Pre-construction real estate investing may not have the ‘name in lights’ appeal that other types of investing carry but it does provide a viable investment style that has the potential to bring in significant profits. The name of the game when it comes to investing is profits so keep this in mind when considering your investment options. This is one of the forms of investing that requires (in most cases) the least amount of capital up front.

This style of investing is not nearly as glamorous to some as flipping houses. There are no beast to beauty renovations. There are, however, some things that should be kept in mind while making this type of transaction.

First of all, no real estate venture is ever guaranteed to turn a profit no matter what the glossy little brochures tell you. With the current trends in property sales, this is typically not the best environment for pre-construction investing though these things tend to change on a regular basis and that market could be looking up again in the very near future.

Networking is more often than not the best way to break into this particular business. There are all kinds of fly by night would be real estate investors. The ones that manage to last are those that network with other real estate agents as well as those who have specific interests and experience with pre-construction investments. Join local groups in addition to online groups that deal specifically with this sort of investment in order to get more information more quickly. The costs involved might appear daunting at first but they are far less than the costs of getting in over your head by not having a grasp of even the most basic ‘ins’ and ‘outs’ of pre-construction real estate investing.

Develop a close-knit relationship with a realtor that specializes in this particular type of real estate investing. This could prove to be the most beneficial thing you will ever do in order to insure future success. Be developing the right relationship with the right realtor you can get information on new properties before they make it to the public sector. This puts you in the rare and wonderful position of beating the competition to the punch. This gives you a much better shot at receiving the rock bottom prices that are often missed by waiting too long to make the purchase.

Be prepared to hold onto the property for a little while if you need to do so. The problem with pre-construction investing is that there are no guarantees that when the time comes you will have been able to ’seal the deal’. Things come up even when you have a buyer that is willing and eager to make the purchase. In other words, there are times when you will need to hold onto the property for a short while and sometimes as a long-term investment. Some options in the case of long-term holds would include renting the property out to vacationers if it is in a high demand tourist area. You can use your realtor to help with that. This allows the property to be earning some income until the sale can be made. Others decided to hold onto the property as a personal vacation home for themselves, friends, and family. In the end, the important thing is that there is a “Plan B” for the property should the deal fall through and you are left paying the monthly note.

The fact that the price of real estate is constantly on the rise is not really a surprise to anyone, is it? After all, everyone knows that they stopped making land a long time ago. In elementary school, we learned about the famous Law of Supply and Demand. As the supply shrinks, the demand always increases. Because the supply has been getting smaller and smaller, since the dawn of time, it makes perfect sense that the demand has been increasing significantly.

As a rule of thumb, the price of real estate doubles every 10 years. So if you buy land today, for $10,000, it’ll be worth about $20,000 ten years from now. Again, this is a rule of thumb, but historically it has proven to be accurate.

One of the major reasons for the rising cost of real estate is the growth of our world population. Take Phoenix, Arizona, for example. In 1940, the population was a small 186,000. By 1994, the population had reached over 1.5 Million. Las Vegas, Nevada, is another fast-growing area. Today, the population is nearly 1.1 Million, up from just 460,000 twenty years ago. Yes, the population more than doubled in twenty years!

You don’t have to look very far to see the effects of rising land prices. How many times have you talked to an old timer who said to you “Twenty years ago, I had the chance to buy that place for only $32,000. And they just sold it for $250,000.” These aren’t rare circumstances. They are normal, common, everyday events.

In the San Francisco Bay Area, demand for new houses has sent land prices skyrocketing as high as 100% over the past four years. Builders are scrambling for parcels. One such parcel of ground, just 4.7 acres close to the freeway in Del Mar, California, was recently offered at the stunning price of $6.7 Million!!!

There are a few times, however, when land prices tend to stay flat, or even decline. Southern California in the early ’80s is a good example. During times of severe, and I do mean severe economic slumps, real estate values have a tendency to stay flat. When the economy recovers, and buyers, builders and investors begin purchasing again, the prices quickly increase.

Inflation is another key to the rising cost of real estate. Remember how a loaf of bread used to cost less than fifty cents? Now it’s $1.99 or so. The same is true in real estate. The same dollar today just won’t buy as much property as it did yesterday. Inflation, especially when combined with rising wages, has created an environment in our real estate markets where the value of the dollar is diminished versus our buying power in times gone by.

Remember the Law of Supply and Demand and inflation, and remember that they quit making land a long, long time ago.

With land Auctions, you get the chance to name the price you’re willing to pay for the land you want to buy. There are some incredible bargains that people walk away with at land auctions. For more information on land auctions visit Auction Acres

Tags: real estate investor, real estate investing

Buying your first home can be an exciting time. At the same time, if you’re not aware and prepared, buying your dream home could turn into a nightmare. Here are a few simple tips to keep in mind when purchasing your first home.

1. Make sure you can afford what your purchase. At first glance, this sounds like common sense, but many first time buyers over extend themselves and purchase more than they can afford.

2. Grab a current copy of your credit report and make sure everything looks good. Make sure you are aware of your credit history so there are no unpleasant surprises when it comes to getting a home loan.

3. Get in touch with a good great Realtor. You want to work with a seasoned Realtor that has plenty of experience. You want somebody that will listen to your needs and will work hard to exceed your expectations. If you feel that your Realtor isn’t doing what he/she can to find the right home for you then fire them.

4. Take your time when making a decision. Your first home is the biggest single purchase of your life, never feel pressured into making a commitment. Make sure you tour several homes and take a day or two to make your decision.

Buying a home is a great way to accumulate wealth. Many homeowners often tap into their equity by taking out a second mortgage. However, when it comes to taking out a second mortgage, the risks cannot be ignored.

Second mortgages have many advantages, but they have weighty disadvantages, too. Ignoring the potential risks can be dangerous.

A second mortgage refinance is similar to your first. It’s a loan secured against your house, and the interest you pay is tax deductible. The main difference in a second mortgage occurs in the event you default on your loan. If you ever default on your loan, the lender who holds the primary mortgage is the first to receive any funds recovered from the defaulted loan. The second mortgage lender is next in line. Because second mortgages are a slightly riskier proposition for lenders, they’re generally tagged with higher interest rates.

What are the advantages of a second mortgage? If you’ve built up equity in your home, a second mortgage allows you to tap large sums of money at one time. The money can be used for home improvements, paying for college, debt consolidation, and even paying for private mortgage insurance.

What are the disadvantages of a second mortgage? All the advantages of a second mortgage can turn into a huge disaster if you fail to make your mortgage payment. Your lender could foreclose on your home if you default on the loan and your primary mortgage.

The Real Estate Book is the one of the largest real estate publication of searchable listings in the world servicing over 490 locations across North America. It is the leading multi-media publisher of real estate advertising in over 400 markets across North America and is the consumers’ choice when looking for a current, free color publication showcasing homes and real estate professionals in their area. The goal of the Real Estate Book is making easy buying a home or house, home and family, home improvement or other home related topics.

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If you are trying to sell your home, The Real Estate Book is the largest and most popular real estate advertising publication in North America. It is the perfect blend of print advertising and online exposure; it delivers leads, helps you get listings and builds your personal brand in one simple, easy-to-use package.

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