How to calculate real estate depreciation

April 30, 2014  //  Posted by: cooldude  //  Category: Real Estate Rumblings

real estate depreciationEvery property, be it commercial or residential, undergoes depreciation with time and hence its value reduces. There are few factors which cater to this process by diminishing the value of your priced property. Are you trying to figure out the present value of your property? If so it is a must to calculate its depreciation as well to get its current market value.

Factors that affect depreciation:

1. Location: Where your property is located is a determining factor of its depreciation. If the property is located is a destination which is top notch, chances are high that you will get better value for your property. However if the value of location has reduced with time, then automatically, the value of the property will also get depreciated.

2. Economy: Next, the market economy is a factor which helps to regulate the price of your property. The better is the state of the economy; the higher will be your property valuation.

3. State: The state of the property is big factor on which its valuation will depend on. For instance, it can be located in a top notch area, but you haven’t spent anything on its renovations, the value of the property automatically goes down.

These are the factors on which the value of your property will differ. Now if you are ready to sell your property, the best thing you can do is get in touch with a real estate agent. They will help you make the task of calculating your property depreciation a lot easier, in turn helping you to determine the current value of your property. Finding good real estate agents is quite easy off late. All you need to do is look for reputed names near yourself, on an online platform. For better insight you can even go through customer testimonials to ascertain their efficacy.

How to calculate real estate ROI

February 13, 2014  //  Posted by: cooldude  //  Category: Real Estate Rumblings

real estate ROIWhen you are looking for an investor who would finance your business the first thing that you should calculate is the Return on Investment. Calculating return on investment is easy especially if you know the formula. It is generally expressed as percentage and the answer is achieved in decimals. The decimal can further be converted into percentage by multiplying 100 with the result. There are three things which help to determine the return on investment. They are as follows:

• Net profit of the business which would also include the profit after incurring all the necessary cost in the business.
• The starting capital is another determinant in finding return on investment. This should be the sum of all the initial investments.
• Last is the time period for which the return on investment is being calculated suppose one month or one year.

Now let’s see how the ROI is calculated. Suppose the income statement shows a net profit of $775 and while setting up the business you spent $25 in flyers, $1000 in shoes and $500 on renting the place which sums up to $1525. The time period for which you will calculate the return on investment is one day. So now you will have to divide the actual net profit with the amount invested which in this case would be $775/$1525. The answer which comes should be multiplied by 100 to give the percentage and the result is 51%. This however is the return on investment for one day. With this data it would not be possible to calculate the ROI for the whole year or the whole month because although the initial capital will be the same but the net profit will change from time to time. So in order to calculate for a particular period you will have to multiply by the number of months and divide by 12 to get the actual percentage.

Difference between a Real Estate Agent and a Real Estate Broker

October 26, 2013  //  Posted by: cooldude  //  Category: Real Estate Rumblings

Real Estate AgentExploring the complex world of real estate is an overwhelming task. It requires knowledge and experience. There are many steps involved in the process of buying and selling a house which can be quite complicated for a novice. This process not only involves huge investment of time and money but also emotional investment. Luckily there are professionals who can carry out this laborious task and take the burden off your shoulders. When choosing a real estate professional, it is very important to understand the difference between a Real Estate Agent and a Real Estate Broker.

A real estate broker acts as a connection between sellers and buyers of real estate. Brokers stick to higher standards and must take more rigorous training and education. In many states, it is mandatory to have a license in order to be a real estate broker. In few states, attorneys are permitted to carry out real property sales for compensation in the absence of a license as a broker. He takes up all legal responsibility for real estate transactions done by him or any agent who works under him. Brokers can open up a brokerage under the law and employ other real estate agents. Brokers are more powerful to resolve any conflicts.

In simple words a real estate agent works directly for brokers or practically under his supervision. Many states refer to agents as salespersons. Agents perform duties such as taking the buyers to show saleable homes, offer advice, locate the right type of home for the buyer, filling out forms that show that the house has been purchased legally. Agents cannot work independently or open a real estate brokerage. They only have small legal responsibilities. The agents are paid a fee to work under a broker. Agents also give a portion of each sales commission to that brokerage.

Understanding their role is very important that will help ensure that the process is much easier and smooth.

What is rental insurance?

April 24, 2013  //  Posted by: cooldude  //  Category: Real Estate Rumblings

rental insurance, rentWhen renting a house it is best to acquire rental insurance. The landowner will acquire his or her insurance which will ensure protection for his or her assets. This does not include the assets owned by the renter in the rented home. In order to protect the items of importance the renter must buy his or her rental insurance.

The tenant insurance companies are informed about your belongings which you need to protect from catastrophes like fire, floods, theft and earthquakes. The list of belongings a tenant wants coverage on must be decided with the amount of money the tenant is willing to use for insurance kept in mind. When looking for rental insurance clear demarcations should be made between the landowner’s responsibility and the tenant’s responsibility. Before going for rental insurance it is advised to look through other rental insurance options and go for the best quote. Rental insurance quotes can also be checked online.

Advantage Of Owning American Real Estate

April 26, 2012  //  Posted by: cooldude  //  Category: Real Estate Rumblings

American Real EstateReal estate across the world has been an enviable area of investment for many. From the most developed countries to the developing ones, real estate ownership has been the Holy Grail for many individuals. The same is the case for American real estate. Owning a piece of real estate on the American soil is the part of the great American dream for most of its citizens. There are many aspects to real estate investment that cannot be simply found in any other sector.

The best part of real estate is that the value never diminishes and on the other hand with the increase in population its price is slotted to go even higher in the coming years. It is considered a tangible asset that one can build upon or just simply go on cashing it without even losing a bit of the original value. Also there are a lot of tax benefits and tax holidays that are being offered by the government for those who own a piece of American real estate.

From owning to renting: take that leap of faith

March 19, 2012  //  Posted by: cooldude  //  Category: Real Estate Rumblings

real estate, rentingThe real estate industry is growing rapidly in the recent years. Many people tend to purchase properties in different parts and sell them off when the value increases. It would be a better option for people to make full use of their property and not let it lie unused. There are two advantages of renting your property. One thing is that it will be a mode of fixed regular income which you will receive every month.

Another advantage is that your property will be looked after by your tenants in an indirect way. Real estate properties tend to lose their value and look if kept idle for many years without maintenance. Getting a tenant is like assuring that your property will be maintained by them for a fixed period of years. It is useless to own properties and not make use of them. One should take the leap to rent out their property if they do not use them.

What Is Real Estate Probate

February 14, 2012  //  Posted by: cooldude  //  Category: Real Estate Rumblings

Real estate probate is a very serious issue that involves many legal tangles and needs to be cleared as fast as possible. A real estate probate occurs when a person passes away leaving some assets that needs to be divided among their heirs. The most common problems occur when there is no will left by the deceased person or there is no trust defined to carry out the probate work. The process of dividing the legal properties of the person then becomes a very long drawn and complicated process.

If there is no will or trust at the time of death, a legal entity then takes over the assets of the deceased including all the cash and real estate. This is done to get all information about the assets and account for the tax due on them. A probate lawyer in a probate court is assigned to take care of this process and finalize the transfer of assets to the heirs.

All about real estate short sales

February 07, 2011  //  Posted by: qwcdirect  //  Category: Property Investments, Real Estate Auctions, Real Estate Rumblings

Real estate short sale is the process where the property owned by the owner is sold by them at a price less than what was purchased. For this the owner has to take permission from the mortgage company to sell property at discounted rate. There has been tremendous rise in the people getting defaulter and real estate short sale is a good process to help the homeowners to stop foreclosure. This helps the homeowners to save the credit in the market so that in future they can get loan if required.

Time taken by the short sales is less as compared to that of the foreclosure. Because of short sales the owner is relieved that he can sell and get rid of the property which is burdening his budget. It’s even a good deal for the investor because they can get the property at a price which is less as compared to the market price.

What Are Real Estate Short Sales?

November 10, 2010  //  Posted by: qwcdirect  //  Category: Real Estate Rumblings

Real estate short sales are conducted when borrower fails to pay the mortgage loan and property worth is less than the outstanding loan amount. The short sales transactions ensure that borrowers can pay the loan amount to a negotiable stage and can reduce losses. In recent times, USA has seen an increase in short sales for properties affected by recession. Borrowers can verify the accurate value of the property through the local market research and expert’s assistance. An accurate estimation will help the property owner to negotiate with bank for the loan amount.

After significant calculation, it is time for owners to advertise about the property and ensure appropriate seller is chosen based on price. All the documents should be handed over and owner can pay their loan with the negotiable amount. For buyer, it is a profitable business also. You as a lender will also get relieved and recover your losses.

Avoid Top 10 Mistakes Made By Real Estate Investors

October 15, 2010  //  Posted by: qwcdirect  //  Category: Real Estate Rumblings

As a Real estate investor, you must remember basics of investment and should avoid sentimental based decisions. You must choose the property area which has the maximum potential to produce great revenues in future. This is extremely important because wrong predictions can produce losses and will also affect customer relationship. Many investors do not have a plan and end up in investing in a property not worth for them. It is important to apply on multiple properties and seek the best deal out of them. It is important for you not to take real estate investment as short term business; it should be taken as long term investment.

It is important to deploy a team of engineers, and experts to assist you in the business and share load. Investors tend to invest the complete amount in property which is not right. Real estate should not deviate from fundamentals. Investors tend to sign a deal without doing research on the property. You must know property and fund management. Proper estimation is also important in the business