A tale of two investors: two new investors start their real estate careers. You will receive the same education. Same mentors. Equal opportunities. One of them goes to create success and prosperity, while the other flat broke.

What made the difference?

Success in the real estate investing is more than knowing much, complete as a business. It takes the real estate mentality and habits of professional investors. Here are some of the real estate habits, you must implement:

1. Development of a long-term perspective. Plan 3 ~ 5 years in the future. Let not heights and deep, shake your commitment. Expect a crisis all 2 ~ 3 months with problems sprinkled generously throughout. How do you react to difficulties? Challenges are your true nature, and how you react is the only thing you can control.

2. Practice self-discipline. What you should do if you should do it, even if you don’t feel, how to do it. Delay gratification for long-term benefit-successful people do the things they do not when errors like do not. Keep in mind: work 5 years as other people are afraid, are so that you can live the rest of your life, how other people only dream about.

3. Work with one objective in mind. Do not work will work. What would you do with your time, if money was no problem? Spend time with family? Do charity work? Travel the world? Their answer to this question will tell you what you really want to do with your life. Be off this life goals you can successfully run. Hard work is not so difficult when your goals quickly you get it.

4. Develop a strong work ethic. This is the formula of 40 +: you work 40 hours per week for the survival and everything after that for success-every hour over 40 an investment in your future (the average millionaire works 59 hours per week). Waste not your time. Make every hour count.

5. First things to do first. Make a to-do list. Set priorities for each activity, focus on the highest priority first, and work on it until it is finished. Are questions, “what is the best use of my time now?” and then you do it. This is the habit of high performance.

6. Dedicated to lifelong learning. You need to learn more more deserving. Study real estate 30 ~ 60 minutes per day. Read books, audio programs on the drive or do useless work, listen to, and take courses and seminars.

7. Devoting themselves to others serve. Success is more than what is erwartet– there are certainly never any congestion on the extra mile. You will be paid in exact proportion to the value you can bring for the company. If you want to make more money, you create more value for the people you serve.

8. Avoid the right people. Their network = your net worth. You’ll tend to like people, you time to spend. Build a network quality human-to find that you would like to help as his committed, those people, be a go-giver instead of a fighter. Want to go with the Eagles, not with the turkeys can hang!

9. Never consider the possibility of failure. Error makes you stärker–fear of failure is what is holding you back. Calculated risks in the direction of your goals to take. What is the worst that could happen? The worst is usually not so bad. Make a habit to do the things you fear. Courageous act is, and the fear you. All you do with persistence and determination back. Today, you resolve on to never give up. Success is predictable.

Sam ally invites you to learn, high and are even infinitely in commercial real estate invest earn with a group (in money, you have used, sitting in pathetic CDs at 4% or less) If you want an item select America’s # 1 be real estate network today! Accompany to us for an upcoming educational presentation online or start to now: Real estate investor Webinar

Sam ally is a resourceful businessman and property investor with over 20 years of credit, collection & loss mitigation expertise. Sam Director with investor is currently Alliance asset management group, buy a residential acquisitions company, keep to fixing and reselling for profit residential properties in different marketplaces. current markets are Costa Mesa/Anaheim, CA, Orlando, FL and Las Vegas, Nevada. Sam is also a co-sponsor with commercial real estate buying group HIS real estate network, and invites inquiries from heavy investors their money for them to work now in the market today. Visit http://www.californiarealdeals.com/

Property, of course, is anything and everything that can be owned. Real estate property, in particular, is defined as land and all of the physical and man-made developments that are permanently associated and attached to it. This includes not only the ground itself and all that is connected to it, but the air above it and the minerals below it as well as all rights associated therewith. All property not defined as real estate is personal property.

With the ownership of real estate comes not only the possession of the physical property and the features that define it, but also the addition of certain legal rights to continuously enjoy the peaceful usage and redistribution of it. What that means is that when we acquire ownership of real estate property, we also get an accompanying package of claims on the property. These claims relate to the use, possession, control, enjoyment, exclusion, and distribution of the property, including the right to pass ownership along by way of a will. Together, these rights change the definition of real estate to real property.

Over the course of time, the ownership and control of real estate has very much become a central part of our lives. We rely on real property to feed, clothe and provide us with shelter. In the United States and other highly developed countries, these basic needs are met in a variety of ways. As a result of the many technological inventions that have advanced our living standards, people are no longer directly dependent on owning land to meet their essential needs. Instead, we rent or own apartments or houses that are serviced by utility companies and financed by lending institutions. We work in office buildings, manufacturing plants and shops and purchase the products and services we need from stores, play in parks and consume the meat and crops that comes to us from distant farms and ranches.

Many people now have the financial means to proceed beyond the use of real estate for the purpose of supplying their basic requirements. Now it is increasingly possible and desirable for individuals to buy real estate as an investment, a wealth creator, and a depository of value that can effectively convert the results of their properly directed work efforts into a tangible, profitable asset.

A real estate investment can be described as the commitment of financial resources for the purpose of preserving and increasing capital and earning a profit. Most everybody makes investments of various kinds throughout their lives. We put our time, energy and money into educating ourselves and our children, buying cars, obtaining health care, accumulating savings and pursuing other ventures in search of gaining a better quality of life.

Frequently, making an investment also involves the setting aside for a time some present comforts in anticipation of earning future benefits. Forgoing instant gratification, while unpleasant, often is necessary in order to sufficiently accumulate the savings needed to acquire real estate property. Moreover, money isn’t the only component typically applied to a real estate investment. One’s time and effort,, referred to as sweat equity, can also be very much involved.

Yes, the resources necessary to reap the intended rewards from real estate investing in terms of money, time and effort must be budgeted and planned in advance, for they surely will be over and above what are needed for securing one’s life necessities. However, those rewards can be substantial, indeed. To best optimize the use of one’s limited resources when investing in real estate, I highly recommend that one acquire and carefully apply the expert instruction included in an essential how-to guide like Real Estate Investing available from . Be sure to check it out!

If you plan a career in real estate investment, the current conditions in real estate may be just right for you to start. But, do you have the mind frame to undertake investment entirely on your own? If not, then it may be a good idea to take up real estate investment classes. These classes will make you aware of the various factors related to investing in real estate, right from how to invest in property to how you can protect it. If you plan to appear for an exam, then real estate investment classes would be the right choice to pursue. Besides, you could even obtain a license, and then you could start your career as a broker or an associate, after completion of the course with real estate investment classes. Such classes may even be compulsory in some states.

As a new investor, you may not be aware of the essential requirements to handle in the real estate market. It is necessary that you understand the finance, laws, practices, principles, terms etc that have to be followed, when you invest in real estate. Depending on your interest, you may venture to specialize in a certain area of real estate. You have the opportunity to select a course or classes, which are offered, in order to help you to invest in the International Real Estate, Commercial Real Estate, Real Estate Appraisal and even Residential Real Estate. These classes are the best bet for you to start with your real estate career. There are different rules and regulations in various states that govern these planned classes. There are different schools and colleges, which impart such training to students of all ages. Even if you have selected real estate investment as a retirement option, the need for such classes may be required.

The classes that are conducted, mostly will train you, what to look for in properties that you plan to invest in, to find the right opportunity and how to invest. They may also cover as to how to make an offer to the seller, what all documents may be required from your end, what documents should be taken from the seller and other relevant documentation necessary to invest. Sometimes, they may even train you, how to invest with a small amount in hand or even without it. The financing needs and options that you have and the benefits that you would gain are also a matter of discussion in such classes. Such classes may even assist you to spot the weak or even phony or fraudulent deals. The trainers or coaches are experienced in the real estate field, and they share their good and bad experiences in real estate. Sharing such real life experiences can help you to understand the actual scenario and become alert, when investment matters most to you. You can put to good use these shared tips and tricks, when you invest.

There are some online courses, which are offered by some schools. They are beneficial for those investors, who are unable to squeeze in some time for classes in their daily schedule. The flexibility to learn at any time of the day, at any location over the Internet is a very good option for such investors. For those planning to sit for the real estate exam, such online courses could be the perfect option. Such online courses can be beneficial to comply with the licensing requirements of the state, where you plan to relocate.

Real estate investment should be taken seriously as a business, if you want to make good money. To observe the market trends and learning from your classes and experiences could make you a successful real estate investor. Real estate investment classes could boost your career and reward you with fruitful gains.

Written by: VD

Date Written: 07/09/08

Reviewer Assigned by: David

Reviewed by: GD

Quality Control: AG

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Quality Control Completed on: 14/07/2008

There is NOBODY IN THE WORLD WHO SELLS MORE REAL ESTATE than RE/MAX . A network of more than 100,000+ Broker Associates working through 7000+ Broker offices in 80 countries provides you an opportunity to jump start your career in real estate.RE/MAX Associates get the maximum commission in comparison to industry norms. The training, technology, support, network and brand given to RE/MAX Associates ensures that they become specialists in Real Estate dealings and rise Above the CROWD!

All RE/MAX associates have the independence to work as entrepreneurs. When you work as entrepreneur there is no cap on your earnings. The more transactions you do, the more you earn. Being a part of a Global Brand RE/MAX will help you get more customers and transactions.

Benefits of real estate agent career at RE/MAX:

National advertising and public relations: As RE/MAX is growing more and more there will be wide era of public relations that takes many forms – from charity sponsorships to sports marketing through the world long drive championship and auto racing of real estate.

Freedom in advertising:RE/MAX real estate associates contribute in group advertising funds;so you can determine how to invest in your own individual advertising as well as personal promotion.

Build a personal sales team:At RE/MAX, you are free to hire licensed or unlicensed assistants, or create a sales team with members specializing in various aspects of the business – all within the overall management framework of the brokerage. So in this way you can build your business to any level you desire.

Negotiate commission rates:You can have the flexibility to negotiate commission rates with customers. However, this freedom benefits both you and the customer, especially when specialized properties require innovative marketing.

Advanced business training: RE/MAX provides training which consists of top producer’s core need for increasing business without increasing work time.

International referral program:Referral program of RE/MAX has proved to be more successful than any other referral system in North America.Full-time quality associates sending leads directly to other full-time quality associates intending to offer better service for customers and extra income for themselves.

Experiment and be creative:As a real estate agent with RE/MAX,you can get the vast experience in different new ways of doing business because this type of real estate adapts latest technology to the real estate sales process; however, you can also use your creativity power in innovations of starting field.

Get all the advantages of owning a business: You can enjoy the independence of running your own business without the hassle of keeping shared equipment running, handling staff payroll, getting the brokerage bills paid, dealing with business ownership tax issues and meeting other regulations that are among the day-to-day responsibilities of the broker. However, all this arrangement will free you to focus on selling real estate.

Control your expenses:You can have complete control upon your ongoing expenses by determining, how much of your income you put back into your business as well as how you allocate business expenses.

Set and attain your own goals:You can create your own business plans as well as set your own goals; and in this plan no manager will tell you how many sales you need to make or whether it’s appropriate to pursue a particular professional designation.

Personal promotion:Enjoy the freedom ofunlimited promotion and advertising to generate a continual stream of qualified prospects.

Build your real estate portfolio without paying big commissions to the broker: You can keep the maximum gain in portfolio of your selling property withouthaving to forfeit a big chunk of the commission.

Now, with the above listed benefits of a real estate agent of RE/MAX and elimination of various obstacles, you can be hassle free direct yourself for real estate agent career at RE/MAX and fulfill your business dreams.

1.The Buyer’s Mantra became “Ready, Fire, Aim”.

Restated: Buy any attractive property, and buy it quickly. The only perceived mistake was not getting involved in the feeding frenzy for good looking real estate.

Frankly, there was a lot of truth involved in that strategy in a run-away market.

The old and wise adage of “look before you leap” turned into “Ready, Fire, Aim”

Offer quickly or lose the opportunity to buy. Once you have it under contract, there will be plenty of time to decide if you really wanted the property. If you didn’t like what you had roped, you could cut it loose to another investor who was waiting in line to buy it. Or, hold for a very short period and flip it for a profit.

Real estate brokers became familiar with the buying game.

If three qualified buyers bid on an available property, there was the buyer would was able to get an accepted offer… he or she was referred to as “The Winner”. The person who came in second was referred to as “First Loser”, and the third buyer as “Second Loser” You only won as a “Winner”. Loser” didn’t count.

2.The Buyer’s Mantra became “Debt is Your Friend… borrow as much as possible.

The Logic: If you could come in with say 10% down and the property appreciated at 20% per annum, then you had a 200% equity rate of return from appreciation only.

WHAT HAS CHANGED?

The following notable changes have happened that have changed the tried and true Real Estate Investment Model

1.A national and world-wide recession that has continued to deepen at an alarming rate.

2.The US Congress led by President Obama has tried all kinds of stimulus efforts to correct the economic downturn.

Most of the visible efforts involved throwing previously unimaginable amount of money at the banking industry… unfortunately with no visible results of correcting the primary element that will cure the recession… employment. The National Debt has increased greatly in recent months.Someone in the future will have to shoulder the burden of dealing with and reducing that debt. Hope that you don’t live long enough for your grandkids to understand exactly what we have allowed to happen. We have mortgaged their future. Big Moral Question: Maybe we owe it to our heirs to accumulate enough wealth to pass to them so they have a running chance at dealing with the situation. Give them “enough to assist them, but not enough to ruin them” with the concept of “entitlement to wealth”.

3.Unemployment rates continue to rise.

Consequence on the Real Estate Market:Unemployed people soon lack the financial ability to pay rent or make their mortgage payment. Increasing mortgage defaults mean increasing short sales or foreclosures for those who were not lucky enough to have sold prior to our current “short sale and foreclosure ridden market”.

4.Property values are spiraling downward in the face of competition by low priced short sales and lender resales of properties that they foreclosed upon.

If you are looking to sell or refinance, then a real estate appraiser will be required by the lender who would make the new loan As always, real estate appraisers are required to use the most recent sales that have occurred in the market However, a number of the recent sales are short sales or resales of bank-owned property. One low sale influences future sales in the eyes of the lender. The lender is looking for Market Value today as well as the current value trend of the market. This adverse impact of short sales and foreclosure sales will continue until the bank-owned properties have mostly all been sold.

5.There is a clear and obvious federal move from capitalism toward socialism.

The move toward much stronger federal regulation of all financial activities is one that causes great uncertainty concerning important financial relationships. The federal government takeovers of General Motors and increasing control of the banking industry causes concerns that additional regulation and new governmental agencies could substantially alter the business models that have caused past stability and long term economic trends. The recent success of a nationalized health care program is positive in concept. How can you argue that people should not have some minimum level of health insurance? That would seem un-American! However, the question remains: “At What Cost?” The cost of the plan stacked upon the financial failures of this recession will cause further stress on a system that is bulging at the seams to hold things together.My friends in the insurance industry appear to be next for strong federal regulation. Anytime the government starts to dictate the “actuarial” statistics, something very strange is about to happen. Who Will Pay The Bill? Guess what? You will be fine….SO LONG AS YOU DON’T MAKE “TOO MUCH” MONEY!

6.Interest rates have been maintained at very low levels. This is highly unusual in a recessive economic environment.

The recession of 1980 – 1984 was led by increasing interest rates. First mortgage price hit 21% during the heart of that recession. Very low interest rates and the availability of mortgage funding so far has characterized the current recession. This is very unusual.The recession of 1980-85 had first mortgage prime at 21%. You really needed to borrow money if you agreed to borrow it at that rate. It was high interest rates that led to the recession of 1980-85.

7.A mantra of “tax the rich” is heard at the federal level and at the state of Oregon level. Oregon is known for being one of the “Top 10 Most Taxed State in the Nation”.

This is a dangerous theme. New employment is required to lead us out of the recession. Oregon has lost much of its appeal to those companies who could help the quickest. Small business is the major source of jobs that will create local stability. However, a number of small businesses failed in 2008 and 2009. Interesting Issue: People with money have the capacity to maneuver their money to avoid taxation. The big problem with “soak the rich” is that sooner or later you run out of “rich companies” and “rich people” to tax. Then what do we do?

WHAT IS THE CURRENT REAL ESTATE INVESTMENT ENVIRONMENT?
- or -
WHAT DO WE HAVE TO WORK WITH?

Put the above in a blender and put it on “whirl” for about 30 seconds. Then, pour it out and evaluate what we have to work with.

1.Cheap Mortgage Money: At this time, there is an availability of “cheap” mortgage money for:

Those who can afford to make a 30% to 40% down (depending upon the property type) and as little as 25% down on other asset types. Contact me for some hints of some that I have discovered.

2.Increasing Debt Coverage Ratios: The lender’s Debt Coverage Ratio (“DCR”) has replaced the Loan to Value Ratio (“LVR”) as the standard for gauging maximum loan amount for income producing properties.

Range of DCR: As the recession started to develop, the DCR was increased from 1.10 to 1.25 and 1.30. Restated: The amount of a new loan has been reduced rather substantially as the recession continued to progress.

How the DCR Works:

Start with the Net Operating Income of the property and divide it by the Debt Coverage Ratio. This will define the maximum allowed annual principal and interest (P&I) payment. Next, divide that by 12 to identify the maximum allowed monthly P&I payment. Using a “present value” calculator, input that maximum monthly P&I payment in with the lender’s allowed loan amortization term and the lender’s required interest rate. The result is the maximum amount of loan that the lender will permit on that property using that DCR.

3. Uncertainty of the tenant’s ability to pay rent.

Here is where the real estate market has been shaken to the core.

Retail: A number of national credit tenants (Linen & Things, etc. etc,) have failed during the recession.Past Observation: The retail triple net lease has been valued highly on the pecking order of desirable “institutional quality” investments. Cap rates were relatively low to reflect the low risk faced with national credit tenants. The Problem: As some of the “big names” started to fold, the risk rating sky rockets. It would be logical that the cap rates would also increase to recognize that increased risk Conclusion: The retail triple net credit tenant lease has started to pick up a bad name. Flip on the Red Stop Light.

Commercial Office: An interesting observation has been made about office tenants. They are starting to contract in amount of space needed. They are also attempting to renegotiate their leases for lower rents. Several of my commercial broker friends are starting to make a special practice in serving tenants as they negotiate against their landlord,

Commercial Medical: I have had several conversations with skilled doctors concerning the potential impact upon their career and their ability to generate income. They have expressed a deep concern about their continued ability to make good money.

Some might say that they earn too much to begin with. Maybe so, but if they have less income, then they can’t pay as much rent for leased medical space. Medical building landlords… are you listening. Lower rents would mean lower values for leased medical buildings

Residential Income: You have heard the adage… “Everyone needs a place to live”. That is true, but watch the “trickle down effect” take an interesting gyration during a heavy recession.

Vacancy factors has started to increase.However, in the Eugene-Springfield apartment market, the vacancy factor has increased from about 2% to about 4%. That is a rate that can very well be tolerated. My friend Brian Miles, CCIM of SMI Commercial Real Estate in Salem has observed that vacancy factors for apartment units has doubled over the past six months in the greater Salem apartment market. The commercial appraisers who appraise apartments are the best source of current vacancy rate and rent level information.The problem is there are few that are generating published vacancy and rent reports any more. Rick Duncan MAI and owner of Duncan Brown Appraisers in Eugene stated that he grew tired of his competition using his reports in their appraisal reports. Rick Duncan and several of the larger apartment complex property managers are the best source for vacancy factors in the Eugene-Springfield area. Rick is my “go to” guy when I need to get a quick and accurate temperature check of the apartment market in the Eugene-Springfield area.

My Caveat To You
Concerning “Real Estate Market Information”
Be very cautious when accepting information as “fact” concerning the “real estate market”.
The “real estate market” consists of a number of localized sub-markets based upon:

1.Type of property
2.Type of tenant;
3.Location; and,
4.Quality of the information source.

Often I real articles in the local newspaper claiming that “real estate is a total train wreck”. Then check the source. It is an article written in very generic terms about the “housing market” is some region far form the I-5 Corridor between The California border and the Canadian Border.

My Observation Concerning the I-5 Corridor (Oregon and Washington): to date

1.Property values for most types of tenant occupied real estate have held up rather nicely compared to other parts of the nation.
2. Mortgage funding is available to those qualified to purchase.
3. Occupancy levels are showing strains of a recession, but this is where the product types would be anticipated to have recessive problems

Bob Nelson, CCIM
The 1031 Guru
41 years of commercial – investment brokerage expertise
(541) 485-8100
bob@1031guru.com
http://www.1031guru.com