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PASSIVE REAL ESTATE INVESTING

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By Joe Arias

Want to make money without having to put in a lot of work? You may want to consider passive real estate investing. It is the perfect solution for an aspiring investor who may have other time commitments like a full-time jobs that does not allow much time to be a property manager or a home flipper. Each of those activities requires at least a little bit of time on your part. You have to collect rent, market your property for rent, make repairs, and so forth.

With passive real estate investing, you basically write a check and then sit back and collect mone over time. There are a couple of different options when you get into passive real estate investing, each comes with its own risks and varied amounts of returns. They are pretty easy to get in to and do not require a lot of knowledge in the real estate industry to be successful. Here are several passive real estate options worth looking into:

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What is Passive Real Estate Investing?

Before we jump into what types of passive real estate options are out there, let’s first look at what passive real estate investing is.

In simplest terms, passive real estate investing is investing in real estate without requiring hands-on effort or active participation. Passive real estate investing can either be direct or indirect. The main difference between the two is the amount of work you have to contribute to each investment.

Why Is Passive Investing a Good Idea?

When you are a passive real estate investor, you will earn money without having to actively work for it. Basically, you pay someone an agree upon amount of money and they do all the hard work for you. Here are some ways you can put you passive income to use:

  • Build a retirement fund
  • Pay off your debts
  • Increase your savings account

While there are non-real estate related ways to earn passive income, let’s just focus on those that do involve real estate in some form. Here are a few ideas for you on how to invest in passive real estate:

Direct passive real estate investing

In this case, an investor will purchase a property which is then rented out to a tenant. This can be done in the form of short-term or long-term rentals. In order to simplify the process, many investors will hire a property management company to do time-consuming duties like maintenance, rent collection, or any other situations that may arise. This allows the investor to have very little active responsibility in their investment, making it a passive investment.

Indirect passive real estate investing

Suppose you want something which requires even less involvement than being a landlord and renting out a property to a tenant. In that case, you can invest in an indirect passive real estate investment by investing in a real estate investment trust (REIT). You will have no day-to-day tasks related to this form of investment and do not need to have very much real estate knowledge to be successful. You will still collect income in the form of returns and dividends.

Different Types of REITs

Real estate investment trusts are made up of corporations, trusts, or associations. These groups invest in large income-producing real estate like commercial buildings, hotels, data centers, or apartment complexes. Investing in a REIT is usually a low-risk investment and is traded like a stock.

There are three types of REITs you can invest in:

  1. Exchange-traded: Registered with the SEC and listed on exchanges like the NYSE.
  2. Non-traded: Registered with the SEC but do not trade publicly. These tend to be more stable since they do not fluctuate with the market.
  3. Private: Not registered with the SEC or traded on exchanges. They raise funds through private investors.

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A well-managed REIT lessens risk by including large groups of properties rather than individual properties. One good thing about them from an investment standpoint is that they provide annual dividend income as well as long-term appreciation. You are usually able to withdraw money from the REIT when you need it, but will be subject to paying taxes on your returns.

There are a couple of downsides to investing in REITs. They are required to distribute 90% of their profits annually, which means they are not able to reinvest funds annually, which can prevent long-term growth. You also don’t have a tangible asset and cannot control any part of the decisions made related to your investment.

Tax Liens

Another passive real estate option is investing in tax liens. According to the National Tax Lien Association, $14 billion in property taxes go unpaid each year. When a homeowner falls behind on their property taxes, the county or municipality where the property is located will issue a tax lien against the property, which the tax assessor’s office usually issues.

These tax liens can be auctioned off to investors. If you win a tax lien auction, you will earn interest until the homeowner pays off the outstanding taxes. You receive your share and accrued interest when the homeowner sends the county a tax payment.

Interest rates on a tax lien can be as high as 12%, which would give you a very nice return on investment. In very rare cases, you may even be able to foreclose on and acquire the property for an incredibly low price.

Tax lien investing can be confusing and maybe more work than a passive real estate investor is willing to commit to. Depending on the state you purchase the tax lien from, you may be required to notify the homeowner frequently in an attempt to collect the debt. This is certainly not for everyone.

Crowdfunding

Another type of passive real estate investing is crowdfunding. With real estate crowdfunding, groups of investors combine their money to purchase commercial properties, apartment complexes, and single-family home portfolios. These are mostly managed and executed through online platforms where investors are able to view progress and send payments.

Crowdfunding is very popular because it is so easy and does not require a large investment. Neighborhood Ventures is a Phoenix-based real estate crowdfunding company. Their projects are usually funded in a matter of days. They buy old apartment buildings, renovate them and then rent them to tenants. They take on projects in their own neighborhoods in an attempt to keep their investment dollars local and improve the communities where they live and work. Investors can very easily and quickly create an online account, upload their funds – as little as $1,000, choose a project, and watch their money grow.

Crowdfunding is another very hands-off investment. Since there are so many crowdfunding companies that are very transparent in the properties they will be purchasing, you do have the ability to choose a project in a real estate market with the potential for large returns. With a company like Neighborhood Ventures, you would be investing in the Phoenix Metro area which is one of the hottest real estate markets in the country, seeing double digit returns each year.

Many real estate crowd funders do require holding your money for a specified period of time. This ties up your money and makes it difficult or impossible to cash out at a moment’s notice in the case of an emergency.

Passive Real Estate Investment or Stocks? Which is the Better Investment?

Deciding between real estate or stock investments is a personal choice that depends on your financial situation, risk tolerance, and goals. You can make money two ways with stocks: value appreciation as the company’s stock increases and dividends. Your returns are based on stock market activity as well as the company’s earning.

Real estate has proven to bring in higher returns in a shorter period of time in most major real estate markets. According to the S&P 500 Index, the average return on investment in the US real estate market is 10.6%. Comparatively, the average annual return for the S&P Index over the past 20 years is only 8.6%. Real estate also tends to be less volatile than the stock market. REITs and crowdfunding reduce the risk further since you are able to enter into the investment for little money out of pocket.

Overall, real estate and stocks both present risks and rewards. There is no right way to invest and people have seen both huge returns as well as huge losses by investing with each.

Risks in Passive Real Estate Investing

Every investment comes with a series of risks, and passive real estate investing is no different; you carry the ongoing threat of losing your principal. First, if you are hoping to make a lot of money through passive real estate investing, you may be disappointed. Something else to be aware of is that there are a lot of passive real estate investment opportunities out there, and they are not all created the same. Always do your due diligence before investing, as no investment can guarantee you either a return or even protection of all your principal. Performing your own due diligence can help you find safer and possibly more profitable investments for your capital.

Here are some things to look out for when considering investing:

  • What is the company’s track record? You could take a look to see their past projects and how much money they made. If the company is consistently failing to complete projects or are not generating the returns they advertise, you may want to pass.
  • How much debt is the company in, and what are the details? Look to see if their debt is due to mismanagement. If so, this is another red flag, and you should probably pass.
  • What do other investors say about the company? You should be able to find online reviews about them.
  • Do they communicate with their investors? It is usually not a good sign if you invest money and then have no idea what the project’s progress is.

The Bottom Line

Many investors have made a lot of money through passive real estate investing. If you find the right REIT or crowdfunding or other passive real estate investment company to invest in, you can make money while you sleep. So, if you are looking for an easy, low-cost investment, passive real estate investment may be your best bet.

Joe Arias and his partners have flipped hundreds of properties in the Southern California Region. He has developed cutting-edge systems to simplify and scale the entire remodel process that can easily be applied to flipping, rentals, wholesaling, and other passive income strategies. More recently, Joe founded a real estate investing education company called RealSuccess Investments, allowing him to share his tools and systems with hundreds of up-and-coming investors. 

RealSuccess is focused on education on flipping, rentals, passive income, and wholesaling.

Joe is also a best-selling author. He has written 4 books: Finding your RealSuccess, First Steps to Flipping, R stands for Rentals and Retirement, and Wholesaling Real Estate.

“I came from Argentina when I was 20, I am 40 years old now. I didn’t know anyone, I am CERO generation, usually people say, I am first or second generation but I was the one that crossed the border, no language, no friends, no family, no money, nothing, nada… If I can do it, anyone can.”

From a young latino immigrant  to a celebrated real estate investor, Joe is a true testament to hard work and discipline. As an investor, he has made it his mission to help others achieve financial freedom while enjoying living a life of passion, fulfillment, and empowerment.

RealSuccess Website

www.ourrealsuccess.com

Personal Instagram: 

https://www.instagram.com/joeariasinvestor/

Real Estate Investment- Instagram: 

Instagram: https://www.instagram.com/realsuccesseducation/

Video For Finding Money from All Day Training (10 Hour Seminar)

https://vimeo.com/manage/videos/528446162

1 Hour Webinar

https://vimeo.com/manage/videos/530996751

Amazon Book#1:

Amazon Book#2

Learn live and in real-time with Realty411. Be sure to register for our next virtual and in-person events. For all the details, please visit Realty411Expo.com or our Eventbrite landing page, CLICK HERE.

HOW TO MAKE MILLIONS IN REAL ESTATE

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By Joe Arias

It’s no surprise to hear that investing in real estate is one of the best ways to build wealth and gain financial freedom. So many successful people have figured out how to make millions in real estate. When you work hard, constantly aim to learn and grow, and network efficiently, you can also make millions in real estate. Unfortunately, many people go into real estate expecting to make a ton of money without putting in the work. If you do not go about it correctly, you can lose money in real estate instead of gaining it.

Tips for How to Make Millions in Real Estate Investing

Focus on One Method at a Time

There are so many different methods to make millions in real estate investing. But you can’t do it if you are spread too thin. You have to master one thing and get good at it if you want to make money doing it. It’s also important to focus on one method so you can fully understand your goals. If you have multiple methods happening simultaneously, your goals could start to get a little murky.

Not to mention, trying to do everything at once can lead to costly mistakes. You simply won’t have the time, energy, or knowledge to follow through on every avenue.

Many people who are just starting off in real estate investing choose to do either real estate wholesaling or invest in rental properties. Real estate wholesaling is great for beginners because it requires very little to no capital to get started. It can be a little tricky at first getting the connections for your first sale, but it’s an excellent way to get your feet wet with little risk on your end. Investing in rental properties is another great investment when starting off because it’s generally pretty simple and, if done correctly, will result in a steady flow of cash each month. That cash can be reinvested into more real estate investments. As you continue to profit and buy more properties, your portfolio will grow, and you will be that much closing to being able to make millions in real estate.

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Establish Your Goals

Once you have narrowed down the method of real estate investing you want to focus on, you must establish your goals. Consider questions like: What are your short-term goals? What are your long-term goals? What types of properties do you want to invest in? Without goals, you will never make it to becoming a millionaire through real estate. When you know what you want out of your investments and your career, you can begin to make smart business choices that align with your goals. You will have an easier time choosing the investments that help you achieve success. You’ll also have an easier time deciding what types of properties you want to invest in, how you plan to finance them, and how to manage them properly.

Break Down Your Goals Into Steps

Of course, it’s essential to think big when setting your personal and professional goals. You also need to be realistic on what you can accomplish based on your experience, capital, and time. You cannot make millions in real estate overnight. It will take a lot of time and hard work, and you need to be realistic about that with yourself. Now that you’ve established your short-term goal start there. Break that goal down into smaller steps until you reach something actionable that you can do today to get started. Consider how long each step will take until you fully complete your short-term goal. As you complete this step, you may realize that you need to go back and set a new goal. That is absolutely fine and a significant first step toward success. As you begin to work through these steps, you may find that you need to edit or change some.

Don’t Invest All of Your Money on Day One

It can be exciting to get started in real estate investment. However, you should not put all of your money into your very first investment. You are at your least experienced that you will ever be, and you’ll likely make a few mistakes. These mistakes will help you grow as an investor and eventually make millions in real estate, but not if you put all of your money into them right away. The best thing you can do for yourself is to start small and make less expensive investments like single-family homes to start. Once you gain more knowledge, experience, and connections, you can begin to make larger investments.

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Constantly Educate Yourself

The biggest thing you can do for yourself when learning how to make millions in real estate investing is to educate yourself. Learn as much as you can from every experience and every connection you make. Ask lots of questions to others in the field. Consider getting a mentor who aligns with your goals to help you quickly learn how to become as successful as they are. Read books and articles, watch videos, and listen to podcasts. Constantly learning about everything new in real estate will quickly put you ahead of your competition and have you making millions years before anyone else.

Take Action

Education is nothing without action. You can spend years learning everything from every book and article and person you talk to, but it means nothing if you don’t put it into practice. Getting started will be scary, but you’ll never know if you can succeed unless you try. All of the knowledge you gained will help you get started. From there, you’ll gain invaluable experience that will teach you more than any book ever could.

Start an Emergency Fund

Ideally, you will reach a point in your career where you can trust all of your income streams to support you. When you are just starting, you don’t have that type of protection. Try to save at least six months’ worth of expenses in a savings account if anything happens, and you no longer have your income. You never know when something might happen. You may have to make extensive repairs on a property that cost a lot of money. Sometimes your properties may sit vacant and have no income. In situations like these, it’s crucial to be covered financially.

Utilize Mortgage Loans

Many people assume that you need to have a lot of money to get started investing in real estate. You don’t have to be rich to make millions in real estate; you just have to be smart. While there certainly are very wealthy people who do very well in real estate, it isn’t a necessity when you are just getting started.

Many people utilize mortgage loans when buying their first income property. How this works if you take out a loan to pay for a property. When you get tenants, they will pay you enough to cover the loan payments while still making a profit entirely. Utilizing loans allows you to buy a larger property and make more money. Once you start profiting off of that property, you can continue investing in others.

Use Data to Your Advantage

If you understand how to pull and read data and analytics, you have a greater chance of making millions in real estate. Understanding how to track and read numbers is essential for your success. When looking at potential properties, you should pull reports from different investment software and take the time to analyze how profitable those properties could potentially be. Once you get started, being able to analyze the reports from your real estate accounting software will help you make better decisions and understand your profits.

Utilize Appreciation for Profit

While not as guaranteed as profit from tenants, investors can make a lot of money by investing in properties that they predict will appreciate. When a neighborhood is up and coming, and you buy a property for a reasonably low value, rent from your tenants will be low for a few years. Once the neighborhood has become more in-demand and popular, you can start raising the rent. Because property values are high in the area, you won’t detract potential tenants by raising your rent. Plus, if you decide to sell the property, you’ll make a nice profit.

If it’s not an up-and-coming area, there are still things you can do to increase the value of your property and charge more in rent. Making small cosmetic changes and improvements with your profits can result in you making more money.

Build Your Real Estate Team

If you are looking to make millions in real estate, you cannot do it alone. You have to prioritize teamwork and trust in others to help you succeed. There are many different aspects of real estate that plenty of people specialize in. As a beginner in real estate investing, it’s even more critical that you find a real estate team you can trust. These people can help you avoid costly mistakes and succeed in real estate.

The following are some of the most important people that you will want on your real estate team:

  • Accountant
  • Accountability Partner or Group
  • Administrative Assistant
  • Attorney
  • Bookkeeper
  • Cleaning Company
  • Electrician
  • General Contractor
  • Handyman
  • Hard Money Lender
  • Inspector
  • Insurance Agent
  • Leasing Agent
  • Marketing Coordinator
  • Mentor
  • Pest Control Company
  • Private Money Lender or Equity Partner
  • Property Manager
  • Title Company

While you certainly won’t need every single one of the people on this list right away, you should start making connections now for the day that you will need them. Not every person you add to your team needs to be a permanent member. As you learn and grow, many of these people will change, but it’s essential to have them to start.

Summary

Making money through real estate investing is not an easy thing to do. If you take the time to learn as much as you can, set realistic goals, specialize in a specific method, and utilize your connections, you can make millions in real estate. To fully unlock your potential, check out our site and learn how to gain financial freedom through real estate investments.

Joe Arias and his partners have flipped hundreds of properties in the Southern California Region. He has developed cutting-edge systems to simplify and scale the entire remodel process that can easily be applied to flipping, rentals, wholesaling, and other passive income strategies. More recently, Joe founded a real estate investing education company called RealSuccess Investments, allowing him to share his tools and systems with hundreds of up-and-coming investors. 

RealSuccess is focused on education on flipping, rentals, passive income, and wholesaling.

Joe is also a best-selling author. He has written 4 books: Finding your RealSuccess, First Steps to Flipping, R stands for Rentals and Retirement, and Wholesaling Real Estate.

“I came from Argentina when I was 20, I am 40 years old now. I didn’t know anyone, I am CERO generation, usually people say, I am first or second generation but I was the one that crossed the border, no language, no friends, no family, no money, nothing, nada… If I can do it, anyone can.”

From a young latino immigrant  to a celebrated real estate investor, Joe is a true testament to hard work and discipline. As an investor, he has made it his mission to help others achieve financial freedom while enjoying living a life of passion, fulfillment, and empowerment.

RealSuccess Website

www.ourrealsuccess.com

Personal Instagram: 

https://www.instagram.com/joeariasinvestor/

Real Estate Investment- Instagram: 

Instagram: https://www.instagram.com/realsuccesseducation/

Video For Finding Money from All Day Training (10 Hour Seminar)

https://vimeo.com/manage/videos/528446162

1 Hour Webinar

https://vimeo.com/manage/videos/530996751

Amazon Book#1:

Amazon Book#2

Learn live and in real-time with Realty411. Be sure to register for our next virtual and in-person events. For all the details, please visit Realty411Expo.com or our Eventbrite landing page, CLICK HERE.

How to Buy a Mobile Home for Real Estate Investing

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By Joe Arias

Are you looking into how to buy a mobile home for real estate investing? First, you need to understand whether or not buying a mobile home will be a worthwhile investment. If you follow the proper steps for mobile home investing, it can certainly be a profitable business venture. Before getting into the steps you need to take to have a profitable mobile home real estate company, let’s first look at the pros and cons of investing in these types of properties. 

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Pros of Investing in Mobile Homes

Mobile homes are advantageous because they are cheaper than investing in other types of real estate. Because they are mass-produced and not built one-by-one like homes, they cost much less than traditional houses. 

Because they are less expensive, you may be able to invest more money in making them a little more modern. You can add things like granite counter, hardwood floors, and updated appliances with the money you save from buying mobile homes. This increases the value and helps get them rented or sold faster. 

As house prices rise across the country, more and more people are looking for affordable options. As a mobile home real estate investor, this puts you in a uniquely profitable situation. Mobile homes are beginning to be seen as a viable option to replace a more expensive traditional house. Even better, mobile home tenants tend to rent for more extended periods of time than those in apartments or traditional homes. This helps you avoid lost rent between tenants. 

Cons of Investing in Mobile Homes

Unfortunately, many people view mobile homes in a negative light. They do not see them as respectable options for homes. This view is slowly changing, but it is something to keep in mind. You simply won’t have the same demand for mobile homes as you would a traditional property. 

Mobile homes can quickly become costly if you invest in the wrong property. Some mobile homes may require you to buy the land you want to keep it on. This is something you need to keep in mind when determining your expenses and return on investment. You should also note that, unlike houses, mobile homes depreciate in value relatively quickly. This is great if you want to buy an old mobile home and fit it up, but not great for resale value if you ever want to get rid of the property. 

Finally, you may run into trouble trying to finance your mobile home. Traditional lenders often won’t fund you the way they would if you were buying a traditional house. If the mobile home you are buying does not already come with land, it’s likely you will not receive financing. This is something you need to consider before jumping into buying a mobile home. 

Now that we’ve got the benefits and drawbacks out of the way, we can look at improvements you can make to mobile homes. These will help raise property value and allow you to charge more for the mobile home. This can help you develop a good revenue stream and allow you to grow your real estate investment portfolio. 

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Improvements to Increase the Value of Your Mobile Home

Attic

The attic of a mobile home is probably the most overlooked area, but it has some great potential. Even if you don’t have the room to build a full-sized building on top of your home, you can easily create a multi-level living area by installing adequate insulation on the interior walls. One way to boost your home’s value is to build an attic loft and add an elevator or stairway connecting it to the ground floor.

Conversion

A second option for upgrading your home is to convert it to a larger house. In this scenario, you would tear out the interior walls and put in new ones. The following are some other types of conversions that can be beneficial: A sunroom (to create more living space), an addition on the side (to add more bedrooms), a deck area (to create outdoor living space), and a basement expansion (so you have a place to keep all of your possessions that aren’t stored in the attic).

Upgrades

A third option is a simple upgrade of the home’s interior. The first thing to do is keep the original ceiling and replace it with a higher-quality material, such as wood. Some other upgrades that can be made to the structure include vinyl and natural flooring, new bathroom and kitchen fixtures, new doors, appliances, and cabinets.

Landscaping

If you are looking to make your mobile home more appealing, you should focus on the building’s exterior. There are plenty of ways that you can upgrade your property to make it more attractive. You can change out the landscaping, which will provide an area of privacy and allow for greater land value. One way to make landscaping more appealing is to add a deck or patio area to have a designated area for outdoor living space.

Exterior lighting

Another significant exterior improvement is the addition of outdoor lighting. Lighting can also boost your home’s value because many buyers prefer homes with street lights, walkways, and security lights. Your home’s lighting should be made up of high-quality, energy-efficient HID bulbs to ensure that it is both safe and functional.

Front Porch

The front porch is a large area that can be made into a place to entertain or relax. Adding a new roofing material to your home’s exterior above the porch can give it a facelift while also bringing in some more value. There are many types of roofing materials, but the most popular is asphalt shingle. Be sure to get a warranty with the roofing installation, so if something goes wrong with it, you can fix it.

Fencing

The final exterior upgrade is fencing. Fences are a great way to increase the value of your home while also giving it some privacy and protection. A fence can be made from many materials, but most are either wood or vinyl.

These are just a few of the ways that you can go about upgrading your mobile home and making it more valuable. Just remember to keep the safety of your customers in mind.

Advantages of Mobile Home Investing

There are several advantages to investing in a mobile home. As stated before, they are cheaper than investing in another type of real estate. They are easy to find and can be located in more appealing areas. They can be bought for less than they cost new. If you don’t have the money to buy your home new, you can get one that is pretty close to new for a lower price. In addition, you can find mobile homes that are in great condition and ready for someone else to move into. That is a rare opportunity to buy a piece of real estate and have someone else pay you to live in it.

What Determines a Good Property Investment

There are many important factors to consider and evaluate when determining whether or not a home is a good investment:

  1. The property must be located in a strong, healthy real estate market.
  2. The property must offer the potential for both upside and downside growth with a low vacancy rate of tenants. 
  3. The property must be professionally managed to keep vacancy rates low and the property in good shape.
  4. The property should be purchased below market value (what it would cost you to build, if ever).
  5. The cash flow should exceed at least 5% per month, preferably more like 15% or 20% per month.

For most people, the ideal investment would be a home that provides long-term value growth (appreciation) but with modest increases in monthly income (cash flow).

Tips for Buying Used Mobile Homes

There are several tips that you can follow if you want to be successful when it comes to buying used mobile homes. First, make sure you take lots of pictures of the mobile home and its surroundings so that you can genuinely get a good idea of what it looks like. Additionally, don’t go into negotiations thinking that the seller will give you a good deal. Instead, make an offer that you think is fair, and you can live with. Lastly, remember to avoid being taken advantage of by people trying to sell you used mobile homes for a lot more than they are worth. When considering a price that seems fair, look into recent sales on comparable mobile homes in the area. Take into account what you plan to make through renting it or reselling it, and make sure the return on investment is high enough. 

Tips for Selling Used Mobile Homes

The following tips will help you maximize the profit in your mobile home. First, make sure that there is nothing that needs to be repaired before you sell it. Make any necessary repairs or changes to ensure that it sells for a profitable and fair price. Additionally, make sure that you clean out the mobile home of any personal items. If it is presented as clean and not in need of any repairs, it will be easy to get someone to pay you a fair price. Lastly, be entirely transparent about the mobile home and anything they need to know about it. Buyers who view you as untrustworthy will not want to buy from you.  

Process of Buying a Mobile Home

Conducting a simple investigation online can help you learn how to buy a mobile home, which is relatively easy. Once you find a mobile home, you can sign a contract immediately to ensure that the mobile home doesn’t get sold to anyone else.  Once the contract is signed, the seller will need to provide information about the property. This information includes details such as who owns the property and if there are any liens against it. Once all of this information has been collected, the title will be transferred, and the buyer will have control over the mobile home.

Summary

When you are looking for a mobile home, it can be a daunting task. However, if you remember to think about your needs first and then look at the available mobile homes, it will make the experience much more enjoyable. Additionally, remember not to fall victim to scams while looking at mobile homes. Do your research to find good areas to invest in mobile homes. Understand the best investments that work with your capital and what you expect to make from your investments. 

To learn more about real estate investing, check out the education services we offer to help you succeed in your real estate investment career.  

Joe Arias and his partners have flipped hundreds of properties in the Southern California Region. He has developed cutting-edge systems to simplify and scale the entire remodel process that can easily be applied to flipping, rentals, wholesaling, and other passive income strategies. More recently, Joe founded a real estate investing education company called RealSuccess Investments, allowing him to share his tools and systems with hundreds of up-and-coming investors. 

RealSuccess is focused on education on flipping, rentals, passive income, and wholesaling.

Joe is also a best-selling author. He has written 4 books: Finding your RealSuccess, First Steps to Flipping, R stands for Rentals and Retirement, and Wholesaling Real Estate.

“I came from Argentina when I was 20, I am 40 years old now. I didn’t know anyone, I am CERO generation, usually people say, I am first or second generation but I was the one that crossed the border, no language, no friends, no family, no money, nothing, nada… If I can do it, anyone can.”

From a young latino immigrant  to a celebrated real estate investor, Joe is a true testament to hard work and discipline. As an investor, he has made it his mission to help others achieve financial freedom while enjoying living a life of passion, fulfillment, and empowerment.

RealSuccess Website

www.ourrealsuccess.com

Personal Instagram: 

https://www.instagram.com/joeariasinvestor/

Real Estate Investment- Instagram: 

Instagram: https://www.instagram.com/realsuccesseducation/

Video For Finding Money from All Day Training (10 Hour Seminar)

https://vimeo.com/manage/videos/528446162

1 Hour Webinar

https://vimeo.com/manage/videos/530996751

Amazon Book#1:

Amazon Book#2

Learn live and in real-time with Realty411. Be sure to register for our next virtual and in-person events. For all the details, please visit Realty411Expo.com or our Eventbrite landing page, CLICK HERE.

How to Start a Property Management Company

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By Joe Arias

If you are thinking about getting into the real estate investment business, you might consider starting a property management company. A good deal of experience and knowledge is required, but it can be quite lucrative if you succeed in setting up a profitable property management company. This article will go over the necessary steps to set up a successful property management company and start making money through real estate investing.

If you’re interested in setting up a property management company, you’ll need to establish a legal entity. Many different legal entities can be used in the real estate investment business, but the most common is a limited liability company (LLC). An LLC can be a good choice because it allows you to operate an enterprise as an individual or with partners without worrying about filing forms and going through the costs of becoming an S Corporation. An LLC might not be the right choice for everyone, so it’s important to talk with your attorney to determine the best option for you. 

Obtain a License

You need to complete one more important step before you can begin your property management company. You’ll have to get a real estate license. Each state has different requirements for getting a real estate broker’s license, so you’ll have to check your state’s licensing and regulation department to determine the specific requirements. A real estate license will allow you to perform transactions on behalf of a property owner as a property manager and will enable you to handle all related paperwork. Depending on your state, you may also have to get a property management license, limiting you exclusively to property management. 

Brand Your Business

Now that you’ve established your legal entity and obtained a license, it’s time to brand your business. Decide on a company name and logo. You may even decide to hire a professional to help you determine your branding. You may not realize it, but font choices and color go a long way in establishing yourself as a reputable, trusted company. 

Separate Your Finances

It’s essential to open a bank account for your business to keep it separate from your personal expenses. This will help you keep track of your business and avoid any trouble when doing taxes. 

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Create a Website for Your Business

Once you’ve established your legal entity and obtained a real estate license, it’s time to create a website for your property management company. Many property management companies use websites to establish their brand, conduct business online, and keep records of interactions with clients. A good website will cost some money, but if you choose the right web developer, you can create a great-looking site that is optimized for Google. This will ensure that anyone looking for a property management company will come across you before your competitors.

In today’s world, it’s more important than ever to have an online presence. Your website needs to be filled with important keywords that your clients could be searching for. These will help you show up in their Google search results and will lead to more business. Knowing what you are doing online makes you appear more reputable and will help gain trust and credibility. If you don’t know where to start, consider hiring someone to take care of your digital marketing. 

Hire a Real Estate Team

Any good real estate investor knows that you’re only as good as the team you work with. As a property management company, you will want to create a solid real estate team to help you succeed. Starting off, the three most important professionals you will need are an accountant, a real estate lawyer, and a trustworthy contractor. An accountant will be necessary to manage the day-to-day accounting related to your company’s operations. A real estate lawyer will play a key role in handling any legal issues that might come up. And a contractor will be necessary for everything from mowing lawns to painting houses. Each of these professionals can represent you at public meetings, so you don’t have to attend them all the time personally.

Set Up Property Management Technology

When you’re running a property management company, it’s crucial to have a good system for keeping track of everything that’s going on. A few years ago, this would have been much harder to do, but you can set up an entire system just using the internet with today’s technology. There are specially designed services for companies looking to increase efficiency and cut down on expenses through technology. From customer and vendor management tools to marketing solutions, you can find what you need through an online service. If you plan to manage short-term rentals, you will need management software that helps you keep track of all check-ins and check-outs, as they will be more frequent and hard to keep track of on your own. 

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Establish a Pricing Structure

Once you have the basic nuts and bolts of your business taken care of, it’s time to establish pricing. Your pricing structure will differ based on the type of real estate that you’re managing. For instance, if you manage properties in a city where there is a lot of demand for affordable housing, you may be able to charge less than if you were managing high-end condos in a neighborhood with very little retail space. An excellent first step if you are just starting off is checking and seeing what competitors are charging in your area. Some fees to consider when creating your pricing structure are:

– Setup Fee: This is a one-time fee that is charged to new clients as soon as you take the job.

– Property Management Fee: This is the monthly amount that you charge for managing each property on your list.

– Real Estate Commissions: This is the percentage of your client’s total rent that goes directly to you. Technically, it’s called a ”total real estate charge,” but most property managers call it a “fee.

– Ongoing Management Fee: This is a percentage of the total rent that you charge each month to have you manage your client’s property.

– Maintenance Fee: This is an hourly fee that you charge your clients for any maintenance or repairs that need to be done at their property.

– Multiple Management Fee: If a client is also using another property management company, then you can charge the rental amount of one of the properties as a multiple management fee for your services.

– Leasing Fee: This is a fee that occurs when there is a vacancy that you need to fill. It covers the cost of staging, listing, showing, and eventually renting the unit. It typically comes out to about one month’s rent. 

– Insurance Fee: If you take on a bigger job that requires higher insurance coverage, then you can charge an additional fee per month to cover the extra cost of the insurance.

– Renewal Fee: If there are any fees associated with renewing a rental agreement, then you can charge your client an additional renewal fee as part of your monthly management fee.

– Eviction Fee: If you need to evict a tenant for violation of the lease, then the landlord can charge the tenant an additional fee as part of your management fee.

– Deposits: If your clients are required to pay a deposit when they sign their property management contract, then you can collect a monthly percentage of that deposit.

– Pet Fee: If the property is set up for pets and has pet deposits, then you can collect an additional fee from those who choose to rent with pets.

Pursue a Marketing Strategy

Regardless of what marketing strategies you choose, you need to make sure they are appropriate for your business. For instance, if you’re just starting out, you might want to focus on word-of-mouth referrals from existing clients. If you already have several clients or a steady number of people coming into your business, then it might be best to focus on local advertising through classifieds. 

If you’re just starting out, you’ll need to work a lot harder than the more established property management companies. The best time to start marketing your business is when you are still very new and unsure of the business. Don’t ever take on too much at the same time. Let your current clients know what your services are and how this will benefit their rental property. Then start new accounts by providing referrals from other potential clients in your area.

For a more modern marketing approach, take advantage of social media and digital ads. Create a Facebook page and an Instagram and update it often. Since the same parent company owns the two social networks, you can run ads across both platforms for a reasonable amount of money. Facebook ads can be adjusted to target specific demographics, locations, and niche interests. You will also want to either learn how to run Google ads or hire a company specializing in them. Investing a few dollars per day into some high-ranking keywords in your field may help you pull in leads and get your first few clients. 

Network

Many people find the most effective way to market their business is to get to know their potential customers simply. This means going out and meeting them, but it also means making a personal connection through social media. Once you’ve established a rapport with someone, you might be able to refer them to your business later.

Summary

Once you learn how to start a real estate property management company, the next step is to make it successful. Even the best business plan doesn’t mean much if you can’t market it correctly. It’s essential to understand your target audience and have some marketing strategies in place before you set out on meeting people and renting out properties. Moving forward, be sure to track your progress. Keep a log of all important numbers, such as contact information for people who expressed interest in your business, how many units you rented out, etc. Keeping tabs on your company’s progress might help you if you decide to apply for bank loans or seek investors in the future. If you have trouble getting started, find a mentor who already runs a property management company and learn through them before you are ready to get started on your own.

To learn more about a career in real estate investment, make sure to sign up for our investment seminars.

Joe Arias and his partners have flipped hundreds of properties in the Southern California Region. He has developed cutting-edge systems to simplify and scale the entire remodel process that can easily be applied to flipping, rentals, wholesaling, and other passive income strategies. More recently, Joe founded a real estate investing education company called RealSuccess Investments, allowing him to share his tools and systems with hundreds of up-and-coming investors. 

RealSuccess is focused on education on flipping, rentals, passive income, and wholesaling.

Joe is also a best-selling author. He has written 4 books: Finding your RealSuccess, First Steps to Flipping, R stands for Rentals and Retirement, and Wholesaling Real Estate.

“I came from Argentina when I was 20, I am 40 years old now. I didn’t know anyone, I am CERO generation, usually people say, I am first or second generation but I was the one that crossed the border, no language, no friends, no family, no money, nothing, nada… If I can do it, anyone can.”

From a young latino immigrant  to a celebrated real estate investor, Joe is a true testament to hard work and discipline. As an investor, he has made it his mission to help others achieve financial freedom while enjoying living a life of passion, fulfillment, and empowerment.

RealSuccess Website

www.ourrealsuccess.com

Personal Instagram: 

https://www.instagram.com/joeariasinvestor/

Real Estate Investment- Instagram: 

Instagram: https://www.instagram.com/realsuccesseducation/

Video For Finding Money from All Day Training (10 Hour Seminar)

https://vimeo.com/manage/videos/528446162

1 Hour Webinar

https://vimeo.com/manage/videos/530996751

Amazon Book#1:

Amazon Book#2

Learn live and in real-time with Realty411. Be sure to register for our next virtual and in-person events. For all the details, please visit Realty411Expo.com or our Eventbrite landing page, CLICK HERE.

Buying Rental Property – Avoid Seller’s Tricks

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By Joe Arias

Buying rental property is a great way to invest for the future. Just watch out for these common tricks that sellers use to inflate the appraised value.

Be careful when buying rental property. We stayed at a motel for a week one winter. The bill showed twice what it should have, but since I already paid the correct amount in cash, I thought nothing of it. When we noticed that the lobby and swimming pool were unheated, we thought it was frugality. Only a year later, when I read a news story about a new owner struggling to make the motel work, did I realize what was going on.

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The owner had been planning to sell. To prepare, she was using the two most basic ways to inflate the appraised value: decrease expenses and increase reported income. By stopping repairs and quietly adding $100 in income every day, she may have shown $45,000 more net income for the year. At a .08 capitalization rate, that means the appraisal would come in $562,000 higher than it should have. Oops! The poor guy who overpaid!

Do you want to avoid a mistake like that when buying a rental property? You need to watch for tricks like these. You also have to understand the basics of appraising income property.

It starts with the capitalization rate, or “cap rate.” If investors in an area expect a return of 8% on assets, the cap rate is .08. Net income before debt service is divided by this to arrive at the value of a property. I explain this further in another article, but the primary point here is to remember that every dollar of extra income shown will increase the appraised value by $12.50 with a cap rate of .08, or by $10, if the cap rate is .10.

Sellers Dirty Tricks

If sellers of rental properties increase the net by honest means, then the property should sell for more. Unfortunately, there are many dishonest ways, both legal and fraudulent, that are sometimes used. Unlike sellers of houses, who may cover foundation cracks with plaster, the tricks used by sellers of income properties aren’t about appearance. They are about income and expenses.

Income can be inflated by showing you the “pro forma,” or projected income, instead of the actual rents collected. Ask for the actual figures, and check to see that none of the apartments listed as occupied are actually vacant. Also, be sure that none of the income is from one time events, like the sale of something.

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Income from vending machines is a gray area. Smart investors subtract this from the net income before applying the cap rate, then add back the value of the machines themselves. If laundry machines make $6,000, for example, that would add $75,000 to the appraised value (.08 cap rate), if included. Since they are easily replaceable, adding the $10,000 replacement cost instead makes more sense.

Hiding expenses is the most common of seller’s tricks. Paying for repairs off the books, or just avoiding necessary repairs for a year, can dramatically increase the net income. Demand an accounting of all expenditures. If a number in an expense category is suspicious, replace it with your own best guess.

Analyze each of the following, verifying the figures as much as possible, and substituting your own guesses if they are too suspect: vacancy rates, advertising, cleaning, maintenance, repairs, management fees, supplies, taxes, insurance, utilities, commissions, legal fees, and any other expenses. This is how you make buying rental property safe.

Joe Arias and his partners have flipped hundreds of properties in the Southern California Region. He has developed cutting-edge systems to simplify and scale the entire remodel process that can easily be applied to flipping, rentals, wholesaling, and other passive income strategies. More recently, Joe founded a real estate investing education company called RealSuccess Investments, allowing him to share his tools and systems with hundreds of up-and-coming investors. 

RealSuccess is focused on education on flipping, rentals, passive income, and wholesaling.

Joe is also a best-selling author. He has written 4 books: Finding your RealSuccess, First Steps to Flipping, R stands for Rentals and Retirement, and Wholesaling Real Estate.

“I came from Argentina when I was 20, I am 40 years old now. I didn’t know anyone, I am CERO generation, usually people say, I am first or second generation but I was the one that crossed the border, no language, no friends, no family, no money, nothing, nada… If I can do it, anyone can.”

From a young latino immigrant  to a celebrated real estate investor, Joe is a true testament to hard work and discipline. As an investor, he has made it his mission to help others achieve financial freedom while enjoying living a life of passion, fulfillment, and empowerment.

RealSuccess Website

www.ourrealsuccess.com

Personal Instagram: 

https://www.instagram.com/joeariasinvestor/

Real Estate Investment- Instagram: 

Instagram: https://www.instagram.com/realsuccesseducation/

Video For Finding Money from All Day Training (10 Hour Seminar)

https://vimeo.com/manage/videos/528446162

1 Hour Webinar

https://vimeo.com/manage/videos/530996751

Amazon Book#1:

Amazon Book#2

Learn live and in real-time with Realty411. Be sure to register for our next virtual and in-person events. For all the details, please visit Realty411Expo.com or our Eventbrite landing page, CLICK HERE.

Ways to Find a Real Estate Mentor

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By Joe Arias

If you want to quickly grow within real estate, finding a good mentor is the best thing you can do for yourself. Whether they be in real estate, politics, or business, almost any successful person had a mentor who helped them get to where they are now. Books, podcasts, and videos will only get you so far when it comes to learning about real estate investing. After that, it’s all about real-world experience and gaining valuable connections.

To learn as much as possible in a relatively short amount of time, you should look into ways to find a real estate mentor. Someone who is trustworthy and knowledgeable will help you quickly grow within the industry and get you closer to your goals. By sharing their mistakes, they can help you avoid making your own. By aligning yourself with someone who has already reached your set goals, you are more likely to achieve your own. There is more to finding a real estate mentor than just picking someone you admire. This article will go over everything you need to know about how to find a real estate mentor.

What is a Real Estate Mentor?

A real estate mentor is someone who will help you quickly grow within your real estate career by offering advice and coaching based on their own experience. Typically, you will choose someone who already has many years of experience and is now knowledgeable enough to share their own experiences with you. They should be willing to help guide you through your career journey based on things they learned in theirs. This mentorship should be a beneficial relationship for both parties. You should also bring something valuable for your mentor, like new skills, networking connections, or potential deals.

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Best Ways to Find a Real Estate Mentor

The perfect real estate mentor should be someone who is successful in the same things that you aspire to do in your own career. Before looking for a mentor, you should complete the following steps:

  1. Identify what you want to accomplish in your real estate career
  2. Establish whether or not your potential mentor has the credentials and experience to help you reach your own goals
  3. Look for someone in the same type of real estate investment you see yourself in (flipping homes, wholesale, property management, etc.)
  4. Make sure the goals of your mentor align with yours
  5. Ensure there is a mutual level of respect

Once you better understand what you want in a real estate mentor, you can begin looking for someone who could be the right fit. This list includes some of the best ways to find a real estate mentor.

  1. Join local real estate groups
  2. Attend networking events
  3. Try out all aspects of real estate to meet the most people
  4. Share your work online and on social media
  5. Create a robust LinkedIn profile and connect with other real estate professionals
  6. Engage with their content and attend their sessions

Types of Real Estate Mentorships

Before you jump right into finding your real estate mentor, you should decide which type of mentorship works best for you. Consider things like your learning style, availability, and what you feel you need to learn from your mentor to succeed. Once you understand yourself and your needs better, you’ll be able to choose the best mentor for you. Below are a few different types of real estate mentorships you may want to consider when looking for your own.

Personalized Coaching

With a personalized coaching style of mentorship, you will get one-on-one coaching from your mentor. This is an excellent option for anyone just starting off in real estate who could benefit from a lot of personalized advice that pertains to their specific needs and goals. This mentor will be someone experienced in the type of real estate investing you plan to get into who can help walk you through any potential projects or deals.

Mastermind Groups

Unlike the personal coaching style of mentorship, being in a mastermind group is like having many mentors around you who you can reach out to. Check your area to see if there are any real estate investing groups that you can join. This is an easy way to connect with peers in real estate and start making connections with people who can help you. If there are no groups in your area, look into some virtual groups instead. You may even end up meeting someone who you want as your mentor in one of these groups.

Apprenticeships

Some of the best knowledge you can gain is through experience. The quickest and easiest way to get lots of experience is through an apprenticeship. With this type of mentorship, you will assist your mentor as they show you the ropes through their own business. This is a valuable way to get hands-on experience, plus you can see how someone who is successful in the same goals you set for yourself conducts their own business. Pay close attention to what your mentor does throughout your apprenticeship so you can follow their example.

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How to Pick the Right Mentor for You

It’s important to note that just because someone has good knowledge of the industry doesn’t mean they’re a good fit for you. Don’t feel obligated to accept someone’s offer to be a mentor just because they are open to it. This is a symbiotic relationship, and both people need to get something out of it. Do your research and make sure whoever you pick as your mentor has similar goals as your own. The best real estate mentor will be able to help you fast-track your goals and grow quickly within your area of real estate. Start by looking for someone who is already accomplishing what you aspire to in your future.

Once you find people who are successful in ways that you hope to be, make sure they would make a good mentor. Just because someone is successful doesn’t mean they are good at being a real estate mentor. If someone doesn’t feel like the right fit, don’t be afraid to talk to others. Find someone who has a good communication style that matches your own. Committing to a mentorship is a big decision, and there is no need to rush it.

Does Real Estate Mentorship Cost Money?

Everyone is different when it comes to requiring payment for mentorship. This is something you should discuss with your potential mentor before committing to anything. That said, having a good mentor can put you ahead of your competition and speed up your success within real estate. Despite costing money, getting a real estate mentor is something you should highly consider for yourself if you want to achieve your goals.

To learn more about how to get started in your real estate investment career, reach out to us to join our three day real estate investment course!

Joe Arias and his partners have flipped hundreds of properties in the Southern California Region. He has developed cutting-edge systems to simplify and scale the entire remodel process that can easily be applied to flipping, rentals, wholesaling, and other passive income strategies. More recently, Joe founded a real estate investing education company called RealSuccess Investments, allowing him to share his tools and systems with hundreds of up-and-coming investors. 

RealSuccess is focused on education on flipping, rentals, passive income, and wholesaling.

Joe is also a best-selling author. He has written 4 books: Finding your RealSuccess, First Steps to Flipping, R stands for Rentals and Retirement, and Wholesaling Real Estate.

“I came from Argentina when I was 20, I am 40 years old now. I didn’t know anyone, I am CERO generation, usually people say, I am first or second generation but I was the one that crossed the border, no language, no friends, no family, no money, nothing, nada… If I can do it, anyone can.”

From a young latino immigrant  to a celebrated real estate investor, Joe is a true testament to hard work and discipline. As an investor, he has made it his mission to help others achieve financial freedom while enjoying living a life of passion, fulfillment, and empowerment.

RealSuccess Website

www.ourrealsuccess.com

Personal Instagram: 

https://www.instagram.com/joeariasinvestor/

Real Estate Investment- Instagram: 

Instagram: https://www.instagram.com/realsuccesseducation/

Video For Finding Money from All Day Training (10 Hour Seminar)

https://vimeo.com/manage/videos/528446162

1 Hour Webinar

https://vimeo.com/manage/videos/530996751

Amazon Book#1:

Amazon Book#2

Learn live and in real-time with Realty411. Be sure to register for our next virtual and in-person events. For all the details, please visit Realty411Expo.com or our Eventbrite landing page, CLICK HERE.