| One of my favorite real estate investing
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| | sure the numbers make sense. For example,
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| stories is about a man in California who
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| | investors value income property according
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| used to just send out offers on a hundred
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| | to current cash flow, or at least they
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| MLS listings at a time. He never looked
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| | should if they want safe and viable real
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| at the properties. He just offered 25%
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| | estate investments, so start by verifying
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| less than the asking price on each one,
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| | income. Ask for actual income figures for
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| trusting that the listing agents were
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| | the past 12 months. It's a good idea to
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| pricing these homes somewhere near the
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| | think about the potential income if the
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| actual value, and so assured that he had
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| | rents are raised, or vending machines are
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| a good deal if the seller
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| | added, but you should base your offer on
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| accepted.Sometimes a seller would accept
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| | the current income.Fortunately, this can
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| his lowball offer. This happens more
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| | be done by phone and by mail. You can
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| often when you make hundreds of offers
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| | also verify all expenses this way, but if
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| instead of just a few. Of course, he
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| | any expenses listed by the seller seem
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| always included an "inspection and
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| | unusually low, they most likely are.
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| approval" clause in the offer. This is
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| | Substitute your own best guess in place
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| common, and it meant that if the home had
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| | of any suspicious numbers.Subtract the
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| real problems, he could back out of the
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| | expenses from the gross income to
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| deal later without forfeiting his
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| | determine the net operating income, then
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| deposit. In the meantime, he very
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| | apply the appropriate capitalization rate
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| efficiently found the truly motivated
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| | to arrive at the value. Not sure how to
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| sellers.My favorite part about this
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| | do this? Learn how, don't just ask
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| story, apart from it being true, is that
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| | someone to do it for you. You really
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| it demonstrates that success in real
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| | should understand the principle of how to
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| estate investing, as in life, is often
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| | figure value based on a cap rate. Real
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| just a "numbers" game. Try enough times,
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| | estate investing is all about the
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| and you are more likely to succeed.The
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| | numbers.Subtract your expected loan
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| story also demonstrates that with a good
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| | payments (talk to your banker), from the
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| clause or two in the contract, you don't
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| | net operating income to see how much cash
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| have to worry about making an offer
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| | flow you'll have. Now you can figure your
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| before you see a property. This is true
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| | cash-on-cash return based on how much of
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| with buy investment property or your next
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| | your own money you put into the deal.
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| home. If you make the offer in the right
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| | Simply divide the annual cash flow by
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| way, and the property it isn't everything
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| | your investment.Do the numbers work? Then
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| the seller says it is, you can reject the
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| | you can safely make an offer. The various
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| deal with little or no loss. However, why
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| | inspections will tell you if there are
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| wouldn't you want to look at the
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| | problems that will affect the cash flow,
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| property?Real Estate Investing By The
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| | and you can always renegotiate if there
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| NumbersYou might skip looking at a
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| | are such problems (assuming you made your
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| property before making an offer because
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| | approval of all inspections a contingency
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| of time constraints, especially if the
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| | of your offer). Of course you can go look
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| property is far away. If you can't get it
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| | at the property now, but real estate
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| for a price that makes sense, why spend
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| | investing is about the numbers.Steve
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| your time traveling to look at it? A good
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| | Gillman writes on all real estate topics.
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| price and terms that make sense - these
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| | Visit his website for:1. A photo of a
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| are what is most important.You'll
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| | beautiful house he and his wife bought
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| probably want to look at the actual
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| | for $17,500.
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| property eventually, but whether or not
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| | 2. A free book on how to save thousands
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| you see the property before you make an
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| | buying your next home.
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| offer isn't nearly as important as making
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| | 3. A free real estate investing course.
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