Looking for your first home? This fabulous Robbinsdale home is perfect for that first home. It has a great Robbinsdale location, is 1 1/2 story with a wood burning fireplace to keep you warm all winter. This wonderful home also has a good size kitchen with walk out to a deck and separate driveway overlooking a nice yard and detached 2 car garage. The home is very sound, just needs your cosmetic touch! It’s close to good shopping, parks, schools and the bus line. Take a look!

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If you are interested in more information on the neighborhood and school district, you can find more HERE. You can also learn more, such as calculating what your mortgage would be.

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The idea of owning rental real estate seems to be gaining popularity as investors tire of the swoops and swoons of the stock market. As I pointed out in a separate column, not everyone has what it takes to be a landlord. But those who do may find rentals to be a good way to build wealth.

Once you’ve made the decision to buy rental property, your real work begins. Finding a profitable rental property usually takes time, connections and plenty of research.

Here’s what you need to know to get started:

Know your time horizon

As with any other investment, you should have a good idea how long you plan to own a rental property before you buy it, says Robert Cain, publisher of the Rental Property Reporter newsletter.

The longer you plan to own the property, the more you’ll probably need to invest in maintenance, repairs and improvements, Cain said.

“If you’re keeping it for 20 years, at some point you’re going to be putting a new roof on that property. You’re going to be putting in new appliances and doing some major repairs,” Cain said. If you’re only planning to own a property for five years, by contrast, you’ll probably want to avoid making any major improvements unless you’re sure you can recoup the cost with a higher sale price.

You also may face more investment risk with a shorter time horizon. Although your rental will almost certainly appreciate over 20 years, it could easily lose value in the next five, particularly if you’re buying in an overheated market. You’ll need a bigger potential annual return to make up for that risk.

For many small investors, long-term ownership makes the most sense, said Pat Callahan, an attorney, landlord and founder of the American Association of Small Property Owners. You’ll have plenty of time to ride out any swings in the market, and rental income can make a nice supplement to your day job. Find enough rental properties, and being a landlord may become your day job.

Develop a network

Experienced landlords find their properties in a variety of ways. Some hunt for foreclosures, making friends with city hall clerks or bank employees who know which properties are about to be sold. Some run ads in local newspapers. Others work with real estate agents who keep their eyes peeled for possible buys.

Several landlords recommended joining a local landlord or property owner’s association to make contacts. Callahan’s Web site offers links to local groups, as does the National Real Estate Investors Association.

“When you begin to own rentals, all the other investors start coming out of the woodwork,” said Sean Hoppe, a landlord in Pottsville, Pa., who owns 11 properties. “Through investor meetings, networking, etc., I can find out what is for sale.”

You also can try approaching landlords directly to see if they’re willing to sell, by calling the numbers listed on rental ads in the classifieds, by cruising neighborhoods looking for “for rent” signs or by talking to any landlords you know personally.

That’s how Bob, who asked that his last name not be used, bought his rental property near Albany, N.Y. The landlord of the three-unit building where Bob had rented for 15 years was tired of the hassles and ready to sell.

“We love (the area) and jumped at the chance to buy it,” Bob said.

So far, Bob and his wife have been pleased with their purchase. They raised rents and required security deposits, which caused the property’s less desirable tenants to leave. He also has a backup plan for the building in case he starts to feel like the prior owner.

“If being a landlord got to be too big a hassle,” Bob said, “we would just get rid of the tenants and make it our own place.”

Get your finances in shape

The better your credit, and the less credit card and other consumer debt you have, the better your prospects for getting a decent loan, Callahan said. Lenders usually require bigger down payments, higher interest rates and generally stronger finances when you’re buying rental property. That’s because they know people are more likely to default on investment property than they are on their own homes.

Landlords say it also pays to have a substantial cash reserve left over after buying a property. This can help pay for unexpected repairs and vacancies. Although there are few rules of thumb, setting aside at least one month’s rent for each unit is a good start. CPA Paul Berning suggests having a line of credit, secured either by the property or your own home, to cover larger costs.

You also should make sure you can save enough for retirement and other goals before investing in rental real estate. While rental income can supplement your retirement kitty, most people shouldn’t count on it to replace other investments or allow themselves to be entirely exposed to the whims of the local real estate market. Rents and property values can fall as well as rise, and those who are adequately diversified with investments in stocks, bonds and cash will be better able to endure the bad times as well as the good.

Avoid overpaying

As one experienced landlord put it: “You make your profit when you buy a property, not when you sell it.” Pay too much, and you’ll never recoup as much as you could have had you driven a better bargain.

The rental real estate market is generally tougher on investors who overpay than on homeowners who do the same thing, several landlords said. While a home is often an emotional purchase, which can lead to “I must have it!” offers and bidding wars, most landlords look strictly at the numbers to see if their investments will pay off. If you pay too much for a rental, you can’t count on a “greater fool” coming along later to bail you out.

Not overpaying can be tough in a hot market, however. Apartments in New York, for example, currently sell at a 60% premium over their “inherent” value. In other words, they’re selling for much more than the income streams the apartments generate, according to Reis, a national real estate research firm. In San Francisco and Los Angeles, the premium is 10%.

Some landlords use formulas, such as not paying more than six to eight times the rents they expect to make the first year. Others try to estimate what the property could be worth after needed repairs and upgrades are made, and they don’t pay more than 70% of that price, less the cost of those repairs, CPA Berning said.

Every real estate market is different, however, and these formulas may not work in your area.

What’s key is to make sure your rental income will cover your out-of-pocket costs, Berning said. That includes the mortgage payment on the property, as well as taxes, insurance, maintenance, repairs and a vacancy rate of around 5%. (If you have five units, for example, you should expect at least one unit to be empty three months each year. Here’s the math: 5 units times 12 months equals 60; 60 times .05 is 3.)

If you can at least break even, you’ll be able to profit from any price appreciation as well as from tax breaks available to rental property. Cain’s Web site sells software to help you make these calculations.

When crunching the numbers, you should know that there’s a big difference in how repairs and improvements are treated for tax purposes. You can typically deduct the cost of a repair, such as patching a roof or fixing a leaking pipe, on your tax return for the year in which the repair is made, Berning said.

Replace that roof or those pipes, however, and it’s typically considered an improvement, which means the cost can’t be deducted. Instead, it’s added to the amount you paid for the property to determine your tax basis when you sell. The higher the basis, the lower your taxable profit. But if you have to wait 20 years after making a major improvement to recoup any of the cost for tax purposes, you may think twice about buying a property that needs a lot of upfront work, Berning said.

To better estimate your costs, get a thorough inspection before you buy a property. Some landlords have favorite electricians, plumbers and contractors that they send to any prospective property, promising them that they can do any repair work they find. Others use professional inspectors they trust.

Longtime landlords say all this work pays off in profitable properties that build their net worth while providing a steady income stream. Callahan, whose family started investing in rental real estate in the 1940s, says it’s a way of life she recommends.

“It doesn’t matter if you’re a professional or a laborer,” Callahan said. “It’s the equal-opportunity wealth builder.”

Liz Pulliam Weston’s column appears every Monday and Thursday, exclusively on MSN Money. See this article in it’s entirety at MSN Money.

Custom built 2 story Crystal home for sale.  Situated on a quiet dead end cul-de-sac on one of the best lots in the area.   Close too pool, library, schools, parks and shopping.  This home boasts large rooms with outstanding storage!  Two story great room gives it a refreshing open feeling and the upper loft is a great bonus.  The walkout basement could be converted into a bedroom retreat.  You could add even more living space in this great home by finishing the second huge area in the basement.  You won’t find a home at this price with bedrooms this size!  To top it off, the backyard has plenty of play room and the extensive landscaping brings further enjoyment.  This one is priced to sell. 

Let’s let the pictures do the talking:

 

Let A Top MN Realtor – Ken Carpenter take you on a personal Tour:

I know, after seeing that you want the full tour of this outstanding Crystal MN home.  6406 45th Place North

Ready to take a look around the neighborhood or calculate the mortgage for this beautiful Crystal MN home.  Here’s the detail provided by the Carpenter Group of ReMax

Find out about the local schools and request further detail on this outstanding Crystal MN Home for Sale

Work with the Top Plymouth Realtor to help you find your next dream home!

Contact the Carpenter Group of ReMax Results!  We can create a Custom Property Search for your next home!

 

 

 

 

This one shows like a model.  A super clean and totally updated 1 Bedroom Condo in excellent Minnetonka community is now available for sale.  Like new-Ceramic bath, great kitchen, new wood floors, newer appliances, counters, carpet and fresh paint.  Main level unit, so you don’t have to worry about stairs!  Indoor pool and beautiful common area for outdoor activities.  Inside parking, best condo in area! Don’t miss it!

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We’ve seen the headlines in the paper – the government is spending more that it’s making, but one area where federal taxpayer dollars have been effectively utilized is that first-time homebuyer tax credit. Economists will tell you that the key to any future sustainable economic recovery lies in home values stabilizing or, better yet, a return to a historical home price appreciation rate of 3 to 5 percent each year. The housing bubble burst and the excess values have been removed, the trouble actually lies in the fact that home values probably dropped far more than they should have!  The good news is that the monthly mortgage payment for a middle income person buying a middle priced home is well below its historical norm.

A review of the latest data strongly suggests that the homebuyer tax credit has had its intended impact of significantly stimulating home sales. From about 4.5 million annualized home sales pace in the few months prior to the stimulus, sales have jumped to 5.1 million in recent months. That is a change of 600,000 additional existing-home sales. New home sales have risen from the mid 300,000 to low 400,000 range over the similar period. The rise in sales has been concentrated in the lower-priced home segment largely because first-time buyers are looking to stay, rightly, well within their budget.

Housing inventories are starting to return to normal and this will help in boosting prices.  The median existing-home price as of August was down 12.5 percent compared to a nearly 20 percent decline early in the year. In short, sales have risen and home prices are stabilizing.

But the housing stimulus package is set to expire. To take advantage of this credit the sale needs to close before the deadline.  Purchase orders written but not closed will not qualify. Some first-time buyers who are signing contracts to buy in October just may make the deadline.  Ideally we would like to see this buying momentum continue so inventory falls back down to the normal 5 to 7 months, a level consistent with home value stabilization. Once that is accomplished, the consumer “fear factor” of waiting and waiting for a lower price later will no longer be part of the home buying decision. We will have reached a point of housing market self-sustainability. Consumer confidence will be lifted. The wealth impact of consumers opening up wallets for general consumer goods will steadily turn positive. Thus, the broader economy also gets set for a sustainable recovery without needing further stimulus dollars.

For that happy scenario to play out, a time extension on the home buyer tax credit is critically needed. At a cost of about $10 billion (if extended through the middle of next year), the housing market will likely have recovered nicely with the broader economy on track for a solid robust expansion. That $10 billion price tag is rather modest compared to the $700 billion in TARP funding and $800 billion of the broader economic stimulus package that was passed early in the year (with debate still raging over the effectiveness of that broad spending bill). Moreover, the cost of $10 billion is a static measure that does not take into account job creations and increased tax revenue from rising economic activity. Actually, if we take into consideration all of the economic dynamic responses, the homebuyer tax credit can be argued as a net positive revenue generator for the federal government. 

A faster and firmer recovery can happen if the tax credit is opened up to more buyers by making it apply to any buyers – not just first-timers – and by raising the income limit for qualification. It would also contribute to healthy economic activity – a sustained recovery – and thus help to put a dent in the deficit. In short – it’s a win/win. NAR is working hard to get that homebuyer tax credit extended. You can help – by calling, writing or e-mailing your Congressional representatives. It’s good for home buyers and it’s good for the U.S. economy.   Home purchases drive purchases in all areas of the economy!

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1. Search on the World Wide Web for distressed or foreclosed properties as a starting point. Use a professional REALTOR to identify great foreclosure deals for you. (Members of the Carpenter Group are Distressed property experts.)  You may be successful at searching the web on your own, but keep in mind some of the information is outdated, some may be incorrect, and some of the available properties are not even listed. We subscribe to updated MLS listings and can offer you the most current information available.

2. If you search yourself for distressed properties and purchase from the selling agent, you are paying a commission to someone with a vested interest. Obtain objectivity in the sale by working with your own REALTOR. You won’t pay any more. Technically, everyone works for the seller, since they pay the commission.

3. With distressed or foreclosed properties, time is of the essence. Purchasers must close on the date specified by the agency, and cannot close after this without penalties of $25-200 per day.

4. It takes 1-3 weeks to qualify a loan. If you are approved for a loan, make sure your lender qualifies you as soon as possible. If you are paying by cash, make certain funds are available. If finances are in order, we will then submit an offer. When both seller and buyer accept the offer, we will submit the ratified contract to the lender and closing agent. These steps will begin the process of a successful real estate transaction.

5. When purchasing a distressed property, always obtain 3-4 bids from different contractors to estimate costs of repairs, if you do not plan on doing the work yourself.

6. If you are going to sell the property after rehabilitating it, ask your REALTOR to research similar properties in the neighborhood to ascertain market price.

7. Keep copious records for tax deductions. Any expenses related to the purchase, repair, or maintenance of the property may qualify. Meticulous records are key to a profitable real estate venture.

8. The title you receive after purchasing a distressed or foreclosed property is a special warranty deed rather than a general warranty deed. This alarms some buyers, but there is no need to worry. The purchase of title insurance protects the buyer. Each lender purchases insurance to protect the loan as well. The property purchaser should obtain titling insurance. The closing agent always offers it.

9. Foreclosure properties require special addendums and special contracts by the individual bank and HUD office (where applicable).

10. Foreclosure properties are potentially the most profitable, but require the most attention to detail. Working with a REALTOR of the Carpenter Team,experienced in foreclosure deals, is highly desirable because the paperwork must be in order to submit a proper bid, and timeliness is critical.

Contact us to help you get started building your investment portfolio!