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Welcome to the AAOA Forum, where we discuss the the topics our members want to hear and want to talk about. We like to take an active roll in the online community to help our members learn and help educate landlords new and old. We encourage you to participate and join in our discussions. Thanks.
Take Control of Your Cash Flow
Steady cash flow is a must-have to stay afloat and thrive in this economic free-for-all.
Fortunately, that’s one problem that’s easy to solve: An electronic payment program that allows you to debit a tenant’s credit card or bank account each month, automatically. Payments are deposited into your bank account on time, every time. Imagine that!
You can schedule any number of transactions depending on your lease agreement, or, if you rent out month-to-month, you can schedule a single transaction.
Taking control of your cash flow has never been more important than during this cycle of high unemployment and sudden layoffs. You need to hedge your bets that you will be the creditor who gets paid.
Posted by Kim Ezzell on 01.29.2009. 7 Comments »
Filed under: AAOA Forum
Remodels Holding More Value Than Home Prices
by Dian Hymer, Inman News
Remodeling Magazine’s 2008-2009 Cost vs. Value Report, produced each year in conjunction with Realtor Magazine, contains good news about the value of remodeling projects.
The recent Cost vs. Value Report showed that renovations on a nationwide basis held their value better than home prices did in 2008. According to the National Association of Realtors (NAR), home prices declined 7 percent in 2008, while the value of homeowners’ investments in remodeling dropped only 2.8 percent in 2008.
Posted by Kim Ezzell on 01.29.2009. 4 Comments »
Filed under: AAOA Forum
Reverse Mortgage for Buyers Debuts
by Tom Kelly, Inman News
Reverse mortgages have been available for more than two decades for older homeowners who have accrued a significant amount of equity in their homes.
Now, the government is backing a program to help older homeowners purchase a home with the increasingly popular financing program.
The Federal Housing Administration, a component of the U.S. Department of Housing and Urban Development, insures the nation’s most popular reverse mortgage known as the Home Equity Conversion Mortgage, or HECM.
The Housing and Economic Recovery Act of 2008 recently approved the HECM-for-purchase program, allowing lenders to close the mortgages after Jan. 1, 2009. The move allows older homeowners to make a large down payment on a new home and then utilize the reverse mortgage as permanent financing.
Posted by Kim Ezzell on 01.29.2009. 2 Comments »
Filed under: AAOA Forum, Financing
Mortgage Shopping: 7 Ways to Save Money
Mortgage Shopping is All About Technique
by Jack Guttentag, Inman News
Last week I reported the results of a mortgage shopping expedition, (Paying Points Wise in Today’s Market ), but did not say much about how I got those results.
This article is about shopping technique.
Most of it is simple. In a highly imperfect market, an investment in the time needed to shop effectively can pay large dividends.
Posted by Kim Ezzell on 01.26.2009. 2 Comments »
Filed under: AAOA Forum, Financing
Hidden Dangers in 1031 Exchanges
by Eric Tyson, Inman News
The November 2008 bankruptcy filing of leading 1031 exchange accommodator LandAmerica should alert all real estate investors to the real perils regarding what firm they choose for handling their 1031 exchange and holding their funds.
1031 exchange accommodators, also known as qualified intermediaries, hold funds in escrow from real estate investors who have sold a property at a profit and have 180 days to close on the purchase of a replacement property (which must be identified within 45 days of the sale of the original property) in order to defer capital gains tax on the profits.
In the case of LandAmerica’s Exchange Services (LES), the company held hundreds of millions of dollars from more than 400 real estate investors.
Posted by Kim Ezzell on 01.26.2009. CLICK to Leave a Comment »
Filed under: AAOA Forum
Setting Rent in a Declining Market
by Robert Griswold
Q: I am a landlord with a high-end rental property located in a very nice, older part of town.
The rental is a 90-year-old home in good condition but without a lot of remodeling. It has 4 bedrooms, 3 1/2 baths, two fireplaces, a spectacular view, a garden and a one-car garage.
A little less than a year ago I rented the property for $4,800 per month. I thought that the rent was very reasonable at the time, as I had many prospective tenants.
But this year the rental market has clearly softened and the tenants have already indicated that they may want to move just because other rental homes are more affordable.I am really hoping that they sign a new lease and would like to offer them a fair rental rate.
Can you tell me by what percentage rentals of this type have come down since they originally signed the lease? Read the rest of this entry »
Posted by Kim Ezzell on 01.26.2009. 5 Comments »
Filed under: AAOA Forum
Don`t Miss Tax Deductions on Your Real Estate Investment
by Phoebe Chongchua, Realty Times
There are an estimated 11 million real estate investors in the U.S., according to IRS data. However, not all of them chose to be a real estate investor. Some accidentally became investors due to market conditions.
“There are people who have bought property for flipping and now they’re kind of stuck with them and in some markets they can rent them,” says Narinder Sandhu, founder of T-ReX Global.
It’s this group of people that could be losing money, especially if they aren’t aware of how best to manage their real estate investment.
Posted by Kim Ezzell on 01.26.2009. CLICK to Leave a Comment »
Filed under: AAOA Forum
Tenant Screening: Accessing Bad Check Databases
Wouldn’t you like to find out if an applicant has written a bad check before you rent to them, or make sure the check they offered to you is good before you accept it and give them the keys to your property?
The TeleCheck® Check Verification Service is available to all AAOA members, including free members, either alone or with an AAOA screening package.
TeleCheck is well-known for assisting merchants in separating good check writers from bad ones, allowing them to adopt a liberal check acceptance policy that will benefit both the merchants and their customers.
These same national databases are available to landlords through AAOA and contain real-time information from more than 306,000 businesses and financial institutions.
TeleCheck offers the most accurate check verification service in the industry. These databases provide merchants with continually updated information including bad check activity as it occurs, automated inquiries using the consumer’s identification (Driver’s License or State ID) as well as checking account data.
An applicant’s check writing history can indicate what type of renter they will be.
The basic Verification service quickly separates good and bad check risks using TeleCheck’s negative database. This database comprises more than 51 million bad check records and can help detect a poor rental prospect, as well as a fraudulent application.
The Verification with Risk Management service uses both TeleCheck’s check writer activity and negative databases along with its risk management system to identify not only bad check writing risks, but also good ones. The risk management service utilizes TeleCheck’s risk and predictive-modeling systems to analyze over 30 variables to predict the probability of a check being good. These assessment tools include regression modeling, neural networks, & decision tree analysis.
To access the service visit www.joinaaoa.org, and sign up for one of our membership options, including free membership, or our new limited membership that allows access to credit reporting. Premium members receive discounts on tenant screening.
See a sample TeleCheck Verification Report.
See more Tenant Screening articles.
American Apartment Owners Association offers discounts on products and services related to your commercial housing investment including REAL ESTATE FORMS, tenant debt collection, tenant background checks, insurance and financing. Find out more at www.joinaaoa.org.
To subscribe to our blog, click here.
Posted by Kim Ezzell on 01.22.2009. 2 Comments »
Filed under: AAOA Forum, Credit Screening
A New Twist to Tenant Retention
Feng Shui often gets a bad rap among conservatives, mostly in my opinion, for good reason. Why did I start to pay attention to Feng Shui?
To me that was an indication that for whatever reason, it was impossible for the occupants to get comfortable and settle in. I have a confession: I have not yet had my home ‘Feng Shui’d’ if you will. The reason is simple. A Feng Shui master is expensive and VERY hard to come by which is why the true masters end up working for the high end homes and corporate clients.
For those who are just curious, like myself…
Meredeth Martin is a Senior Real Estate Advisor for the Paragon Real Estate Group in San Francisco. She can be reached 415.738.7067 direct or via her web site: http://meredithmartin.com/
Posted by Kim Ezzell on 01.22.2009. CLICK to Leave a Comment »
Filed under: AAOA Forum
Is It a Bailout or Bail?
by Howard Bell
It’s easy to hate the financial system that broke itself and most of the world, especially when they need even more of our money.
They simply are not lending and the danger is an ever deeper world economic crisis.
Advice for Obama: “The incoming administration and the Congress are currently discussing a substantial fiscal package that, if enacted, could provide a significant boost to economic activity,” Bernanke said.
“A modern economy cannot grow if its financial system is not operating effectively,” Bernanke said during a speech at the London School of Economics (via marketwatch.com). Basically, he is saying that the banks are central to the crisis and if you don’t fix them now this crisis will get worse.
Bush has already released the last half of TARP, about 350 billion and Obama has every intention of using a part of this for foreclosure relief. It’s clear that we are not sure how to spend this money.
I like the Obama direction of simply investing in America and bringing its infrastructure into the 21st century, but that is long term and we are hurting in the short term.
Bernanke, Obama And The FDIC
Obama and the FDIC: Obama has assured Congress that a good deal of the new money from TARP Program would be used to help homeowners refi and escape foreclosure. The FDIC’s Blair also has a plan to reduce mortgages and increase workouts so that they are performing according to expectations. Today, the mortgage workouts are re-defaulting at an alarming rate of 50% within the first six months of the work out.
Bush, Bernanke and Paulson
The outgoing administration has refused to use TARP money for foreclosures, insisting that it’s key to shore up the banks, so that they will lend and companies facing a shortage of cash will be able to stay in business and people will pay bills.
Earnings are out for the banks and they are losing a lot of money because more and more are defaulting on credit and car loans as well as mortgages. Citigroup is now below $5…..sad that six months ago it was the largest bank in the world. But Bernanke is warning Obama that most of the remaining $350 billion – and possibly more – has to go to shoring up banks if they are to resume lending at anything approaching normal levels.
What’s not clear to me is, even if you continue to shore up the banking system, that they will loan. The money already given to banks has not really been used to keep the economy’s wheels in motion, but for mergers and bonuses. Quite a pickle…..
Howard Bell PFP CCRM is the founder/editor of Your Property Path.com, featuring over 450 articles on property management, Your Property Path SF, trade talk for the San Francisco real estate industry, and Your Property Path Amazon Store. Howard is a property manager in San Francisco and holds a certification in financial planning.
See Howard Bell’s feature, FDIC’s Plan to Save 4 Million Mortgagors .
American Apartment Owners Association offers discounts on products and services related to your commercial housing investment including REAL ESTATE FORMS, tenant debt collection, tenant background checks, insurance and financing. Find out more at www.joinaaoa.org.
To subscribe to our blog, click here.
Posted by Kim Ezzell on 01.22.2009. 1 Comment »
Filed under: AAOA Forum, Financing