December 2022 – Page 3

REAL ESTATE NEWS (Los Angeles, CA) —

Below is a list of the top invest rents of the last 10 years. Check out how real estate compares to other investments in the list. At the end of this article, request free list of 2022 / 2023 best investment.

ROI stands for “return on investment”
In real estate terms, this metric identifies the profit earned on a real estate investment after deducting all associated costs, according to Bankrate.com

What is ROI on real estate?

ROI is the profit earned from a real estate purchase after deducting the costs of the investment, which typically include the purchase price and any additional expenses associated with repairs or remodeling. ROI is not realized until the property is sold. One of the most common ways to make money investing in real estate is through appreciation, or when the property grows in value over time.

There are many different types of properties to consider investing in, beyond just single-family homes. Condos, townhouses and multi-family homes can also be good investments, and you can even consider investing in tiny houses or ADUs (accessory dwelling units). It’s also possible to invest in land that has no existing structures on it.

Many real estate investors assess ROI carefully before deciding whether to purchase a particular property, in order to have a data-based estimate of how much money they might earn on it.

How is ROI calculated?

ROI = (sale price of investment – cost of investment) / cost of investment

Rentals: Owning a rental property can generate steady long-term income. Determining ROI for rentals requires first calculating your projected annual rental income and your annual operating expenses, which could include such things as insurance, property taxes, HOA dues and maintenance costs. Your ROI for a rental property can then be calculated with this formula: ROI = (annual operating costs – annual rental income) / mortgage value (i.e., the amount that still needs to be paid on the mortgage loan).

What is an average ROI on real estate?

According to the S&P 500 Index, the average annual return on investment for residential real estate in the United States is 10.6 percent. Commercial real estate averages a slightly lower ROI of 9.5 percent, while REITs average a slightly higher 11.8 percent. ROI can vary by property type, as well, so it might work out differently for a multi-family home than it would for a single-family home or an apartment building.

Other metrics to calculate investment profitability

Potential investment profitability can be assessed in several ways, and it’s not unusual for investors to combine multiple metrics to create a more complete picture. Other common metrics include:

Capitalization rate: This measures the annual, debt-free rate of return from a rental property. The formula involves three variables — net operating income, property value or price and rate of return — any one of which can be calculated using the other two.
Internal rate of return: IRR requires a more complicated calculation than ROI, and it measures the annual rate of return over a particular time period, rather than over the total time of ownership.

Cash-on-cash return: This simple formula compares annual pretax cash flow from a property to the total amount of cash invested. Cash-on-cash calculations typically measure returns over a very specific time frame, such as one year.
How many mortgages can I get to buy investment properties?

In 2009, Fannie Mae increased the number of mortgages allowed to one borrower from four to 10. However, most lenders will be very wary of extending that many loans to a single individual. Very few loan programs actually allow more than four mortgages in practice. And to qualify for that many, you will need to meet specific criteria. These include having a solid credit score and a loan-to-value ratio of 75 to 80 percent. Lenders will also want to see that any existing real estate investments on which you hold mortgages are performing well.

Get a free list of the top 10 best investments for 2023 as stagflation continues. Fill out the online form.

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Copyright © This free information provided courtesy L.A. Loft Blog with information provided by Corey Chambers, Broker CalDRE 01889449. We are not associated with the seller, homeowner’s association or developer. For more information, contact 213-880-9910 or visit LALoftBlog.com Licensed in California. All information provided is deemed reliable but is not guaranteed and should be independently verified. Properties subject to prior sale or rental. This is not a solicitation if buyer or seller is already under contract with another broker.

REAL ESTATE NEWS (Los Angeles, CA) — Today, we have some of historic challenges for home sellers that we are facing in this shifting real estate market. Here we will break down eight tactical ways to can take away from today’s blog post. Implement them in your home sale or your real estate business immediately.

One of the biggest questions that we’re getting from the agents and home owners that we talk to every day is: what to do about expired listings when there are not enough buyer.

It can be easier for real estate to get listings, but they’re just not selling. So, in this blog post, we’re gonna break down eight specific things to do in real estate during a shifting market to get a property onto the market and get it sold reliably. If any of this article makes sense to you, and you’d like to have a conversation with us at the team about potential working together, I will put a link below.

In the last couple of years, we saw a very, very hot sellers market, artificially pumped up by the money printers in the federal government, along with radical, loose monetary policy of the federal reserve. Now that they’ve caused massive runaway inflation, things are changing. It’s no longer so simple and easy to get a home sold for big bucks.

As more property listings expire with no sale, sellers wonder what there agents did wrong.
Poor communication usually the culprit. In today’s softening market, many real estate agents are afraid to communicate the truth about pricing to their client the home seller.

There are many new real estate agents out there that have little or no experience with a down market. They may not know how to handle it. Before, they could stick a sign in the front yard, list the property on the MLS, and multiple offers would come in quickly. That’s different now. Expectations must be set correctly, and communication must be accurate, so that home sellers don’t end up confused and disappointed. When a property is listed for sale, sellers need to be updated every day on what is happening (or not happening) and why. — and what to do about it. A home sellers should never have to call their agent, after a week or two of silence, to ask for an update.

The home must be priced right. A home that is overprice in this market will attract no offers. The listing will get stale, and prospective buyers will assume something is wrong with the property, as they ignore it in favor of correctly priced homes.

In today’s market, sellers much be flexible in offering terms that encourage prospective home buyers to place offers. Because financing and high interest rates are a chief concern in the market today, sellers may address this by offering to help buy down the rate so that the buyer can afford the monthly payments. Some sellers who have plenty of equity and cash can solve the problem by financing the property themselves, without the need for a mortgage lender.

Most importantly, the home needs to receive offers. Homes sell for the most money and greatest level of satisfaction when they receive an offer within two weeks of listing. That’s my home asking prices must be set correct: either just right, or a bit on the low side as to attract more attention, more offers, auction effect and a higher final sale amount.

If some buyers are interested in the property, but do not place an offer within a few days of viewing, the listing agent should consult with the seller about the advanced tactics of providing reverse offer to the buyer prospects.

Find out how much your home is worth, free, online. Get free list of recently sold lofts, condos or houses in Downtown LA. or in your neighborhood, along with a list of currently listed comparable properties. Fill out the online form:

<a href="https://laloft.wufoo.com/forms/qbg942419l39cs/" target="_blank" rel="noopener noreferrer">Fill out my Wufoo form!</a>

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Month: December 2022

Top 10 Investments of the Last 10 Years — Real Estate, Stocks, Gold or Bitcoin: Which Performed the Best?

Reverse Selling a Home — How to Get a Home Sold in a Buyer’s Market

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