16 Secrets Used By Real Estate Investment Firms
Many new investors overlook the concept of proven formulas or secrets used by real estate firms.
That will grow their businesses.
The most critical part of getting started in real estate investing is setting up your structure—if you don’t want to miss out on profits.
If you’re sceptical about getting started in real estate investing following top real estate gurus’ teaching courses – you’re smart.
Before you read further, you need to realize this – you may need money to make money.
Real Estate Investment Firms Process
Noble Sky International’s personalized approach is by working together one-on-one.
Many of our students are now part of our community of real estate investors who have set up and running their business entities in the US.
Our real estate investment firms’ strategies are highly profitable.
Many gurus make their money teaching real estate investing rather than doing deals themselves.
The two questions that I ask my investors are;
What are your financial goals?
When are you ready to deploy your funds for your investment?
1 Financial Goals
What are your financial goals?
Financial goals are the personal, big-picture objectives you have set for how you will save and spend your money.
Setting financial goals can be short-term goals or something more significant and further down the road.
It’s often easier to reach your goals if you identify them well before you think of investing with real estate investment firms.
The stage of life you’re in usually determines what type of goals you wish to achieve.
2 Ready to Invest
Before you take the next steps towards working with real estate investment firms, do a self-check to qualify yourself:
- you’ve set your goals
- you have a spending and savings strategy
- you’ve built an emergency fund
- you are saving for retirement
After you have determined your financial goals, have a spending and saving strategy in place—you need your six-month emergency fund.
You need to know your investment risk tolerance before investing in any vehicle you choose.
Risk tolerance is how much you can keep the emotion out of investing—not everyone is cut out to invest in stock markets and be a day trader.
“I will tell you how to become rich. Close the doors. Be fearful when others are greedy. Be greedy when others are fearful.” – Warren Buffett.
The mission-critical part of getting started in real estate investing is obtaining the deals.
Cookie-cutter real estate investing business plan templates will only take you so far in your investing business.
We offer you our critically developed trade secrets, the best that you can learn at our webinar.
Most student investors discover that they have limited time and resources at the end of all the knowledge accumulated.
Almost everyone wants to earn a maximum profit for their dollar without putting in the hours.
We can show you how to have unlimited access to the Noble Sky team for support.
Every other month we close deals for wholesale or tax auction homes that generate a minimum return of 30% for our investors.
Some investors prefer a more personalized approach; we can work together on private one-on-one projects.
Here are the 16 Secrets Used By Real Estate Investment Firms
- Financial Goals
- Ready to Invest
- Market value
- Market trend
- Overseas potential
- Auction secrets
In a real estate boom, property investors will clamour for practically any home that reaches the market.
The property’s price where it brings in the tenants plays a more significant role than just location.
No matter how bad times are – transactions in the real estate market never go to zero.
You need to find a location where plenty of buyers want to move with the city’s growth.
Property on both ends of a street, even in a low area, can sell for different prices—it boils down to the home’s size and how new (or after rehab).
You want to buy on the low end of the neighbourhood’s price range because of others’ market value.
Homes in your community will bring your cost up.
Another factor to consider when choosing a location is buying near a water body, a lake, or sea.
Millennials represent over 60% of buyers when searching for a rental property.
Young people’s top priority is having a beautiful place to live, scores for walkability and biking, parks, cultural diversity, and a wide-ranging restaurant scene.
Older millennials are moving toward the suburbs and to good schools to raise a family.
If you invest in an attractive location with the largest buyer pool, you will have an easier time when you sell.
Parents look for the best school districts for their children.
Excellent schools are the most critical factor in your home’s location. Millennials are looking to buy a house to raise a family to consider your home’s location’s essential aspects are a great school district.
Many people will not consider buying a home in a location where the schools are bad.
The location of houses close to highways, trains, or other public transportation always appreciates faster than those in the outskirts.
People prefer to live within a twenty-minute drive of work when choosing the location of a home.
Downton living with excellent walkability to work or local amenities are ideal locations to look out for.
Grocery stores, restaurants, shopping, entertainment are the top amenities people are looking for when buying a home.
Local amenities directly affect real estate prices in the area.
Final thoughts on the Importance of Location
If you’re buying a home, the first thing you should do is choose a location. It’s the most critical factor when buying real estate.
Many Real Estate Investment Firms have at least a strategic plan that outlines their competitor analysis’s leading role.
Comprehensive competitor analysis has essential aspects of strategic marketing that help forecast future returns from future investments.
We provide a comprehensive research report that brings everything up to speed with your competition and out-compete them.
Population trends can help reveal these developments in the region.
Trends in census data over time serve to identify the history of the county.
Demographic analysis includes the statistical study of populations defined by criteria, take place simultaneously to form an area or community’s unique attributes –
- population age
- race, ethnicity, nationality
- crime risk
- school quality
- migration patterns
- community expansion
A rise in significant demographic changes can have an immense impact on the real estate trends for the city’s future growth.
4 Market value
Market value is an opinion of what a property would sell for in a competitive market based on the features and benefits (the cost) of that property.
The overall real estate market, supply and demand, and how much similar properties sold in the same condition.
5 Market trends
Since World War II, Real estate property prices have trended upward between 2 and 5% yearly.
However, from 2007 to 2008, prices plunged as much as 39% per year -through the average decline appears to be lower.
6 Overseas Potential
The US market is favoured by foreign investors from Europe, Canada, China, and Southeast Asia.
According to data firm Real Capital Analytics, a potential overseas investor has fueled the long-running bull market in US commercial property.
- office buildings, apartments
- malls, another real estate
Leverage in real estate using borrowed money or other people’s money to buy your investment property.
When leveraging real estate, you borrow funds from a lender instead of covering the entire purchase price yourself.
A 20% down payment gets you 100% of the property and house you want in most cases.
What is Leverage in US real estate?
Leverage in real estate is using other people’s money or borrowed money to buy a property.
You don’t have enough cash to purchase the investment property you want.
You want to maximize your returns by investing less money into each property investment.
When you look at that same property without Leverage – see the difference in the rate of return.
When you can leverage your real estate investment purchase, you still get to depreciate the property’s total cost, not just the cash you put into it.
You need to either refinance or sell the property before the expiry of the loan term.
You can break your mortgage contract or transfer your mortgage to another lender before the end of your term.
Find out the upfront property costs to determine how much money you will need to close and how much the loan you need.
Should you not repay the minimum amount over an agreed period, the lender may foreclose the property.
8 Auction Secrets
Auction Secrets are not secrets, but simple psychology with a caveat – if your competitors have higher capital and will spend it. YOU LOSE.
At the auction, dress and act like an agent, suit and tie for men and similar professional attire.
When you are dressed, looking like an agent/s, it puts doubt in your competitive mind that not everything is ‘above board.’
Dismiss any agent’s ‘auction helpers’ that may approach you with a polite wave of the hand.
Should You Buy A House At Auction?
Buying a home at auction is riskier than buying through the usual process.
It is vital to how real estate auctions work—the most significant risk of limited knowledge of the auction properties.
You can find home auctions through local governments, real estate agents, and online county auction sites.
Many investors incorrectly believe that auction homes are a good deal and may buy “blind” such well below market value bargains.
As with any real estate purchase, you will need to read, understand, and sign lots of paperwork.
When a homeowner has not paid the mortgage for at least a few months, they fall into default, and the bank may foreclose the property.
Bank-hired trustees hold these bank foreclosure auctions.
Buying A Property From Auction.
Owner-occupants on a budget and real estate professionals migrate to sources where there is less competition.
Naturally, auction properties generate fewer offers, resulting in a lower sale price.
However, foreclosure auctions don’t provide the discounts that existed during the time of the crisis.
White continues to explain that buyers are highly motivated when fewer properties are available because of home appreciation and favourable mortgage rates.
He says that online auctions have increased competition and driven up prices.
Finding Real Estate Auctions
You can find real estate auctions by contacting the local county or visiting the websites for details.
Local real estate agents and brokers are also valuable resources, as they can earn commissions through online auctions.
Multiple Listing Service Data
Real estate agents, appraisers, and contractors understand construction and remodelling costs and can accurately estimate a property’s fair market value and the cost of the work needed for refurbishments.
Keep in mind that foreclosure auctions are cancelled and repeatedly postponed at the last minutes as
The borrower may have worked out a solution to avoid foreclosure.
9 Bidding – What Bidders Need to Know
Before you can bid at an auction, you need to register and submit a refundable deposit of 5% to 10% of the property’s expected selling price to the entity holding the auction.
If the auction is live, be sure to check in at least an hour before the scheduled start and obtain an official bidding card – which you raise when you are ready to bid.
In a lender confirmation auction, the lender does not have to accept your offer, even if you are the highest bidder.
In an absolute auction, the winning bid gets the property.
To bid at an auction, you need to set your minimum and maximum bid prices.
If you allow emotions to get in the way, you may make a foolish purchase by paying above your maximum price.
Accessing a Property
Accessing a property to evaluate repairs is a crucial step to take to determine your expenses.
You cannot access an auction property to view the interiors, so a drive-by by a professional contractor will give you a quick estimate of repair costs.
You do not know a property’s repair costs before bidding will be detrimental for you to buy a house blind and be saddled with astronomical repairs.
Payment Options – Cash
Buying a property at auction requires that you pay cash you need to pay to the county government in full immediately after winning the auction.
Bidders at property auctions are often real estate investors who can afford to pay cash.
A real estate rehab is when investors purchase a property, complete renovations, and then sell it for a profit.
The seven stages of a real estate rehab deal help you fix and flip the investor game and make your investing journey more manageable and realistic.
How To Perform A Real Estate Rehab
Luckily, learning how to complete a real estate rehab is not as complicated as it may seem. It will require preparation and hard work, but by following these steps, you can help ensure your rehab property is a success:
- Walkthrough the property to determine the extent of work scope and cost.
- Create a range of work outlining the specifics of the repairs.
- Find the right contractor for the job.
- Organize your critical documents, paperwork, and prepare to get started.
- Manage all aspects of the rehab project.
- Complete the walkthrough/inspections and make the last payments for the job.
- Stage the property and host an open house.
Flipping is a real estate investment strategy when an investor purchases a property not to stay but to sell it for a profit.
Unless you can buy with cash, the financial risk of house flipping using a mortgage is not worth it.
When determining the maximum price you should for a property, the 70% Rule of real estate investing dictates that the after repair value, minus repair costs, is less than 70%.
Rental Properties Are Low-Risk Investments.
Real estate has been and continues to be one of the safest investment strategies. A right balance between risk and return is one of the essential features of an excellent investment. Unlike with stocks, with rental property investment, you can’t just lose everything.
13 Co Share
A cooperative or “co-op” housing is a type of accommodation where the owners do not own their units outright.
Instead, each resident becomes a shareholder and co-share in the corporation based on the size of the unit they live in.
Co-op housing provides an alternative to traditional homeownership.
Co-ops are less expensive than apartments since they operate on an at-cost basis, collecting money from residents to pay expenses.
What Does Co-Broke Mean in Real Estate?
To co-broke means to split a commission with another broker. In real estate, the listing agent will secure a commission from the Seller split with a buyer’s agent.
This splitting of commission is called co-broking. If the buyer does not have a separate agent, then the listing agent will represent both parties under dual agency and collect the entire commission.
Beginner property investors should always buy the property based on analytical research.
The key aim of most property investors starting is to build a lucrative property portfolio.
Most are likely to over-capitalize their purchase or “fall in love” with the wrong house.
To excel as a savvy property investor, it takes planning and a team to
- find the best deals
- negotiate the best possible price and
- work toward the best outcome for your investment goals.
Frankly, it is the numbers that determine how fast you reach your investment goals.
When beginning property investors fail to plan, they plan to fail.
The best overall strategy is to focus on both the short and long term and ensure your investment decisions meet your financial goals.
What type of property do you need to buy to meet your financial goals?
Once you have outlined your investment journey, Noble Sky will help you with strategies to achieve your financial goals.
Budding or beginner real estate investors have two common traits: they act impulsively or become overly cautious and analyze paralysis.
Both these traits mean the budding real estate investors who never make it beyond their first property.
Diving Right In With Unrealistic Expectations
Some get so excited after attending one seminar and buy into the first crazy scheme they join without a second thought.
We have our fair share of potential investors with unrealistic expectations.
One man who has never invested in any property, stocks, bonds, or shares wanted 800% profits!
Does the reason?
He wanted his real estate investment to make him rich overnight.
When the investment property doesn’t make them profits overnight, they lose heart and throw in the towel, saying the investment property doesn’t work.
The other type of budding investor will end up overloaded with information and cannot act after spending time:
- attend every seminar
- read all the books
- listen to all the property podcasts
- watch all the videos
Analysis paralysis happened when an investor overanalyzed or overthought a situation that can cause forward motion or decision-making to become “paralyzed,” – meaning no solution or course of action next.
Timing The Market
There are many pessimists out there who enjoy negative media fanning the market with fears or second-guessing.
These are the people who want to control the best scenarios for themselves BUT rarely have the cash or the means to get a loan.
- the right time to buy
- when prices hit rock bottom
- exchange rates in their favour
They like to pose questions for many scenarios and probabilities and request the Pros and Cons list.
Financial Planners sometimes recommend these ‘when-to investments, with dates for “when to buy” and “when to sell.”
If you get your timing wrong, it may wipe your entire investment out.
Don’t time the markets; even the experts get it wrong!
“How To” Method of Real Estate Investment Firms
The best vehicle to put your money into is a ‘how-to’ investment model, such as real estate.
All property grows in value and doesn’t have the ‘when-to’ investment vehicles’ wild price variations as in stock and shares.
If you buy at the right time in the property cycle, this can massively speed up your investment returns.
The trouble is that many new investors don’t know where, when, or how to invest in real estate.
Here are some of the best ways to make money in real estate, ranging from low maintenance to high.
Use an online real estate investing platform.
There are many online real estate investing platforms that connect borrowers to investors willing to lend them money.
Some of these platforms also connect real estate developers to investors who want to finance projects through debt or equity.
Investors willing to take a significant amount of risk hope to receive monthly or quarterly distributions.
Some of these real estate investments are speculative and not liquid — you can’t quickly unload them the way you can trade a stock.
Think about investing in Rental Properties
If you’ve ever had a landlord, you probably don’t dream of being one.
Being a landlord is one of the most unglamorous jobs.
I know landlords who have compared themselves to being the janitor—dealing with overflowing toilets, blown bulbs, and even oversize bugs in the middle of the night!
Before you think of living life as a Landlord, you need to think about
- How much time you have?
- How much capital you’re willing to invest in?
- Do you want to deal with tenants?
- Do you have DIY skills?
You can take on a long-term tenant for traditional monthly rental unfurnished.
There is a house hacking strategy where you can rent out rooms or rent part of your home via Airbnb.
You will need to furnish your home for this strategy.
The tenants are pre-screened by Airbnb, and the company’s host guarantee protects against damages.
House hacking lets investors buy a property with up to four units under a residential loan.
A better option is SkyRent, where you can buy and rent out an entire investment property, and professional managers for a small fee handle the project management.
Consider Flipping Investment Properties.
If you have watched enough HGTV, you know that buying an under-priced home, putting in the minimal renovation, and reselling it for a profit is called House Flipping.
Many beginner real estate investors dream of a career as a “Flipper” and make huge profits.
In actual life, the strategy is a lot harder than it looks on TV, where everything is concluded in under 60 minutes—the highlight reels!
Be prepared for a more prominent element of risk behind every Flip project.
The math and accuracy of the estimates for repairs is not a simple thing you can pull out from a spreadsheet.
You will need to find a contractor good at estimating expenses and managing the project from start to end.
For flipping, the other considerable risk is the longer you hold the property – the less money you make in turning the project around.
Speculation over Patience
Many budding real estate investors think investing in property will be a quick fix to their financial problems.
Strategic investing is not speculative and not about seeking short-term gains in real estate.
It takes time to make money—everything takes time; it is not instantaneous.
It takes time to sell real estate, with many costs, including capital gains tax.
By approaching property investment with patience and persistence, you will gain far more success than if you seek the next big thing.
Noble Sky helps you secure proven, high performing property that grows consistently over the long term is the only way to ensure you make it to the top of the property ladder.
Contact me for a personal consult.
My name is Rauf Said.
I am the founder and Chief Investment Strategist for Noble Sky International.
If you’re ready to step up and learn how real estate investing works for you in the United States of America, please call me at (+65) 9422 0100 or book a Consult here.
I would enjoy speaking with you about your situation and share details on how Noble Sky help investors from Asia enter the US real estate market.
We don’t have inventory to sell, but we have a specialized approach to help you get started with your real estate business in the US.
Like all investment decisions, the best real estate investments are the ones that best serve you, the investor.