According to the California Department of Realtors,
Length of Time to Close – Back to Pre-Peak Levels
By Sara Sutachan, senior research analyst
For four years in a row, the time it took to go from contract to close was 30 days for a normal transaction between 2005 and 2008 according to C.A.R.’s Annual Housing Market Survey. In the last two years, with the current tough underwriting standards for mortgage loans, escrow is taking a bit longer—about 40 days. But actually the length of time it takes to close escrow is the same as it was in 2003 (just prior to the mortgage frenzy of ’04, ’05, and ‘06). This shows the market returning to somewhat normal conditions as escrow companies are taking their time to review, document, and close the transaction.
For distressed sales, the length of time to close escrow is about 5 days longer than for non-distressed home sales. And because we know that not all distressed sales are created equal, the problems in closing are largely with short sales as it takes these transactions about 50 days to close escrow, versus 35 days for REO or foreclosure sales.
Note – all numbers are based on medians.
Your purchase of a triplex is a great way to cash flow and at the same time increase your wealth as the property gains value. Let’s look at some of the reasons why multiple units are a shortcut to financial freedom. If one house is a good investment, would not two, four, six or eight houses be even better?
Investing in a triplex, a property that contains three units separated by dwelling walls may provide ownership advantages over single-family rental dwellings.
A triplex has multiple tenants contributing rent each month and might ease your cash flow shortages should one unit become vacant, when compared to a vacancy with a single-family home. Your purchase of a triplex may increase your wealth as the property gains value.
After the first few months of operation, your monthly rents should take care of your debts and expenses. You’ll have more positive cash flow and you’ll be able to use it any way you want.
Consider three separate yet attached units perfect for multi or extended families, those that want to live in one unit and rent the others or rent the entire house for serious cash flow!
Occasionally there are multi-unit properties with an architectural design that permits one unit to be kept as a vacation home (and maybe a vacation rental, too) while the other units are rented out to long-term tenants. This kind of flexibility is nice for an absentee owner who wants to get some enjoymen
t from a property at the Lake while still trying to generate income when the place is not being used. While most multi-unit structures do not lend themselves favorably to this type of arrangement, occasionally there are properties that work well for this purpose.
So what are the major advantages of this type of investment and how can it lead to financial freedom? Read the rest of this entry »
Many people assume they can hold off saving for retirement and make up the difference later. But this can be a costly mistake. Waiting too long to start saving can make it very difficult to catch up, and only a few years can make a big difference in how much you’ll accumulate. This doesn’t mean there’s no hope if you haven’t set aside anything for retirement yet. It just makes it all the more important that you implement a plan today.
Start saving now
Start saving as much as you can, as soon as you can. The earlier you start, the longer compounding can work for you.
Take advantage of employer plans
Chances are your employer offers a 401(k), 403(b), or similar retirement savings plan. You can contribute up to $16,500 to a 401(k) plan in 2011.
Since pretax contributions are excluded from your paycheck, you’ll enjoy an immediate tax savings when you contribute to one of these plans.
Of course, you’ll have to pay income tax when you start receiving distributions from the plan, but it’s possible you’ll be in a lower tax bracket at that time.
Your employer’s plan may also allow you to make Roth contributions. There’s no immediate tax benefit (contributions are made with after-tax dollars), but qualified distributions are entirely free from federal (and most states’) income tax.
Even if you can’t contribute the maximum allowed, you should at least try to contribute as much as necessary to get any matching contributions that your employer offers. This is essentially “free money.” However, you may need to work up to six years before you’re fully vested in (that is, before you fully own) any employer matching contributions.
Read the rest of this entry »
These days, using a personal computer is just a normal part of life. You may have e-mail or online accounts that require a password, or you may have pictures, videos, or documents stored online or on your hard drive. You may even maintain a blog or website. Like your physical assets, these “digital” or “cyber” assets can have both sentimental and economic value. Chances are, nobody else knows your cyber assets even exist, and if they do, they may not know where those assets are stored or how to access them. It’s important that you make plans for the disposition of your cyber assets in the event of your incapacity or death. If you don’t, your survivors may have to deal with time-consuming and costly searches, or worse, the assets may be overlooked and lost altogether.
What happens to your cyber assets at your death depends on what type of asset it is, and while the laws regarding cyber assets are not well settled, there are some broad guidelines. Domain names, once registered, become your personal property under property law, and your websites and blog content are yours under federal copyright law. These types of cyber assets are clearly defined by law and are transferable to your heirs (e.g., through your will). On the other hand, certain online accounts, such as e-mail accounts, Facebook, Twitter, eBay, or PayPal, may not be classified as property in the legal sense; you are merely given a license by the website when you agree to its terms of service. Under these terms of service, transferability of your accounts may be limited or even prohibited altogether. Terms of service vary widely from site to site. Some sites, such as YouTube, will allow persons with legal power of attorney to access your accounts, and they post instructions on how to do so. Other sites, such as Facebook, will put your accounts into a “memorial state.” Many sites, however, will terminate and permanently delete your accounts upon notification of your death. You should read and understand all terms of service and make any necessary legal arrangements so your heirs will have access to your accounts.
Note: On the flip side, you may have certain private accounts to which you want to ensure that no one is given access and which will be terminated immediately upon your death.
Article courtesy of my friend JR Pablo. To find out more email JR Pablo jrpablo@patelco.org
We’d like to believe that disasters caused by floods or earthquakes are rare. But as we have seen with the recent natural disasters in the United States and abroad, the impact can be financially devastating. If you were to fall victim to a natural disaster, could you pay for the damages out-of-pocket? Will your homeowners insurance provide adequate coverage? Could any of us depend on the government for assistance?
Standard homeowners insurance generally does not cover damage directly caused by either floods or earthquakes. Federal disaster assistance is usually in the form of loans or grants and is only available if the damage is widespread and very serious, and the affected area is declared a disaster area by the Federal Emergency Management Agency (FEMA). So what should you do? First, review your current insurance with your insurance professional to determine what is, and especially what isn’t, covered. Assuming you aren’t covered for damage caused by flood or earthquake, consider buying flood or earthquake insurance, especially if you live in an area prone to recurrent disasters of this type. Read the rest of this entry »
Home’s Exterior:
Now that summer is here, its time to take care of some things that need getting done on the outside. Guys, surprise your wives by doing some of these things before they ask. Just a suggestion, to keep everyone smiling.
Flashing, which is typically a thin metal strip found around doors, windows, thresholds, chimneys, and roofs, is designed to prevent water intrusion in spaces where two different building surfaces meet.
Vents: All vents, including clothes dryer, gable vents, attic vents, and exhaust vents, should have hoods, and be in good working order.
Exterior Siding:
Replace any wood siding and sheathing that appears to have water damage.
Inspect any wood sided walls to ensure there is at least 8″ between any wood and the earth. Read the rest of this entry »
As the economy tanked many garage-salers are entering the market for the first time or re-entering it as a way to raise cash, and experienced shoppers know this because the quality of the goods has gone down.
Now many people are trying to sell what they might have thrown away or donated to charity in the past.
If you are new to the garage sale scene, here are some tips:
If you’re selling
-Plan ahead. Take the spring and summer to collect, price and box items to sell in the fall.
-Group small items and sell everything for $1 or more to eliminate coins.
-Price low. That should be the goal if you want to get rid of stuff.
-Choose the best hours- 8 a.m. to noon on Thursday and Friday and 9 a.m. to 3 p.m. on Saturday.
-Promote yourself. Advertise as much as you can in the newspaper and on Craigslist, Facebook and bulletin boards.
-Be friendly. Greet everyone who comes to the sale.
- Be specific about sale items in an ad, such as a leaf blower, musical instruments or furniture.
- Keep signs on every other block and every corner where a turn is required in the city. Add balloons to attract the eye.
-Sell with others. Doing it alone is too much work.
-Cut prices. Advertise that on the last day or last afternoon, everything is half-price.
-Donate leftovers. Call ahead to have charities pick up what’s unsold.
What to know if you’re buying
-Don’t bring your purse. Take change ones ones and fives instead.
-Shop later in the late afternoon for the best bargains near closing time.
-Cruise around good neighborhoods for better quality goods.
-Leave your card or phone number. Ask to be called if an item remains unsold and the seller is willing to accept your price.
BUY YOUR HOME AND AUTO POLICIES FROM THE SAME INSURER
Some companies that sell homeowners, auto and liability coverage will take 5 to 15 percent off your premium if you buy two or more policies from them.
SHOP AROUND
Friends, family, the phone book and Internet are some of the sources you can use to find homeowners insurers. Get a wide range of prices from several companies. But don’t consider price alone. The insurer you select should offer both a fair price and excellent service. Quality service may cost a bit more, but you buy insurance in case you need to make a claim, so it’s important to get a company with a good reputation.
Talk to a number of insurers to get a feeling for the type of service they give. Ask them what they would do to lower your costs. Check the financial ratings of the companies with AM Best or Standard and Poor’s. Read the rest of this entry »
Someone once said that open houses were a waste of time. This was perhaps someone who did not see the value of comparing various properties and getting educated for free.
Open houses exist for the benefit of buyers and sellers. The seller benefits from having interested buyers come through and the possibility of multiple offers. Buyers benefit by visiting the property at their leisure during the 3 or 4 hour window, and being able to compare homes on their tour. This is only the tip of the iceberg as far as the benefits of open houses go.
Having a realtor along with you when you visit an open house, can be a huge benefit for you. Your experienced realtor can point out the key features of the home, and other important facts that you might not have thought of. After seeing several homes on one day, you may be thoroughly confused and could benefit from ane expert to keep things in perspective.
For the experienced house hunter, open houses are a way of making a personal decision and taking some time. Most serious buyers are able to find a home much faster than those who are starting from scratch. It takes most buyers a couple of months to find a home once they start looking.
I highly recommend open houses as a way of getting some education about the home buying process and to get your questions answered for free. Once you are more knowledgeable about home buying, you may be ready to make a committment about owning versus renting…………..always a better strategy in furthering your wealth building plan.
The first rule of real estate has many connotations.
Can you name a ‘good location’ from a ‘bad location?’ If you can, then the next
Question is to ask if these 2 locations have anything in common? Do they have houses?
Families, schools, Stores and gas stations nearby?
If they do, then what is the reason for the
difference between the two? Was it something you heard from a friends or neighbor? something you read? stats you saw on the internet? school results? Was it a combination of all of these? Realtors cannot answer your question
of whether a house is in a ‘good’ or ‘bad’ location.
Many clients ask this question in hopes of having their beliefs confirmed.
However such generalizations are a matter of personal taste and perception; and it is unethical
for Realtors who are bound by a code of ethics, to steer customers to any particular
location. Instead agents can rely on the information in the multiple listing service to which they
subscribe (this is costly and you should ask your agent if they are a member). The MLS is a comprehensive database of listings featuring properties that go back many years. It is a historical
archive. Having this resource is a must for any agent who wants to provide the highest level of
service to their customer.
This blog is continued tomorrow……….please submit your comments to ‘good location’ vs ‘bad location’. I would love to hear from you. What are your perceptions from your experience?
