Fellwock Real Estate Blog

Building Real Estate - New Home Construction Tips
by Shane Toews

Your next few months constructing your new home could prove to be a time consuming and daunting task. You must recognize that it is difficult, if not impossible to have everything go smoothly. When buying a home while it is under construction you must have some key notes available. First, the contract of purchase and sale must be clear and very detailed to outline your expectations. It must describe the specifics including the details of the labor and materials used to satisfy your buying agreement. These stand from of construction contracts are available and these forms of agreement are designed to provide an enforceable agreement between the seller (builder) and the buyer.

If your developer asks for a deposit (which he will) make sure that it will be deposited into a trust account. If the agreement should default, the deposit should always be returned back to yourself. If the developer wishes to hold your deposit as a stake holder, the return of your deposit may be more difficult. In addition to the standard contract of purchase and sale, you should include a specifications sheet and the plans for the house. Building contracts are long, complex documents. Both parties (builder/seller and buyer) should obtain legal advice prior to entering into a building contract.

Do the walk though! Insist that prior to possession date, both parties conduct a walk-through of the property prior to possession date. Make sure that all the work is completed and agreed upon. At this time, both the seller and the buyer should sign and date the list. Copies should be given to both parties, realtor’s and lawyers involved. The crown has developed a program in 1998 called the Home Owners Protection Office. Essentially it is designed to protect the quality of construction in a new home development. This office licenses residential builders and building envelope renovators, monitor’s the provisions of mandatory third-party home warranty insurance and researches/educates the residential construction industry and consumers.

If you are the owner of a leaky home, the HPO will administer no-interest repair loan programs and PST relief grants for owners. They’re set up to ensure that no one has to lose their home due to the cost of repairing a leaky home. The reconstruction loan program provides no interest loans to homeowners and housing co-op’s who are unable to pay for the cost of repairs.

Your warranty includes a minimum of two years on labor and materials. Five years on the building envelope which includes water penetration. And ten years on the structure. In order to minimize confusion about warranties, the HPO created this 2, 5, 10 year home warranty insurance logo. It’s now used in the marketing campaigns of your local realtors and builders in the Residential real estate market of British Columbia homes. This should take place when you first occupy the home. You could always find more information on this topic by visiting www.hop.bc.ca

Finally make sure that your realtor inserts a clause clearly stating that the occupancy certificate must be obtained on or before completion date. However, landscaping and other outside work can still be in the process of completion. Your occupancy permit merely allows you to move into your new home! We hope this article helped you think of some things that you might not normally know. Please do not rely on this article as a guide or legal advice as you should always consult your lawyer or local realtor for advice, they are the expert.

Shane Toews is a Licenced Realtor who helps others to educate themselves about current real estate issues. He also provides assistance on how to find quality homes, apartments or vacation rentals in Canada’s Fraser Valley area.

Visit his website http://RentFraserValley.com for more information on Fraser Valley Homes and Apartments for Sale or Rent.

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Preparations before you apply for a home loan
by Vicky Edema

Applying for any kind of mortgage or home loan is not the tedious task as it used to be before. Even mortgage lenders have gone out of their way to make things easier for you. However, there are a number of points you should take care of before you apply for a home loan or during the application process. Knowing every step of the process in detail will not only help in reducing your headache but also help you get approval of a home loan faster than usual and get settlement of your new home even faster than that.

Following are preparations you should do initially before applying for a mortgage loan:

1] You should have good knowledge of your finances and your budget. You should in fact prepare a list of all your assets and liabilities, as well as your monthly income and expenses. 2] You should do some research regarding home loans and mortgages before you apply for one. There are various loan options available in the market and you should learn about the features of each one so you can determine which loan is best for you. 3] If possible, try to get as much information as possible about the mortgage lender or agency you have short listed for your loan application. Look for a referral from other customers of the lender. 4] You must try and find out names of the loan lenders listed in the brokers panel. In other words, names of the lenders the broker usually deal with and what are the loan types that a lender is providing. 5] Ask for advice on how much money you can borrow against the value of the property before you reveal your finances and personal details. Not all lenders will provide accurate information without knowing your personal details and financial situation but asking for a recommendation on the loan amount can be a good idea. 6] Meeting should be fixed as per your specification. Always prefer to meet the lenders in their office. Before scheduling meetings with anyone always ask them what papers you should bring for the initial meeting. This can save you valuable time and get you organized.

Once you have covered the initial checklist as mentioned above, you should know there are 4 typical stages before you are granted the loan. 1] Introduction of the company: this will cover information of the business you are about to deal with, their group of lenders, their fee structures etc. 2] Qualification: in this round your documents which assist and show your financial condition and budget will be checked. The amount and the type of the loan you require will be discussed along with its use, such as, is it for investment or for purchasing a home to move into as your primary living residence. 3] Offers: during the third stage loan products will be discussed with you. Emphasis will be paid on the loan you want. Different loan products will be compared to provide you the best deal. Loan calculators will come in useful to set the repayment amount, upfront and ongoing fees. 4] Application: If you are using a broker, here the finance broker contract is signed. Remember that a privacy declaration pact is also signed. This will allow them to provide information to third parties. You will also complete the application form and sign a declaration declaring that the information given is 100 percent correct.

In the application stage a mortgage provider will check your completed application, check for details and point out if any information is missing. He will also attach all the supporting documents and will complete the serviceability form and send it to the evaluator. This is to show your capacity to pay the loan back. The lenders evaluator will log that application and will allot a serial number to it. Hell also confirm the receipt of application. He will crosscheck it for every detail and every document. If everything is as it should be then a conditional approval is sent back for the borrower.

After such formalities, finally a loan is provided to the customer to go ahead and purchase their dream home. Knowing the application process and organizing yourself beforehand will go a long way towards making your dream into reality.

Vicky Edema has been the Managing Director of Austral Mortgage Corporation since 1992, a company specializing in offset home loans and property finance

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Feng Shui Your Way To Higher And Bigger Home Sale Prices
by Kerry A. Francis

You may well think that Feng Shui is an art and science to be applied after the home is purchased and the new homeowners or renters have moved in. It used to be thought in the American automobile industry that quality was something done after the sale - it was for the dealer or salesperson to deal with. Look where this mentality has led the auto industry. Feng Shui is a useful tool, technique and strategy to both sell that Home, Condo or Cottage quicker and at a higher price.

Location of a home is not only important but so is the actual layout and ease of movement throughout the property. First make sure that the house is not cluttered - both with items and pathways. Imagine the home was in a fire and it was an emergency. Could you move around the home and out to the front or back doors quickly. The house should be cleared of all unnecessary items. Less is more. The dominant rule of Feng Shui in this situation is that the eye is drawn easily and promptly to the corner diagonal of each room. Rooms will seem larger in size. More space in a home is perceived better than less space. The more perceived space the more will be the corresponding selling price.

Similarly the house must look good and inviting to the senses. The best recommendation in the land of Feng Shui is lots and lots of horizontal counter space to support the good karma. Even then these countertops and shelves should be as clear and open as possible. Again the more perceived space in the openness of the house the higher the selling price. Unnecessary clutter makes landmarks so to speak in home buyers mind leading to perceptions of a smaller residence. In most cases, smaller residences mean smaller sale prices. In todays real estate market of low interest rates and high demand for properties even though the market is hot impressions are even more rather than less important. The home buyer has to make even faster snap decisions on the spot. Perceptions rather than hard facts often rule the sale today.

Entrances to the home have to be easily accessible; Mirrors in doorways are bad news with Feng Shui. Movement is good - rather than deadly silence. Ceiling fans or a ticking clock can add well to the perceptions. In addition the entrance should be inviting to guests - not a barrier. A welcome mat is always nice, fresh flowers in a smaller vase always seem to carry a nice message.

Your home and its order and cleanliness scream out about the care, condition and maintenance of the house. Counters should be clean, the cupboards and pantry well organized and of course the counters should be clear and free of clutter.

The ambience of the home according to Feng Shui is what carries the day. Soothing background music can set the tempo and tone. A soft scent can further enhance these effects - either cinnamon or pine scents always seem to do well. Stay away from From strong incense. And always close the bathroom doors.

Lastly the front door is the most important area in the home for first impressions and the higher selling price of the property. The entrance area should be clean and simply immaculate with soft lights turned on in the foyer area. It is best to have additional supports flanking the front doors - such as lush very healthy plants and flowers.

All in all Feng Shui helps in the preparation and good karma of your property that is for sale. First impressions more than carry the day in the very hot real estate markets. Buyers have less time to think so to say. Homes are sold in a snap. If you do not buy that house, condo or cottage now - it may well be gone tomorrow. First impressions and the positive effects of Feng Shui carry the day. Feng Shui!

Manitoba Cottage Rent Manitoba Lot Sell Your Winnipeg House

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Home Improvements and Pretty Real Estates
by Neoli Marcos

Like it or not, people will say things about your home. Or rather, your home says a lot about you. Either way you look at it, we’re living in a world obsessed with image. The right one. Now, be honest. Ask yourself this question, is my house a before or after image of a home-makeover TV show?

Now, if you answered ‘After’, you were probably just too shy, or are in denial (kidding). But if you said ‘Before’, well, at least you know you have a problem, and you can fix it.

You don’t have to call the reality TV show guys for a televised makeover of your home or property. You just need to have your local builder make a quote of your home’s improvement costs. And then you can apply for a home improvement loan.

Your goal is to apply for the home improvement loan with the lowest interest rate. But don’t just jump on the first one that looks promising. Shop for quotes, and then choose the best. Ideally, you should borrow money above the quoted price of your builder, just so you won’t run into money shortage in the middle of the construction.

Whether it’s a new paint job, or a landscaping project, or an extension room, house renovations certainly increase the value of your property. Now, your house fits the ‘After’ photo left side of the TV screen. Of course, nothing beats a smile here and there in your home, and just plain being nice to each other by everyone living there. Now that’s the best home improvement of all.

Neoli Marcos write articles and press releases for http://www.ozfreeonline.com - this piece he made served as an article exclusive for http://realestate.ozfreeonline.com - which offers a comprehensive list of office & commercial real estates, homes for rent or sell and an apartment finder to thousands of properties in Australia.

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Criteria, Terms, Network - The Foundation of Real Estate Investing
by Robert Earl The Earl of Real Estate

In 2005, a bestselling book called The Millionaire Real Estate Investor was written by Gary Keller with Dave Jenks and Jay Papasan. The question is, because of the recent market changes of a buyers market from a sellers market do the principles laid out in the book still apply?

First, lets understand how the book was originally written. It was based on extensive research and interviews with over 120 millionaire real estate investors. The basic model laid out were Criteria, Terms and Network.

Criteria: What you buy. Criteria is the name used for the checklist you use to identify the type of property that you are going to buy. This applies to a buyers market because there appears to be all type of opportunities available, but you still need to establish what you are looking for & how you are going to take advantage of the market conditions. Are you going to stick to one particular type of property? Only condos or single families? These apply no matter what the market. Will you be able to resale it or rent it? The buyers market presents some new opportunities to consider.Are you going to focus on pre foreclosures, foreclosures or short sales? With these situations presenting themselves more & more, including them in your criteria checklist would be worth considering to see if they provide the greatest opportunity and the least risk.

Terms: With interest rates remaining fairly low, and with the wave of the sub prime backlash, terms are even more important in the buyers market then they have ever been. Add to that the true evaluation of proper offer prices when overall prices are stagnant or declining. Simply taking the time to establish your own parameters to determine when a deal is a good deal & when a deal should be walked away from is critical in an emotion filled buyers market.

Lets look at the principle of Network: Who helps you. to todays marketplace. Having a network of select relationships that know your criteria & that are able to feed you opportunities is essential. Imagine a well placed attorney that knows of pre-foreclosure proceedings or a Northern Virginia Real Estate Team (http://www.theearlofrealestate.net/team.aspx) that is intimately aware of a particular area or that is working in conjunction with a bank to dispose of Bank Owned / Foreclosure Northern Virginia Homes (http://www.theearlofrealestate.net/77_bank_owned_SF.aspx).

All of these areas still applies & answers a lot of the questions of what you’ll buy, how you’ll buy it & who will help you.

‘Mastering these areas will give you the greatest chance for long term success & place you solidly on the path to becoming a Millionaire Real Estate Investor’. This was sound advise when the book was written and remains sound advice today.

Robert Earl - Founder of The Earl of Real Estate Team is a Real Estate Entrepreneur & Real Estate Coach serving the Northern Virginia Real Estate (http://www.theearlofrealestate.net) Market. The Earl of Real Estate Team focuses on Vienna VA Real Estate, Condos, Townhomes & Homes for Sale (http://www.theearlofrealestate.net/Vienna.aspx)

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Buyers Being Creative In A Soft Real Estate Market With A Challenged Credit History
by Dale Rogers

The stars have lined up against many would be buyers with the amount of baggage they bring to the table in the way of challenged credit. They want to buy something. They need to buy something. Whether it be a recent bankruptcy, repossession, foreclosure, large medical bill collections, identity theft or judgements or recent unemployment any one of which can plummet a credit score and put the would be buyer in a financial hole. In a soft real estate market where owners need to sell and have a high degree of motivation to dispose of their property. This is the opportunity that a buyer with challenged credit history can seek to “help” a seller out of their current dilemma by arranging sale terms that will help both buyer and seller. These scenarios may not work for anyone who has zero options, zero income and zero means to pay anything back. It is rather, for those who are fighting their way back and do have options, have income and now have means to meet their obligations on a negotiated deal. This will not work if a buyer throws their hands up and gives up to the possibility of buying a property. This opportunity will work for those buyers who have a need as well as a burning desire in their belly to buy something that will meet their family goals and will do what is necessary to make it happen.

A buyer needs to be aggressive in their efforts to take advantage of this temporary real estate market. Some areas of the country have more opportunities than other areas. However, there are deals in every area. A buyer needs to find them. There is little reward for a buyer to deal with an unmotivated seller. There must be pressure on the seller to move the property. Whether it be for reasons of health, estate situation, job loss, divorce, out of state move, downsizing, upsizing, budget, cash flow or other reasons if a buyer with checkered credit has a shot of doing something. A buyer early on will need to come to the conclusion that the chance of matching the perfect house with the perfectly motivated seller will be slim. Therefore, from the get go the buyer must be willing to compromise on the purchase. The buyer must realize that this is not the last home they will buy, it is the first home they will buy with a high degree of challenged credit. The buy decision, although well thought out, must recognize the purchase is not permanent and is not fatal. It is simply a means to get into a property and get on the equity accumulation train, which will help them over time. So the search begins to find a motivated seller while being somewhat flexible while not having unreasonable expectations that will not fly with the current credit circumstances.

Buyers can try to do it themselves or choose to bring in a professional realtor who knows the market. Right now a lot of realtors have a lot of time on their hands. Six months ago when the market was raging, that was not the case. What a difference a day makes. The criteria then on a broad based approach would be to find a vacant home, on a realtor lock box, with a lower mortgage balance and with a high seller motivational to move the property. If a property is not listed, then the seller may not be motivated enough for a buyer’s purposes. They are not serious enough. If a property has had three or four price reductions in the last few months in the Multiple Listing Service this would be a sign of a motivated seller. Likewise if a seller has indicated a willingness to pay for buyers closing costs, hold a second mortgage, consider a lease option or a lease purchase, these are all signs of the degree of seller motivation necessary for a buyer with challenged credit to find a workable property. Early on in the realtor selection process, a working relationship must be established with a realtor who is willing to make multiple offers and does not take rejection personally until an acceptable deal can be negotiated.

At the same time, a mortgage broker will need to be contacted to determine exactly what is possible in the way of a first mortgage. Banks are not geared to do what will be required to make a deal with challenged credit. It will be assumed that in spite of the past history, the buyer now can make a monthly mortgage payment and may even have some cash to work with. Cash can be gifted from parents or other sources if necessary. The results of the mortgage broker interview will dictate what and how the deal will need to be structured. Pulling credit will determine if the housing history is 0 x 30 (meaning no housing payments more than 30 days late in the last twelve months) or worse. Collections, judgements, repossessions or any other adverse challenge the buyer may face will be noted. From this exercise, a buyer will have a payment number in hand for their monthly housing expense including principal and interest, taxes and insurance and perhaps a maintenance fee (as found in an association or condo) all inclusive in the monthly housing expense. The mortgage broker and realtor will need to work in tandem to structure the deal that is achievable on part of the buyer. Many times, in the market place the deal is negotiated without any thought to the financing. Here it will be necessary to fix the financing first THEN find the house. Most buyers with a 580 score or better can get a 95% Loan To Value first that allows a 100% Combined Loan To Value. This will no doubt be a subprime type loan with the first being one loan with no Private Mortgage Insurance (PMI). An offer might look like something like this:

Purchase price would be at say $225,000 with a 95% LTV first mortgage of $213,750 and allow a 5% LTV seller held second of $11,250. The rate on the first would be for this scenario 8.5% on the first and aggressively negotiate the same for the seller held second or less. A seller may rationalize that they were going to reduce the price another $10,000 in 30 days anyway and this way I get most of their cash now. Following then, the first mortgage of $213,750 with a rate of 8.5% with payments on a 2-year fixed ARM of $1,643.55/month. The second of $11,250 at say 8% on a 10 year basis would be $135.95/month for a total principal payment of the first and second of $1,779.50/month plus taxes of $300/month and insurance of $220/month for a total housing expense of $2,299.50/month in housing expense. With a subprime loan, collections and such are not included in the debt service calculation if they are old enough. So for a working couple if the lender allows a 50% debt ratio to income the minimum income on a full documented loan would be $2,299.50/. 50 = $4,599/month. Say the wife makes $3,000 per month and the husband makes $1,599/month then they would just make it. The seller would need to pay all the buyers closing costs and prepaids (tax and insurance escrows and advanced fees) and any buyer cash can be used for monthly lender reserve requirements.

In summary then, this is a temporary buyer’s market in most areas and to be successful buyers need to focus on motivated sellers. Even before looking at any property the seller’s agent must be interviewed to determine if there is a high motivation of selling the property by paying all the buyers closing costs and prepaids and perhaps hold a 2nd mortgage. If there isn’t, the buyer should not be looking at that property. If the buyer has a vacant lot, a small mortgage note, income property or anything of value like a boat or motorcycle can all be brought to bear on a deal. The barter and trading process is how America was built. Working in tandem with a professional realtor and a mortgage broker a buyer can enlist some professional help to meet the needs of their family even with challenged credit. It is not a static situation. During the first two or three years of this scenario the buyers need to put their financial house in order through family budgeting and planning with discipline to qualify for a better rate and terms on their mortgage and other credit needs for their families future. In a few years through a lot of hard work and sacrifice they can be out of their financial hole and back on an even keel.

Dale Rogers
http://www.brokencredit.com
http://www.sellerhelpsbuyer.com

Dale Rogers is a thirty-year mortgage veteran and frequent contributor to the Broken Credit Blog. The BCB is a free website created to assist the general public with information about credit repair and responsible mortgage lending.

<a  href=’http://www.BrokenCredit.com’>http://www.BrokenCredit.com</a>
<a  href=’http://www.sellerhelpsbuyer.com’>http://www.sellerhelpsbuyer.com</a>

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Benefit From Low Commercial Real Estate Loan Rates
by Tim Kelly

Acquiring or buying a property for commercial purposes involves huge funds and hence borrowings play a key role in real estate business. Even if there is sufficient finance at hand to own a property usually one prefers to borrow as the surplus money can be used for other business purposes. Cost of a loan is what a borrower thinks all the time as it is crucial in deciding the fate of the loan seeker. And it is all the more important in commercial real estate matters. Commercial real estate rates therefore should be carefully studied before taking the loan.

Commercial real estate loan rates depend on some basic factors. First of all it should be made clear that commercial real estate loan rates are usually lower interest rate loans. The rate of interest depends on whether the loan is secured or unsecured. Any secured loan comes at lower rate of interest rate and unsecured one with bad credit history on the top of it comes at higher rates. In case of commercial real estate loan lenders keep the very commercial property the borrower intends to buy as collateral. With the loan fully secured lenders provide commercial real estate loan at lower interest rate.

Usually commercial real estate loan rates are lower in the range of 6-7 percent. This means buying any real estate is cheaper through commercial real estate loan. But lower interest rate also depends on lender to lender and credit history. In the competitive loan market each lender has own rate of interest. Compare them and further lowered interest rate can be achieved. Your credit history also determines the rate. A good credit history certainly gives more confidence to the lender and he can lower the rate of interest. Another way is to see how much you are borrowing in relation to the value of commercial property. If the borrowed amount is way lower than value of the property you can take a reduced interest rate. See if you can make a larger down payment so that borrowings remain smaller. Surely for taking commercial real estate loan at lower interest rate one needs to fulfill some high condition like good credit history.

In case you are not that highly qualified borrower, you have the option of ‘hard money’. There are lenders who are willing to accept risks in lending money to say bad credit people at high interest rate. Hard money loans for commercial real estate buying may range 12-16 percent based on risk factors.

A lot on interest rate front depends on how many commercial real estate loan providers have you studied and compared. These lenders can easily be approached on their websites. Compare individual interest rates and settle for the suitable lender. Apply online to him for fast processing and approval of the loan.

Commercial real estate loan rates are usually lower rates but a lot depends on how much eligible a borrower is. Good credit history and lesser borrowing as compared to the value of collateral certainly enable in taking a reduced interest rate.

Tim Kelly is an expert in finance having completed his LLM in Finance (Master of Laws in Finance) from Institute for Law and Finance at Frankfurt University. He is currently working with CommercialRealeStateLoan as a financial advisor. To find commercial real estate loan, commercial real estate loans, commercial real estate loan rate, commercial real estate loan major in UK that best site’s you need visit http://www.commercialrealestateloan.co.uk.

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Five Good Reasons for Buying Out-of-State Homes – and Why a Real Estate Buyer’s Agent Is Key for All
by Allen Voivod

When some people decide to buy property outside the state in which they currently live, they may be doing it with a lot of knowledge already. They could have the resources of friends and family already living in that state, or the experience of having visited and spent significant amounts of time in the state.

For others, however, the choice to buy real estate – whether it’s a commercial property, a single home, a condo, or even just bare land – can seem daunting without some knowledge of the new state.

Of course, there’s some research you can do for yourself. You’ll have to narrow it down to the state (and maybe even a county or region) on your own. But when you get down to choosing a city or town, the best source of information is going to be a well-qualified real estate buyer’s agent or broker.

Here are five reasons why most people buy out-of-state, and how a real estate agent or broker can assist with all of these scenarios.

1. Retirement. Retiring used to be simple. You bought a place wherever you liked the weather, and you stayed there. Now, though, people live longer, retire earlier, and have active and diverse retirement lifestyles. An agent or broker based in the region you’re considering can help you pinpoint the best spot for the lifestyle you want to have.

2. Rental income. If you buy property but don’t plan to use it all the time, you might think about renting it out – either by advertising locally, or using a website like Cyberrentals.com. Either way, a local agent or broker can give you the scoop on everything from advertising options to cleaning services to management companies and landscaping pros in the area.

3. Vacation destination. Do you like skiing? Surfing? Boating? Hiking? Cultural attractions? Tourist attractions? Some or all of the above? The great thing about talking to an agent or broker in advance is that he or she can also tell you what’s available in the area, with the confidence and insider knowledge of a local resident.

4. Family relocation. The reasons to relocate are many: change in job, change in lifestyle, moving closer to (or farther away from) family, choosing a different environment for raising your kids, lower cost of living, even lower taxes. You’ll be able to do a lot of research about the state you want to go to, but when it gets down to picking cities or towns, finding a local agent or broker who knows the lay of the land is vital to being satisfied with the ultimate decision you make.

5. Real estate investing. As evidenced by TV shows like ‘Flip This House,’ buying homes to fix up and re-sell ASAP is a growing trend. And with foreclosures at a 30-year high, more and more homes can be found for this purpose. With the help of an agent or broker in-state, you can easily find the lenders offering houses for sale, reliable people to do the upgrades, and even market the property for sale.

Ideally, you’d want to spend as much time in the state in which you want to buy – exploring, asking questions, and seeing for yourself what the experience will be like, and how it fits into your specific situations and desires. But most folks don’t have the time or resources to do that.

And in those cases, the local real estate buyer’s agent or broker can be one of your first and best friends in that new state.

Allen Voivod

Alpine Lakes Real Estate has been building long-term relationships in the White Mountains region for more than 20 years. Their extensive real estate expertise is enhanced by their vast knowledge of the entire building process. With offices in Lincoln and Campton, NH, they also offer assistance with IRS 1031 ‘like-kind’ exchanges, and the Design-Build services of their in-house architect. For more information, go to http://www.AlpineLakes.com .

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Biggest Home Improvement Mistakes For A Real Estate Investor
by Joel Teo

As a real estate investor it is sometimes a good investment move to make home improvements to any real estate properties that you purchase. There are several mistakes that commonly occur involving home improvement and real estate investing, and by knowing what these mistakes are you can save a lot of money and aggravation. Let the mistakes that other real estate investors have made be your guide on what to avoid.

The first mistake that some real estate investors make is to buy a property in a bad location or for more money than the house is worth. No matter how many home improvements you make on one of these properties it is unlikely that you will recover a decent profit or even your investment back. Always consider both of these factors before deciding to invest in the property and make home improvements.

A big mistake that many real estate investors make when they are doing home improvements is not knowing or finding out about the building codes in their area. Some investors do not obtain the necessary permits that are required by the city where the real estate investment property is located. This is one of the biggest mistakes, and it can cost you plenty if you make it. The building inspector is there to make sure that the home improvements are safe and done properly. If there is a permit required and you neglect to get one, you may be required to tear down any work that was done, get the permit, and then start from scratch.

Under budgeting for the home improvement project is another common mistake made by real estate investors. The old saying was to take the costs and triple them. That is an exaggeration but not by much. Most investors do not make a full detailed budget of what is needed for the home improvement project down to the last nail and staple. By being realistic and budgeting for all possible materials you will have a more realistic budget and are a lot less likely to go over budget. You should also plan for any unexpected eventuality that could occur and plan for it in the budget as well to avoid any unexpected and costly problems.

The single biggest mistake that real estate investors make is trying to save money on home improvement by doing projects themselves when they are not qualified. There are some projects that should have a licensed contractor or repairman on them. Many home improvement projects can safely be taken on by an amateur and turn out beautiful, but some projects like a new roof or any other extensive renovations should only be done by experts. This is because there are many safety issues involved in these projects, not just for the person doing the job but also for any tenants or owners who live in the house.

By avoiding these mistakes you can save a lot of money on your real estate investment. Know the value of the property before you purchase so you do not pay too much, and make sure that the location is decent. Make sure that your budget is realistic and that it takes into account every possible piece of material and cost. Also make sure that you factor in any possible unexpected cost or problem. The biggest mistake to avoid is to know when you should call for professional help and when you can safely do the home improvement project yourself.

Copyright © 2007 Joel Teo. All rights reserved. (You may publish this article in its entirety with the following author’s information with live links only.)

Joel Teo writes on various financial topics including Las Vegas Real Estate. Learn more about Las Vegas Real Estate Investing at http://www.realestateinvestment101.info

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Why Do You Need a Real Estate Appraisal?
by John Harris

Anytime you buy or sell real estate, you need a real estate appraisal. The primary purpose is to find out exactly how much your property is worth. Banks and similar lending companies also require it, before a buyer can obtain a mortgage.

A real estate appraisal develops an “educated and trained opinion” on the value of the property. It also, in some circumstances, may ascertain the best use of the property, garnering the best selling price. For example, a long-time residential property may be in an area that has been rezoned for limited commerce, which could potentially bring in a higher sales price than marketing the real estate to potential residential buyers.

An appraiser differs from an inspector, who is looking for things that need to be corrected, repaired or replaced — things that are required by law to be completed before the property can be sold or to enhance your sale price. Though an appraiser will look at these same things, he/she is only interested in developing the value of the property.

A real estate appraisal is based on the highest and best use of real property — what use of the property will produce the highest possible value? The final appraisal must be both profitable and probable.

The real estate appraisal includes a definition of the type of value that is being developed — whether it is a market value (what most sellers need), a condemnation value, quick sale value, and so on.

The Process

The appraiser looks at each property individually, beginning with an objective inspection of the interior and exterior of the home or building, as well as driving through the surrounding neighborhood. The appraiser looks for the assets, as well as the detriments, of the property. For homes, gross living space, quality of construction, location, layout, the number of bedrooms and bathrooms, the lot size, condition of the home and land, central air conditioning, landscaping, number of fireplaces or the lack thereof, decks, pool, fencing, recent renovations, amenities provided by the surrounding neighborhood, and crime statistics of the area are all considered by the real estate appraiser.

Living space is calculated by measuring the outside of the home. It does not include such areas as the garage, porches, sheds, and so on. Basements are generally calculated separately from the living space. The contributory value of basements is determined by the local market, government regulation, if it is finished or not (and the quality of the finish), and so on.

The real estate appraiser usually only considers permanent buildings within his/her appraisal. Fixtures that can be relocated, such as above ground pools and sheds, are not included in the appraisal.

If you are the real estate seller, you should point out any features, amenities or improvements of your home that are not readily discernable.

Next, the real estate appraiser analyzes the available market data for your area and the surrounding neighborhood, including current and historical comparable sales, current offers for comparable homes, pending sales, and proposed improvements. The appraiser gathers data from a variety of sources, as well as his/her own personal knowledge of the local market. The appraiser then compares your real estate to the broader market.

Each real estate appraiser has his/her own process of analyzing, collecting and reconciling the needed appraisal data. If you get five different appraisals for your real estate, you may receive five different appraisal opinions. They should, however, all be within a similar value range, if they are completed within the same timeframe and under the same conditions.

Though the real estate appraisal is not for public consumption, it may be shared with all parties concerned. For instance, a buyer has offered $150,000 for a home, but the buyer-side, commissioned appraisal value is only $146,000. Sharing this appraisal with the seller means that the owner can do needed improvements to bring the price up or offer the real estate to the buyer for the appraisal amount.

For the highest appraisal possible, real estate sellers should have an inspection and appraisal done before putting the property on the market. First, the inspection in order to make any needed repairs or renovations. Then, get the appraisal to ensure you are getting the most for your real estate.

John Harris is an expert researcher and writer on real estate topics such as economics, credit improvement tips, home selling advice and home buying preparations. For more on San Diego Homes for Sale visit http://www.twtrealestate.com.

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