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Financing

Real estate financing is a term generally used to describe an investor's method of securing funds for an impending deal. As its name suggests, this method will have investors secure capital from an outside source in order to buy and renovate a property.

Found 29 blog entries about Financing.

Unlike the stock market, where most people understand and accept the risk that prices may fall, most people who buy a house don't ever think that the value of their home will ever decrease.

The housing market, like other assets, is susceptible to unsustainable gains, and bubbles are formed over time even though many people feel it is a sure bet for growth.  That's because of the large transaction costs associated with purchasing a home, not to mention the carrying costs of owning and maintaining a home discourage speculative behavior. However, housing markets do go through periods of irrational exuberance.

This article will help to explain real estate cycles, triggers that cause them, and why consumers should be cognizant of the forces at play

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NOI = Gross Revenue – Total Operating Expenses 

The NOI, or Net Operating Income, is one metric used to evaluate an income-producing asset. It is defined as the total income that a property generates less than the total operating expenses and losses from vacant units. 

Prior to investing too much time, energy, and money into acquiring a property, it is crucial for investors to have a clear understanding of the amount of revenue an asset can generate. Many people confuse NOI with the amount of money the property is generating before they take expenses into consideration. When looking at financials on a property and all expenses are not being deducted, the numbers become falsely inflated and are essentially meaningless. How much does it actually

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Black Swans are circumstances that take civilization completely off guard because they occur with an extreme element of surprise.  The source of these events often is not knowable and the frequency and duration of a Black Swan cannot be reliably predicted.

In the world of finance and economics, a Black Swan is the term given to an event which is impossible to predict in advance and that has extremely negative consequences for an economy. The author Nassim Nicholas Taleb, a former Wall Street trader, summarized the nature of these events in his 2007 book “The Black Swan”:

"First, it is an outlier … outside the realm of regular expectations, because nothing in the past can convincingly point to its possibility. Second, it carries an extreme

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Black Swan Event · This Time Is Different · The New Normal is Not Normal · Time To Rethink Your Career · This Is What Happens When Change Happens · 30 Million Americans Are Unemployed in 6 Weeks · How To Do Business From Home · Why Fi ? · Our Country Is In A Leadership Vacuum · The Stock Market Is Disconnected From Reality · Become The Best At Serving Your Sphere of Influence · Just Do Something · Circumstances + Attitude = Outcome · Awaken Possibilities Again · Resist The Urge To Do Nothing · Now Is The Chance You’ve Always Wanted · Strike While The Iron Is Cold · The New Normal Is Not New Or Normal · What To Do With What Is Left · Now Your Job Is To Live Out Your Greatest Potential · Growth Is Still There, It’s Just Not In The Same Places As Before

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What’s the Difference Between a Seller’s Market and a Buyer’s Market? As we begin 2019, if you are about to start looking for a home, you may come upon these terms. Beyond a simple definition for each of these, it is very important to know the different factors that define each, and how the different markets can impact a buyer.  This article will examine these areas.

Seller’s Market Defined

A seller’s market exists when there are many more buyers seeking to purchase than there are homes available on the market. Stated differently, there are less houses available to satisfy a larger pool of buyers in the marketplace. This lack of listing inventory leads to rapid (at times excessive) price appreciation, very quick closings, many cash buyers,

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 Chances are good your buyers are not approved at all…they’ve only been pre-qualified

Shocking headline, isn’t it?  Hard to hear the truth sometimes, but I am going to tell you that in my experience, the bulk of Pre-Approval letters being given to Real Estate agents by Loan Originators are just plain worthless.  They are being written to get the buyers a house, but the protection/reassurance the seller is looking for that tells them the buyers really are qualified does not exist.  Welcome to Fantasy Island.

My intention in writing this is two-fold: first, to let you know about this situation, and second, to give you some suggestions for getting a comfort letter that is worth the paper it is printed on.

Frequently a Realtor will refer me one of

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Written by Robert H. Ruth

Thanksgiving is like a fixed-rate mortgage

I have to admit that my favorite holiday is Thanksgiving.

I love the food: turkey and dressing …mashed potatoes slathered with gravy …mmm!

I love going for a run or a long walk in the late morning, and the smells that greet me when I come home are intoxicatingly good. Maybe the crisp, late fall air that I come in from enhances the aromas from the kitchen.  

I also love the traditions of Thanksgiving, knowing that the roasting pan we use belonged to my mother in law. I can’t help but think that it holds not only the flavors of the turkey, but the memories of all those Thanksgivings past, and I feel like she is still at the table with us, sharing her love and stories of

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Written by Robert H. Ruth

 

Second home season is officially here!  While buying a primary residence is a substantial commitment financially, with long ranging impacts, purchasing a second / vacation home is an even larger commitment, so careful deliberate planning is paramount if you are in the market to purchase a second home this year.   Here are five important issues to consider when contemplating a second home purchase:

 

How familiar are you with the area?

  • Buying a home as an annual vacation destination or to use on weekends or Holidays is a very serious commitment. You better make sure you like the area you are purchasing in because you’ll be spending a huge amount of your free time there. Many buyers I work with have

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Written by Robert H. Ruth

Every year since 2013 the National Association of Realtors (NAR) has published a report looking at trends among buyers and sellers in the Real Estate Industry from the previous year. I’ve always eagerly anticipated this report because it provides excellent insights into the composition of the Real Estate marketplace. This year I thought I’d share some of the more significant findings that are pertinent to home buyers since that is the focus of my blog posts here. If you want to see the report for yourself, I have provided a link for you to download a pdf version here: CLICK HERE

The introduction of the report has much useful information about the composition of buyers in the Real Estate marketplace .  Here are what I

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  Did you know that homeowners will spend between 1 percent and 2 percent of their home’s value on upgrades and upkeep annually? This percentage is in addition to their mortgage payments and typical monthly expenses. In this video, Tim Bray shares more on the true cost of owning a home. Below, you’ll find an infographic that shows how often various home maintenance tasks need to be performed. Real estate agents can use this information when discussing affordability with clients and share the infographic as well.       click here for a high resolution PDF
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