3 Ways to Market Your Flip

You can put all of the time and effort in the world into beautifully renovating a home, making sure every penny of your house flipping funding is used wisely and effectively; but if you’re not able to resell that home quickly, all of your profits will get eaten up.

House flipping is all about speed. You need to be able to garner offers within days – ideally hours – of putting your flipped property on the market. If you’re having trouble attracting buyers, here are a few simple tips to consider:

  1. Use every housing app out there.

Work with a realtor to create a beautiful listing for the home that has a ton of great pictures. Have a professional photographer take the photos to ensure that they are full of natural light and make the rooms look huge. Buyers know that rooms always look bigger in pictures, so if your images don’t make the home look flawless, every perspective buyer will move on.

Once you have your pictures and your perfectly worded description, make sure your home is listed correctly in all the most important apps – Redfin, Trulia, and Zillow. Check the listings regularly to make sure the information is up to date and complete. If things go slowly, occasionally take your listings down and put them right back up so that your house goes to the top of the new listings.

  1. Go all out at your open houses.

Have open houses often, and make sure they are professional and welcoming. Help people find your house by using signs on nearby street corners and a clear sign in front of the house. Have cookies, a healthy snack option, and water bottles for everyone who comes in.

Have a flyer for the home that is full color, beautifully designed, and full of useful information. Highlight the quality of the local schools, the proximity to amenities, or the fact that the house has its own solar panels – whatever makes the home stand out.

And don’t overlook neighbors who drop in to take a peak. Looky-loos tell their friends and relatives about houses near them so that they’ll move closer, and sometimes they buy second homes to rent out. Always be nice to the neighbors.

  1. Don’t underestimate the power of social media.

Make sure to post links to your listings on Facebook, LinkedIn, Instagram, Pinterest, Twitter, and any other social media service that you use. Links on social media get passed around, reaching people who may not even be actively looking for a new home. Social media helps you cast a wider net.

For more tips, or to learn about our current house flipping loans, give our office a call today at 559.326.2509.

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Posted in House Flipping, Rehab Loans

Flipping Houses: Can it Be Done with No Money?

The first question that most people ask when they explore the possibilities of house flipping is, “How much money do I need to get started?” As the old adage goes, it takes money to make money, and this is certainly true in the world of house flipping. However, you don’t need as much capital as you might think to get started as a house flipper.

While successful house flipping usually requires an upfront cash offer in order to secure a desirable property, no one expects house flippers to have that much cash on hand without any assistance. Even experienced house flippers who have made fortunes from their flipping pursuits rarely make a purchase using only their own money.

Most house flipping funding usually comes from bank loans, investing partners, or private money lenders. Private lenders tend to be the most popular choice because bank loans take too long and come with too many strings, and personal investment partners have a tendency to be unreliable.

So, if you’re getting house flipping loans from a private money lender, does that mean that you can purchase a house to flip without any money down?

The short answer is probably, but you shouldn’t.

If a lender is willing to give you 100% of the purchase price, they are more likely than not a hard money lender, and you are more likely than not getting yourself into a rather unwise situation. Unlike private money lenders who cultivate long-term partnerships, hard money lenders care only about getting the most interest they can, regardless of the outcome.

Private money lenders are more careful about who they lend to. If they are reputable, they will care about the success of your investment. Thus, they will only lend to people who are serious about their investments, and the clearest way to show commitment to a project is to invest one’s own money.

At ZINC, novice investors are expected to put down 20 to 30% of the initial purchase price. More experienced investors who have cultivated a relationship with the firm can put down as little as 10%. Our most trusted investors can take out house flipping loans of up to $1,500,000, leveraging their experience and capital in ways that they would never be able to on their own.

Learn more about our loan programs by giving our office a call today at 559.326.2509!

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Posted in Fix & Flip Loans, House Flipping

How are 2017 Rent Trends Shaping Buy and Hold Investing?

Across the nation in 2016, rent prices leveled off. This is good news for renters and for the housing market in general. New construction finally started catching up with demand, and more Millennials who had been avoiding the housing market started to buy. So what does this mean for buy and hold investing professionals?

While prices have leveled, they are still incredibly high. Landlords across the country are not complaining about the income they are bringing in these days. It still pays to invest in buy and hold real estate, because housing prices are still going up and rent prices are expected to remain high, though steady.

In some major metro areas, rents are actually falling, but this isn’t the case across the board. According to Apartment List, rents are down in cities like San Francisco and San Jose, but this is primarily due to new development at the luxury end of the market. Landlords of new luxury buildings are being forced to cut their prices and offer extra amenities to draw new tenants in. However, in the low and middle income housing brackets, rents are still going up due to a lack of supply. In this area, responsible investors can both make a solid return and provide much-needed quality, affordable housing to underserved communities.

In other cities, rents are still going up at incredible rates. In Tacoma, WA, for example, rents rose 7.7% in 2016. In Long Beach, CA, rents rose 6.1%. These cities are considered “secondary cities” – cities that are not far outside of major metropolitan areas (in these cases, Seattle and Los Angeles) and offer many of the same amenities and job opportunities, but at a lower cost of living. Secondary cities around the country saw much steeper rent increases than their primary counterparts in 2016, and that trend is expected to continue. Hot markets like these are ideal strongholds for buy and hold investors to explore.

As always, the investors who do best in any market are those who are financially prepared and ready to act quickly. At ZINC Financial, we offer buy and hold loans to both novice and experienced investors, giving you the leverage you need to succeed in any market.

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Posted in Buy & Hold Loans, Buy and Hold Real Estate, Rental Real Estate Financing, Rental Real Estate Investing

Mortgage Rates Going Up in 2017: What Does It Mean for House Flippers

After the presidential election, federal mortgage rates went above 4% for the first time in two years. Given all of the upheaval that has occurred during the first weeks of Mr. Trump’s presidency, experts really aren’t sure what will happen to interest rates as the year progresses, but the best estimates suggest that the rate will continue to rise at a slow, steady pace. By the end of 2017, interest rates are expected to hit 4.6-4.7%.

At the same time, median incomes are expected to rise, as are home values. According to an article in Forbes, Redfin predicts the median home sale price to increase 5.3% compared to 2016, and Zillow predicts a more modest rise of 3.2%. These stats are good news for house flippers, but not all of the news is good. Home affordability is expected to go down in 2017, meaning that it will be harder for average Americans to buy.

So what does this mean for house flippers?

In 2016, home affordability was also incredibly low, and home prices were on the rise. There were very few foreclosures, and yet, house flippers managed to thrive. Those who did best were the flippers who made the most of smart residential rehab loans in up and coming neighborhoods. The competition was fierce, but those flippers who partnered with experience and did their research ended up with incredible gross profits across the board.

In 2017, we expect more of the same from ZINC Financial clients. House flipping and mortgage rates may never be the best of friends, but despite the expected increase in 2017, we believe that savvy investors will continue to find ways to be competitive, both through traditional flipping and through buy and hold strategies.

2017 is unlikely to be a conventional year in any sense, and that goes for house flipping as well. Our best advice for house flippers is to be open to new strategies and ways of thinking and to be especially careful with financial planning. Choosing a trustworthy private money lender should be among your very first steps to help ensure that you have the funding you need at an agreeable rate when you need it.

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Posted in Fix & Flip Loans, Fix & Flip Tips, House Flipping, Real Estate News

Kitchen House Flipping Tips for Greater ROI

Kitchens are the new family rooms. Studies have shown that modern families spend more time together in the kitchen than any other room in the house. That’s why the kitchen is such an important part of any house flip. Potential buyers might be willing to overlook shortcomings in the bathroom, the closets, or even one of the bedrooms, but a subpar kitchen is out of the question. Here are a few kitchen house flipping tips to help you get the most ROI out of your next flip.

  1. Add an island

If you have the space and the means, everyone seems to go nuts for a kitchen with an island. The extra counter space and storage space is essential if you like to entertain. Plus, you can add barstools to one side of an island to create a casual eating space or make it easy to socialize while meals are being prepared.

  1. Get clever with the cabinets

Standard shelves inside cabinets aren’t enough to woo potential buyers anymore. Consider looking into more intuitive cabinet designs, such as rolling drawers for larger pots, lighting inside deep cabinets, and separate utensil racks within larger drawers. The more useful you can make the space, the more excited buyers will be about their new kitchen.

  1. Think open

Closed-in kitchens get hot, feel claustrophobic, and don’t lend themselves to social gathering. If at all possible, reframe the layout of the kitchen to make it open to the rest of the house. Knock out walls or create cutouts if you have to. Just make sure that you plan your budget accordingly. The right house flipping loans and a great contractor are essential for ensuring that your big shifts are as cost effective as possible.

  1. A bit of color goes a long way

As neutral as you’d like your house flips to be in terms of design, you simply can’t avoid making a few strong decisions in the kitchen. Our best kitchen house flipping advice is to use lighter, neutral tones overall – avoid dark wood – and incorporate a bit of color to add some interest to the kitchen. For example, you can include a beautiful tile backsplash or paint the back wall of glass cupboards.

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California Real Estate: What to Expect in 2017

As we head into 2017, many fix and flip investors are wondering what to expect with the California real estate market.  It recent years, the state has performed well from a house flipping investment stand point with house prices and sales continuing to rise.  The biggest issue investors have faced is the lack of inventory on the market as increasingly first-time home buyers purchased available properties.  In 2017, we expect a few of these trends to continue as well as a few new trends to develop.  Here’s what we think you can expect:

List Prices Will Remain Stable
Right now, the median list price is $469,000 in California per RealtyTrac.  This is the same median price as October 2015, which shows list prices are not going up or down.  Therefore, investors have some predictability when looking for properties and can plan accordingly.

Median Sales Price Has Increased
Compared to October 2015, sales prices have gone up by 1%.  Now, that may not seem like a lot, but it marks an average increase of $3,000.00.  Right now, the median sales price for homes in California is $418,000.  If home sale prices continue to hold steady, investors stand to profit.  Zillow predicts that we’ll see a growth of 3.6% this year when it comes to home sales prices.

Home Sales Have Slowed, But Will Pick Up Pace
RealtyTrac reports that in October of 2016, home sales were down about 30%.  However, when you compare October 2016 to October 2015, home sales had a substantial increase of 1036%.  That’s quite tremendous and shows how much the market has recovered.  In 2017, we expect that home sales will pick up.  Right now, there are many millennial buyers looking for their first homes and they are ready to make purchases.  Keep in mind, in 2016, 50% of home buyers were millennials.

Rent Prices May Hold Steady, Not Increase
There are numerous factors at play when it comes to rent prices, such as demand.  In the past few years, we saw rent prices surge across the country, but that trend may not hold true on 2017.  Particularly in the state of California.  According to Zillow’s chief economist, Dr. Svenja Gudell, “Renters should have an easier time in 2017. Income growth and slowing rent appreciation will combine to make renting more affordable than it has been for the past two years.”  So, what does this mean for buy and hold investors?  Quite simply that rent prices will remain high, but not grow this year.

Home Values Will Increase
In 2016, it was reported that home values across the country rose by 4.6%.  This was welcome news to home owners.  Economists say that in 2017, we can expect home values to increase by an additional 3.7% in 2017.  Properties will be more valuable than they have been in quite some time, which is beneficial to both home owners and investors.

Have questions about 2017 real estate and how you can leverage current trends to your advantage as a house flipping investor?  Give ZINC a call at 559.326.2509 and speak with an expert from our team!


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Posted in Fix & Flip Loans, Fix & Flip Tips, House Flipping, Real Estate News

3 Buy and Hold Strategies for 2017

2017 is off to an excellent start with rent prices remaining quite high across the country.  According to reports from ApartmentList.com, in November 2016, rent prices were actually 1.5% higher than rent prices in December 2015 with the national averages being $1,100 for a 1-bedroom and $1,250 for a 2-bedroom unit.  In California rent prices remain high with San Francisco, Los Angeles, and San Jose making the Top 10 Cities with the Highest Rents List and San Bernardino coming in #10 on the 10 Cities with the Fastest Growing Rents List.

With these numbers looking so good, buy and hold investors have an opportunity to make great returns on their investments this year.  In order to help these investors, we’ve compiled a list of 3 strategies for those pursuing rental real estate investing in 2017:

  1. Our first tip to buy and hold investors is to work with a real estate agent that is aggressive and understands your financial goals. In 2016, prices were on the rise for single home residences across the country.  In fact, we saw roughly a 61% increase in home prices.  While prices are not predicted to rise as substantially in 2017, they are still going up.  Inventory is also at a low.  With these two factors at play, it’s important that you have a realtor on your side who is actively looking for property opportunities for you and is willing to help you get a decent sale price too.
  2. Keep your cash flow in mind. When you own a rental property, you not only need to cover the mortgage every month, you also need to cover your insurance, taxes, and repairs.  You’ll also want additional funds on-hand should your property remain vacant for a month or more.  Since rent prices are still high and rentals are in demand, this really should not be a problem for most investors, but always be realistic and do your due diligence to ensure positive cash flow every month.
  3. Right now, mortgage rates are volatile and they are going up. A traditional bank loan will not be your best option when it comes to financing your buy and hold property.  Instead, we encourage you to work with a private money lender like ZINC Financial.  Not only do we offer very competitive rates on our buy and hold loan programs, we also provide expert guidance and impeccable service to every investor that we partner with.

If you’d like to receive more information on buy and hold strategies you should consider this year or have questions about our loan programs, give our team a call at 559.326.2509 today.

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Posted in Buy & Hold Loans, Buy and Hold Real Estate, Real Estate News

Our 2017 Real Estate Trend Prediction

Housing market predictions are always a bit tenuous, and 2017 is no exception. With the unexpected election of Donald Trump in particular, housing experts aren’t sure how much the market will be effected.

One prediction that seems quite likely to come true is that interest rates will remain at or near their current low levels. It was fully expected that the rates would go up following the election, but that’s out the window now. With possible volatility to come in the economy, interest rates are likely to remain low to help transition the market from our current presidency to our next.

Another prediction you can count on is an increased number of Millennials entering the housing market. A good chunk of Millennials are now in their late twenties or early thirties, and that segment of the population is looking to buy. And unlike previous generations, many Millennials are skipping right past the so-called starter home and looking for houses to fit their growing families and their growing savings accounts. Millennials have waited longer to buy, and now that they are ready, they have good, steady jobs and an eye toward the future.

Baby boomers will make up the next biggest portion of home buyers. Boomers are looking for places that they can retire, often in suburban areas and second tier cities — cities that are conveniently the best places to flip houses right now.

Where will these Millennials and Boomers be buying? In the west. While most experts expect the overall housing market to slow down next year, several big cities in the Western United States are expected to see big growth, according to realtor.com. Some of the top ten hottest markets for 2017 are Phoenix, Portland, Los Angeles, and Sacramento. Phoenix, the hottest predicted market, is expected to see a 7.2% increase in sales and a 5.9% price increase.

All in all, buy and hold real estate and house flipping are expected to persist in popularity and strength. With the right residential rehab loans, house flippers and buy and hold investors alike have been seeking out those hot markets and making their mark. Indeed, house flipping reached its highest level since 2007 this year, and those figures are likely to continue into 2017.

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Posted in Real Estate News, Rehabbing Tips

Best Cities for House Flipping in 2016

House flipping is a tricky business, particularly in the modern marketplace. Smart house flippers have to look at a lot more factors than whether home prices are going up or down. New construction, the overall economy, the local economy, foreclosure rates, and home affordability all need to be measured and weighed.

Fortunately, someone else has done the weighing. WalletHub recently put together a list of the best places to flip houses in 2016. They took into consideration such factors as median purchase price, average remodeling costs, local housing market strength, and quality of life. This list doesn’t go strictly by the numbers, but neither do a lot of house flippers. Some readers may find the results a bit surprising.

The five cities at the top of the list are, in order, Sioux Falls, SD; Fort Wayne, IN; El Paso, TX; Oklahoma City, OK; and Lincoln, NE.

If you look closely at the list, you’ll notice a lot of second tier cities at the top of the list, places that are growing and have a lot to offer, but that aren’t nearly as big as, for example, Los Angeles or Chicago. These slightly-off-the-beaten-path cities are more affordable and more pleasant to live in while offering a lot of the same job and education prospects, which is why they are so appealing to buyers. Thus, they are also appealing to house flippers.

Big cities like San Diego and San Francisco are much further down the list, not because they aren’t great places to flip houses, but because they are very expensive places to flip houses. If you want to flip houses in a major city, you’ll need significant residential rehab loans to cover your costs and make your investment feasible. With the right house flipping loans, investors stand to make the best gross profits in big cities, especially at the higher end of the market.

As we enter 2017, it’s likely that this list won’t shift much. Home prices should continue to climb, and inventories will likely remain low. To learn more about the house flipping prospects for 2017, call our office today at 559.326.2509.

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Posted in Fix & Flip Loans, House Flipping, Rehab Loans

What to Look for When Choosing a Buy and Hold Lender

Choosing to invest in buy and hold real estate is one of the smartest decisions that you can make. Buy and hold properties are generally a low risk, high return endeavor that can help you earn monthly income with very little effort, as well as a big payout when you decide to re-sell the property.

One way to make your investment more secure is by partnering with a buy and hold lender. If you haven’t thought about taking out any buy and hold loans, you should consider these advantages:

  • The right loans will let you keep your capital in other investments, allowing you to diversify.
  • A loan allows you to better leverage your wealth, opening up more and better buy and hold investment opportunities.
  • A reputable lender can help you navigate the investment process, providing advice and support so that you avoid costly mistakes.

If you decide to take out a buy and hold loan, here are some of the main factors that you should consider:

  1. The reputation of the lender.

Before you sign anything, make sure you’ve done your homework and know who you are getting involved with. Watch out for hard money lenders who may be more interested in making quick deals than forming mutually beneficial investment relationships. Talk to current and past clients of your chosen lender, and check their rating with the Better Business Bureau.

  1. The terms of the loan.

Watch out for hidden fees and unfair terms in your loan agreement. Don’t sign anything that you don’t fully understand. If there are words you don’t know or aren’t sure about, ask for clear definitions. Don’t worry about sounding silly – better to risk being a bit embarrassed now than to pay for your lack of understanding later. Besides, a reputable lender should be ready and willing to help you navigate the ins and outs of your deal.

  1. The actual agreement.

You may decide to get a loan from a family member or colleague, or you may opt to enter into a joint partnership. These can be great ways to go if you have someone that you can rely on and work well with. Just make sure that you get all of the terms down in writing. Even if your partner is your best friend, you never know what might go wrong. And even if nothing goes wrong, a misunderstanding about who was responsible for what could ruin your friendship. Writing everything down will give you legal protection and help you avoid unnecessary complications.

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Posted in Buy & Hold Loans, Buy and Hold Real Estate, House Flipping

Things to Be Thankful for as a House Flipper

We’re faced with a lot of uncertainty in America right now, but this Thanksgiving season, there is plenty for which house flippers can be thankful. Here are just a few of the most promising facts and figures to add to your list of things to be grateful for this November.

  1. House flipping is at a six-year high.

Housing data firm RealtyTrac has announced that house flipping is at its highest level since 2010. In the second quarter of 2016, a total of 51,434 single family homes were flipped. That’s an increase of 14% from the previous quarter and 3% from the same quarter last year.

  1. House flipping is helping the housing market.

Under usual circumstances, a high level of house flipping is seen as a concern, because it might indicate that we are heading for another housing bubble or that homeowners are facing a high number of foreclosures. Right now, however, we are looking at housing inventory shortages around the nation, and house flipping is actually helping increase the number of viable options for home buyers. As PBS reports, rehabbing foreclosed homes in struggling areas helps create affordable housing options in areas that desperately need them.

  1. Profits from house flipping are up.

In the second quarter of 2016, average gross profits on house flips around the country reached $62,000, according to RealtyTrac. That figure sat at $59,250 the previous quarter and $57,900 the previous year. Currently, the average sale price for a flipped home in the US is $189,000, which means that investors are buying rehab properties on the front end for an average of $127,000. That figure is nothing to balk at, but it’s a very reasonable upfront investment to make for such strong returns, particularly with the right house flipping loans in place. Residential rehab loans from reputable lenders help make the entire flipping process faster, more secure, and more lucrative.

  1. Huge profits can be made in the high-end market.

A recent article highlighted nine cities where the average gross profit per flip is over $100,000. Of course, the starting prices in these cities are much higher, but the ultimate ROI is well-worth the front-end investment for savvy house flippers. The city at the top of the list is San Jose, with homes grossing an average profit of $161,000. Second place goes to nearby San Francisco with $146,000.

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Posted in Buy & Hold Loans, Buy and Hold Real Estate, Fix & Flip Loans, Fix & Flip Tips, House Flipping, Real Estate Investment Blog, Real Estate News, Rehabbing Tips

Making the Difference Between a Flip and a Flop

House flipping is not a foreign topic to most people thanks to the success of popular shows like Flip This House and Flip or Flop.  However, what many people do not realize is that some of the most successful investors in the industry aren’t on camera.  They’re out there doing what they love to do; flipping houses and making substantial profits.  In fact, in 2015, 179,778 single family homes and condos were rehabbed in the U.S. alone.  That’s quite the number!

Seasoned investors have perfected the art of house flipping with time and experience, learning from their mistakes as they go.  Usually, their flips will never flop, but that isn’t always the case.  Below, our team of experts has shared a list of tips that we think you’ll find to be useful:

Neighborhood Choice is Important
All too often, investors focus on the property and lose sight of where it’s located.  In the house flipping industry, location is very important.  If you’re rehabbing a single family home, you’ll want to choose an area that is safe, current, and a place buyers want to be.  When buyers look for homes, they know certain areas have good and not-so-good reputations.  They are looking to buy in the good spots, especially if they have children.

The House Belongs to You… Temporarily
The goal of an investor is to rehab the property, sell it, and move on.  With that being the case, personal tastes are a huge no-no.  While you may like bold paint and certain styles, you need to keep the general likes of buyers in mind.  Right now, most buyers want clean, contemporary homes.  They also are focusing more on green energy, new finishes, and appliances.  If you’re not sure what design “must haves” are coveted by today’s buyers, take a look at this article published n inman.com which is packed with great tips.

Financing First
A huge mistake that investors make time and time again is not securing house flipping loans in advance.  There are multiple reasons you want to get pre-approved for a rehab loan.  Perhaps the most important is that you’ll have a better understanding of your budget and also have an upper hand when negotiating with sellers.  At ZINC, we make the loan process very easy for the investors we partner with.  And, unlike other private money lenders, we really do partner with our clients by providing them with advice, industry expertise, and knowledge throughout each phase of the investment process.

Ready to get started?  Contact our team today by calling 559.326.2509.  We’d be happy to help you make your next flip a huge success!

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Posted in Buy & Hold Loans, Fix & Flip Loans, Fix & Flip Tips, House Flipping, Rehab Loans, Rehabbing Tips

House Flipping: The Pros Weigh In

HouseFlippingHQ.com published an article that contains some really insightful tips from the pros.  The author spoke to 20 seasoned house flippers and asked them each the same three questions:

  1. What is your number one piece of advice for someone who is looking to get into flipping or wholesaling houses?
  2. What is the most important mindset shift that needs to happen for someone to become a successful house flipper or wholesaler?
  3. What is the one thing you wish you had known about house flipping or wholesaling when you first started?

We found the article to be so helpful that we wanted to share some of it with you and provide our own feedback too.

Question #1:

When asked what was the number one piece of advice they would give investors, the answers varied across the board.  Many said that it’s important to be educated and to do the research, others said that networking is viable along with professional mentorships.  The piece of advice our team thought was spot on was given by Nick Manfredi.  He said, “Joint venture with someone who knows the business: it decreases risk.”  At ZINC, we agree with this idea which is why we created a joint venture program some time ago.  This program is available to our most successful investors as it allows them to invest in more properties while lowering their overall financial risk.

Question #2:

This question received really great answers.  Some pros said that it’s important to make house flipping a full-time effort and others said that people must think of themselves as serious real estate investors.  We strongly agree with the latter.  If you come into the industry with the mentality that this is a “hobby” or that there isn’t much at risk, you have it all wrong.  You must take on an investor mindset and serious investors do their research, are extremely diligent with their budgets, and seek out partnerships that lead to long-term growth.

Question #3:

As the saying goes, “hindsight is 20-20”.  Responses to this question included:  having better strategies to vet expenses related to contractors and construction, knowing how to market properties, and having a clear schedule and/or timeline to stick to.  However, the response we thought was exceptional was given by Ginger Mancias who said, “I wish I would have partnered with other people sooner.”  She also said, “Surround yourself with a strong team and seek mentors and advisors.”  The rehab industry is ever evolving because it is part of the U.S. real estate eco-system.  This is why the most experienced investors often turn to partnerships.  Whether they align themselves with real estate agents, contractors, or reputable private money lenders, they know that when they work as a team, they can accomplish a great deal more.

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Posted in Fix & Flip Loans, Fix & Flip Tips, House Flipping, Rehab Loans, Rehabbing Tips

3 Questions to Ask Yourself Before Buy and Hold Investing

Few investment opportunities are as lucrative or secure in the current marketplace as rental real estate investing. Home prices and rent prices are on the rise around the country, and neither shows any sign of slowing down in the next few years. With mortgage rates and vacancy rates both incredibly low, people who invest in buy and hold real estate are seeing excellent returns, both on a month-to-month basis when they collect rent and when they ultimately sell their properties.

Before you decide on a rental real estate investing strategy, there are a few questions you should ask yourself to help ensure that you get the most out of your investment. Here are some of the big picture considerations that you should use to help guide your research into buy and hold investing.

Do you want to be landlord?

Investing in buy and hold real estate doesn’t necessarily mean that you have to take on the responsibilities of a landlord. Many buy and hold investors choose to rely on property management firms to advertise vacancies, manage tenants, collect rent, and handle any day-to-day issues that may arise on their properties. While a property management firm will eat into your profits, it will also save you a great deal of time and energy.

That said, there’s no reason why you can’t act as your own landlord, especially if you choose to invest in a single family property. When you only have to deal with one tenant and maintenance issues at a single house, being a landlord can be a pretty easy gig. Whichever route you choose to go, be sure to weigh the value of your time versus the commitment that you think you’ll have to make in order to serve as your own landlord.

Do you have a good accountant?

There are quite a few tax incentives that go along with being a landlord. If you’re not a CPA yourself or if you don’t have any past experience managing rental properties, you’ll definitely want to speak to an experienced accountant to make sure that you take advantage of all of the tax incentives that are available to you as a buy and hold investor. Things like trips to and from your property, rehab expenses, advertising expenses, and a whole range of other costs can be deducted at the end of the year. So if you’re not a good details person, make sure you have someone working for you who is.

How will you fund your investment?

Many novice investors make the mistake of sinking their life savings into a second property with the intent of renting it out. There’s no reason why you need to put your savings on the line. Instead, you can turn to buy and hold loans from reputable private money lenders. At ZINC Financial, our apartment flipping loans are available for both single-family houses and multi-unit apartment buildings.

Whoever you choose for your loans, make sure that you read the terms carefully and keep an eye out for hidden fees. You should also look for a lender who has an excellent reputation within the industry and a lot of repeat clients.

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Posted in Buy & Hold Loans, Buy and Hold Real Estate, Rental Real Estate Financing, Rental Real Estate Investing

Rent Continues to Rise in California and Other States

If you have been toying with the idea of rental real estate investing, now is really the time to act. Rent rates continue to rise around the country with some of the biggest increases seen in states like California. According to MyApartmentMap.com, the average rent across the state of California right now is $2,384. Nationwide, the average rent on a studio apartment is over $1,000 and the average rent on a three bedroom apartment is just over $1,600. Compared to just last year, rent prices have gone up over 3%.

In other words, it’s a very good time to be a landlord.

In some markets, construction is finally starting to catch up to the demand for new apartments, but in many markets builders simply can’t get new apartments up fast enough. Part of the reason why demand is so high is that housing prices are also currently on the rise and out of reach for a lot of Americans. At the same time, some people we could buy are choosing to rent instead thanks to the flexibility offered by renting. Others choose to rent to be closer to jobs in major cities like Los Angeles and San Francisco. Even as rent prices go up, demand is staying steady and vacancy rates are remaining extremely low.

As a buy and hold real estate investor, you can take advantage of the current housing market at both ends. The property that you buy is likely to increase in value over the next few years, according to all of the major forecasts. At the same time, you’ll be able to collect monthly rent from your tenants, which is great for your cash flow. The passive income that you can earn from rental real estate investing is simply unmatched in other types of investments.

Of course, buy and hold real estate is something that you can’t simply jump into. In order to be most successful, you should research your options carefully and make sure that you choose buy and hold loans that suit your investment needs. Ask yourself whether it makes more sense for you to invest in a single family property near where you live or a multi-unit building across state lines. Do you want to serve as your own landlord or hire a property management firm? All of these decisions will have an effect on your bottom line.

Thankfully, the team here at ZINC Financial is here to help. We offer both single-family and apartment flipping loans for buy and hold investors. We can also provide advice on which markets are currently the hottest and how to effectively manage your own property, if that’s the route that you choose to take. Give our office a call to learn more about our current loan rates or to discuss the numerous advantages of rental real estate investing.

Posted in Buy & Hold Loans, Buy and Hold Real Estate, Rental Real Estate Financing, Rental Real Estate Investing