Category Archives: Real Estate Investing

March 22, 2007 · 1:17 pm

Olathe, Kansas – Poised for Housing Growth

There are many reasons to consider Olathe, Kansas as a place to live or invest. Quality housing. A school district that is second to none. Ample dining opportunities as well as shopping. Good road network. Safe communities.

If you are looking at Olathe as an investor an article in yesterday’s Kansas City Star had this to say;

The growth boom in Olathe is not expected to slow anytime soon, city planners have predicted. So much so, that according to their estimates, they expected Olathe’s current population of roughly 120,000 to grow to 325,000 by the year 2050.

Wishful thinking? Not by City Planner Bryan Dyer’s numbers.

“We might be off by a person or two,” he joked when discussing the numbers with members of the Olathe Planning Commission recently. “We know there is a strong interest out here, and as long as we keep roads and city services growing the population will continue to follow that trend.”

Dyer, who leads the city’s Long Range Planning Division, said he also expects the city to grow from its current 60 square miles to more than 90 square miles in the next 50 years.

Seems to me that is very good news for the rental property owner as well as the “regular” home owner.

Leave a comment

Filed under Kansas City neighborhoods, Real Estate Investing

March 21, 2007 · 7:40 am

MAREI of Kansas City

On the evening of April 10, 2007 I have been asked to be a guest speaker at the Mid-America Association of Real Estate Investors (MAREI) meeting. Kim Tucker has asked me to speak on the advantages of Buy & Hold real estate. My favorite subject. Especially with today’s current state of affairs in the real estate market.

By following the link above you can find out the details and even plan some time on your calendar to come on out and listen. It is my hope to make it worth your time and money.

Leave a comment

Filed under Real Estate Investing

March 19, 2007 · 9:37 pm

Stock Market vs. Real Estate Investing

I have discussed before the 4 benefits of owning residential investment property. And today I had a little fun with a stock broker from Kansas City that was, well gloating I think would be the term, on the fall of real estate as an investment vehicle.

Really?

I know I shouldn’t do these things, but I decided to have a little fun with him. Here is some simple math;

$100,000 invested in the stock market returning 10% a year (his number) will give you a $10,000 increase in your portfolio after one year. Not too bad, actually.

$100,000 invested in real estate, however, should net you around the $20,000 in the same period of time. Is that better? Let me explain.

Take the $100,000 cash and purchase $400,000 worth of real estate (4 $100,000 houses, 1 $400,000 apartment…really doesn’t matter) with a historical appreciation rate of 5%. That leads to a $20,000 increase in property value after one year.

Now you may want to say what if houses don’t appreciate 5% this year? Good question. But if you are holding for 6-8 years, does it matter for any one year what appreciation is? Remember, historical appreciation in Kansas City is 5% on average. Some years have been 10%-12%. Other years, like last year, were -2% to +3%. Heck, my zip code was 6.6% last year.

“Wait. We’re not done here yet,” I told him. “Remember, real estate yields four benefits; cash flow before taxes, principal reduction, depreciation and appreciation. We’ve only discussed one of the benefits!”

3 Comments

Filed under 4 Benefits of Real Estate Investing, Real Estate Investing

March 19, 2007 · 7:31 am

Investment Real Estate Profitability

You MUST know your numbers when you are going to purchase investment real estate here in Kansas City. Or anywhere, for that matter. Here in Kansas City, I feel like I’m alone in this proclamation. And as I look around the country, I find very few professional real estate agents who truly work with and understand the purchase and management of rental property.

If you have some time, I would urge you to bounce around to a few of the real estate links you will find on the right hand column of this blog. One is Bawld Guy Talking. He is an investment real estate agent out in the San Diego area. His blogs are always worth reading.

Last week I added Indiana’s own Land Chasers. He has some good posts over there.

Yesterday, I added Equity Scout. It is another blog certainly worth your time if you are involved with, or thinking about investment real estate. I believe it is authored by Christopher Smith and he has another blog. And here is a link to that blog and an extremely relevant article.

Kansas City is a great real estate market for the investor. And it never hurts to get opinions from other professionals, especially if it takes you just a moment of your time.

Leave a comment

Filed under Kansas City Real Estate, Real Estate Investing

March 13, 2007 · 6:34 pm

Mortgage Lenders: "Easy Money Is Drying Up"

For those of you paying attention to this blog and several like it, money is getting a little tighter out there for those looking to purchase a home. And the forecast for home sales is dipping a bit. And current mortgage delinquencies are creeping ever upward.

This is great news for the qualified buyer! Especially the real estate investor.

Listen, I work hard. Utilize effective marketing techniques including all aspects of the internet. I am up front with my clients. Things work out for me. I do well in all markets.
For sellers, however , life is a little more difficult. On the other hand, if you have good credit, some ready cash and you are looking to make a move to begin or increase your real estate portfolio you may want to take a very serious look at the Kansas City housing market right now!
To discuss what this market means to you just drop me an email.

Leave a comment

Filed under Kansas City Real Estate, Real Estate Investing

March 13, 2007 · 4:04 pm

Investment Real Estate Glossary

GRM. ARV. Determine your NOI before I can tell you what LTV you will need. What? If you are new to real estate investing these terms and initials can really get you jumbled. But here are a few that will help you sort through some of what you read.

ARV – After Repair Value
CAP Rate – Capitalization Rate
CFBT – Cash Flow Before Taxes
GOI – Gross Operating Income
GRM – Gross Rent Multiplier
NOI – Net Operating Income
LTV – Loan To Value
3B2er – You have to go to here to find out. (Funny Video)

But don’t get too caught up in all of this. As you gain experience it will be easier and easier to talk the lingo. What is really important is that you learn how to determine profitability. You’ll need your own formula or to work with someone that has successfully worked with investment property.

Leave a comment

Filed under Real Estate Investing

March 3, 2007 · 9:17 am

Kansas City Real Estate Links That Help: Localism

Most of you know my policy on open information regarding real estate in Kansas City. I’m completely for it. Open the MLS. Open the tax records. Open the comparable sales. The more information the consumer has to make intelligent real estate home buying decisions the better I can do my job. And that is to help them secure (or liquidate) the right home(s) for their situation and to negotiate the best deal possible and then walk them through to success closing.

To that end I have provided you with Free, no registration, Kansas City MLS searches, links to investment clubs like MAREI and KCIG, private MLS sites like Trulia and write this blog and this blog to allow you insight into what a real estate agent does and how he thinks.
So today I want to give you a new link. It is still in Beta. But Localism is a great site that you will start seeing in your real estate searches. Localism is a real estate agent driven site that allows you to learn about your state and community and your local real estate conditions. There are even homes for sale sections and great articles about the current state of the market.
Of course, there are some REALTORS that are better writers than others. Some that seem to put more effort into the posts than others. Obviously, some are just fishing for leads. Some are really trying to serve the public.

The great thing about it is you get to decide. It’s like an interview with an agent. Like what you are hearing? You can leave a comment or question. Get to know more about them without actually meeting in person or making the phone call. In short, you get open information about your next real estate agent. You learn how they think, what they specialize in, where they live, etc. You get to decide who the best agent for you will be instead of just stumbling into an open house an working with that dude.

Check out the site. You’ll find me on the Kansas side. Due to an oddity of the system,since it’s still in Beta, I cannot do both Missouri and Kansas.

Leave a comment

Filed under Kansas City Real Estate, Real Estate Investing