Real Estate Investors Association of Greater Cincinnati

Many investors like buying rental properties to make passive income. Passive income is money you earn without having to work for it every day. Owning rental homes or apartments means you can collect rent payments each month without doing much active work.

Take the story of Jim and Cindy, for example. A few years ago, Jim inherited a small two-family home from his grandparents. At first, they weren't sure what to do with it. But after fixing it up, they decided to rent out both units. To their surprise, the rent covered the mortgage payments with some left over. They had stumbled into passive income!

Motivated by this experience, Jim and Cindy used their savings to purchase another rental property a year later. As the properties started building equity over time, they began exploring ways to diversify their investments and revenue streams.

If you already own a few rental properties like Jim and Cindy, you wonder - should I buy more properties, or try making passive income in other ways too? There are several options to consider beyond just more real estate.

Bu
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Mobile homes represent a unique yet often overlooked asset class that continues to yield attractive returns. The lack of mainstream discussion leads to confusion about how to effectively invest in mobile homes. This article demystifies the process, outlining the three primary investment types: mobile home parks, mobile homes on rented land, and mobile homes with land.

Mobile Home Parks
A mobile home park may consist of two or more units on a single parcel. Owners might possess just the land or both the land and the homes. Operating a mobile home park often requires inspections and special licenses. Ownership models vary: owning both the homes and the land is akin to running a flat apartment complex with comprehensive responsibilities, whereas owning just the land reduces maintenance duties, as tenants manage their own units. Given the right management approach, both scenarios can be highly profitable.

Investors should consider seller financing to mitigate sellers' potential tax impacts from cash sales. For bank financing, community banks are usually more amenable to negotiating terms. However, the increasing acquisition of larger parks by hedge funds has intensified competition, potentially squeezing ret
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I get this question a lot, especially, during or just after a presentation showing an apartment complex illustrating a ‘cash on cash’ return in excess of 20%.

If you went to a Commercial Broker and told them you were looking for properties with a 20% COCR, they’d do one of two things;

1. They would buy the property themselves if they ever found one with a 20% COCR
2. They’d hang up on you because they’d think your expectations are unrealistic.

You probably won’t find an Apartment complex advertised with a 20% COCR. However, you can increase your chances of finding some great deals by doing a few things differently.

First off, there’s no big secret in ‘finding’ Apartment complexes for sale. Start by using the same vehicles most investors use. For instance, you can search through Loopnet.com or go to any of the major or regional Commercial Brokerage web sites such as Marcus & Millichap (MarcusMillichap.com), CB Richard Ellis (CBRE.com) or Sperry Van Ness (SVN.com) just to name a few.

Ano
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There’s a dark secret that many investors know but that no one seems to talk about much. It’s a secret that every full-time investor eventually discovers for himself or pays the consequences. 

To illustrate, let’s take 2 imaginary real estate entrepreneurs, Investor A and Investor B. For the sake of simplicity, let’s imagine that both investors start from the same place. Same income, same credit, same skill level. Then, both attend a real estate conference one weekend in hopes of finding a way to quit their jobs in short order and become full-time real estate entrepreneurs. 

The story of Investor A 
Investor A latches on to a landlording course. He’s attracted to the idea of building wealth and loves the tax-advantaged nature of rental properties. On Monday, he sets out to build a rental empire that will allow him to become financially independent in short order. 

“A” is very successful in finding under-priced rentals in his hometown. His typical deal looks like this: 

ARV:     
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I was having a discussion this week with leaders of 12 real estate associations about why:

1. “Small investor sentiment” is way down right now. Surveys are showing that nearly half of small rental owners and rehabbers think that this is a bad time to acquire properties, find deals, invest etc.
   
   
2. But at the same time, REIAGC members are finding, buying, holding, and flipping deals that are PROFITABLE ones, even when viewed in the light of a possible downturn

When I’m hearing one thing but seeing another, I get curious. So I asked this mastermind of 30 or so very experienced, long-term investors what THEY thought the difference was. See if you agree.

Most small investors, like 99%+, have a single end-to-end strategy for ‘doing” real estate that looks like this:

1. Find deals “On MLS”
2. Finance them with conventional, DSCR, or Hard Money loans
3. (a) Rent them at market OR

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Many investors like buying rental properties to make passive income. Passive income is money you earn without having to work for it every day. Owning rental homes or apartments means you can collect rent payments each month without doing much active work.

Take the story of Jim and Cindy, for example. A few years ago, Jim inherited a small two-family home from his grandparents. At first, they weren't sure what to do with it. But after fixing it up, they decided to rent out both units. To their surprise, the rent covered the mortgage payments with some left over. They had stumbled into passive income! 

Motivated by this experience, Jim and Cindy used their savings to purchase another rental property a year later. As the properties started building equity over time, they began exploring ways to diversify their investments and revenue streams.

If you already own a few rental properties like Jim and Cindy, you wonder - should I buy more properties or try making passive income in other ways too? There are several options to consider beyond just more real estate.

Buy
Read More...

What is Cross Collateralization?
Cross collateralization is the act of using multiple assets to secure one loan.

Who Qualifies for Cross Collateralization Deals?
Investment property owners with high equity in an investment property or own a piece of investment real estate free and clear (no debt).

Why Do Real Estate Investors Use Cross Collateral?
Cross-collateralization loans allow real estate investors to utilize equity in their real estate investment properties without having to refinance their long-term debt or take out long-term debt altogether.

How Do Real Estate Investors Use Cross Collateral?
Cross collateral is most commonly used in lieu of a down payment to give real estate investors 100% financing on new acquisitions (fix-and-flips or buy-and-holds). 

Does my property need to be owned free and clear to be used as cross collateral?
No! If you have high equity in your existing real estate property and there is a low balance first mortgage, you can use equity in that property as a form of down payment for a hard money loan. This allows you to significantly reduce your down payment or obtain 100% financin
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We are asked the question quite often. Unfortunately, there is no ”correct” answer. There are many variables in determining what this value should be.

Let’s look at some of the factors in determining this value.  

A note: the reconstruction value is not a “guaranteed” value – it is a “not to exceed” value. There is no guarantee your will receive that full value, if the property can be repaired / rebuilt for less than that value.

First, the “value” (reconstruction value) needs to be defined. The reconstruction value does not include the value of the land. It is only the cost to rebuild the structure. There are several versions of the reconstruction value, including actual cash value (ACV), functional replacement value (FRV) and replacement value REP or RCV). Each of these may vary significantly – and still be correct. Each reconstruction estimator program has different variables and all can be correct. 

As a base value, a “correct” replacement cost value is one that is within 80% of the value calculated by a claim adjus
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I got into the real estate investing business to have more free time for myself and my family and to have the financial freedom to do whatever I wanted, whenever I wanted. I wanted my life to be more worry-free. I have spent a great deal of time accomplishing that goal and I want to share some of my insights with you as a real estate entrepreneur.

When you decide to become a Real Estate Investor, make sure you structure your business in such a way that it doesn’t become overwhelming, even more so than a full-time job could be. It’s very easy to fall into that trap, especially if you work from home. You can also fall into the trap of trying to do everything yourself, and long-term, this just won’t work. Believe me when I tell you that most tasks in your business need to be delegated to others starting with your marketing.

In my case, I like to work from home and most of the functions of our business are handled offsite and by Independent Contractors.

Working from home has its advantages and challenges; the biggest challenge is that your work is always right there, calling you to finish one more thing, day, and night. But if you realize this in a
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“You can either work hard, or you can work smart.” These words have guided my actions for many years. After confronting nearly every obstacle, impasse, and dead-end imaginable, they ring as true today as ever before.

Over the years, I’ve learned that, while valuable, sheer determination and sweat alone are not enough to overcome problems. Nor are they enough to increase the odds of profiting from an investment. Somewhere along the line, I decided to work smart. Once I made that decision, I dedicated myself to finding those solutions that required the least expenditure of energy and, at the same time, provided the greatest return. I set out to discover how to maximize the odds of success and have developed a set of rules.

RULE #1 – PLAY THE GAME WHEN THE ODDS ARE IN YOUR FAVOR TO WIN OR DON’T PLAY.

You must sharpen your skills and learn to be as selective as possible in all your real estate deals. Selectively participate only in those investments that offer odds in your favor. The more you learn to realistically analyze a deal, the more likely you will win.

Speculation on market direction is a s
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