Today, I want to begin a series of blogs on advantages of buying and selling various kinds of residential properties. What I share comes mostly from my personal experience as I currently own at least one of each of these kinds of properties. Have you ever gotten in the car with someone to take a short or long trip? When the radio comes on, you may discover that the music playing there is music you like or do not like. Just as people have different tastes in music, they also have different tastes in residential property.
Today, I want to focus on advantages and disadvantages in buying or selling mobile homes. As I stated earlier, I currently own a mobile home that is a rental property. This is the second mobile home I have owned.
There are some advantages of buying mobile homes as follows:
AFFORDABILITY- Mobile homes are affordable. The quality of mobile homes has increased greatly over the years. Many mobile homes or manufactured homes as some people prefer to say are as nice if not nicer than some stick built homes. From a cost perspective, however, they are quite affordable.
MOBILITY- As the word implies, mobile homes can be moved. The advantage is that if you move to another location or do not like the neighborhood where you live, you can take your home with you.
While there are some advantages of buying and selling mobile homes, there are also some disadvantages as follows:
FINANCING- There are fewer lenders willing to finance mobile homes that stick-built homes. Since there are less competition, you might need to be prepared to pay a higher interest rate or a greater down payment to buy them.
INSURANCE COSTS- My experience is that insurance costs are higher for mobile homes than stick built homes. If you know of a very affordable insurer of mobile homes, let me know.
ZONING- Many counties or towns have restrictions about mobile homes. Before you plan to move in a mobile home on a lot you own, do your homework to make sure you can.
HIDDEN COSTS- There may be hidden costs to buying a mobile home. If you buy a mobile home and plan to move it to your lot or land, be sure that you figure in costs for items such as moving costs, HVAC system, sewer system, water system, etc.
These are a few advantages and disadvantage of buying and selling mobile homes. Keep these in mind. - Randy Wall, Lora Lee Properties
Today, I want to write about home improvement projects for Fall. Your home is like your relationships in that they need attention all the time. Listed below are a few small, simple home improvement projects for the Fall:
CHANGE YOUR SMOKE DETECTOR BATTERY- it is a simple, inexpensive thing that might save your life. Change the battery in your smoke detector in the Fall. Most persons can do this in a matter of minutes. The time change of "Spring Forward, Fall Back" is always a good reminder to me.
HEATING/ AIR CONDITIONING CHECK UP- If you have not already done so this year, get your heating and air conditioning system a check up. Most service calls are less than $100. If you cannot afford a service call, at the very list change your air filter. If you heat with oil or some other fuel, make sure that you have sufficient fuel to get started in the winter to come.
FALL PLANTING- Though many persons thinking about Spring planting, the Fall is also a good time to plant bushes and other flora. It is also a good time to plant grass seed. If you plant now, the root system will have time to grow and get acclimated before the winter season.
LEAVES- If your home is like my home, leaves will need some attention this Fall. This is something healthy persons can do and it is good exercise. Keep the leaves to use as a mulch for flower beds. Speaking of leaves, don't forget to make sure your gutters are clear of leaves. Clog gutters can create problems with rot of boards around the roof edge of your house. If you cannot do this yourself, see that someone does it for you.
PROTECT YOUR FLOWERS- Finally, make sure that you protect or take in flowers before they are killed by frost and cold weather. If you put them in a place such as a garage, storage building, etc., you can take them out in the Spring and enjoy them for another season.
While you are outside doing these Home projects, don't forget to look around and see the beauty of the season. - Randy Wall, Lora Lee Properties
Today, I want to write about some creative financing options for buying property. The good news and the bad news is that it is more challenging for persons seeking to buy their own homes today. That is good and bad news because there were some persons approved for loans a few years ago that should never have gotten loans. Likewise, it is challenging today for real estate investors to get financing on their purchases. Lenders today are not only seeking a good credit score for loans to real estate investors, but they might want as much as fifty percent down for a loan. Therefore, the time is ripe for some creative financing options to buying property. Let me share a few options today as follows:
OWNER FINANCING- As many home buyers are finding getting financing challenging today, so many home sellers are having trouble selling homes quickly. One option is for the owner of the property to do owner financing where they sell the home for five to twenty percent down and a monthly mortgage payment. This can be advantageous not only to home sellers to sell their home, but it also can provide them with passive income. A real estate professional, an experiencing real estate investor, or an attorney can assist you with this.
LEASE WITH OPTION TO BUY- This is similar to owner financing. In this scenario, the potential buyer leases the house from the homeowner. For the option to buy the house, they pay an option fee (typically 5 to 10 percent). They have the option as stated in the contract to buy the house at a priced mutually agreed by the buyer and seller. Lease options give flexibility to both buyer and seller. The contract in a lease option can include that the potential buyer pays for all or some of the repairs on the home they lease.
SUBJECT TO CURRENT LOAN- Another option to buying a property without a bank is to buy it “subject to” the current mortgage. Of course, this only typically works if there is a mortgage and has equity in the property. Though most home loans do have a “due on sale” clause, most lenders will not exercise that option if the mortgage payments are being made in the timely fashion. A real estate attorney can assist you with this option.
These are a few creative financing options to consider. There are certainly others. Happy buying and selling.-- Randy Wall, Lora Lee Properties
Today, I want to write about some secret places where you can find motivated sellers. Everyone looks for the “for sale” signs in the yard or on the MLS for property listings. Here are a few places where you can find motivated sellers where many do not look. They are as follows:
YARD SALES- Yard sales are not just a place where you can find a bargain on clothes, videos, or the like. It is also a place where you can discover homes for sale. As you visit the yard sale, talk to the people holding the sale. You might discover that they are having a yard sale for an estate that might be in probate or because they are getting ready to move due to job change, divorce, etc. People who have an estate to settle or who are moving are usually very motivated to sell a house. That yard sale might be a gateway to not just buying a cheap video or book, but also to buying a house in a few weeks or months.
NEWSPAPERS- Everyone looks in the classified ads to see homes for sale or rent. However, there are some places where you might discover homes for sale. One place is the obituary column. Check out the obituary pages. If you read in the obituary that a person dies without any other survivors in their home, more than like the heirs will be selling the property in a few months. Keep tracks of their address and if the property comes to sell. Another place to discover homes for sale or how to rent or sell your home is the news pages. If you read that a new company is expanding into your area, persons coming to the area will need a place to live. See if their HR department will give your name as a possible landlord or home seller. If the news in the newspaper tells that a company is shutting down, people could be losing their homes or moving away. If you have a friend who works at the business that is closing, see if they will put up one a flyer about your company on their bulletin board that you “buy homes”. This might be a good business opportunity for you even if business is bad for the company.
NEIGHBORHOOD TOURS- Take a moment to simply ride through neighborhoods. As you drive, notice homes where the yard is unkept. The homes of these homes could be quite motivated to sell that home for all sorts of reasons.
These are a few “secret” ways to find home buyers and sellers. Good luck in your quest. Happy buying and selling.-- Randy Wall, Lora Lee Properties
There are many ways to make money in real estate. The main way that has worked for me is buying a property… fixing it up (if necessary)… and then renting it out. Today, I want to share some tips about rental property. These tips come from the experience my wife and I have had through the years as landlords and real estate investors. Below find a few tips as real estate investors and landlords:
PROPERTY/ LIABILITY INSURANCE- A good insurance agent should be a member of your real estate investment team. It is helpful if the insurance agent is a real estate investor as they understand your situation. It is important that you have insurance on your real estate investment to protect your investment . Today, people sue each other at the “drop of a hat”, so make sure that your insurance coverage has liability insurance to protect yourself. Speaking of insurance, remind your tenants to have insurance on their possessions. (I have a reminder about this in their rental agreement.) Your insurance will not cover their possessions.
MONIES FOR ON-GOING EXPENSES- Remember to set aside rental income for on-going expenses with the rental property such as property tax, repairs, etc. I usually set aside about 10-15 percent of my rental income. Taxes and repairs, of course, can vary. There will, of course, will be capital expenses if you keep the property long enough such as replacement of HVAC system, flooring, roof, etc.
RENTAL AGREEMENT- I find it most helpful to have a rental agreement with my tenants. It states clearly what are the rights and responsibilities of tenant and landlord. Make sure that your rental agreement is in alignment with local and state laws for tenants and landlords (e.g. in my home state of NC, the security deposit can not be more than 200 percent of the monthly rent.)
RENTAL APPLICATION- I always have prospective tenants fill out a rental application. This application gives personal information, references, income information, etc. which is useful in choosing tenants. I also ask that they pay a rental application fee that I use to do a background and credit check on tenants.
MAINTENANCE RECORDS- Keep maintenance records on your rental properties. I have to say that I can say this much easier than I do it. These records can be helpful in tracking warranties on products and setting a maintenance schedule in the future for capital projects.
APPRECIATE YOUR TENANTS- Everyone appreciates being appreciated. Make the effort to show your thanks and appreciation to good tenants with flowers, gift cards, cards, etc. on lease renewal, birthdays (you have their birth dates on the rental application), etc. This good will will go a long way.
While I have a few horror stories with tenants, these tips have helped me have many good experiences with tenants. Good luck, and happy real estate investing.- Randy Wall, Lora Lee Properties