The Beginner's Guide to Real Estate Investing, 2nd Edition
No matter what the market does, real estate stilloffers plenty of moneymaking opportunities. In thisnew edition of The Beginner's Guide to RealEstate Investing, Gary W. Eldred presents the toolsand knowledge new investors need to get started profitably. Packed with smart moneymakingstrategies and real-life stories from successfulinvestors, this edition also covers the latestinformation on financing, foreclosures, cash flow, and much more. You'll not only master the basics ofinvesting, but also discover specialized techniques that the pros rely on to grow their long-term wealth. Concise yet comprehensive, this practical guide shows you how to:
Find great deals on properties with big potential
Get started with low- or no-down payment financing
Utilize creative financing options and otherpeople's money
Buy low-cost foreclosures and REOs
Make value-adding improvements to any property
Craft winning offers and negotiate like a pro
Manage rental properties hassle-free
Flip investment properties for fast profit
In addition, Eldred shows you how to tailor yourinvestment strategy to make money almost anywhere, in any type of market. With proven tech-niques, timeless principles, and totally up-to-dateinformation, The Beginner's Guide to Real EstateInvesting, Second Edition is the perfect place to start building a prosperous future --- today.
Part One. Mindset + Knowledge = Wealth.
1. Get Started Now.
Just Say No to Excuses.
You Must Believe It to See It.
Set Goals Now.
2. Multiple Paths to Building Wealth.
Appreciation in Market Values.
Mortgage Payoff (Amortization).
Buy at a Market Price.
Create Value with Property Improvements.
Improve the Neighbors and Neighborhood.
Convert the Use.
Manage and Market Your Properties More Profitably.
Protect Your Profits from the IRS (Tax Shelter).
Discounted Notes, Tax Liens, Tax Deeds, and Realty Stocks.
Part Two. How To Raise The Money.
3. Strengthen Your Credit Power.
Consistency: Fast Track or Flake.
Credit Scores Count Most.
4. How to Invest Using Little (or None) of Your Own Cash.
Why Low-Cash Deals Magnify Your Returns.
Minimize Your Down Payment with Owner-Occupant Financing.
Don't Overlook FHA.
Discover FHA's Best Kept Secret: The 203(k) Program.
Too Many Vets Pass Up VA Loans.
Even Fannie and Freddie Accept Little- or Nothing-Down Loans.
5. Avoid Banks, Seek Seller Financing.
How to Get the Sellers Interested.
What Type of Seller Financing.
Try a Contract-for-Deed.
Assume a Low-Interest-Rate Mortgage.
"Assume" a Nonassumable Mortgage.
6. Five More Techniques to Finance Your Investments.
Wraparounds Benefit Buyers and Sellers.
Master-Lease an Apartment Building.
7. How to Come Up with the Money to Close.
Cash Out Some of Your Current Home's Equity.
Bring in Partners.
Sell Unnecessary Assets.
Easy Money—Hard Terms.
Use Credit Cards.
Sweat Equity (Creating Value through Improvements).
Eliminate Your Down Payment with Pledged Collateral.
Use Creative Finance.
8. Here's How to Qualify.
Be Wary of Prequalifying (and Preapproval).
You Can Make Your Qualifying Ratios Look Better.
The Application Itself Contains Many Clues to Your Integrity.
No Preset Qualifying Income Applies to Commercial Properties.
Part Three. How to Invest for Maximum Gain.
9. Twenty-Seven Ways to Find or Create Below-Market Deals.
Why Properties Sell for Less (or More) than Their Market Value.
Don't Dilly-Dally with Due Diligence.
How to Find Bargain Sellers.
10. Make Money with Foreclosures and REOs.
The Stages of Foreclosure.
Approach Owners with Empathy: Step One.
Some Investors Profit from the Foreclosure Auction: Step Two.
The Benefits of Buying REOs: Step Three.
11. More Sources of Bargains.
Federal Government Auctions.
Buy from Foreclosure Speculators.
Probate and Estate Sales.
Short Sale Bargains.
12. Run Numbers Like a Pro.
Monitor the Construction Cycle.
How to Profit from the Construction Cycle.
Gross Rent Multipliers (GRMs).
Cash Flow Returns.
Create Your Own Appreciation.
13. Greatly Increase the Value of Your Investment Property.
Search for Competitive Advantage.
First, Verify Actual Rent Collections, Not Merely Rental Rates.
Talk with Tenants.
Set Your Rents with Market Savvy.
Your Apartment Checklist.
Give the Interior a Martha Stewart Makeover.
Safety, Security, and Convenience.
Rightsize the Rooms.
Create More Storage.
Check Noise Levels.
14. Twenty-One More Ways to Rocket the Value of Your Properties.
Create Strikingly Attractive Curb Appeal.
Collect More than Rent.
Convert a Garage, Attic, or Basement.
Create an Accessory Apartment.
Create a Special Purpose Use.
Change the Use of a Property.
Cut Operating Expenses.
Gentrification and Other Value Plays.
Part Four. Onward And Upward To Building Wealth.
15. Win What You Want through Negotiation.
How to Define Win-Win.
Know the Property and Neighborhood.
Know the Sellers.
Establish Favorable Benchmarks.
Tit for Tat.
Get Seller Concessions Early.
Come Ready to Buy.
Ask for More than You Expect.
Never Offer to Split the Difference.
List Your BATNAs.
Negotiate for Yourself.
Leave Something on the Table.
16. Write Your Purchase Offer.
No Single Contract Form.
Draft Clauses with Understanding.
17. Craft Your Lease to Increase Profits.
Achieve Competitive Advantage.
Craft Your Rental Agreement.
Landlording: Pros and Cons.
18. The 12 Secrets of Successful Landlording.
The Good News.
Hired Management versus Self-Management.
Before You Buy, Verify, Verify, Verify.
Prepare the Property for Rental.
Craft a Winning Value Proposition.
Attract Topflight Tenants.
Create a Flawless Move-In.
Retain Topflight Residents.
Strong Market? Raise Rents.
Prepare for Special Problems.
Maintain the Property.
Process Move-Outs Smoothly.
Persistently Seek Ways to Increase Your Cash Flow.
Keep Trading Up.
Index (Not Included).
Gary W. Eldred, PhD, has investedsuccessfully in real estate for morethan twenty-five years and has servedon the graduate business school faculty at Stanford University and the University of Virginia. He cohosts a nationally broadcastradio show on investing and frequentlymakes presentations at seminars throughoutNorth America. He is also the author of106 Mortgage Secrets All Borrowers Must LearnBut Lenders Don't Tell and Trump University Real Estate 101, both from Wiley.