by Mark on September 1, 2008
I just sat down with a Realtor friend of mine and she showed me a flyer on a condo she just bought. It was a 2 bedroom, 1 bath condo on the 3rd floor in a neighborhood in between Lowry and Fitzsimons in east Denver area. She asked me to look it over, so I did. When I saw the price on the flyer, my jaw dropped…$29,900, no I did not forget to add another zero to the end of that number. Then she smiled and asked me to guess what her offer was accepted for…$27,000. She plans on renting it for about $500 to $600 a month. She was able to pay cash but even with a loan she would be able to generate positive cash flow right off the bat.
Right now the rental market is appreciating due in large part to the foreclosures that have occurred. It is unfortunate that some home owners have had to lose their homes to foreclosure but they still need a place to live and renting is their only option until they can qualify to buy a house again.
If you can buy a $50,000 condo and put 20% down, you would have a loan of $40,000. The interest rate on a full income verification, 30 year fixed loan for an investment property is about 6.5%. Assuming about $100 or so for HOA payments and about $50 a month for taxes, your payment would just under $400.00 a month. Now how much you can charge for rent depends on many things but let’s assume that you could get $600 a month on a condo like that. Could you use an extra $200 a month while you hold on to this property waiting for it to appreciate? What if you could find 5 properties like that?
There are currently loan programs that allow for only 10% down and stated income loans to buy income property if you are self employed. The rates on these loans can run form the high 6’s to the low 7’s.
If you’re new at this (and even if you’re not) you will still want a Realtor to help you find the right property and make sure that the price is a good one but there may not be a better time to look into this then right now.
Written by Mark Afman -
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by Kristal Kraft on September 1, 2008
While cruising the blogisphere today I discovered (second-handly) a great new website called ZipSkinny. My friend who writes the Cleveland Real Estate News, Carole actually got it from Have Coffee Will Write who got it from … who knows?
Regardless of who’s responsible for uncovering it, I must confess, I love this program. Currently in BETA, like so many good tech tools this program delivers data my customers ask me about quite often. In fact there is hardly a day that goes by that I’m not asked, “how many children in the neighborhood?”
ZipSkinny works instantly, just plug in a Zip Code (here I’ve used Denver 80210) and up comes the demographics for the area, age, education, Social, Income, occupation, martial status and median age.
Another nice feature is ZipSkinny will allow you to compare up to 20 zip codes! What a cool tool! My relocation buyers will absolutely love having the ability to compare all the neighborhood potentials!
I enjoy having just more resource to assist my customers in finding the perfect home, in the perfect neighborhood, in the perfect Metro Denver Mile High City, the most affordable city in the West! OK, so it’s been a good day, let me enjoy the moment…
kk
Written by Kristal Kraft -
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by Larry D. McGee, Denver Realtor on September 1, 2008
I first remember hearing that expression when I was 13 years old and on my first Boy Scout camping trip. The Scoutmaster was informing the troop that before we had lunch, we had to set up camp, because it was going to rain in the afternoon. A simple lesson, that being the benefit of the lunch was the labor of preparing the camp. A simple lesson that we have all learned at one time or another, but have difficulty remembering, especially if we think we can get something for free or lower cost.
The radio, television, newspapers and WWW continue to inundate us with mortgage ads that promise the equivalent of a “Free Lunch” when you buy or refinance a house. My least favorite is the one that admonishes “the biggest no-brainer in the history of earth”, but there are plenty of others to choose from. Please consider, if a advertisement claims that you can obtain a mortgage without paying closing costs, how does the mortgage company stay in business? Some part of closing costs go to pay the expenses to operate the mortgage company, and hopefully with some left over to provide a profit for the owners. So if there are no closing costs, how are expenses and profit accounted for? The answer to that is the difference between what the money costs the mortgage company and what you pay for it. It’s the retail markup on the sale of money. [click to continue...]
Written by Larry D. McGee, Denver Realtor -
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