Posts Tagged ‘rental’

I recently saw a report on MSNBC that more than half of potential homebuyers say they’re still not ready to enter the housing market, according to a poll conducted by Realtor.com. The primary reason for this reluctance was the consumer’s concern over losing their job. Other fears potential homebuyers expressed in the poll was that they were bothered by falling home prices and worried that they would be unable to sell the home they were currently living for enough money.

In my day to day business I am seeing that while more restrictive lending is stopping some would be purchasers from moving forward, even those who are highly qualified to purchase a new home are not rushing to snap up the deals and feel that values will continue to drop. Furthermore, as many of the best deals in the marketplace are foreclosed properties, new homebuyers are constantly reminded that purchasing a home is a big risk financially in these troubling times.  Additionally, many perceive purchasing a foreclosed property as a lot more complex than other transactions.

The poll by Realtor.com also found that Americans generally are skeptical about Obama’s plan to alleviate the foreclosure crisis by giving the lending industry $50 billion in incentives to lower borrowers’ monthly payments. While about 27% of those polled did feel the plan was working, the remaining people did not believe it was working, or didn’t know if it was working.

What does all this really mean, though? In my business , I am seeing an increased interest from both potential sellers and buyers in home rental rather than traditional sales and purchase.   

Renting gives those relocating an option to test out the market and find the right fit, and allows those needing to upgrade a chance to do so much sooner than they might be able to in these current conditions.  Potential sellers are choosing to rent instead of sell, as well, in order to allow the real estate market to recover and their values to rise.In my opinion, until Americans become convinced that the market is changing for the better, renting will become the preferred option for many who would otherwise have purchased a home.   

 DenverRentAHome.com can help those in the Denver, Colorado and surrounding areas with over 75 years of combined expertise in the residential rental and property management fields.  Homeowners can now post their properties online for FREE for two weeks, followed by a low monthly fee. And prospective tenants can now get pre-qualified online! Visit www.DenverRentaHome.com for more information or call 303.681.6767.

It’s tough to find the right apartment in Boston, especially if you live in a city just like Boston, MA these days. High rents, older buildings, a transient population, its enough to make you give up and move to the suburbs! But, by following a a few realistic steps you can find the perfect place.
How much are you ready to pay? This is one of those times when you will have to think about a budget. It may sounds boring but its better to spend an hour on this now than to find out you can’t make rent in two months! Take into account food, utilities, transportation, entertainment, and shopping. Make sure you leave yourself some room for emergencies (this money can be put into savings if none arise). Now that you have a budget you know what price range you fall into and can get out there and start looking. Check for apartments in the Boston area. Of course if you’re a student you probably want to be close to the university. Find a number of places that suit your needs. Some helpful place to look that I have found is Boston Apartments for Rent which offers renters free listings. Find a realtor, and start looking. Keep in mind that the faster the realtor can rent you a place the more time they will save and conversely the more money they can make. Take your time, look at a number of apartments.

Once you have decided on a place make sure you will be able to afford the upfront costs. Most Boston apartments require a first and last months rent, as well as a security deposit. After moving in look around and report any problems to the landlord, typically any damage after you move out will be deducted from your security deposit. Good luck hunting for the perfect new place! Boston is a great place to live and you will find an apartment that suits your needs

It’s tough to find the right apartment, especially if you live in a city just like Boston, MA these days.  High rents, older buildings, a transient population, its enough to make you give up and move to the suburbs!  But, by following a few simple steps, taking the time, and being realistic you can find an apartment for rent in Boston.
What can you afford?   This is one of those times when you will have to sit down and come up with a budget. It may sounds boring but its better to spend an hour on this now than to find out you can’t make rent in two months!  Take into account food, utilities, transportation, entertainment, and shopping.  You need to keep some money for emergencies (this money can be put into savings if none arise). Now that you have a budget you know what price range you fall into and can get out there and start looking.  Check for apartments in the Boston area.  Of course if you’re a student you probably want to be close to class.  Find a number of places that suit your needs.  Some helpful place to look that I have found is Boston Apartments for Rent which offers renters free listings. Find a realtor, and start looking. Don’t forget that the faster the realtor can rent you a place the more time they will save and conversely the more money they can make.  Take your time, look at a number of apartments.

Once you have decided on a place make sure you will be able to afford the upfront costs.  Most Boston apartments require a security deposit.  After moving in look around and report any problems to the landlord, typically any damage after you move out will be deducted from your security deposit. Good luck hunting for the perfect new place! Boston is a great place to live and you will find an apartment that suits your needs

It’s tough to find the right apartment, especially if you live in a city just like Toronto, Ontario these days. High rents, older buildings, a transient population, its enough to make you give up and move to the suburbsareas of Toronto! Luckily, by following a few simple steps, taking the time, and being realistic you can find the perfect place.
How much are you ready to pay? This is one of those times when you will have to sit down and come up with a budget. I know it sounds boring but its better to spend an hour on this now than to find out you can’t make rent in two months! Take into account food, utilities, transportation, entertainment, and shopping. Make sure you have some money for emergencies (this money can be put into savings if none arise). Now that you have a budget you know what price range you fall into and can get out there and start looking. Check for apartments in the Toronto area. Of course if you’re a student you probably want to be close to school. Find a number of places that suit your needs. Some helpful place to look that I have found is Toronto Apartments for Rent which offers renters free listings. Find a realtor, and start looking. Keep in mind that the faster the realtor can rent you a place the more time they will save and conversely the more money they can make. Take your time, look at a number of apartments.

Once you have decided on a place make sure you will be able to afford the upfront costs. Most Toronto apartments require a first and last months rent, as well as a security deposit. After moving in look around and report any problems to the renter, typically any damage after you move out will be deducted from your security deposit. Good luck hunting for the perfect new place! Toronto is a great place to live and you will find an apartment that suits your needs

By buying a fixer-upper rental, you can get positive cash flow and a fast increase in equity. The downside? This can be a fair amount of work, and you have to be a landlord.

It is getting tough to have positive cash flow from rental homes, due to real estate prices going up faster than rent in most areas (as of 2005). One way to deal with this problem is to buy cheaper homes, to keep the loan payments down. These homes will usually need some fixing up.

What you want is houses in nice areas that are dirty and ugly. The more they scare off the usual buyers, the more likely you are to get a great price. However, you want to find homes that mostly need “quick fixes,” like cleaning and painting and new carpet.

Let’s suppose you are in an area where two-bedroom homes are selling for about $115,000, and the rents leave most new landlords breaking even or with slightly negative cash flow. This is a tough place to make money on rental homes.

On the other hand, suppose you buy a fixer-upper for $75,000, and after $12,000 in repairs and $3,000 in other costs it is ready to rent. Even if you refinance to get some of your cash back out of it, you will be borrowing $25,000 less than for similar homes in the area (you’ll have a total of $90,000 into it versus $115,000 for other homes).

What does this mean? Your mortgage payment will be about $160 less per month (based on current rates of interest). That can mean positive cash flow. You also have created $25,000 in equity if the home is now up to the standards of the other homes around it, and so worth $115,000. That means that if being a landlord doesn’t suit you, you can sell the house for a nice profit.

Another way to boost that cash flow is to now lease the home and give the renter an option to buy. You can likely get as much as $150 more in monthly rent, which helps the cash flow. You may be able to sell at a higher price than market as well.

Bottom line? When cash flow seems impossible, start looking at those fixer upper rental properties.

There are many more than five kinds of residential rental properties depending on how you classify them. But from the perspective of basic investment differences, there are five types that come to mind, each with their own problems and advantages. The first type is single family homes.

Single Family Rental Properties

Houses are appealing to investors for a few basic reasons. First, they provide the easiest way to get into real estate investing, because of the financing options and possibility of a low down payment. Second, they can build equity fast during times of rising prices – even if rents are not rising. Third, they can be sold to other investors or home owners. These two markets make the eventual sale easier.

Of course they have problems too. First, it is very difficult to find houses that can produce cash flow after all expenditures are considered. Also, as a single unit, if you lose your tenant, you lose 100% of your income until it is rented again. If you own multiple homes, it can be a lot of work to collect rent and maintain them versus an apartment building with a similar number of units.

Apartment Buildings

The primary advantage of apartment buildings is that the prices are based on income, because unlike houses, only investors are buying them. This means decent cash flow is normal (otherwise why buy?). Also, because the prices are based on net income more than anything else, if you can find a building with low rents, you can quickly increase the value just by raising them. Of course, the primary problem with apartment buildings is the greater difficulty in financing them, and the larger down payment normally needed.

Small Multiple-Unit Residential Rental Properties

Between single family homes and apartment buildings are the duplexes, triplexes and four-plexes. As long as you stay under five units, you can finance these like a home. Though this is an advantage, it is also the reason it is tough to make this type of rental produce cash flow. There are many people out there buying them to live in one unit and get the equity gains from the whole property. Most of them are not thinking of cash flow, so they push the prices too high. It is convenient to live where your rentals are, though, so if you can come close to breaking even, the eventual gain from equity build-up may be worth it.

Low Income Housing

Mobile homes and small houses in need of repairs get their own category because this low income market has unique advantages and problems. Normally you’ll have more late rent payments and other issues with tenants. You also will have more repairs. In general, investing in low income housing means more hassles and more time invested.

What makes it worth it? Cash flow. Suppose a normal three-bedroom house costs $130,000 and rents for $750 per month. You may find a three-bedroom mobile home on a lot nearby for $45,000, and get $600 per month in rent. Repairs, though more frequent perhaps, are cheaper, as is insurance and property taxes. You can see that there is greater potential for cash flow.

Low income housing is all about cash flow. As for the added hassles, there are ways to deal with that. I know a man who has forty rental properties with low income tenants (mostly mobile homes with real estate), and he gives free rent and a small salary to a handyman/manager who does everything from fix toilets to collecting rent.

Other Residential Rental Properties

This “other” category includes the less common residential rentals. Since these properties often don’t have the advantages that the ones above have, people invest in them for one reason: cash flow. For example, a large house that would lose money every month as a normal rental might do well as a boarding house, where you rent rooms out individually. This can be very profitable in a college town.

Even less common, but still potentially profitable, are rentals of RVs, or recreational vehicles. You’ll see this more in the southwest than in other areas (it’s almost common in Arizona). Conversion of old motels into residential rental properties is another way investors create cash flow. Certainly there are a few I have missed as well. Probably houseboats are rented by the month somewhere.