 diabetes, arthritis, and Alzheimer’s disease. Because of health risks associated with loneliness, seniors that share a home are actually dealing with their current and potential future loneliness.

In addition to social connection and apartment affordability, sharing is also motivated by personal security, and sharing of daily chores. The need to “age in place” is driving the increase in co-sharing seniors in the large asset multifamily rental because these buildings tend to be located near urban services and health care centers, have elevators and wheelchair lifts, and have higher levels of amenities.

Amenities Promoted in 55+ Adult Living

When looking over senior housing options available in Houston, I found most of the advertising in the higher end communities mentioned affordability, distinction, style, lifestyle, freedom from chores, and choice. Specific advantages and amenities listed by the higher end properties in the facility advertising included:

Independence
Affordability
Beautifully landscaped grounds
Luxurious and spacious interiors
Locations close to dining, entertainment, parks
Locations close to and medical centers
Diverse and colorful neighborhood
“Dynamic alternative to the ordinary”
“Live your lifestyle with passion”
Luxury
Style
Home
Distinctive living experience
Restaurant-style dining
Resort amenities
Complete freedom
Infinity pool
Court yards
Dog park
Wine tasting lounge
Media room
Chef quality demonstration living
It’s a lifestyle
Boutique, resort style

Amenities Advertised at Less Expensive 55+ Community Options

Retirement and 55+ community combinations in a lower price category advertised:

Activities and programs
Privacy
Aging in place
Gym
Garage
Outdoor grills
Designer living
“Trade your to do list for a bucket list”
Pet-friendliness
Outdoor pool
Yoga and art classes
Access to meals
Choices
Community
People of similar life stages
Leave home maintenance and yard work behind
Water gardens
Swimming pool
Computer room

The youngest of the baby boomers are approaching 55, and the huge number of 55+ adults who are still active but looking for reduced housing maintenance responsibilities and costs as they age and live within a fixed income makes this group a dynamic market for senior living situations. Not all are turning to apartment renting, but this tend is worth watching.

Competition for good rental properties is stiff, and in order to buy a property in a climate of competition you may need funds fast. As a broker and a direct lender, it is my job to help you get a hard money loan easily and quickly. Private Lenders, not banks, are willing to help you fund your project based on the value of the property and its after renovation value. We have money to lend. A perfect fit is out there.

Give me a call or send an e-mail. I am focused on funding your success.

Patrick StCin, 512-213-2271,

e-mail: patrick@REICapital.cash

Tech Considerations for Multifamily Housing

Posted on July 19, 2019 by Patrick StCin

Just this week, I said that one of the mistakes a real estate investor can make is not seeing the property in person before buying it. I said that so I could eat my words today, at least with regard to buyers of finished properties. I still think it is unwise for an investor to buy a property to fix, flip, develop, or fund without inspecting it in person. However, Multifamily PRO is reporting that augmented and virtual reality technology is expected to increase the number of residents willing to sign leases without visiting the property in person because they will be satisfied with viewing the property using virtual self-guided tours.

New technologies are and will be changing the apartment-buying, apartment-selling, apartment-living and apartment-operating experience. Considering this, investors, builders, and remodelers need to focus on communications and electronic infrastructure to support these new technologies when planning, budgeting for, building, and marketing multifamily housing. A few areas to focus on include:

Excellent Internet Connections

The first things to think about are internet connections, their quality, number, location, and security. Smart-home technologies like smart locks, lights, thermostats, as well as visual monitors for pets, children, and deliveries will be expected in the new high-tech apartment unit. These will impact the way the resident interacts with facility operators. For the resident, chat bots may make routine maintenance requests on behalf of the resident, reserve facilities, and schedule hair and dining appointments. For the facility operator, chat bots may provide routine information to residents and collect repair orders and rent payments. All these electronic interfaces will require excellent internet infrastructure in the multifamily complex.

Numerous Charging Stations and Outlets

The demand for electric cars, electric scooters, and electric-motor-assisted bicycles will drive the demand for charging stations and charging outlets at multifamily properties. Planning, budgeting, and locating these facilities for convenient access, exit, and safety will be important.

Locating Autonomous Vehicle Dropoff Points and Parking

Autonomous vehicles, both driven and flown, will need places to park and drop off clients, meals, and other products. This will affect the size of the parking area you will need and the layout of delivery sites around the building. Robots and drones may deliver and pickup within the apartment. A drone may deliver to a dropoff point with directions for a robot that will complete the delivery inside the apartment community. Conventional vehicles will also be expected to make deliveries and pickups and need space to maneuver.

Facial Recognition

Artificial intelligence technologies will enable facial recognition for customer identification and for criminal background checks, and these facial recognition systems can track a person as they move around a property. This will improve security but raise privacy concerns.

Planned Office Space in Apartment

People working from home will need an excellent internet connection and may want an office available as part of their apartment.

An electronic interface between operator and potential buyer may be a way to design flexible space for the customer with the hope that they will stay longer in a space that fits them well.

These ideas, with some speculations added, came from the NAA Apartmentalize conference in Denver through reporter Andrew Stephens on Multihousing PRO.

REI Capital Resources built its reputation on finding private funding for investors for quick turn purchases and difficult situations.

Give me a call or send an e-mail and share with me your plans and needs, and I’ll see what lending solution I can generate for you.

Patrick St.Cin

W – 512-213-2271
Patrick@REICapital.cash
Info@REICapital.cash fffff

Fourteen House Flipping Mistakes to Avoid

Posted on July 16, 2019 by Patrick StCin

I decided to visit fix-n-flip websites to come up with a list of the top rooky mistakes you can make when buying, fixing, and reselling a home for profit. One of the websites I consulted while compiling this list of mistakes to avoid while fix-n-flipping houses for profit is Dave Ramsey’s website. Dave Ramsey is well known for his advice that all of us get out of debt, and that is good advice. If you have cash that you can spend to finance your fix-n-flip project, you will not feel so much pressure if the house does not sell quickly. You won’t be tempted to sell the property for a loss because loan payments and interest costs are eating away at your bottom line. You will be able to wait out the market and sell for a profit.

However, if you need to find funding, there are private lenders and hard money lenders out there that will finance your project and I can help you find them. Calculate how much you need and give me a call. I’ll do my best to find you the right loan for the right price quickly.

Below are 14 mistakes fix-n-flippers make in the areas of planning and budgeting, buying, renovating, and reselling properties.

Planning and Budgeting: Not calculating permit costs, property assessment fees, loan originating fees, loan processing fees, inspection fees, points, or interest in your budget. https://www.moneycrashers.com/five-tips-for-effectively-flipping-a-house/
Planning and Budgeting: Not knowing how much you can afford for the entire project before making a deal, including purchasing a home, making repairs, completing renovation projects, and selling the house.
Buying: Buying a property sight unseen. https://www.moneycrashers.com/five-tips-for-effectively-flipping-a-house/
Buying: The location you choose to buy in has a housing inventory shortage and such a high demand for houses that you become entrenched in a bidding war and end up paying above-market prices for a fix-n-flip property. https://www.moneycrashers.com/five-tips-for-effectively-flipping-a-house/
Buying: You bought a house to renovate that is far away from your residence causing you to spend too much money on gas getting to and from the job site, and the repairs take longer to complete than they would if the house was nearby. https://www.moneycrashers.com/five-tips-for-effectively-flipping-a-house/
Buying: Not knowing the market and not knowing if you are getting a good deal on the house you are buying. https://www.daveramsey.com/blog/how-to-flip-a-house
Buying: Not looking for black mold, a bad roof, or a cracked foundation when evaluating whether to buy the house to fix and flip. https://www.moneycrashers.com/five-tips-for-effectively-flipping-a-house/
Renovation: Putting in high-end upgrades while renovating the house that cause the house to cost more than the neighborhood can afford. https://www.daveramsey.com/blog/how-to-flip-a-house, https://www.moneycrashers.com/five-tips-for-effectively-flipping-a-house/
Renovation: You did not have a reliable contractor help you estimate the repairs for the house and a surprise repair broke your budget. https://www.daveramsey.com/blog/how-to-flip-a-house
Renovation: You underestimated repair costs and did not add 20% to your estimated repairs. https://www.moneycrashers.com/five-tips-for-effectively-flipping-a-house/
Renovation: You tried to do repairs yourself without experience and without budgeting for contractors when you need them. https://www.moneycrashers.com/five-tips-for-effectively-flipping-a-house/; https://www.daveramsey.com/blog/how-to-flip-a-house
Reselling: Because you don’t know the market and have not done your research, you can’t accurately calculate the house’s potential value, and you don’t know how to price the house for sale. https://www.daveramsey.com/blog/how-to-flip-a-house
Reselling: Failure to network with buyers and build relationships before picking a house to fix-n-flip. https://www.moneycrashers.com/five-tips-for-effectively-flipping-a-house/
Reselling: You did not list with a real estate agent even though you hate hosting open houses. https://www.moneycrashers.com/five-tips-for-effectively-flipping-a-house/

REI Capital Resources is “focused on funding your success!”

Contact me at
Patrick@REICapital.cash
512-213-2271 Grid Table 7

Depreciation: Causes of the Fall?

Posted on July 3, 2019 by Patrick StCin

What Can Make Real Estate Depreciate?

Depreciation is a decrease in the value of an asset overtime. When doing your due diligence research before making an investment in real estate, be sure to look around and consider those lurking circumstances that might decrease a property’s value.

Although location affects the value of property most because real estate is by its nature real and tangible, supply is also a critical factor in how real estate is valued.

Supply

Overabundance means there is more of an item or resource than is needed or can be afforded by buyers, so it’s value goes down because no one buys it at the current price. The value will continue to go down until it reaches a point where buyers decide it is worth the price to store, use, and maintain the asset until the value goes up again. One example of this is the overabundance of condos that were launched in Miami right as demand fell because of a shortage of foreign buyers that was reported in the wsj article, “In Miami, There Are too Many Condos and Not Enough Foreign Buyers,” by Candace Taylor.

Location

New businesses and a new reputation may also impact the value of properties. For example a related article in the wsj reported recently that visitors to Miami’s South Beach has doubled in 10 years. The article “Wealthy Buyers Say So Long to South Beach,” by Candace Taylor, points out that the construction of new hotels on Miami Beach has made it a hot spot for spring breakers and the masses of students who come to party but not to buy has caused traffic congestion, litter, loud parties, and more danger in the neighborhood. As a result, the properties are not so attractive to wealthier buyers and the prices of upscale condo sales have tumbled in the first quarter of 2019.

Other natural changes near a property can affect its value. Some obvious ones are wildfires, sink holes, and earth quakes. Another is global warming. One reason Miami beach prices are falling according the same wsj article by Taylor is because of fears that sea levels will rise. Homes and condos at lower elevations have lost some value because of these fears.

Neglect and Lack of Maintenance

Abandoned homes tend to lose value because they are not lived in or cared for. They slowly fall into disrepair.

Global Investors

The value of houses can also go down because of events that affect buyers from other parts of the world. The wsj article mentioned previously explains that severe economic and civil disruption caused by socialist and totalitarian regimes in countries like Venezuela, Argentina, and Brazil can affect the ability of their once-wealthy citizens to purchase property abroad as the value of their currency falls compared to the dollar.

In the commercial real estate arena, as Jeff Levin pointed out in the Forbes Community Voice, trade wars between the United States and China has reduced funding for new building projects because China is decreasing its investments in U.S. commercial real estate and selling its assets, which brings down prices.

Competition for inexpensive properties to invest in and improve or to rent out for income is usually pretty stiff. As a broker and a direct lender, it is my job to help you get a hard money loan easily and quickly. Private Lenders, not banks, are willing to help you fund your project based on the value of the property and its after renovation value. We have money to lend and you need money quickly. A perfect fit is out there.

Give me a call or send an e-mail to the contacts below.

Patrick StCin, 512-213-2271

e-mail: patrick@REICapital.cash

Appreciation: Causes of the Rise?

Posted on July 2, 2019 by Patrick StCin

What Can Make Real Estate Appreciate?

Appreciation is an increase in the value of an asset overtime. Depreciation is the opposite, a decrease in the value of the asset overtime. When doing your due diligence research before making an investment in real estate, be sure to look around and consider those circumstances that increase a property’s value. Tomorrow, we will talk about those circumstances that might cause a property to depreciate.

Engraved in every real estate investor’s memory is the fact that location affects the value of the property most because real estate is by its nature real and tangible, a building, land, flora, fauna, and natural resources.

Using our imaginations and our memory, let’s review several things that can increase the value of an asset

Supply

Scarcity means there is a limited amount of some item or resource, so it becomes harder to find and worth more when you do find it due to competition for the limited resource. One example of a shortage creating a rise in value is the situation with single-family starter homes in the United States and the world. Although lower in price, single-family starter homes have become more valuable because there are not enough of them.

Location

Some changes in a vicinity that increase home values may not be due to a physical change nearby, for example the employment rate goes up, the local economy improves, and/or the crime rates go down. These changes may be due to a new business coming in, but also may be due to regulatory changes that lower taxes or technological changes that allow people to work at home.

A physical change near the property can affect its value. Sometimes the value of a house goes up because of something that moves into the neighborhood or nearby, for example a water park or amenity that brings tourism or a research facility or fulfillment center that brings jobs and workers. Sometimes something that was there all along is discovered or becomes more appreciated than it was before, for example mountains and foothills with a view or the solace of desert spaces. Sometimes, a land use regulation may change causing a mini land rush.

Development

Development causes appreciation of houses. Let’s say that you buy bare land on the edge of a community and build on it. The value of the property will appreciate at least the value of the house. If you buy in what is already known as the best district, you will most likely pay a premium price for that reputation and it will not go up over time because it is at the top already. If you buy in a place with a poorer reputation, such as a school district, and better management, government programs, or community involvement begins to improve the school district’s reputation, the homes in the area will likely appreciate.

Additions or Updates

Additions, enlargements, or updates of a home itself will appreciate its value depending on what is added and the quality of the materials and workmanship. These additions to quality might include finishing the basement, adding a screened-in porch, updating the bathroom or kitchen.

Global Investors

The value of houses can also go up because of things that happen in another part of the world that affects buyers or sellers. Economic disruption or lack of opportunity in one country can cause people to invest in another country and move there, increasing the value of the property in that area. Wars and trade wars can also affect property value in a global economy. The wsj explains in a recent article that after housing prices fell in the United States, Latin Americans bought up luxury homes and condos in Miami.

Tomorrow, we will talk about what circumstances might make a property depreciate.

Competition for inexpensive properties to invest in and improve is usually pretty stiff. As a broker and a direct lender, it is my job to help you get a hard money loan easily and quickly. Private Lenders, not banks, are willing to help you fund your project based on the value of the property and its after renovation value. We have money to lend and you need money quickly. A perfect fit is out there.

Give me a call or send an e-mail to the contacts below.

Patrick StCin, 512-213-2271

e-mail: patrick@REICapital.cash