Posts

BUILDING WEALTH IN REAL ESTATE: HOW LONG DOES IT TAKE?

/in , , , , , /by

By Glenn Mananeng

This is a question on the mind of investors. There is no definite answer for this. This topic is always up to debate no matter how you look at it, as wealth is measured differently by every individual. Here are a few factors you need to know when building wealth – allow us here at Unique Wealth Education to teach you some important pointers to consider:

#1 Wholesaling

This is the easiest point of entry for the majority of the investors, as it requires the least amount of capital. You find a seller who wants to put their property for sale and find a buyer for that property on “as is” condition without the fixing part to try and get the market value higher. After the property has been sold, you’ll get a cut on the sale. Basically you are the intermediary that builds a buyers list to locate undervalued properties using a multi-pronged approach. This relies heavily on how good and how broad your real estate network is.

#2 Fix and flip

You don’t have to be an avid real estate investor to know what fix and flip is. Anyone who has cable and passed by HGTV has a basic idea of what it is. You buy a house below the average market value, renovate it, sell them for a profit! This is one of the most widely used real estate investment strategies used around the county.

Keys to fix and flip investing success:

· Preparing yourself by understanding how to locate undermarket valued properties in the right locations
· Understand values (make sure you are comparing apples to apples and going with the highest comp when doing our due diligence as a conservative approach)
· Aligning yourself with multiple capable and competitively priced renovation contractors to not only give you a bid prior to purchasing the home, but also to deliver as agreed on
· Understanding how far to go with finishes and layout changes to keep within the budget and comps in the area
· Stay away from potential losers such as foundation issues and bad layouts
· Having a sales strategy in place prior to the purchase that accounts for commissions, closing costs, holding costs, etc…
Contrary to “reality” real estate shows, getting rich doesn’t happen overnight. The longer it takes to flip the property, the more expenses you would incur for maintaining it while waiting for a buyer. Working with getting coached by or partnering with a seasoned investor is a huge advantage, as you learn best practices and pitfalls to avoid, which only years of experience can provide.

#3 Rentals

Mortgage Paydown

Let’s use a rental property as an example. In a normal scenario, you have a tenant who is essentially paying the rent in exchange for living privileges. If you bought the rental property with a mortgage, your loan will eventually cancel itself out over time. Why? The rent you receive from your tenant is basically used to pay the loan, which is increasing your equity in the property. The money left over is your cash flow divided by the amount you put down to come up with your CAP rate. This is a GREAT way to build long term wealth.

Cash Flow

We can all agree that this is very important. For those who are new in the game, cash flow is basically the income you get from your investment property (usually rental properties). This is a major factor in generating a high return for your investments and savings. Once you increase cash flow by accumulating properties, this allows you to plan your income and determine the course of future investments.

Taxes

If taken into account optimistically, you’ll see a lot of tax benefits when it comes to real estate investments. Consult your CPA to see how you can depreciate properties that you are holding onto for rental income and also discuss with them acceleration methods used to front load depreciation to give you more capital to buy more and keep building your portfolio.

The answer to how long it’s going to take, as you might’ve guessed already, is up to you. Your real estate skillset, determination, experience, and risk management are major players in this ballgame. it’s all about how smart you invest in the industry. If you make due diligence and play your cards right, you’ll one day realize that you’ve gained a considerable amount of wealth already. Unique Wealth Education can help you in your real estate career in helping you avoid common mistakes & pitfalls, is something that we take to heart very seriously. Contact us at(734) 224-5454 or email us at [email protected]to learn more.

Skrrt, Skrrt… Cars and Real Estate…

/in , /by

Exclusive Article by Fuquan Bilal, NNG Capital Fund

Before I discovered real estate I had a passion for cars. I even owned a body shop as one of my first businesses. I now keep my businesses and investments diversified within the real estate industry. Yet, I still love cars, and there are a lot of great lessons that correlate between the two.

When I was younger (and often lived above my means) I had Range Rovers and new BMWs. I would lease and trade in every year to get the latest model. I liked to live flashy, like many new real estate investors do.

I’ve learned and matured a lot since then.

I now drive this 1982 seven series BMW. I’ve had it since 2010. I restored it, and still love working on it.

It’s one of those great pet projects that is good for distraction and decompression from the business. It recharges me.

 

When I visit places like Miami, I’m still excited by new supercars and exotics. I can appreciate the appeal. But, I’m honestly much happier now with my classic.

It’s durable. It’s a vehicle that lasts. I purchased it as a long term investment. I’ll still have to keep up with maintenance and will make modifications. It’s worth it though. It’s rewarding to make a better product.

Classic cars like these go up in value over time, instead of down. This is another reason it really made sense to me.

I invest in real estate for the same reasons. It’s durable, can go up in value, lasts long term, and can be fun and rewarding to see the transformation when remodeling rental properties.

The cash flow from my apartment investments allowed me to recently purchase a car for my mom too, as she always wanted to drive mine!

I’m so grateful that my smart investments allowed me to go pay cash for a car for her. It was not a brand new car, but it was a strategic investment.

It won’t be long before my kids are ready to drive too. When it’s time, I’ll work with them to buy a mortgage note. Then they can use the income from that investment to buy a car or make payments on one if they really want to go that way.

What are you driving and why?

Investment Opportunities:

Find out more about investing in secured debt and real estate, go to NNG Capital Fund

Welcome To Your MONEY PATCH

/in , /by

By Tim Houghten

Money might not grow on trees, but funding portal Patch of Land may have invented the closest thing to it…

Whether looking to grow your real estate investments with access to attractive capital, or boost your yields with passive income investments, this is one patch of the web worth checking out. Named one of Entrepreneur magazine’s ‘100 brilliant companies of 2015’, Patch of Land brings a unique twist to real estate lending and crowdfunding, and the proof is in the performance.

PIONEERING WIN-WINS

While peer-to-peer lending, and crowdfunding has been catching plenty of media attention, it hasn’t always been a walk in the park for fundraisers and funders. Until now the two main challenges have been the amount of work required for project promoters, without any guarantee of funding. And then a lack of track record, and organization base investment decisions on for those looking to put their capital to work. Recently, Patch of Land co-founder and CEO Jason Fritton provided a new perspective on how Patch has created a new model of peer to real estate lending. There are two things which really separate this platform from everything else on the landscape:

1. Patch offers ‘Pre-funding’, gives you your loan, and then raises funds from the crowd

2. Patch works together with institutional lenders instead of trying to replace them

This creates a true hybrid where “real estate, finance, and technology, converge.”

The startup that Fritton describes as a “tech and efficiency company” shares some threads with other peer-to-peer, online mortgage lending, and crowdfunding sites. These are that real estate fundraisers bring their projects, which are ultimately financed by the crowd. It is the execution that stands out.

Fritton highlights that his company is the “first in market to directly secure fractional investors in real estate loans.” That means Patch of Land underwrites, and gives real estate investors and professionals the funding under the supervision of SVP of Underwriting & Acquisitions Douglas Cochrane. Then Patch of Land opens up the opportunity to a range of individual accredited investors and institutional lenders.

Now operating in 25 states, and with over $600M per month in funding requests the company is able to offer retail investors, hedge funds, regional and “community banks the yields they really want, along with efficiency in origination.” In fact, Jason explains that this enables these capital sources the freedom to participate in deals they could not do directly, while permitting more common sense underwriting of deals. Operating under SEC Rule 506(c) of Regulation D, this connector empowers those with projects to raise money cost-effectively without all the marketing and substantial filing expenses of going it alone. All while delivering the due diligence investors need and crave. As of September 25 th , 2015 Patch of Land had a solid track record of performance, with no principal or interest losses.

THE SECRET SAUCE

Fritton explains that a great deal of the success has come from “the privilege to hire experts in all areas,” to grow the California based Patch of Land team. The founding and executive team now spans a wealth of technology expertise, lending professionals with billions in transactions under their belt, along with an entrepreneurial marketing team with experience in organizations like Disney. Silicon Valley appears very bullish on investing in ‘The Patch’ too, with a successful, oversubscribed Series A round of funding topping $23M, achieved in early 2015.

So far Patch of Land has perhaps been most well-known for funding single family deals, but Jason tells us they have recently funded a Ramada flagged hotel, office, and retail buildings, and are testing moving into new construction financing.

Whether you’ve got deals that need funding, or capital that deserves higher yields, Fritton says “give us a try, and come grow with us!

More details, statistics on past performance, and online tools can be found at PatchofLand.com.