BiggerPockets Daily

Short-term rentals (STRs) are the fastest-growing segment in hospitality and have been gaining market share for years. A confluence of factors like robust travel spending from Americans, increasing consumer preference for experiences, and remote work is expected to support 11% CAGR growth in the STR market through 2030. Given the recent growth of STRs, vacation rental investing has become increasingly popular. Historically, however, the only way for people to invest in this asset class for a steady income and capital appreciation was resorting to the time and capital-intensive process of buying and managing a single or portfolio of vacation rental homes. In this article, we will explore the fundamentals of REIT investing, the benefits of investing in a vacation rental REIT, and Wander REIT, the first and only STR REIT that can help you reap the benefits of STR investing without the hassle. Learn more about your ad choices. Visit megaphone.fm/adchoices

Real estate prices fluctuate based on supply and demand, but because so many demographic, economic, and policy changes influence the markets, it’s virtually impossible to know what to expect. Before the COVID-19 pandemic, for example, economists weren’t predicting a downturn in commercial real estate. Now, Morgan Stanley’s chief economist warns of a crash more damaging than the 2008 financial crisis. On the other hand, unexpected gains are common as well. In May 2020, Zillow predicted a drop in home prices and home sales followed by a slow recovery in 2021. But instead, a homebuying boom caused prices to skyrocket before 2020 came to an end. With the ever-changing markets, what seems like a good investment one year can look like a poor choice the next. But even with all the uncertainty, there are some enduring truths in real estate that you can always depend on as an investor. And understanding these tenets can help you navigate the shifting landscape with more confidence. Learn more about your ad choices. Visit megaphone.fm/adchoices

The residential real estate market is doing better than most had expected after interest rates more than doubled last year. Prices declined nationally each month from July 2022 to January 2023 (although never by more than 1% per month). However, prices came back up 0.2% in February. Ironically, February was the first month that prices dipped year-over-year, interrupting what was a record 131-month run of ever-increasing prices. It’s too early to say, but it appears that despite high rates, the residential market is stabilizing. It’s not quite so pretty for commercial real estate, particularly office, though. The Office Recession Back in October of last year, I noted that “broadly speaking, the outlook for commercial real estate, specifically office buildings, is not great. And large office buildings, in particular, are doing poorly and will have difficulty in the coming years.” The reasons were threefold. First, the pandemic and lockdowns shuttered a lot of businesses, many permanently, and this led to a general deterioration of the existing stock and reduced demand for office space. Learn more about your ad choices. Visit megaphone.fm/adchoices

How would you describe the housing market right now? Is it up? Flat? Down? Crashing? Each option is a little bit correct and a little bit wrong. That’s because these days, there is almost no way to describe the housing situation in the United States on a national level. To understand what is happening and to make solid investing decisions in 2023, you need to be looking at regional trends and individual market metrics. To shed some light on the differences in market behavior, I dug into the 295 largest housing markets in the country and wrote up the most interesting trends and findings from my research. Learn more about your ad choices. Visit megaphone.fm/adchoices

After seven straight months of declining prices, the S&P/Case-Shiller U.S. National Home Price Index increased in February, and March seems to be carrying the same upward momentum. The latest data from Black Knight finds that out of the 100 largest markets in the nation, 93 had price increases from February to March, up from 79 in January-February. This, of course, is traditionally expected as the spring months tend to bring a bump in prices as homebuying demand ramps up. But the rise is more than expected. “A modest bump in homebuyer demand ran headlong into falling for-sale supply,” said Andy Walden, Black Knight’s vice president of enterprise research. “Just five months ago, prices were declining on a seasonally adjusted month-over-month basis in 92% of all major U.S. markets. Fast forward to March, and the situation has done a literal 180, with prices now rising in 92% of markets from February.” Learn more about your ad choices. Visit megaphone.fm/adchoices

Economists look to the residential housing market as a primary indicator of whether a recession is coming, and home transaction and construction data began showing positive signs that the housing downturn may have reached a bottom in February. Many believe we’ve dodged a severe recession, and some are even optimistic that the Fed will achieve the soft landing the central bank was hoping for—an outcome of stabilized inflation without a significant rise in unemployment. Consumer spending has begun to plateau, and The Fed has signaled that it will likely put future rate hikes on hold while keeping an eye on inflation. The rate hikes that began last March may finally be coming to a close. Meanwhile, signs have pointed to a recovery in the housing cycle. After a contraction in selling activity, a slowdown in residential development, and falling home prices, things started to turn around in February. Learn more about your ad choices. Visit megaphone.fm/adchoices

For centuries, investing as a group has been a key ingredient in building wealth. I recognized early in my journey that earning a college degree, landing a steady W-2 job, and contributing to my 401(k) would only get me so far. I was participating in a vast investment world as an individual—but the real investors were “playing” on teams. More than a decade ago, my three brothers and I came together on a trip where we shared our desire to obtain financial freedom for our families and future generations. We knew we couldn’t do it alone. We also knew that combining resources was nothing new. For the wealthy, outsourcing the administrative process to pool their money may cost tens of thousands. But that is a drop in the bucket when considering the size and scope of these investments for each group. For my family, we struggled to get started in those early days. Like grappling over the last piece of cake as kids, we were challenged to get on the same page, navigating things like joint bank accounts, being transparent, managing a cap table, and so many other hurdles, twists, and turns. Learn more about your ad choices. Visit megaphone.fm/adchoices

Dallas, Texas, is one of the fastest-growing metropolitan areas in the country, with a large, diversified, and growing economy. With home prices below the national average and solid cash flow potential, Dallas has many traits that support favorable long-term conditions for real estate investors. Population and Labor Market Located in Northeast Texas, the Dallas metropolitan area is actually composed of two large cities and one small city: Dallas and Fort Worth, and then the smaller city of Arlington that lies between them. Combined, the Dallas metropolitan area has a population that is growing well above the national average. The median age of residents in Dallas is just under 33 years old, which is right around the peak homebuying and household formation age—which indicates strong and sustainable demand for housing in the region. Learn more about your ad choices. Visit megaphone.fm/adchoices

When growing a real estate investing business, having a good FICO Score is a key factor in obtaining capital and achieving the highest return on investment. Hard money or private money lenders use this score to determine if they should give a loan to the borrower and what interest rate they should set. In most cases, hard money lenders look at your FICO Score before pre-qualifying your application and approving your loan. So, let’s take a look at FICO Scores, how it’s determined, and some steps you can take to improve your score over time. Learn more about your ad choices. Visit megaphone.fm/adchoices

Investing in real estate comes with risk, and having the right insurance coverage is critical to protecting your rental property investment. Just as each property is unique, your insurance policy should also be custom to your dwelling type, location, duration of the rental agreement, and more. Understanding the nuances of coverages for short-term, medium-term, and long-term rentals is especially important, as the wrong type of policy can render your claim denied by an insurer. This is because the risk of a long-term tenant is perceived differently from that of a property rented out on a short-term basis, such as an Airbnb or vacation rental. So, how do you know if you have the right coverage in place? In this article, we will take a closer look at each type of insurance policy and its key differences. Learn more about your ad choices. Visit megaphone.fm/adchoices

When the weather warms up, it’s a good time to clean out the nooks and crannies and not just the ones in your closet. Every year, you should take a step back, evaluate your processes, take care of your business “housekeeping,” and set new goals. You’ve just paid your taxes, so getting organized for next year is top-of-mind. If you want to take this opportunity to give your real estate business a refresh, we’ve prepared a checklist of items to address in your spring cleaning efforts, with tips from two real estate investment advisors. Learn more about your ad choices. Visit megaphone.fm/adchoices

In the past few months, we have published a couple of robust overviews of DSCR loans, a popular loan product that has entered the scene over the past few years. DSCR loans enable investors to qualify for a mortgage loan on an investment property without consideration for personal income or “DTI” ratios—making these loans a top option for investors scaling portfolios, especially for single-family rental properties. Qualifying for the best rates and terms for DSCR loans is primarily driven by three factors: leverage, property cash flow, and credit. After that, investors can use advanced strategies such as optimally structuring loan terms such as prepayment penalties, adjustable rate options, and borrowing entities to tailor DSCR loans to their specific investing needs. Learn more about your ad choices. Visit megaphone.fm/adchoices

Every great empire that has come before the United States has eventually fallen. Some have fallen at least somewhat gracefully, like Great Britain. Others, like ancient Rome, well, not so much. As I write these words, more and more ink has been spilled regarding the looming threat to the American-led world order. Words such as “de-dollarization” and a “multipolar world” are thrown out often, perhaps simultaneously or even interchangeably. And indeed, “de-dollarization” is happening, albeit at nowhere near the speed some doomsayers describe. And we are likely already in a “multipolar world” where the United States is no longer the sole superpower. Instead, a new cold war—this time between the United States and China—seems to have dawned as East and West once again bifurcate and globalization slows down and begins to reverse. Not surprisingly, what plays out over the next few years will have a significant impact on investors. But first, let us strip away the hyperbole and describe what exactly is happening. Learn more about your ad choices. Visit megaphone.fm/adchoices

As a real estate investor, your business thrives when it’s properly maintained and optimized for future growth. You’ve counted the costs, done the research, and created a model for current success. But at a certain threshold, we all reach our personal limitations—or think, “There must be an easier way!” That’s where property management software comes in. Property management software can help real estate investors perform better in the present and grow faster in the future by simplifying everyday processes. But with all the property management software and app options available, what sets one apart from another? Which features are foundational, and which are fluff? Let’s take a look at how you can determine which property management software is best for your real estate investing business. Learn more about your ad choices. Visit megaphone.fm/adchoices

There’s been a lot of alarm in the real estate investment community lately over a newly enacted Federal Housing Finance Agency rule for Fannie Mae and Freddie Mac loans regarding mortgage fees. The gist of the complaint is that homebuyers with good credit will now have to subsidize those with bad credit. Technically, this is true. However, the way it is being framed is quite misleading. The general argument goes something like this: Those with a 620 FICO score will get a 1.75% discount, and those with a 740 FICO score will pay 1%. Learn more about your ad choices. Visit megaphone.fm/adchoices

Median asking rents are beginning to dip in many markets, according to new data from Redfin, a turnaround from the skyrocketing rent prices observed last spring. The median national asking rent fell to $1,937 in March, a 0.4% year-over-year decline. Median asking rent prices are lower than they’ve been in over a year, and the days of bidding wars for an apartment are coming to an end in many markets. It’s indicative of a correction from overinflated rent prices that resulted in part from a pandemic-driven demand for more space. But rents are still about 20% higher than they were when the pandemic began. Learn more about your ad choices. Visit megaphone.fm/adchoices

A common question on the BiggerPockets forums goes something like this, “I have $50,000 and looking to invest in real estate. How should I start?” In normal times, my advice would nine times out of 10 be house hacking for a first-time investor, especially given the markedly better rates and terms homeowners can get as compared to investors. However, in the past year, that delta in loan terms has compressed substantially, and so while house hacking is still an option, it’s not head and shoulders above everything else as it once was. Although, house hacking has certainly held up better than many other strategies. Indeed, if there ever was a challenging real estate market—particularly for new investors or those with $50,000 or so burning a hole in their pocket—this would be the one. This 2022 meme succinctly explains that challenge as much as any essay could (updated for 2023 audiences): Learn more about your ad choices. Visit megaphone.fm/adchoices

Do Americans really vote with their feet, leaving high-tax states in favor of low-tax states? While most people don’t move often—and many never leave their home state—we can look at trends and patterns among those who do move across state lines. I’m not interested in the politics of it. I’m interested in the actual migration numbers compared to tax rates. Set aside your politics for the next five minutes, and let’s focus on the raw population numbers. After all, population change is the foundation of demand for real estate. By understanding where people are moving, we can understand where real estate markets will boom over the next few years. Learn more about your ad choices. Visit megaphone.fm/adchoices

Everyone would love to reduce their tax bill and pay less money to the IRS. But did you know that you can write off home improvements on your taxes? The good news is that certain home improvements can reduce your tax liability. For example, home upgrades that add value to your property, improve energy efficiency, or are adaptations for medical purposes are tax deductible. Of course, not all home repairs can lower your tax obligations. And there are certain limits on how much you can claim on your tax returns. But capital improvements to your home make you eligible for tax deductions or tax credits. As with most tax laws, the rules on writing off home improvements can be complicated. Therefore, this article aims to disentangle the complexities when writing off home improvements on your taxes. Before learning about home improvement tax deductions, there are a few things to watch out for. First, the rules can change from year to year. Therefore, you should speak with a tax advisor about how much you can write off on taxes. Additionally, your income level can also impact home improvement deductions. Learn more about your ad choices. Visit megaphone.fm/adchoices

Let’s face it. It would be tough to become a local expert in every market where you are interested in buying an investment property. It takes a great deal of time and effort to become an expert in your own neighborhood. You need to build relationships with contractors and real estate agents and learn about zoning, permitting, city ordinances, development rules, and short-term rental regulations– this is all in addition to constantly staying up to date on what homes are selling for in your neighborhoods. It’s time well spent on your business. And investors looking to expand and grow their fix-and-flip or buy-and-hold rental business eventually realize that building a team becomes crucial for sustainable growth. And sanity, of course. Hiring a CPA, real estate attorney, and virtual assistant are pretty straightforward additions to help you organize and operate your business. But there are seven crucial relationships you need to develop to truly become a local market expert. How they can help you, however, might not be obvious. Learn more about your ad choices. Visit megaphone.fm/adchoices

Let’s face it. It would be tough to become a local expert in every market where you are interested in buying an investment property. It takes a great deal of time and effort to become an expert in your own neighborhood. You need to build relationships with contractors and real estate agents and learn about zoning, permitting, city ordinances, development rules, and short-term rental regulations– this is all in addition to constantly staying up to date on what homes are selling for in your neighborhoods. It’s time well spent on your business. And investors looking to expand and grow their fix-and-flip or buy-and-hold rental business eventually realize that building a team becomes crucial for sustainable growth. And sanity, of course. Hiring a CPA, real estate attorney, and virtual assistant are pretty straightforward additions to help you organize and operate your business. But there are seven crucial relationships you need to develop to truly become a local market expert. How they can help you, however, might not be obvious. Learn more about your ad choices. Visit megaphone.fm/adchoices

I recently asked an agent what they were doing for lead generation. Zillow was one of their sources. Here’s how the conversation went with one prospect. Agent: “Hello, this is Luke Skywalker (names have been changed to protect the innocent). How can I help you?” Lead: [weird, heavy breathing] “Hi, this is Darth. I had a question about 123 Tattoine St.” Agent: “Great, I know that property well! What would you like to know?” Lead: “Is that wallpaper in the dining room green or gray?” Agent: [facepalm] Not all leads are created equal, but this is often par for the course when it comes to online real estate leads. In this article, I’d like to put forth to you that not only are investors (and investor leads) easier to deal with, but they are also considerably more valuable. Plus, I’ll give you some tips to finding more investors to work with. Learn more about your ad choices. Visit megaphone.fm/adchoices

Strong demographics have fueled the U.S. demand for housing over the last several years. As millennials, now the largest generation alive in the country, hit their peak home-buying age, demand for home purchases and rental units has surged. This demographic strength has been one of the several variables that have pushed up home prices since prior to the pre-pandemic period. But demographics isn’t everything when it comes to demand—economics matters too. And with persistently high inflation, and a great deal of economic uncertainty, there is the risk that demand for housing could slow in the coming years. What happens to demand over the coming years will have big implications for real estate investors. Learn more about your ad choices. Visit megaphone.fm/adchoices

It was bound to happen, and it finally did. Last month, according to a new report from the National Association of Realtors (NAR), real estate prices finally went negative, “The median existing-home prices for all housing types in February was $363,000, a decline of 0.2% from February 2022 ($363,700), as prices climbed in the Midwest and South yet waned in the Northeast and West. This ends a streak of 131 consecutive months of year-over-year increases, the longest on record.” All good things, right? Though at first, this might sound odd. I myself wrote back in September last year that prices had finally started to decline. But those were month-over-month prices. In normal times, even when the market is flat, prices tend to increase in the summer months and decrease in the winter months. Learn more about your ad choices. Visit megaphone.fm/adchoices

When it comes to investing in real estate, you may be tempted to stay close to home, and this is understandable. You’re more likely to understand the market and feel more comfortable being nearby while looking for tenants or collecting rent. It may seem daunting, but several real estate investors find it lucrative to seek out markets in other cities or states in order to secure more affordable investment properties. Now, there are several options available to you when it comes to the management of real estate investments: managing yourself, hiring a property manager, or hiring a property management company. Regardless of what you choose, chances are in our tech-driven world that some type of software will be employed to conduct business operations. Setting up software or tech to manage your properties ensures that when it’s time to place a tenant in your rental and deal with finding tenants and collecting rent, you’re able to present yourself as a capable and professional landlord—even from miles away. Learn more about your ad choices. Visit megaphone.fm/adchoices

The annual percentage rate (APR) and interest rate are two critical metrics affecting the cost of borrowing money. Although both figures are related, knowing the difference between interest rates and APR is vital when comparing mortgage offers. For example, learning how APR is calculated could save you thousands of dollars on your home loan. APR versus interest rate gets confusing because some people use the terms interchangeably. Also, some mortgage lenders prominently display their loan interest rates — usually because the interest rates are lower than the annual percentage rate. So typically, you must hunt for the APR in the small print of loan terms. What’s the deal with calculating interest rates and APRs? How can you decipher these figures to determine the actual cost of your mortgage? What is a good APR for loans when comparing mortgage rates? This article helps you know how to compare lender fees to get the best deal on your mortgage. Learn more about your ad choices. Visit megaphone.fm/adchoices

President Biden’s proposed Budget for the Fiscal Year 2024 seeks to promote expanded access and improved affordability in healthcare and education while cutting taxes for low-income families and shrinking the deficit, but the proposed funding comes from increasing taxes on wealthy families and eliminating an important tax break for real estate investors, which Republicans will likely reject outright. Depending on your politics, you might have different views on taxation. But most Americans agree there’s an issue with the distribution of wealth in the United States, and 84% of those think the government should raise taxes on the wealthy to solve the problem, according to Pew. Disparities have widened over the past three decades—the wealthiest one percent of families now hold 34% of the nation’s wealth, up from 25% in 1989. Families in the 20th to 40th percentile of wealth distribution have seen their net worth decline 39% since 2007, while families in the top 20% have watched their net worth grow 13%. Learn more about your ad choices. Visit megaphone.fm/adchoices

A low-income home loan could be your answer to homeownership if you have below-average earnings. Unfortunately, insufficient income is why banks and lenders reject conventional mortgage applications. However, several home loan programs have great financing options to make purchasing a home possible for low-income families. Let’s face it—buying a home is tough at the best of times. Even with a sufficient down payment, a mortgage lender will refuse a home loan application if they think you cannot afford the monthly mortgage payments. In addition, if you are a first-time homebuyer, qualifying for a home loan can seem impossible due to the large deposit. If these scenarios affect you, what options are available to afford to buy a home? Popular low-income home loan programs include USDA, FHA, VA, Home Possible, and HomeReady. These programs have options like zero to three and a half percent down payments, less stringent minimum income requirements, or lower credit score thresholds. Therefore, a low-income home loan may suit you, depending on your situation. Learn more about your ad choices. Visit megaphone.fm/adchoices

Any tax person will tell you that you should save a receipt for every business-related purchase, no matter how small. Even so, many landlords are not keeping a paper trail of what’s often their most significant form of monthly income: rent. A rent receipt is a simple document that shows that your tenant is paying rent. In this article, we’ll walk you through why you need a rent receipt, how to fill one out, and how to accept rent payments online. Learn more about your ad choices. Visit megaphone.fm/adchoices

Commercial real estate is facing stress from several directions. The primary stress is rising interest rates, which are putting upward pressure on cap rates (which pushes down asset values), making refinancing costs increasingly difficult and expensive to come by. But there is another risk arising, specifically to the multifamily niche of commercial real estate: oversupply. Recent data suggests that there may be a short-term glut of multifamily units hitting the market at an inopportune time. Learn more about your ad choices. Visit megaphone.fm/adchoices

Net operating income (NOI) is a vital real estate profitability metric to help you calculate an investment property’s potential revenue. The NOI provides valuable data to determine whether to purchase a property, predict potential rental income, or raise rents to boost cash flow. The NOI formula is straightforward. You deduct the operating expenses from the gross operating income (GOI) to calculate a property’s potential profitability. In other words, net operating income is the difference between how much the property costs to operate and the amount of revenue it generates. Net operating income doesn’t use expenses like debt payments, mortgage payments, depreciation, or capital expenditures in the calculation. However, it helps you compare properties when buying or selling real estate. As a result, some investors consider this to be the most critical metric in real estate investing. This article explains why NOI is important when making real estate investment decisions. Learn more about your ad choices. Visit megaphone.fm/adchoices

Do you ever wonder how many mortgages you can have at once? In 2009, Fannie Mae updated its same borrower policy, amending the maximum number of conventional mortgages any one person can have from four to 10. However, qualifying and finding a lending institution that’ll give you more than four can be difficult. In this post, we’ll discuss what’s required to have multiple mortgages (including an example), the pros and cons of having multiple mortgages, and how to manage them. Learn more about your ad choices. Visit megaphone.fm/adchoices

It’s a nightmare scenario for any landlord. The lease expires, and your tenant doesn’t move out on time. You are then faced with the complicated decision of legally removing the tenant. After all, you cannot change the locks, cut off utilities, harass them, or do a self-help eviction. While the tenant won’t leave the rental unit, you are probably not getting monthly rent payments. Unfortunately, the situation when a tenant stays on after the lease expires — called a holdover tenant — is all too common. What is worse — tenants’ rights mean you are limited in what you can do, despite being the legal property owner. It may seem that your only option is to start legal proceedings. But, as any landlord knows, the eviction process can be expensive and time-consuming. And there is no guarantee that you can recover unpaid rent. Are there better ways to remove a tenant who refuses to leave after the lease period expires? This article will help you know the answer to two vital questions: How long can a tenant stay after the lease expires? What should you do if a tenant doesn’t move out on time? Understanding your legal position when a formal lease agreement expires is critical to answering these two questions. Learn more about your ad choices. Visit megaphone.fm/adchoices

Artificial intelligence has been around for decades, but it seemed a lot more innocuous when it was just playing checkers. ChatGPT, an AI language processing tool developed by OpenAI, can pass the bar exam. We’ve all seen and read enough science fiction material to feel a twinge of fear that robots may be coming for our jobs. But what’s more likely to happen over the coming decade is that AI will enhance our capabilities, making our work processes more efficient and giving us back that precious free time that is often the motivation for real estate professionals to build passive income streams. Of course, there are valid reasons to be concerned about ethics, safety, and human independence and agency as a result of this new technology. But so far, ChatGPT is proving to be an invaluable resource for real estate professionals in multiple aspects of their business. Understand its limitations and how to use it effectively, and you could build more wealth in less time or kick back and relax a little longer than you would otherwise. Learn more about your ad choices. Visit megaphone.fm/adchoices

Real estate agent earnings vary widely based on numerous factors, including experience, location, and niche. Some agents struggle to get by while others earn a comfortable living. However, some constants exist in how real estate agents work and get paid. For example, most real estate agents work on commission, which they earn at the end of a transaction. If you’re looking to become an agent or are just curious about how much realtors make, here’s what you should know. Learn more about your ad choices. Visit megaphone.fm/adchoices

A condo can be an attractive choice when purchasing an investment property, especially for first-time investors. They generally cost less than single-family homes and can be easier to maintain. However, whether or not they’re a good investment depends on several factors. Ready to learn more? Read on as we uncover the answers to common questions about investing in condos. Learn more about your ad choices. Visit megaphone.fm/adchoices

Managing rental properties is a complex task, especially when it comes to keeping track of which tenants are paying on time and who has outstanding balances. If you’re not maintaining an accurate paper trail and organizing your finances, your investment property can quickly become your greatest nightmare. A rent ledger is invaluable for property managers, landlords, and accountants, as it makes your life much easier when paying taxes and settling landlord and tenant disputes. In this article, we’ll discuss what a rent ledger is, how to create one, and the many benefits of having one. Learn more about your ad choices. Visit megaphone.fm/adchoices

Real estate properties listed as “off-market” are not publicly listed for sale. However, that does not mean that you cannot buy off-market properties. You may discover a great and lucrative real estate investment if you know how to find off-market properties. What is the best way to find off-market sales? Are there advantages to searching off-market property sales for investment opportunities? What should you be careful of when buying a property off-market? This article answers these questions and many more. Learn more about your ad choices. Visit megaphone.fm/adchoices

A wraparound mortgage is a financial option for real estate investors and traditional home buyers. In many cases, it can be a more desirable alternative to other non-conventional funding sources and can benefit both the buyer and seller. However, wraparound mortgages also come with their own set of risks, so you should be well-informed before getting into one. In this article, we’ll explain what a wraparound mortgage is, how they work, weigh the pros and cons, and discuss alternative loan options worth considering. What is a Wraparound Mortgage? With a wraparound mortgage, the buyer becomes responsible for paying the seller for the property’s total purchase price plus interest, based on the negotiated terms. A wraparound mortgage is basically a secondary mortgage or junior loan that an investor or home buyer takes out directly with the seller instead of a traditional bank or lending institution. Instead of trying to qualify for a loan, credit history checks, and meeting a conventional institution’s requirements, the buyer works out the loan and repayment conditions with the seller. Learn more about your ad choices. Visit megaphone.fm/adchoices

There are hundreds—if not thousands—of books on real estate, personal finance, personal development, and motivation. It’s likely you’ve heard of many of them, whether you read about them in an article or heard about them during a podcast. But what are the best real estate books for beginners? Successful real estate investors and entrepreneurs recommend everything from How to Win Friends and Influence People to The Millionaire Next Door. But deciding which book you should read first or next is a daunting task. Considering throwing up your hands and giving up? We understand—and so we did the heavy lifting. Learn more about your ad choices. Visit megaphone.fm/adchoices

There are hundreds—if not thousands—of books on real estate, personal finance, personal development, and motivation. It’s likely you’ve heard of many of them, whether you read about them in an article or heard about them during a podcast. But what are the best real estate books for beginners? Successful real estate investors and entrepreneurs recommend everything from How to Win Friends and Influence People to The Millionaire Next Door. But deciding which book you should read first or next is a daunting task. Considering throwing up your hands and giving up? We understand—and so we did the heavy lifting. Learn more about your ad choices. Visit megaphone.fm/adchoices

Bonus depreciation lets you maximize your return and minimize your tax liabilities. With bonus depreciation, you can deduct a large portion of the cost of qualifying assets during the year they were placed in service. Unfortunately, understanding bonus depreciation, how it works, and whether it’s right for your real estate investment strategy is no small feat—but that’s where we come in. In this guide, we’ll walk you through everything you need to know about bonus depreciation. Learn more about your ad choices. Visit megaphone.fm/adchoices

Choosing the right real estate investment to add to your portfolio requires ample research and extensive knowledge about the market that you’re investing in. A poor decision can result in your portfolio dropping substantially in value. When markets start to dip, and the economy enters a recession, selecting the best investment becomes even more important. The most rewarding investments are ones that occur in recession-proof markets, which are areas where homes are in high demand regardless of how the economy is performing. Not every market performs the same. By investing your money in homes that are situated in recession-proof markets, you can benefit from consistent rental income, moderate appreciation even in poor economic environments, and continued rental increases YoY. Learn more about your ad choices. Visit megaphone.fm/adchoices

Commingling refers to the combining or intermingling of funds that may be coming from various sources or earmarked for different purposes. As a real estate investor, commingling can help diversify your portfolio and expand your potential. As a property owner, you must clearly understand where your funds are coming from and what they’re for so that you use them appropriately. In this post, we’ll explain what commingling is, when it’s advantageous, and when it could be illegal. Learn more about your ad choices. Visit megaphone.fm/adchoices

Selling your house without a Realtor may not be as complicated as you think. Although more work is involved, selling without the help of a real estate agent could be a smart financial move. You could save money on the agent fee, have more control over the sale process, and, in some cases, sell your home faster. However, before you put a “For Sale by Owner” sign up in your front yard, it’s wise to consider the complexities of selling your house without a Realtor. Apart from dealing with a ton of paperwork, selling a home by owner is time-consuming. And in the end, the money you save on agent commission fees is usually not worth the extra effort. This article discusses the pros and cons of selling your property without a Realtor. You will learn about the selling process to help you decide if the “sell a house by owner” route is for you. If you decide it makes financial sense, then go for it, but you might find that it makes more sense to simply hire an agent. Learn more about your ad choices. Visit megaphone.fm/adchoices

I know what you’re thinking. This guy is trying to stretch the SVB headlines into a multifamily real estate investing story. It must be clickbait. I get it. But I hope you’ll give me a moment to tell you two ways the SVB and other major bank failures could potentially benefit multifamily syndicators and investors. Then you can decide if there’s any substance to my headline. Like all of us, I watched the news stories unfold swiftly over this past week. Silicon Valley Bank went from paying bonuses to closing shop within days. There is no need to recount the gory details here. But as I pondered the bad news falling out from this hopefully localized but potentially more significant situation, I realized two potential bright spots for multifamily syndicators and investors. Not just current players—but those eager to get into this currently over-crowded space. My short-term thesis is speculative, so I freely admit I could be wrong on this one. But I will plant a confident flag on my longer-term discussions below since I believe these outcomes are virtually inevitable. Learn more about your ad choices. Visit megaphone.fm/adchoices

Rental properties are a fantastic source of income as long as your tenants pay rent. Unfortunately, even the strictest tenant screenings are imperfect, and even the most responsible renters can be hit with unpredictable, life-altering circumstances. That’s when rent guarantee insurance comes in handy. Rent guarantee insurance provides financial protection if your tenants fail to pay rent. In the occasionally unpredictable real estate environment, rent guarantee insurance helps you minimize risk, so you don’t have to worry as much when collecting your monthly rent payment. In this article, we’ll discuss rent guarantee insurance, how it works, and how to find the best insurance policy for you. Learn more about your ad choices. Visit megaphone.fm/adchoices

It goes without saying that investors of all stripes have been spooked by the recent collapse of Silicon Valley Bank and Signature Bank, as well as the Swiss National Bank facilitating UBS’ $3.2 billion purchase of Credit Suisse, First Republic Bank’s stock falling more than 70% and bank stocks, on the whole, being hammered. Many seem to think a 2008-like financial crisis is beginning. While it’s important not to understate the precarity of our current situation, there are major differences that make these two events, more or less, incomparable. For one, Lehman Brothers was an investment bank, and both Silicon Valley Bank and Signature Bank were commercial banks. The size was also quite different despite Silicon Valley Bank being the second biggest bank failure in American history. Lehman Brothers had $600 billion in assets in 2008. Silicon Valley Bank had $198 billion. Adjusting for 15 years of inflation, Silicon Valley Bank was maybe 20% the size of Lehman Brothers. Learn more about your ad choices. Visit megaphone.fm/adchoices

Are you listening to the advice of the world’s greatest investors? More importantly, are you acting on that advice? If it isn’t clear already, the latest swing banking failures show that risky bets are capable of producing devasting results. Protecting your money should be first and foremost on your mind. So with that in mind, I’ll ask again. Are you listening and acting on the strongest advice of the world’s most successful investor? Learn more about your ad choices. Visit megaphone.fm/adchoices

A square foot is a measured amount of flat space that covers an area. Its measurement is one foot x one foot (or 12 inches * 12 inches, equaling 144 square inches), meaning that if you have a 100-square-foot bedroom, you can divide it into 100 equal squares. Regardless of your reasoning, you need to know how to calculate square feet down to the foot. Being off by even a little bit can cost you hundreds—even thousands of dollars. Here are a few reasons why: Identifying fair market value: Square footage is a key indicator of a property’s fair market value. When selling a house, you need to know what comparable homes in your area are worth. If the average home price per square foot in your neighborhood is $200 and your measurements are off by 10 feet, you could undervalue your property by $2,000. Tax assessments: If you believe the assessed value of your property is too high, you can calculate the square footage to see if your number matches the assessors. You can dispute the assessment and save money on property taxes if your number is lower. Renovations: If you’re renovating your home or a rental property, you need to calculate the square footage of the areas you’re rehabbing. This calculation will let you know how much material to buy and ensure your new furniture and appliances will fit and function properly. Learn more about your ad choices. Visit megaphone.fm/adchoices