The Worst Real Estate Investment Strategy Ever!
Copyright 2006 David Schneider
It's true, You can make a lot of money by investing in real estate. Yet, many investors are not. And when you look at their real estate investment strategy, it's no surprise.
The problem is that they have been brainwashed by the so called real estate investment gurus. You know the ones that I am talking about. The ones that tell you that for a few of your hard earned dollars they will teach you all their ultimate short-cut secrets to successfully making millions.
They will tell you that you don't need a job, money or credit. All you need to do is pay them and they will show you the exact way to invest in real estate. Do what they say, follow their real estate investment strategy and your life will changed forever.
Well I have some bad news for you. In most cases, it's the worst real estate investment strategy you could ever follow.
Don't get me wrong, Its' OK to go to seminars, buy books and audio products if you are using this information to learn certain techniques, financing options, tax laws and other ways to invest. In fact, you should do this, because it will make you more creative and you will become a smarter real estate investor, however it's not the most important thing that you should do.
>>> The Most Important Step When Investing In Real Estate
Before you start to invest in real estate, you should sit down and create a very specific plan of what you want the outcome of your real estate investment plan to be!
I know that this is not very exciting, however, if you don't know why your investing and the overall outcome that you want, then how do you know if you making a good or bad decision?
>>> Two Important Questions
The only reason to invest in real estate is to make money. There are two important questions you need to ask yourself.
1.) When do you want the money and how much?
2.) What are you willing to pay to get that result?
The answer to these questions will help you determine your real estate investment strategy.
Let me give you several examples.
>>> Buy and Sell Strategy
If you want the maximum amount of money in the short run, you should be buying real estate with the intent of a quick sale and profit. This may be buying fixer-uppers or looking for below market properties that you can sell for a profit quickly (know as flipping).
To do this, the price you will have to pay is your time to find, analyze, fix, finance and sell the properties. Once you sell any of your properties and realize your profit, you must go out and repeat the process again and again to continue to make a profit.
One problem with this strategy is that when you stop buying and selling your profits stop. So it's important to make sure you take some of your profits and invest in something that will produce the income you will need and want later on in your life.
>>> Buy and Hold Strategy
This strategy is to buy properties, rent them out and have the tenants pay for the properties. Once the properties are paid for, you will continue to have rental income for the rest of your life.
The price you pay in this strategy is not only the time to find, finance and analyze, it's the problems that may occur when ever you have tenants. So you will need some type of a system to manage or you can hire a management company to do this.
Personally, I like the Buy and Hold strategy because you are building up assets and income that will come to you for the rest of your life. To deal with the management part you need to create a system of policies and procedures.
Whether your strategy is to Buy and Sell, Buy and Hold or maybe a mix of the two, the key is to plan for what you want your ultimate outcome to be.
If your outcome is to have an income of $100,000 per year without any work, you may choose to buy and hold enough rental real estate that will provide that.
In summary, the worst real estate investment strategy ever is when you don't take the time up front to to decide exactly why your are investing in real estate and what do you want when you are all done
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Dave Schneider has been investing in real estate for over 25 years and is devoting to helping landlords make more money!. For free audio seminars, tools and information on real estate investing and being a landlord, visit this site now: http://landlordtools.com
How to Select an Installer for Your Solar Panels
With the new rollout of massive federal tax credits, state subsidiary programs and net metering, going solar makes sense. So, how do you pick an installer for your system?
Install My System
As with any major part of your home, installation of a solar platform should be done by a professional. Many of the tax credit and rebate programs require professional installation and failure to do so can lead to the loss of the benefits. In short, there are practical and economic reasons to get it done right.
While a solar platform is necessarily a form of electrical generation, you shouldn't assume every electrician knows how to install one. In truth, most do not. Instead, you can visit a site like solarcompanies.com to find businesses in your state, search on the web or simply pull out the phone book. In states such as California, installers are plentiful while other locations may require a bit of hunting.
Once you've located potential installers, make sure to ask some questions. Do not pick the lowest price or first one you find. Use your common sense and ask the same questions you would to any contractor installing something on your home.
The first question to ask is whether the installer has, in fact, installed systems before, how often and for how many years? You do not want a neophyte handling your installation. Installation experience is vital because certain elements of solar systems are very unique, particularly if you are tying into a grid system for a utility company. If you are tying in, make sure the installer has experience doing such installations, not just putting up solar panels.
The second question to ask is whether the installing company is licensed. Most solar installers will be required to have an electrician's license. Contacting the state electrical board to ask about the installer is a wise move. For some state rebates, you may also have to use an installer that has a solar contractor specialty license. Again, the state electrical board should be able to help you out with this.
This may all sound a bit confusing, so let's turn to the easiest method for finding installers. When in doubt, contact the manufacturer of your system. Many manufacturers have a list of approved installers. If not, they typically can make recommendations regarding various entities that handle the job for you.
Richard A. Chapo is with SolarCompanies.com - a directory of solar energy and solar power companies. Visit SolarCompanies.com to read more more solar electricity articles.
Selling Solar to Your Utility – Interconnection Agreements
In many states, homeowners and businesses can now sell solar panel energy to utilities. Doing so requires an interconnection agreement with your local utility.
Lowering Your Utility Bill
In a majority of states, homeowners using solar can take advantage of a concept known as net metering. Net metering essentially refers to the act of selling excess power produced by your solar panels to the local utility. While you are at work during the day, the energy produced by panels is fed directly back to the utility [your meter runs backwards] and then you use utility energy as you need it in the evening. The utility company "pays" you at the same rate per watt as what it charges you, thus creating a "net metering" situation. Practically speaking, it is a tremendous way to slash or eliminate your electrical bill.
If you intend to sell electricity to the utility company, you can't just do it. Instead, you must get and sign an interconnection agreement with it. While the name can change from utility to utility, this agreement basically lays out the ground rules on how the process will work. Let's take a closer look.
Federal and state laws require utility companies to supply you with standard interconnection agreements. The agreement specifies the terms and conditions under which your system will be connected to the utility grid. These can include your obligation to get any required permits, maintain homeowner's insurance and meet certain connection specifications.
Sometimes set apart as a separate document, the agreement will also include the specifics related to the sale and purchase of power by each of you. Instead of installing multiple meters to asses the transfer of power, most utilities will simply let the existing utility meter run forward when you are drawing energy from the grid and backward when you are supplying energy to it.
If you supply more energy than you use in a month, must the utility company send you a check? Unfortunately, net metering laws do not require the utilities to do so. Instead, the company will credit the monetary equivalent of the excess generation to the next month's electrical bill until you eventually use it during a cloudy or rainy month.
Interconnect agreements are fairly standardized agreements that shouldn't cause you much concern. Just make sure you get one before hooking up to the local utility.
Richard A. Chapo is with SolarCompanies.com - a directory of solar energy and solar power companies. Visit SolarCompanies.com to read more more solar electricity articles.
