Coach "Y"

The Most Important Factors for Real Estate Investing

What's the most important thing to look for in real estate? While location is always a key consideration, there are numerous other factors that help determine if an investment is right for you. Here's a look at some of the most important things to consider if you plan to invest in the real estate market.

1. Property Location
Why It's Important
The adage "location, location, location" is still king and continues to be the most important factor for profitability in real estate investing. Proximity to amenities, green space, scenic views, and the neighborhood's status factor prominently into residential property valuations. Closeness to markets, warehouses, transport hubs, freeways, and tax-exempt areas play an important role in commercial property valuations.

What to Look For
A key when considering property location is the mid-to-long-term view regarding how the area is expected to evolve over the investment period. For example, today’s peaceful open land at the back of a residential building could someday become a noisy manufacturing facility, diminishing its value. Thoroughly review the ownership and intended usage of the immediate areas where you plan to invest.

2. Valuation of the Property
Why It's Important
Property valuation is important for financing during the purchase, listing price, investment analysis, insurance, and taxation—they all depend on real estate valuation.

What to Look For
Commonly used real estate valuation methods include:

Sales comparison approach: recent comparable sales of properties with similar characteristics—most common and suitable for both new and old properties
Cost approach: the cost of the land and construction, minus depreciation— suitable for new construction
Income approach: based on expected cash inflows—suitable for rentals
3. Investment Purpose and Investment Horizon
Why It's Important
Given the low liquidity and high-value investment in real estate, a lack of clarity on purpose may lead to unexpected results, including financial distress—especially if the investment is mortgaged.

What to Look For
Identify which of the following broad categories suits your purpose, and then plan accordingly:

Buy and self-use. Here you will save on rent and have the benefit of self-utilization, while also getting value appreciation.
Buy and lease. This offers regular income and long-term value appreciation. However, the temperament to be a landlord is needed to handle possible disputes and legal issues, manage tenants, repair work, etc.
Buy and sell (short-term). This is generally for quick, small to medium profit—the typical property is under construction and sold at a profit on completion.
Buy and sell (long-term). This is generally focused on large intrinsic value appreciation over a long period. This offers alternatives to compliment long-term goals, such as retirement.
4. Expected Cash Flows and Profit Opportunities
Why It's Important
Cash flow refers to how much money is left after expenses. Positive cash flow is key to a good rate of return on an investment property.

What to Look For
Develop projections for the following modes of profit and expenses:

Expected cash flow from rental income (inflation favors landlords for rental income)
Expected increase in intrinsic value due to long-term price appreciation.
Benefits of depreciation (and available tax benefits)
Cost-benefit analysis of renovation before sale to get a better price
Cost-benefit analysis of mortgaged loans vs. value appreciation
5. Be Careful with Leverage
Why It's Important
Loans are convenient, but they may come at a big cost. You commit your future income to get utility today at the cost of interest spread across many years. Be sure you understand how to handle loans of this nature and avoid major pitfalls.

What to Look For
Depending upon your current and expected future earnings, consider the following:

Decide on the type of mortgage that best fits your situation—fixed-rate, adjustable-rate mortgage (ARM), interest-only, zero down payment, etc.
Be aware of the terms, conditions, and other charges levied by the mortgage lender.
Shop around to find lower interest rates and better terms.
6. New Construction vs. Existing Property
Why It's Important
New construction usually offers attractive pricing, the option to customize, and modern amenities. Risks include delays, increased costs, and the unknowns of a newly developed neighborhood.

Existing properties offer convenience, faster access, established improvements (utilities, landscaping, etc.), and in many cases, lower costs.

What to Look For
Here are some key things to look for when deciding between new a construction or an exiting property:

Review past projects and research the construction company's reputation for new investments.
Review property deeds, recent surveys, and appraisal reports for existing properties.
Consider monthly maintenance costs, outstanding dues, and taxes. Costs such as these can severely impact your cash flow.
When investing in leased property, find out if the property is rent-controlled, rent-stabilized, or free market. Is the lease about to expire? Are renewal options favorable to the tenant? Who owns the furnishings?
Quality-check items (furniture, fixtures, and equipment) if these are to be included in the sale.
7. Indirect Investments in Real Estate
Why It's Important
Managing physical properties over a long-term horizon is not for everyone. Alternatives exist that allow you to invest in the real estate sector indirectly.

What to Look For
Consider other ways to invest in real estate:

Real estate investment trusts (REITs)
Real estate company stocks
Real estate sector-focused mutual funds and ETFs
Mortgage bonds
Mortgage-backed securities (MBS)
8. Your Credit Score
Why It's Important
Your credit score affects your ability to qualify for a mortgage, and it impacts the terms your lender offers. If you have a higher credit score, you may get better terms—which can add up to substantial savings over time.

Mortgage lending discrimination is illegal. If you think you've been discriminated against based on race, religion, s*x, marital status, use of public assistance, national origin, disability, or age, there are steps you can take. One such step is to file a report to the Consumer Financial Protection Bureau or with the U.S. Department of Housing and Urban Development (HUD).
What to Look For
Scores greater than 800 are considered excellent and will help you qualify for the best mortgage. If necessary, work on improving your credit score:

Pay bills on time—set up automatic payments or reminders
Pay down debt
Aim for no more than 30% credit utilization
Don't close unused credit cards—as long as you're not paying annual fees
Limit requests for new credit and "hard" inquiries
Review your credit report and dispute inaccuracies
9. Overall Real Estate Market
Why It's Important
As with other types of investments, it's good to buy low and sell high. Real estate markets fluctuate, and it pays to be aware of trends. It's also important to pay attention to mortgage rates so you can lower your financing costs, if possible.

What to Look For
Stay up-to-date with trends and statistics for:

Home prices and home sales (overall and in your desired market)
New construction
Property inventory
Mortgage rates
Flipping activity
Foreclosures
The Bottom Line
Real estate can help diversify your portfolio. In general, real estate has a low correlation with other major asset classes—so when stocks are down, real estate is often up. A real estate investment can also provide steady cash flow, substantial appreciation, tax advantages, and competitive risk-adjusted returns, making it a sound investment.

Of course, just like any investment, it's important to consider certain factors, like the ones listed here, before you invest in real estate—whether you opt for physical property, REITs, or something else.

❤️💫I’m excited to share my spotlight feature on Connect 365 this month! This year is should still be about making new connections! Be sure subscribe to the Connect 365 newsletter to get the full version of this amazing edition!

How to Convince an FSBO to List with You

As a real estate agent, seeing those “for sale by owner” signs has to make you cringe.

Why would anyone try and sell their home without an agent?

Do they really know what they’re in for? What they’re risking?

In all honesty, they probably don’t. The biggest reason people choose to sell their home sans agent is to save on commission fees. Plain and simple, they want to save money.

Want to convince an FSBO seller to list with you instead? Here’s where you start.

Show them the money.
What most FSBO sellers don’t know is that the commission check they’re afraid of will likely pale in comparison to what they’ll lose on their home’s sales price.

According to the National Association of Realtors , the average FSBO property sells for $190,000. The average agent-listed one? It sells for nearly $60,000 more.

Now, unless they’re selling a super luxe property with an equally luxe price tag, the commissions they’d pay an agent are going to be nowhere near $60K.

To really illustrate this, put together a nice infographic comparing the average FSBO and Realtor-listed data. Mail out postcards with the graphic to any FSBOs in your area, and include your info on the bottom. You can bet you’ll get a few bites once they see the shocking numbers.

Other Tips
Though money certainly talks, there are a few other secret weapons you can bring out to sway FSBO sellers as well — especially if you’re able to get them on the phone or sit down with them in person.

First, talk about your tools
Most FSBO sellers don’t market their properties at all — and it means a longer sale and, often, a lower sale price than they were hoping for. Tell FSBO owners about all the tools you have at your disposal that can draw attention to their property — things like video tours, MLS, other buyer and agent connections, etc. These are things they simply don’t have access to.

Next, remind them of the legal stuff.
FSBO owners better be well-versed in real estate law and contract negotiations, because that’s what on the road ahead of them. If they’re not, they’ll likely need to call in a real estate attorney for help, and at hundreds of dollars an hour, they’re rarely a cost-savings when compared to a real estate agent.

If you’re able to, you can also consider cutting your commission — even just a little bit.
If the property looks like it’s in good, marketable condition, reducing your commission fee just a small amount could still net big gains in the end. The seller will think they’re getting a great deal, and you’ll have a new listing. It’s a win-win for everyone.

Talk about timing, too.
A lot goes into selling a home. There’s marketing, setting up showings, prepping the house, negotiating the contract, and so many other steps. Does the seller really have time to do it all on their own — plus whatever job and other obligations they already have? Also, do they have a strict timeline they’re on for the sale? Do they need to be in another house by X date for a new job? FSBOs don’t usually go quickly, so they’ll need to be prepared for a lengthy sale if they continue DIYing it.

Finally, let them set the rules.
Maybe it’s not all about the money. Maybe they had a bad experience with an agent in the past, and they simply don’t want to go through it again. Let the FSBO seller know that they can set the ground rules should they choose to list with you. What do they want you to do? What do they want you to step back from? Where could they use your guidance and expertise? Giving them some control in setting the stage can help alleviate any fears left from previous experience.

Make Sure to Follow Up
Take some time to create an FSBO fact sheet — something you can leave with sellers to remember you by. Fill it with tips, tricks, and guidance aimed at FSBO sellers (but don’t give away all your secrets!) and of course include your contact info on the bottom.

You can also ask to add them to your FSBO email list for extra advice. Then, send them the occasional message over the next couple of weeks with local market updates, selling guidance, and more. Though they may use it to continue selling the home themselves, you’ll keep yourself top of mind. In the event their home doesn’t sell fast enough or they’re just plain tired of DIYing it, you can bet you’ll be the first agent they call.

Yudenia Guerra
Your Billingual Realtor
Buckhead Atlanta, GA
(407) 2797238

How to Overcome FSBO Listing Presentation Objections

How REALTORS overcome For Sale By Owner (FSBO) listing presentation objections

As online platforms like Zillow and Realtor.com become more and more popular, clients will come to you with more FSBO listing presentation objections. It might seem easier for them to list the home themselves. Or, they don’t want to pay you a commission. We work with our clients here at Icenhower Coaching and Consulting on objection handling like this. Whatever the objection, you must prepare yourselves with a few scripts to combat these common FSBO listing presentation objections.

💋Common FSBO Listing Presentation Objections

Sometimes a seller will say (over the phone or during a virtual listing consultation) that they want to wait. They have different reasons, but one example would be “I want to try to sell it myself first.” This is a FSBO listing consultation objection and ultimately you want them to see the benefit of listing with you.

One way to handle the objection is to first tell the seller that you understand where they are coming from. If they want to try listing it themselves as a FSBO until a certain date, tell them that’s fine. If this happens during your listing presentation, great! Take some time to ask them a few questions that may lead them back to wanting to list with you sooner rather than later.

💋Educate your client on the market

One point to hit on is that the inventory in the market is low right now. Supply is low and demand is high. FSBOs get minimal exposure. Most homebuyers (I would say 98%) use a Realtor to buy a house. Realtors help buyers find a home by searching the local MLS. FSBOs aren’t on the MLS. Therefore, in order to raise the sellers chances of getting the best price for their house, listing with you is in their best interest.

Especially during COVID-19, FSBOs feel very hidden. You may have a sign in your front yard, but not many people are out and about. People are staying at home, and buyers trust a Realtor. Now more than ever, buyers will want to have a professional on their side to make sure the process goes smoothly. FSBO listing presentation objections are common, but in this current market there are a lot of reason to go with a Realtor.

🤔Why choose a Realtor?

Yes, your potential client could post their listing to Zillow or Realtor.com, but buyers that are working with Realtors will rely on their expertise. And Realtors will show buyers listings on their MLS. Zillow is a secondary news feed. Most of the properties on Zillow are the homes no one wanted to buy. The best priced homes that are the most desirable and in the best shape typically sell in 24 hours with multiple offers. Those houses don’t ever make it to Zillow. We as Realtors have full access to live data from the MLS, and we have the ability to give that access to our clients.

One thing to worry about with these FBSOs is that they are talking to multiple Realtors. They may be working the system and talking to multiple agents and asking them to bring a buyer. Watch out for that! They may be having multiple listing presentations and presenting the same FSBO objections to every agent. All you can do is move them closer to signing the listing agreement and be wary of someone trying to take advantage of you.

⭐️Persistence and coming from contribution are key

The best thing you can do is to stay with your potential client every week. Set them up on a listing alert email. Call them about status changes in their neighborhood. Converting most FSBOs is a 6-week process. Communicate and add value for 6 weeks, and you will see that they will likely list with you. Keep trying! Continue to talk these FSBOs through their objections in additional listing presentations. Try to hold a virtual open house. Keep giving them CMAs. Keep washing their windows! Come from contribution until they change their tune.

Home Buying and Selling During the Pandemic: What You Need to Know Use our guidance and these resources to understand home buying and selling during the pandemic, from virtual showings and inspections to closings.

5 minimalist makeovers (home presentations)

~Naomi Findlay

Here’s five simple ways you can transform your property, whether renter or homeowner, to make your space more liveable and appealing.

The space we surround ourselves with has a big impact on how we feel and interact with others. The mass of mainstream TV programs on room makeovers and creating great spaces to live in has meant more and more people who are looking to improve their homes and make them their own. We all pick up interiors magazines and flick enviously through the inspiring images. And we’re learning more and more to make the best of what we’ve got.

The trouble many people face is deciding where to start and working out what can be achieved, while working within their given time frame and budget.

Here are five simple ways you can transform your property:

Paint is an amazingly simple and inexpensive way to achieve a dramatic transformation to your property.

Whether you repaint in the same colour to refresh the walls and remove the signs of everyday living and wear or inject a completely new colour scheme into the property, paint is a fantastic option.

It is also something that most people can have a go at doing themselves over the space of weekend.

Often renters can paint their spaces (as long as they consult their landlords), and a lot can be achieved with very little.

Mulch
Mulch can be a homeowner’s best friend. Placing a fresh layer of mulch on your garden beds and pots can give the yard and outdoor space a fresh and inviting feel.

If weeds are a problem, make sure you carefully poison them first, avoiding overspray on the healthy plants you want to keep. Then wait 7 to 10 days before applying the fresh layer of mulch.

This will ensure that the active ingredient in the poison has had enough time to kill the weeds.

Mix it up
As homeowners we can become very familiar with and complacent in the spaces we live. So take a fresh look at your spaces and rooms.

This is not always easy to do when you have been living there for a long period of time.

To help overcome this, try this exercise. Take the accessories (cushions, linen, lamps, art, ornaments) from all the living spaces in your home and place them on one single table.

Leave it there for a day or two. Go through the items and throw out (or recycle) anything that is broken or you don’t really love. Then start to rebuild each space using some different items to those that were originally in the space.

This is a great opportunity to go shopping for a few fresh on-trend items to freshen your “new spaces” too.

Soft furnishings
Soft furnishings can often end up looking a bit tired and worn due to everyday wear and tear. Breathing new life into them can impact the entire property.

To start with, give the cushions and rugs in the home a thorough clean, throw out anything that is looking past it used by date.

Look at adding some cushions and throws to a living or bedroom that will add texture and movement or even a dash of colour to transform the feel of a room.

Whether you shop online or in retail stores there’s a great variety of soft furnishings on the market and you’ll be sure to find something that matches your personal style.

Layer with light
An often forgotten element is the way we use light to create a welcoming and comfortable space. In many cases we approach lighting from a clinical perspective and not a design viewpoint.

To transform a room, consider including some table and floor lamps with bulbs or varying wattages. This will allow you to set an ambient feel with your lamps as well as maintain functional lighting as well.

Be sure to select bulbs that illuminate with a warm light rather than a cold white light.

Yudenia Guerra, realtor
Buckhead, Atlanta

Best Real Estate Investments: How to Find the Right Property

Finding the right investment property can be a challenge, but if done right, it can let you achieve early financial independence. This post will explain the main ways to find several different kinds of investment properties.

What are your real estate investing goals?
Even the best plans go awry without the right goals in place. So what are your goals for real estate investing? Make a 100-day goal and monitor your goals weekly. A massive element of success in making goals is writing them down and putting them in a location where you see them every day. Having the purpose of your day or week or month defined by those goals helps each action that you take help move you in the right direction.

After you write down your short-term 100-day goal, take a look at the long term. Write down your long-term plan property by property. An example of this would be that you want to make at least 1 million dollars in rental income by the end of next year. Achieving goals like this may seem complicated, but if you aren't scared of your goals, then you aren't dreaming big enough!

A good rule of thumb when hoping to succeed is by taking the goal you make, multiplying it by ten, and working to achieve that goal instead. You will be amazed at how creative you can get and how well you can hustle toward a target if you are properly motivated. For example, a way you might achieve your million dollar goal is by saving all of the income you receive from your rental properties and stop living off that cash flow. Instead, put that money back into your business by using it as a down payment or fixing up current properties to attract higher-paying tenants.

Your goals will determine the properties you choose to invest in. Don't just dive into real estate without a plan of attack or you'll be spinning your wheels while you figure out where to go with it. So, write down those plans and keep an eye out! We are going to talk about some property types that will help you achieve some very different goals. Pay attention to the one that resonates with the goals you've set, and think about moving in that direction.

8 Hottest Atlanta Neighborhoods

Atlanta is booming with things to do and places to see! With tons of neighborhoods to choose from, we have narrowed down our list (in no particular order) to provide you with our top picks for the 8 Hottest Neighborhoods in 2018. Which is your favorite?

8. Glenwood Park
Located on the east side of Atlanta, Glenwood park had its first residents move in in 2004. The neighborhood is very walkable, has a town square, and is located about two miles from Downtown Atlanta. The community was built around the concepts of new urbanism and green building principles that support sustainability. With events going on every weekend, this neighborhood is hot for new residents looking to get that small town feel in a near-city location.

7. Inman Park
Inman Park was Atlanta's first planned residential suburb back in 1890. This neighborhood supports all lifestyles whether you're a family or someone single looking to mingle. Today, almost all of the homes have been restored to provide a modern feel to a old, historic area. To keep up the community, Inman Park has an annual, three-day festival during the last weekend of April filled with music, a parade, and food from all over Atlanta. Ranked as StreetAdvisor's 3rd Best Neighborhood to live in Atlanta, Inman Park has long earned it's spot as one of Atlanta's hottest neighborhoods.

6. Scottdale
Formed because of a cotton mill in 1900, the Scottdale community has been booming lately due to its prime location inside 285 near Downtown. In Fact, the community has been branded as "Atlanta's Next Success Story". Current listing prices on Zillow for this area are ranging from $220,000-500,000 with lots of new construction available. A little behind some of the other communities, this neighborhood is ranked as one of the hottest due to it's large potential.

5. West Midtown
Once known as an industrial center, West Midtown has reinvented itself as a hip spot in Atlanta. Full of artisanal flare, this neighborhood focuses around pristine craftsmanship when it comes to it's renovated warehouse buildings, premium goods offered in its shops and four art center located within its boundaries. If you're looking for a hot, urban neighborhood, then West Midtown is for you.

4. Chamblee
Located in Dekalb County, Chamblee was first incorporated as a city in 1908. Among the other neighborhoods mentioned in our top 8, Chamblee is the farthest from the downtown at about 14 miles away. However, what it lacks in distance is made up by the housing options and booming development in this area. Since 2000, the downtown district of Chamblee has seen tons of lofts and townhomes being been built in this community. For families or young adults looking for their desired housing option at a reasonable price, Chamblee hits the nail on the head.

3. Westview
Next on the come up in Atlanta is Westview. This neighborhood has recently been placed on the map with the addition to the Beltline back in September that scored this area about five blocks on the trail. Mentioned as one of Atlanta Magazine's top places to live in 2018, this neighborhood is hot due to it's location and cost of living. Homes ranging in the $200,000s can put you steps away from the Beltline and minutes from Downtown. With popularity increasing daily with more individuals moving to Atlanta and frequenting the Beltline, this neighborhood is not far from being overcome with new movers.

2. Peachtree Heights West
With buyers on waitlists for homes in this area, Peachtree Heights West is one of Buckhead's most prestigious and desired neighborhoods. Homes in this area start at $1M and go up from there, so home buyers must come ready with their wallets ready when considering this top spot. If you're looking for a southern, luxurious, suburban feel that's minutes from Downtown, then this community is the place to be. Ranked as the #1 Hottest Atlanta Neighborhood by Curbed Magazine, Peachtree Heights West is hot on the map for those looking to live lavish in Atlanta.

1. Edgewood
With homes ranging from the $300,000s and up, the urban neighborhood of Edgewood is on the rise. This year, Edgewood will be home to MARTA's first transit-oriented development that has already started pre-leasing. Edgewood comes complete with a bar and retail district to keep your days busy and nights full of entertainment. This area is full of sophisticated professionals, hipsters, and young families that want a mix of city life, locally-owned shops, and that neighborhood feel (InTown Expert). With the introduction of the Atlanta Streetcar, Edgewood is one of our top hottest neighborhoods especially for individuals invested in the future vision of Atlanta.

Yudenia Guerra
Billingual Realtor
Buckhead Atl 407-279-7238

Eight Ways To Determine If A Property Is A Good Real Estate Deal

~Expert Panel; Forbes

POST WRITTEN BY
Forbes Real Estate Council

Every homebuyer wants a good deal on their real estate purchase. According to a report by Fortune Builders, location and condition are two key determining factors in deciding if a home is a good purchase.

While price also matters, finding a property that can be overhauled with minimal effort and time may not be that easy. Anyone who has bought a house with the intention of fixing it up knows there could be hidden problems and challenges that crop up without warning and aren’t easily identifiable, even with the best of home inspections.

Being able to discern at first glance if a home is worth its investment takes a keen eye. Eight members of Forbes Real Estate Council provide at-a-glance tips on determining if a property is a good deal. Here is what they had to say

1. Check For Zoning Issues And Liens

Generally speaking, one way to tell is when a property has a characteristic or complication that leads to an automatic "no" for the majority of investors. Zoning issues and liens on smaller non-institutional grade property are a sweet spot. These properties are too expensive for retail DIYs but not enough meat for institutions. - Colin Bogar, Property Passbook

2. Follow The 1% Rule

There are many ways to evaluate investment returns when purchasing an income property. As a general rule of thumb, I always advise my clients to use the 1% rule as an investment strategy. The 1% rule states that the income property should rent for at least 1% of the purchase price to yield positive cash flow. The due diligence would be analyzing the fair market rental rates in the area. - Alex Chieng, A & L Real Estate Team

3. Let Go Of The HGTV Hype

In order to score a great deal on a property, buyers need to forget the HGTV hype and let go of lofty expectations. Buy the "worst" place on the block and slowly renovate as your budget allows. Formica and old appliances won't kill you, and the there is a lot to be said for the value of location over the perceived value of something as easily replaceable as countertops. - Elizabeth Ann Stribling-Kivlan, Stribling.com

4. Check The Cap Rate

Cap rate (i.e., the price/earnings ratio) vs. the neighborhood is one such signal, although sometimes there are legitimate reasons for some sellers to be more motivated than others. We’ve also found price per square foot or price per door vs. neighborhood comps to be important metrics, when used properly. Successive price drops can also signal a good buying opportunity. - Larry Solomon, TheGuarantors

5. Look At The Roofline

Look at the roofline. This is a trick taught to me by a well-known home inspector, Dylan Chalk, author of The Confident House Hunter: A Home Inspector's Tips for Finding Your Perfect House. Dylan has done structural inspections on about 5,000 homes. It's the first thing he looks at. It can tell you if the house looks sturdy, complicated, simple, elegant, vulnerable or weak. Is it original or has it been added to? Will it drain properly? Rooflines reveal. - Kevin Hawkins, WAV Group, Inc.

6. Get A Sense Of Condition And Presentation

The condition of the property along with how it has been presented will usually dictate if the property can be purchased at a discount. So if the property doesn't have online photos then it likely has zero curb appeal. It also means that a significant discount can be requested on the purchase price and that the listing agent doesn’t have much to work with and could just be after a quick sale. - Engelo Rumora, List'n Sell Realty

7. Assess Purchase Price Vs. County Appraisal Value

I can immediately determine if a property is a good deal just with an address and the county appraisal district website. Plug in the address and if the selling price is way below the county's value assessment, you have a 90% chance you will profit from this property. Why? Because fair market value is determined by the county's appraisal value plus 10-20% over their assessment. This is always the first step. - Angela Yaun, Day Realty Group

Forbes Real Estate Council is an invitation-only community for executives in the real estate industry. Do I qualify?
8. Determine If Price Is Less Than 100 Times Monthly Rent

If you can buy an investment property for $900,000 and rent it out for $9,000 per month (or more), then it's likely a good deal. While it greatly simplifies all the factors in real estate investing, looking at the price as a factor of 100 times the monthly rent is a quick and easy baseline to getting a great price on a real estate investment. -