Being the Smart Investor

Let's face it, times are changing. The Fed just cut rates again, and buying property looks even more lucrative. Not doing your homework, or in the industry "Due Diligence", will kill a deal faster than you think.

Now you may think the usual, like checking your property's background, physical integrity, and other pertinent stuff. This is all great, and should be a usual.

Now ask yourself a question, have you conducted any due diligence on yourself?

Check your money, does this make sense? Can you afford this, and does it really work for you? When I go out and look for perspective cash flow deals, often times there is a whole lot of misleading information. Let's face it, advertisement is meant to lure you in. Many will write an ad to make you think you can afford something, or try to persuade you to think a deal make sense.

Run the numbers on your own. Get the gross scheduled income; calculate what the cap rate should be. Be very careful if the annual expenses are low. I wont deny good deals, however when the expenses advertised are lower than what they should be, check it out!

Remember, "Management, Taxes, Maintenance, Insurance, and Utilities". Those five are key expenses with cash flow property operation. If the operating expenses are unusually low, something with those five is off, find it!

Check your money, check your system. Is your support system supporting you? Is your team reliable? This should be a no brainer, but it is often overlooked. My biggest pet peeve is integrity. If you can't trust someone, why do business with them. Making a quick buck isn't always worth it.

JP Sherwood

Hurry up and Buy!

Yeah yeah, prices are still falling.
And yes, interest rates are pretty low.

That's still not an excuse to go and buy something. I haven't heard of anyone benefiting with "keeping up with the Joneses".

Now I don't want anyone to get the wrong idea. Improving your assets by buying property is great.

However buying a property and having to dump it off two years down the line because you didn't do you homework isn't so great. Due diligence is key!

If you going to buy right now, that's great. Do it for the right reasons. Do it for your reasons.

Let me know what you think.
John

For Sale By Owners

Hello,
If you are thinking of selling your home without a Realtor, make sure you are prepared! There are a lot of papers, rules, inspections, and disclosures that occur in a deal. And although you may think that by not paying a commission you are passing on the savings to the buyer, keep in mind that those savings you give now may haunt you later!

Let's talk about this pet peeve: Disclosure! A lot of disclosure occurs, and from the last time you were in a real estate deal, do you remember what needed to be disclosed? It can be pretty confusing, and stuff could fall through those cracks!

Does the buyer have a Realtor? As I'm sure there are a bunch of good hearted Realtors in the industry, I'm not so sure that they would work for free. Now that "savings" you are passing just got reduced by half, or more!

How is your marketing? I'm sure that some of the online classifieds, such as Craigslist.com are being utilized. However are you listed in your regional MLS? Are you hosting any Open Houses? Have you checked the comparable properties to see if your asking price is too high (or to low)?

There is a lot of talent out there with Realtors, and there are a lot of people convinced that they can do the job themselves.

I like examples, so I am going to use one. If you were on trial for murder, and were innocent yet there was a stack of circumstantial evidence against you, would you represent yourself to save a few dollars?

Let me know what you think.
John

Mistakes of an uninformed Buyer

Hello,
I talk to a lot of people about real estate. I keep hearing the same thing over and over again; "I am just going to wait six months for the market to come back".

STOP!

Don't wait. I will guarantee, when you do wait and decide to get behind the eight ball, you'll be behind everyone else too! Good thinking you! Really knew when to strike when the iron was hot!

1. The early bird gets the worm. Prices may keep falling, yes, but really how much more? We have seen a lot of falling, and yes I will agree that they probably will fall some more. But ask yourself two things; One, do you know when they will bottom out? And two, can you finance right now?

If you answered yes to the first one, congratulations, you are psychic and should tour in Las Vegas. If there was a yes to the second question, and you haven't purchased yet, help yourself out by taking your right boot off and tap it against your head!

2. Would you pay a little extra for a sure thing? I sure as hell would. Why gamble with an unknown when you can have security for a little extra. This is just common sense! I don't even know why I am talking about this, but people, would you leave your front door unlocked on the chance you WOULDN'T be robbed just so you can open your door more conveniently?

Do yourself a favor, help the economy a little, and buy something! A house would be great, because those who can finance right now will be the foundation for what's ahead.

Let me know what you think.
John

Personal gains and finding good deals.

Hello again,
I don't think I need to remind everyone, but finding a good deal is always worth it. The other day I found a great deal on a brand new bed. I'm also working on a deal for a place that could be a good deal too. The problems, although apparent, can be smoothed out. But bear in mind, a good deal will always profit. Let me know what you think.
John

Keep you properties up!

Hello,
I would like to make a suggestion, to all those who are looking to sell there homes. I know the market is tough, and with the growing trend of foreclosures and short sales, a little elbow grease goes a long way to a prospective buyer! You would be surprised on how appealing a home looks with a few minutes of picking up the trash. Best of all, it's free.
Let me know what you think.
John

My First Blog.

Hello,
This the very first blog I have published for JP Sherwood Realty. The site went up last night, and I am very excited.