Tuesday, May 23, 2006

Housing Bubble Ready to pop? Not for me!

I had a revelation today and it is really simple. For those of you in real estate for the investment of it, whether you flip, buy and hold, get cash flow or a combination of the two I have some advise for you. In Real Estate as in life you have two choices.

A. You can wait for the RE market to correct itself.


B. You can increase your income and correct the RE market.

Ask John Mackey how much his life would change if gas went to $7 a gallon. Ask Angelo Mozilo, if he takes his kids to the movies only on matinee times. Do you think that if Toll Brothers sold their homes for 1.67 million instead of 1.71, their bottom line will be in the red?

My advice to you is learn to earn more and "mass media econmoic concerns" will not concern you. Sometimes the most basic concepts are the hardest ones to grasp!

Tuesday, May 09, 2006

Orange County Real, Estate

Ok, they made me an offer I could not refuse. Recently I was offered a sweet commission to do SEO for a small remodeling company in Orange County, California. The company, a small remodeling firm that thrives on sales derived from phone calls. As the money starts coming in and organic page rank begins to take place, I plan on sharing the keys to my success and even the website so that you can follow. But lets just start by saying, I started a quick blog by the name of , a couple of other legitimate tricks, keyword campaigns and link exchanges that work on increasing page rank and whalah, here comes the calls.

The deal I cut? I guranteed the owner 25 phone calls per month. If I hit my mark each month, I get paid $300 per phone call. To ensure a low budget but effective quality control, I ordered a cell phone whose number is only for people that find his website via the internet. Keep your fingers crossed and send me any SEO tips you have learned along the way. I thank Thumb's SEO and NYC Money for giving me a great start a few months ago.

Hey what happened to Thumb?

Monday, May 08, 2006

Option Arms: Investors Should Know

It's been a long time.... I shouldn't have left you..... without a tight beat to step to.....

- Timbaland & Aaliyah

Negative Amortization Loans

I dont know about you but all I have ever heard about Option Arms is well, negative. I am not here to convince you to go out and get a negative amortization loan for a real estate investment but for those of you that dont know how they work I want to give you a macro look at the investment. The Wall Street Journal had a great article covering this. Think of it this way and very simply:

If the deferred interest is less than the appreciation of the home, you win.

If the deferred interest is more than the appreciation of the home, you lose.

However the greatest benefit to a negative amortization loan is the cash flow of the loan. I could spend the next several minutes explaining why so many investors exploit this great loan. But if you dont take the time to work out the numbers, then how will you ever know if the loan is bad or not? I urge you to study this loan, its good and its bad.

Key Secrets to make the ARM a great investment

1. Never buy an investment that doesn't cash flow.
2. Buy your property in an appreciating neighborhood. If the appreciation is at least 3% a year, a real act of "nature" would have to occur in order for one to not make money with this loan. Regardless of rate hikes.
3. Make an interest only payment once a year, and pay the min payment the other eleven.
4. Set a limit interest rate. Of course if you get in at a 6.2% interest rate, and rates are rocketing upward, make a limit according to your return projections.
5. This loan works best on cash flowing apartment buildings.

Love it or hate it, the option arm is here to stay and many investors take advantage of it.