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Real Estate in Atlanta

Atlanta is a fast growing metropolitan area, with a cultural mix of sports, art, entertainment, and nature.

What a Healthy Real Estate Market Looks Like

First, the market needs to be in a growing population. A good indicator of a growing population is whether there are a good amount of jobs available. If jobs are available, people will relocate to them. However, with COVID, more people are working remotely, so they could be moving to their dream location. Growth is not the only scale to be aware of, though, as market affordability is very important. Comparing median house prices and median incomes nationally and in the area will show if your investments will be worth it.

Atlanta’s Market

Once you know what a general healthy market looks like, you can locate great deals in the Atlanta area. Here are a few tips to get you started:

  1. Look for a growing population. Many young people are flocking to Atlanta, and they aren’t ready to commit to owning property yet. This helps boost the rental property needs in the area. For example, by 2050, Gwinnett County will have one of the largest populations of all other counties, besides Fulton County.
  2. Look for more affordable neighborhoods. While Atlanta’s housing market is typically more affordable than other large cities, it does have more desirable areas. Instead of investing in real estate in established neighborhoods, invest in lesser known areas, near jobs that people will be moving to.
  3. Look for the jobs. Jobs are growing in Atlanta, and, therefore, it’s important to invest in property in the area. People can’t work a job without a home to come to every night, and therefore, investing in locations with jobs near by will make the renters flock to you.

Atlanta has many opportunities for investors. With the growth Atlanta is experiencing, the market could be yours!

 

A Deal’s a Deal, No Matter How You Find It

With the competition in the market place, it’s hard to find real estate that you get for a good deal. However, through creativity, you can find your next property.

Word of Mouth

One way you can find properties with barely any work is through word of mouth. Tell your everyone you know, from family to your book club that you are looking for great property deals. That way, if they see anything, they can tell you. Also, joining a real estate club may help you out as well. Even though people in the club are also looking for deals, you could be looking for something completely different than them.

Ads

There may seem like there is only one option for advertising, but there are a variety of different types of ads you can use to find properties. You can leverage people’s use of the internet by placing an ad on Google or Craigslist, or you can go a little more old fashioned. There are options from making a mailing list, to tastefully putting signs in your yard or on your car, to even buying a radio commercial. If you want to go big, get a billboard! If you want even more options, place ads in your local newspaper or in any landlord magazines you know of. All of this advertising gives you the possibility of someone with a fabulous property reaching out to you.

Online Options

Even though it’s popular, don’t dismiss using MLS as a way to find a property. Look at a wide variety of online marketplaces. Be willing to search on Craigslist to find some properties. If you are willing to say you want properties on Craigslist, people will most likely be listing their real estate. Look through expired listings. You could potentially find a great deal, because the house didn’t sell during the time it was listed. But continue to make sure that as much as you are searching, you will be easy to find. Make sure that your website comes up when people search about selling homes in your area. Look into search engine optimization to help you in that area.  A blog is another approachable way to make your business out more noticeable.

Other Possibilities

Be willing to drive around your area and find vacant properties to research. While you’re out, also look for properties for sale by owner, as owners may be more excited to work with you. You can always use a wholesale seller, who will charge a bit of a fee, or a commercial broker. Sometimes, one man’s misfortune can be a real estate owner’s opportunity. You can find a good deal if you look into upcoming foreclosures and buy the property first. If someone does get foreclosed, you can always bid on it at the courthouse when it arrives. Be willing to look up the eviction records at the courthouse and buy right before someone is forced to evict a tenant. Also, if someone doesn’t pay taxes, you can get the right to buy their property, and it can be a great deal!

It may be hard to find real estate at first, but don’t be discouraged. If you cast your net wide, the properties will start coming in!

Strategizing Success

You can get caught up in so many things  when starting a new business! You can micromanage all the details and lose sight of the big picture, or you can focus so much on your goals that you forget to put in the supporting work to get there. It’s easy to be overwhelmed. If you keep some simple principles in the front of your mind, you’ll have nothing to worry about. Here are three tips to get you started.

Keep Your Goals

Your goals are super important. If you forget what you want to achieve, it will be hard to get there. Therefore, in order to make sure you achieve what you want, always remember your final plan. Make big dreams and keep them! You can figure out where you want to end up, and then figure out how to work backwards from there. You can only get there if you know where you’re going!

Know the Costs

You need to keep all angles of the money in mind, from costs to profits. If you don’t know what you’re spending money on, or what’s bringing in the profits, your business won’t reach its full potential. It’s also okay to hire someone to keep track of everything if you have too much on your plate. Just make sure you know what’s happening at your business all the time!

Keep Growing

Your business needs to keep growing continuously. Because of this, you need to set yourself up for growth. One of the best ways to advance your business is to use marketing. Marketing will help you reach more people, and will hopefully make you more money in the process. However, try to figure out the sweet spot of spending and making money. At some point, you won’t gain anything, even if you’re spending a lot of money. Once you find the sweet spot, you can make your business move past it, and then invest even more in marketing.

Starting a new business is overwhelming, but keeping these three things in mind will help you achieve all your goals!

An Invested Broker

While there are a many real estate brokers around the country, very few have the desire and specialized knowledge to work with investors.  As a real estate investor, you want to work with brokers who have a wide variety of experience that will help you make good investments.

Three Kinds of Brokers:

  1. The new broker. While these brokers don’t have a lot of experience, they make up for it with the determination to learn as much as possible.
  2. The professional. This broker has so much experience that now she is working only on her own investments.
  3. The middle broker. This broker has experience, but is still eager to work with investors. They have a system, network, and a portfolio that prove they are ready to work with you.

Two Things Brokers Should Know:

There are two important categories that your broker needs to be familiar with: the numbers and the market.

A broker needs to understand all the numbers that are associated with real estate, and be able to translate those numbers into a good deal for you. He needs to be able to look at a property and know whether it would be worthwhile for you to invest in. If a property needs work, a broker should be able to share what type of work needs to get done in order for the property to have greater return.  If he doesn’t have the answer, he should have a network to consult with and refer you to.

A broker also needs to understand the market, so that she knows what a good opportunity is for you. Because of her knowledge about the market, she will be able to guide you to the best deals in the area based on a variety of factors. She will also help you realize realistic goals within your local market.

What To Look For:

  • A broker who has invested will have the experience to help you. They avoid making mistakes with you because of lessons they have already learned.
  • A broker who works with other investors. They have connections that will help them find you deals.
  • A broker who has access to properties off the market. They do not need to rely on MLS (multiple listing service) alone.
  • A broker who has an excellent network. If they have a large network, they can often help solve problems for you before they even occur.

Make sure your broker is a good fit, and someone you can happily work with. You will reach your goals faster if you are working with the right team!

Financing Doesn’t Have to Start at a Bank

While the most common way to finance a property is through a mortgage loan, you can also creatively invest without ever working with a bank. There’s nothing wrong with working with a bank, but it is good to have different techniques in case a mortgage is not the best option.

Here are a few reasons working with a bank alone can sometimes hurt your business:

  • The best property deals happen in market down cycles, and that is when the bank lends the least amount of money.
  • You take on most of the risk, and the bank takes the least risk possible.
  • You cannot control what funding the bank will offer from week to week. Their policies could change and negatively affect you at any time.
  • Bank loans often are very slow, and could cause you to lose out on a great property while you’re waiting to hear back from them.

So, what is creative financing then? Below is a quick summary of five of the most common types of creative financing. While each of these are useful, it’s important to remember that you should not try to learn all of them at once. Instead, pick one or two that work for you and research them until you know all the details. Then, start incorporating it into your business when appropriate.

1st: Seller financing. 

Seller financing just takes the bank out of the picture without adding in any other players. In this equation, the seller agrees to let the buyer pay for the property in monthly installments. While it isn’t common, that doesn’t mean it won’t work best in certain situations.

2nd: Private Loan from a Self Directed IRA

This tool requires lending, like a traditional mortgage, but it is based off an IRA instead of a bank. Note that you cannot borrow money from your own IRA, but you would find an interested party who is willing to use their funds to invest in the property. A potential investor may be willing to help a fellow investor work towards the same goals, since they are not able to use their IRA funds to invest in their own property.

3rd: Private Loans (not IRA)

This is in essence the same as the last tool, except the money is outside of an IRA. You can often meet people at real estate events who are willing to invest their finances privately in property. These people may even turn out to be mentors and friends who can help you in your career, and because you are controlling their investment, they have a more invested interest in you.

4th: Master Lease with Option to Buy

If a landowner is renting a property and finds themselves not motivated to do work on the property or find new renters, a savvy entrepreneur can come in with this option. She can offer to pay the landowner what she is getting now, put in some maintenance on the property, and fill in the empty spots. The landowner is responsible for taxes, insurance, and major costs, but the entrepreneur covers all the costs associated with rent (vacancy, turnover, etc.). This means the landowner still receives the amount he had, while the entrepreneur is able to make money additional to that, because of her ability to fill the property and gain money from those additional renters. 

The option to buy would allow the entrepreneur to buy the property after a set amount of time. Whatever she had invested in the beginning will act as a credit towards the purchasing price. There are a few options for an exit strategy:

  • The entrepreneur can save for a down payment and look for financial partners.
  • She can do a 1031 exchange, where she essentially just turns a different rental property in for this one, and defers taxes on the difference.
  • Finally, she could just sell this option to another investor and walk away with that profit.

This option means less risk for the entrepreneur. She only risks her time and whatever investment she put into the property at the beginning.

5th: Master Lease + Option (with a Credit Partner)

If you want to purchase a property, and just don’t have the money, a credit partner can come in and purchase the property with a mortgage. Then, you master lease the property and take care of it. The credit partner does no work and pockets the rent minus the mortgage fee, while you get the rest of the profits. 

There are a variety of exit strategies that could be used here, including the ones listed above, but another option is purchasing at 50% interest in the property at 50% of the original price. That way, each partner could choose to purchase the property from the other, or just eventually sell it and split the profit. 

Each of these tools are good in certain situations. Getting to know one or two extremely well will work better in the long run, rather than trying to use them all right away. Hopefully, with more options than just traditional financing, you will be able to invest in a greater variety of properties.