BiggerPockets Daily

Let’s get one thing straight: everyone should hold both stocks and real estate in their portfolios. Diversification is the ultimate hedge against risk. But that doesn’t mean we can’t pit stocks and real estate against each other in a classic Mortal Kombat-style matchup. Which earns the best return on investment: real estate or stocks? And while we’re asking this grandiose question, which investment is safer? Learn more about your ad choices. Visit megaphone.fm/adchoices

Let’s get one thing straight: everyone should hold both stocks and real estate in their portfolios. Diversification is the ultimate hedge against risk. But that doesn’t mean we can’t pit stocks and real estate against each other in a classic Mortal Kombat-style matchup. Which earns the best return on investment: real estate or stocks? And while we’re asking this grandiose question, which investment is safer? Learn more about your ad choices. Visit megaphone.fm/adchoices

Do you want to destroy your wealth? I can teach you how. Do you want to create more wealth for yourself? I can teach you to do that as well. Do you know about the denominator effect? In finance and investing, the “denominator effect” occurs when the value of one portion of a portfolio decreases drastically and pulls down the overall value of the portfolio. As a result, any segments of the portfolio which did not decrease in value now represent a large percent of the overall pie. While this is true and somewhat obvious, there is another denominator effect at play in real estate. An insidious destroyer of investor dreams and wealth. If you acquire and operate a great asset and this denominator goes in your direction, you will celebrate with a double win. But even if you buy and operate your asset well, this denominator effect can destroy you and liquidate your equity. What is this denominator effect? I’m talking about cap rate decompression. Learn more about your ad choices. Visit megaphone.fm/adchoices

In January, we published an article about DSCR loans, a product increasingly used by more and more real estate investors to scale their portfolios. Known for easy qualification and light documentation standards (no income verification, no DTI requirements, no tax returns, etc.), sophisticated real estate investors are continuing to utilize DSCR loan options after maxing out on conventional financing options or simply finding it’s not worth trading the time and hassle of a bank qualification for the slightly lower rates. The previous article outlined the basics of how to best position yourself as a DSCR loan borrower to get the best rates and terms on your DSCR loans. Quick recap: the rates and terms are primarily driven by three main metrics: Loan-To-Value (LTV) Ratio Debt-Service-Coverage-Ratio (DSCR) Ratio FICO/credit score While the rate you’re going to be quoted is going to be mainly driven by those three factors, there are several other pieces to the puzzle that can also change the terms offered. The savvy DSCR loan borrower will use all the options available to optimize terms, especially in volatile rate environments like today, where every little bit of rate matters in securing profitable investments! Learn more about your ad choices. Visit megaphone.fm/adchoices

Last week, Silicon Valley Bank (SVB) rapidly collapsed—going from normal operations to insolvency in a matter of days. SVB was the 16th largest bank in the United States, with about $209B in assets. The failure represents the 2nd largest bank collapse in U.S. history. As of Sunday, March 12th, a second bank, Signature Bank, was seized by regulators for fears of insolvency. As of this writing, the government has stepped in with emergency measures intended to stop a full-blown financial crisis from occurring, but this story is still developing. In this article, I will explain what has happened so far and what you should be keeping an eye out for in the coming weeks. Learn more about your ad choices. Visit megaphone.fm/adchoices

I’ve written two relatively recent articles on the economy. The first summarized Lauren Baker of ITR Economics keynote address at BPCON 22. She concluded that signs point to a potential soft landing in the economy—the aversion of disaster. Great news! Or not. I discussed the potential that the throttling of commercial credit markets could crash-land this potential soft landing. In my second article, I talked about the implications of the credit cycle. I overviewed Howard Marks’ thoughts on the potentially disastrous impact of a restricted credit market. We discussed the characteristics of a generous credit market as well as a tight one. We reviewed the possible impact on the economy and what could go right or wrong. Learn more about your ad choices. Visit megaphone.fm/adchoices

You’re not alone if you’re unfamiliar with land trust affiliate marketing. However, it is quickly becoming a popular real estate marketing strategy—and can be a highly effective one at that! Land trust affiliate marketing is a technique that involves using land trusts to market real estate properties. This post will dissect exactly what that means, how it works, and its benefits and disadvantages. Are you ready to discover one of real estate’s newest marketing trends? Learn more about your ad choices. Visit megaphone.fm/adchoices

There are few real estate markets with as many attractive cities as California. From the allure of luxury and lifestyle in Los Angeles to the technology heart of San Francisco, there’s a reason why California rents are often reported to be the highest in the nation. The California real estate market is an important one for real estate investors thanks to its large and diverse economy that spans numerous industries, including technology, entertainment, and agriculture. This creates sky-high demand for housing, leading to attractive rental income and consistent property appreciation. It also makes California an incredibly competitive real estate market. It’s not the easiest region to achieve positive cash flow in real estate, with a higher entry point than many other states. Those who already own property, have recently inherited a home, or have decent capital to reduce debt servicing tend to fare the best in the Californian market. Learn more about your ad choices. Visit megaphone.fm/adchoices

Property taxes can substantially impact how much you’re paying for your home and dig into your profits as a real estate investor. They also vary widely from state to state, with Hawaii’s average property tax rate at around 0.29% and New Jersey’s averaging approximately 2.46%. While there’s only a 2.17% difference between the two, that 2.17% equates to a lot of money. Let’s say you own two homes: one in Hawaii and one in New Jersey, and they both have an assessed value of $500,000. If you’re paying the average property tax rates for each state, you’ll owe $1,450 in Hawaii and $14,546 in New Jersey. That’s a $13,096 difference! While there are no states without property taxes in 2023, many states have low property taxes. In this article, we’ll discuss what property taxes are, how they’re calculated, and list the states with the lowest property taxes. Learn more about your ad choices. Visit megaphone.fm/adchoices

A blanket mortgage is useful for real estate investors with a large real estate portfolio. Also called a blanket loan, the mortgage consolidates several separate loans into a single mortgage. For many experienced investors, having one loan payment makes juggling several mortgage payments and interest rates more straightforward. However, arranging a blanket mortgage loan is not always the best financing option. For example, loans are harder to secure. And putting individual mortgages under one “blanket” can put all properties in the portfolio at risk. When does it make financial sense to put separate mortgage loans into a single loan? Are there situations when it is best to keep individual loans separate and not consolidate them into an entire mortgage? This article explores the pros and cons of using blanket loan refinance to manage multiple properties in a real estate portfolio. Learn more about your ad choices. Visit megaphone.fm/adchoices

If you’re a real estate investor looking to grow your portfolio, you are likely aware of the difficulties of finding adequate funding. You may have had to meet stringent qualification criteria, offer individual guarantees, and contend with complex loan management issues. Luckily, there’s a solution to the confusion. Rental portfolio loans reduce the difficulties of financing multiple rental properties by allowing you to use them as collateral for one loan. This can simplify the process of accessing streamlined capital for your investments. In this article, we’ll go over the fundamentals of rental portfolio loans, the benefits and drawbacks, and how they can assist you in developing your rental business. Learn more about your ad choices. Visit megaphone.fm/adchoices

Did you know you may be charged a prepayment penalty for attempting to pay off your loans early? Prepayment penalties are fees that some lenders charge if you refinance or pay your mortgage off early. Not only are they fairly common—they’re also often misunderstood by borrowers. In this article, we’ll discuss how a mortgage prepayment penalty works, the types of prepayment penalties you may encounter, and how to avoid paying them. Learn more about your ad choices. Visit megaphone.fm/adchoices

There are plenty of reasons to want a second home. Whether you’re making the leap into real estate investing and need a property that can cash flow each month or you just need a place to stay in the summers, second homes are a mainstay in the classic “freedom” lifestyle. However, buying another property is a serious financial commitment. And if buying a primary home is one of the largest financial transactions you are likely to make, purchasing a second home can be just as large. Therefore, before buying a second home, it makes financial sense to calculate if you can afford the purchase costs and maintenance. So, whether you want to find the perfect beach getaway, commuter home near a major city, or rental property to start a real estate portfolio, you need the best advice on how to buy a second home. This article explores the necessary steps to take ownership of a second residential property. You will learn how to choose a location, find financing, and close a deal. Learn more about your ad choices. Visit megaphone.fm/adchoices

You’ve decided, for whatever reason, that you want to invest outside of your local area or state. Your next question is—where should I invest? I’m going to offer you a list of things that you can consider when trying to figure out what market to invest in. These things are in no particular order, and some of them may not apply to you or your particular situation. My intention with each one is to give you something to think about and hopefully some ideas on where and how to start looking for a market that suits your investment needs. Here we go! Learn more about your ad choices. Visit megaphone.fm/adchoices

I am a huge fan of doing it yourself. My husband and I have flipped numerous houses—but on a fairly small scale, one home at a time and doing almost all of the work ourselves. YouTube is a great resource. There are videos for just about any task on that site. But just because you KNOW how to do something doesn’t mean it makes sense for you to do it yourself. Here are four jobs we have attempted at least once—and will never again do ourselves. Learn more about your ad choices. Visit megaphone.fm/adchoices

It was the year 2000. We had made it through Y2K! The world would continue as it had for many centuries before. One thing would change though. I was now in my freshman year of high school, and I started getting asked something more and more consistently. No, I am not talking about your mom or dad embarrassingly asking you if there were any new love interests in your life. The question was, “So, Ryan, what do you want to do for a job when you’re done with school?” I had already given this thought. I wanted to work for ING. Yes, the large banking and financial services company. Why? Well, if you drove through my state capital (Hartford, Conn., at the time), they had a really tall and cool looking office building with their giant orange ING tiger logo affixed on top. Learn more about your ad choices. Visit megaphone.fm/adchoices

Don’t be that person! If you’ve ever been to a networking event, then you’ll know who I’m talking about: the person who goes around giving out business cards as if they’re flyers. The best networkers give out business cards only when asked to do so or after you’ve established a personal connection. Otherwise, you may seem superficial, and the cards will become meaningless! Here are some steps you can follow to create a large yet intimate network. Learn more about your ad choices. Visit megaphone.fm/adchoices

The popularity of manufactured (mobile) homes has been on the rise over the past several years, spurred partly by highly competitive traditional housing markets, overall interest in smaller homes, and the search for more affordable housing. But what about adding this type of home to your real estate investment portfolio as a single home or in a mobile home park setting? Although I haven’t personally invested in manufactured homes yet, I’ve researched and spoken with experts about the pros and cons as I consider diversifying my portfolio. This article will outline some interesting and informative information I’ve come across. Learn more about your ad choices. Visit megaphone.fm/adchoices

Before the pandemic, co-living as a housing solution was already gaining popularity as urbanization caused rents to rise in major cities. Now, the concept of living in accommodations with communal spaces is making a comeback after the pandemic left a rental affordability crisis and loneliness epidemic in its wake. Early this year, the largest co-living operator in North America, Common, announced a merger with Habyt, the largest co-living operator for Europe and Asia. The result is a global leader in co-living that will operate 30,000 units worldwide, many of them co-living spaces. It is estimated that there were 74,000 total co-living bedrooms either for-rent or in development in the U.S. in 2022. At the end of 2019, real estate investment firm CBRE found that there were about 5,000 beds in only about 150 co-living communities around the country. It’s a rapidly accelerating trend, and research shows it may have staying power. Learn more about your ad choices. Visit megaphone.fm/adchoices

Real estate is widely considered the best and more consistent investment around. However, calculating the value of your investment is more challenging than checking your monthly bank statement. Multiple ways to calculate your return on investment (ROI) for a rental property exist. How you choose to do so depends on your situation. In this article, we’ll discuss the importance of calculating ROI for real estate and then show you how and when to calculate ROI for: Cash flow Cash-on-cash return Capitalization rate (cap rate) Appreciation Here’s how to calculate ROI on a rental property: Learn more about your ad choices. Visit megaphone.fm/adchoices

The U.S. housing market is facing an affordability crisis. The combination of high home prices, rising mortgage rates, and decreased spending power has driven housing affordability to its lowest level in decades. As such, it is difficult for investors and homebuyers alike to identify cities where they can afford to buy property. But, there are still great opportunities to buy real estate, even on a budget. I’ve done the research and have identified the eight most affordable markets for real estate investors. Below, I’ll explain how we arrived at the current situation, my criteria for selecting these markets, and then give you some data about the cities. Check out the list below and determine if any of these cities fit your investing goals. Learn more about your ad choices. Visit megaphone.fm/adchoices

Are you tracking the storm brewing in the commercial real estate realm? It’s not a big surprise. It happens in every downturn in one form or another. But investors always seem to be surprised. Though this downturn will likely not be as devastating as the Great Recession, there is one element that makes the problem more pervasive. That is the fact that a much higher percentage of the investor population invests in commercial real estate now compared to 2008. Crowdfunding, social media, the JOBS Act, and the proliferation of new gurus (I call them “Newrus”) have contributed to the size of cracks in the ice that have already formed and are about to give way. BiggerPockets has facilitated a wonderful community that has spawned education, connections, mentoring, and so much more. Communities like ours have also created paths for investors and syndicators to connect at a level investment sponsors and investors could have only dreamed about in years past. Learn more about your ad choices. Visit megaphone.fm/adchoices

Are you struggling to wrap your head around depreciation recapture? If so, you’re not alone. When running your real estate business, you can account for the wear and tear of your property and any furnishings and appliances you own via depreciation. You can divide the costs associated with these items over several years through depreciation based on the schedules of asset classes that the internal revenue service (IRS) publishes. Depreciation recapture refers to the portion of a gain you realize from selling a rental property taxed as ordinary income instead of capital gain. In other words, when you sell your property, the IRS taxes you on your depreciation deductions. Still confused? That’s okay. In this post, we’ll show you how depreciation recapture works (and include examples), how to calculate it, and tell you if it can be avoided. Here’s everything you need to know about depreciation recapture. Learn more about your ad choices. Visit megaphone.fm/adchoices

Can you win in any market? No seasoned real estate investor would deny the importance of keeping up with macro and micro market conditions. Ignore either, and you don’t really stand a chance. With that said, lately, conversations of a downturning market have swallowed up evergreen advice. In fact, new data suggests that investor homebuying fell 46% year-over-year in Q4. So, it feels like not enough is being said about tried-and-true strategies, principles, and tools. Learn more about your ad choices. Visit megaphone.fm/adchoices

When people consider taking the leap to start investing in real estate, one question always persists: is now the right time to start investing? The longer this question looms in an investor’s mind, the harder the proposition becomes. The short answer is yes. It is always the right time to invest in real estate. In terms of an asset class, real estate tends to appreciate over time and provides investors with income that can lead to generational wealth. To be frank, more people should be investing in real estate, but it takes planning, hard work, execution, and a little bit of luck. Most savvy real estate investors all have stories that include roadblocks and obstacles to their success, but they found a way to maneuver through the industry to still be thriving today. Some investors give up too easily when something goes wrong or if the current environment isn’t as easy to navigate as they’re used to. Success doesn’t come easy, but these tips to navigate the market and find success may instill some confidence in investors that are looking to start investing or investors that are considering moving on to a different venture. There has been a lot of discussion regarding the current state of the market, and a lot of panic from investors has ensued. Interest rates have increased, which brings challenges into play, but with the right tools and guidance, there are still plenty of opportunities for success. Learn more about your ad choices. Visit megaphone.fm/adchoices

Writing a late rent notice is an unavoidable part of being a landlord. The notice of a late rent payment has three purposes. First, it reminds the tenant to pay the overdue rent promptly, informs about late fees, and then warns the tenant of the consequences of nonpayment. However, a late rent letter has a more important purpose — it’s a formal document necessary if you choose to start an eviction process. Of course, being a landlord is easier when all tenants pay their rent on time. However, even the most diligent tenant can forget to pay their rent money by the first of the month. Of course, some tenants have serious financial difficulties and cannot pay rent. But in all cases, writing a late notice for rent is a vital part of the rent collection process. This article is a complete guide to dealing with overdue rent and how to encourage tenants to make rent payments on time. You will also find a helpful late rent notice template and step-by-step instructions on writing a late rent notice. Learn more about your ad choices. Visit megaphone.fm/adchoices

Americans are squeezed by inflation and rising housing prices in big cities. They’re seeking refuge in states with warm climates, a lower cost of living, and plenty of job opportunities—states like Florida, Texas, and the Carolinas. An analysis of census data from the National Association of Realtors (NAR) reveals which states lost residents and which made population gains in 2022. The trends clearly indicate that many Americans are moving in response to affordability concerns. Learn more about your ad choices. Visit megaphone.fm/adchoices

Fixer-uppers can be transformed into fantastic places to live. They can also get expensive. In addition to your mortgage loan, you will often need to pay for repairs out of pocket or get a short-term, high-interest loan. What if you could combine your home purchase and the cost of renovations in a single loan? With an FHA 203(k) rehab loan, you can! FHA 203(k) loans (also known as renovation mortgage loans) let you purchase or refinance a home by combining the mortgage and repairs into a single loan with one monthly mortgage payment. This post will explain how FHA 203(k) rehab loans work, their requirements, and the pros and cons of getting one. Learn more about your ad choices. Visit megaphone.fm/adchoices

The vast majority of real estate investors get into the industry to pursue passive cash flow. Unfortunately, over the last several years, finding deals with strong cash flow has become a challenge. However, there are still plenty of markets in the U.S. that continue to offer cash flow potential. Below, I provide what I believe to be the top 10 markets in the United States for cash flow. Learn more about your ad choices. Visit megaphone.fm/adchoices

Last week, I listened to On The Market episode “New Low-Interest Mortgages Are On the Way for Investors (How to Get One).” I was ready to learn the secret of acquiring a lower rate—and surprise, surprise—the three lending professionals had some ideas based on the market, but they had no crystal ball on what rates would actually do throughout the rest of 2023. There were three quotes from the podcast that stuck out to me as a buyer’s agent and investor: Christian Bachelder, The One Brokerage: “Volume, just on a grand total, is down. But volume per investor, if that’s a metric that I could use, is definitely [up].” Bill Tessar from CIVIC: “I am really bullish on real estate, short and long-term. I think you can get a better deal today than you could six months ago. You can negotiate a little bit, you could demand a little bit more. You’re not paying over list price. You’re getting contingencies on your deals. You’re getting seller concessions on points. You’re getting all that stuff. That’s great. So I’m bullish on real estate.” LendingOne’s Matt Neisser: “The one thing I’d say to borrowers [that] I say to myself is I try not to bet on interest rates.” Learn more about your ad choices. Visit megaphone.fm/adchoices

The U.S. Department of Housing and Urban Development (HUD) is a federal government agency that helps people get access to affordable housing. Most Americans associate HUD with public housing assistance and assisting low-income families. However, HUD programs also help individuals qualify for FHA loans, make home improvements, and enforce fair housing laws nationwide. Many property investors are considering buying HUD homes to expand their portfolios. HUD foreclosed homes are often sold below market value, allowing you to rehab and flip the property for profit. However, HUD housing programs are also a great way for families to buy their first home. Schemes like the “Good Neighbor Next Door Program” or the “HUD $100 Dollar Program” provide highly affordable financing options for low-income families to buy a home. This article explores what it takes to purchase a HUD home and whether this type of housing can be profitable. You will also learn the pros and cons of buying a foreclosed HUD property. Learn more about your ad choices. Visit megaphone.fm/adchoices

Calculating the principal and interest on your mortgage helps you identify the actual cost of a property. If you have a $400,000 loan at a 30-year fixed rate of 5%, the amount you spend after 30 years isn’t $400,000. It’s actually $773,158. $400,000 will go toward your principal, while the other $373,158 will go toward your interest. When you buy a home with a fixed interest rate, your monthly mortgage payment will be the same for the duration of your loan. However, even though you’re writing a check for the same amount every month, how much you put toward your principal and interest will always be different. In this post, we’ll define what your principal and interest payments are on a mortgage and show you have to calculate how much a house will cost you to make a more informed decision when purchasing a property. We’ll also discuss the difference between APR and your interest rate, what factors impact your interest rate, and how to track where your fixed-rate mortgage payments are going. Learn more about your ad choices. Visit megaphone.fm/adchoices

I’m worried about a significant decline (or crash) in commercial real estate valuations, specifically including multifamily, in 2023 and 2024. I feel that the red flags are so clear and all pointing in the same direction that I’d be neglecting my duty to this community to fail to make my stance as clear as possible and to defend that stance in great detail. In this article, I’ll walk through my thesis, outlining four primary threats to multifamily valuations, following the summary below: Part 1: Cap Rates Are Lower Than Interest Rates Part 2: I’m Not Betting On Meaningful Rent Growth In 2023 Part 3: I’m Betting On Interest Rates Rising In 2023 Part 4: High Interest Rates Put Pressure On Valuations And Debt Underwriting Part 5: News, Anecdotes, And Further Reading Part 6: Ideas To Protect Wealth And Make Money In This Environment Please note that real estate is local. My analysis in this article is reflective of the average across the United States, though I do dive into a couple large regions. Learn more about your ad choices. Visit megaphone.fm/adchoices

I’m worried about a significant decline (or crash) in commercial real estate valuations, specifically including multifamily, in 2023 and 2024. I feel that the red flags are so clear and all pointing in the same direction that I’d be neglecting my duty to this community to fail to make my stance as clear as possible and to defend that stance in great detail. In this article, I’ll walk through my thesis, outlining four primary threats to multifamily valuations, following the summary below: Part 1: Cap Rates Are Lower Than Interest Rates Part 2: I’m Not Betting On Meaningful Rent Growth In 2023 Part 3: I’m Betting On Interest Rates Rising In 2023 Part 4: High Interest Rates Put Pressure On Valuations And Debt Underwriting Part 5: News, Anecdotes, And Further Reading Part 6: Ideas To Protect Wealth And Make Money In This Environment Please note that real estate is local. My analysis in this article is reflective of the average across the United States, though I do dive into a couple large regions. Learn more about your ad choices. Visit megaphone.fm/adchoices

I’m worried about a significant decline (or crash) in commercial real estate valuations, specifically including multifamily, in 2023 and 2024. I feel that the red flags are so clear and all pointing in the same direction that I’d be neglecting my duty to this community to fail to make my stance as clear as possible and to defend that stance in great detail. In this article, I’ll walk through my thesis, outlining four primary threats to multifamily valuations, following the summary below: Part 1: Cap Rates Are Lower Than Interest Rates Part 2: I’m Not Betting On Meaningful Rent Growth In 2023 Part 3: I’m Betting On Interest Rates Rising In 2023 Part 4: High Interest Rates Put Pressure On Valuations And Debt Underwriting Part 5: News, Anecdotes, And Further Reading Part 6: Ideas To Protect Wealth And Make Money In This Environment Please note that real estate is local. My analysis in this article is reflective of the average across the United States, though I do dive into a couple large regions. Learn more about your ad choices. Visit megaphone.fm/adchoices

Prospective homebuyers have been waiting for more affordable conditions, and according to data from the Mortgage Bankers Association, they might be ready to start making offers. Mortgage demand surged 7% in the week ending January 20th after skyrocketing nearly 28% the week prior. While there have been variations in mortgage demand, often following fluctuations in the federal funds rate, a 28% increase in the volume of mortgage applications hasn’t occurred since the first week of March 2020. Meanwhile, inventory isn’t growing to keep pace. Homebuyer sentiment improved slightly in December. Inflation is moderating faster than some recent expectations, and a growing cohort of economists are betting the Fed will pull off a soft landing. Did we manage to avoid a housing market crash, and is the housing market already making a comeback? Learn more about your ad choices. Visit megaphone.fm/adchoices

There are a number of potential benefits associated with exchanging into a Delaware Statutory Trust (DST) 1031 property. However, it is important to note that these potential benefits should also always be carefully weighed with the potential risks that are possible with DST investments, and as with all real estate investments, investors should consult their tax attorney and or Certified Public Account before investing in DSTs. Still, DSTs continue to grow in popularity, especially among aging baby boomers who are tired of managing their own properties and are looking for a way to transition into a passive income stream. DST investments not only provide investors the potential for passive income but also the following six benefits as well. Learn more about your ad choices. Visit megaphone.fm/adchoices

The last year or so has been challenging for investors and savers alike. With inflation raging and many of the major markets in correction territory, it’s been difficult to find a safe place to park cash. Bond yields have been below the rate of inflation, and savings accounts have offered pathetic interest rates. Any money held in cash or bonds has been losing spending power against inflation. For real estate investors who often need time to save up cash between purchases, this can be a problem. Luckily, it looks like things are starting to change. One silver lining of recent rate hikes is that as the Fed raises their federal funds rate, bond yields and the interest rate paid on money market and savings accounts tend to rise. This is exactly what we’re seeing. These low-risk assets now offer the potential to earn a real (inflation-adjusted) return. Bond yields have fluctuated between 3.5% and 4% for the last several months. According to Bankrate, high-yield savings and money market accounts are now offering between 3.3% – 4.3% as of this writing. Learn more about your ad choices. Visit megaphone.fm/adchoices

The Biden-Harris administration is responding to a rent-burdened nation with new actions designed to promote a fair rental market, alongside the release of a “Blueprint for a Renters Bill of Rights.” The demand for housing skyrocketed in 2021, causing rents to increase 17.1% year-over-year at their peak in February 2022. The Federal Trade Commission (FTC) and the Consumer Financial Protection Bureau (CFPB) are being charged with identifying unfair practices that prevent tenants from accessing or maintaining housing. The Federal Housing Finance Agency (FHFA) announced that it would consider limits on rent increases and other renter protections through a transparent and public process. And the U.S. Department of Housing and Urban Development will publish proposed rules that would require certain owners of rental assistance properties and public housing authorities to give 30 days’ notice to terminate a lease for nonpayment. The administration is also calling on state and local governments, as well as the private sector, to participate in improving conditions for renters by making their own commitments — as an example, the Wisconsin Housing and Economic Development Authority (WHEDA) and the Pennsylvania Housing Finance Agency (PHFA) have limited rent increases on subsidized affordable housing to 5%. Learn more about your ad choices. Visit megaphone.fm/adchoices

What would life be like with no rent? No mortgage payment? Pretty good, as it turns out. Nowadays, 11 million Americans spend half their income on rent, and that doesn’t include the millions of homeowners similarly overstretched. But for anyone looking to find a different path, house hacking comes with plenty of perks. For this story, I tracked down a bona fide house hacker and pried until he agreed to spill the proverbial beans on exactly how he did it. Learn more about your ad choices. Visit megaphone.fm/adchoices

How do you classify yourself as a landlord or real estate investor? Are you a rookie emerging on the scene? Do you identify as an independent or small landlord? Or are you perhaps a property manager with a few rentals under your belt? How you see yourself in relation to the real estate world can depend largely on how others like you classify themselves. And this can include anywhere from a mom-and-pop landlord to a large multifamily corporation. However, with the advent of modern technology, there’s a new type of landlord on the scene — the digital landlord. Previously being a real estate investor or landlord came with a lot of manual tasks. Things like collecting rent, sorting through paper applications, and even navigating maintenance issues were time-consuming and tedious. But with technological advances in the real estate landscape, tech is transforming historically manual pain points of the renting process into seamless, simple, and digital. Learn more about your ad choices. Visit megaphone.fm/adchoices

In 2022, 41% of renters spent more than 35% of their income on rent. As rental and living costs rise, wages are struggling to keep up. Living in a major city is exceptionally expensive, so most young professionals live in older apartments farther away to save money. With so much spent on rent, it’s unfathomable for younger generations to even think about purchasing their own homes. But what if there was a way to live in a new apartment and save 30%-40% on rent? Furthermore, the rent includes utilities, regular cleaning, furniture, and community events. Sounds too good to be true? It’s real, it’s called co-living, and it’s on the rise. Learn more about your ad choices. Visit megaphone.fm/adchoices

Prospective homebuyers are getting a little more hopeful that mortgage rates will come down, and a greater share is feeling confident that it’s a good time to buy a home, according to the Fannie Mae Home Purchase Sentiment Index, which has recovered slightly from its all-time low in October. The data comes from a survey of about 1,000 homeowners and renters who were asked more than 100 questions about their attitudes toward home buying and the economy. The Fed has indicated that slower rate hikes are on the way and may even cease once rates reach just over 5% since December data shows inflation is moderating. Meanwhile, many markets are already shifting into the hands of the buyer, with sellers offering more concessions, and the Case-Shiller Index shows home prices declining month-over-month, though they’re still elevated compared to a year ago. More prospective homebuyers are betting that the affordability crunch will ease, likely as a result of these changes. But if their optimism translates to increased demand, that could cause prices to rise again. Learn more about your ad choices. Visit megaphone.fm/adchoices

The No. 1 reason wholesalers have such a terrible reputation in the real estate industry is because they never have good deals. The most common complaint I hear is that wholesalers aren’t leaving enough profit margin for investor-buyers to make any money deals. So what’s considered a good deal anyway? That would be a property that is going to bring our investor-buyers a nice return on their money after flipping. The biggest problem is that there’s a lot of wholesalers out there who don’t know how properly analyze deals! It’s critical as a wholesaler that we analyze deals from a fix-and-flipper or buy-and-hold investor’s perspective because they are our primary customer. And what may look like a good deal for us wholesalers may not be a good deal for our investor-buyers. Learn more about your ad choices. Visit megaphone.fm/adchoices

In recent years, a fairly new loan product: Debt Service Coverage Ratio (DSCR) loans, has become enormously popular with real estate investors. DSCR loans have become a critical tool for investors on track to achieve their dreams of financial freedom. These loans, meant specifically for investment properties only, are so effective and popular because they require no income verification (or Debt-To-Income Ratio) and no tax returns or endless paperwork. Further — while the qualification and documentation are much less than conventional mortgages — the interest rates are just barely higher (typically less than 1% more). These loans offer fixed rates for 30 years, including options where it’s interest-only for the first 10 years, so you avoid the payoff and refinance pressure that often comes with hard money alternatives. Learn more about your ad choices. Visit megaphone.fm/adchoices

https://www.biggerpockets.com/blog/real-estate-investing-mistakes-you-dont-want-to-make-in-2023 Learn more about your ad choices. Visit megaphone.fm/adchoices

https://www.biggerpockets.com/blog/1031-exchange-versus-sale-pros-cons Learn more about your ad choices. Visit megaphone.fm/adchoices

https://www.biggerpockets.com/blog/how-the-housing-correction-will-affect-everyone Learn more about your ad choices. Visit megaphone.fm/adchoices

https://www.biggerpockets.com/blog/2015-07-06-ultimate-guide-systems-outsourcing-real-estate Learn more about your ad choices. Visit megaphone.fm/adchoices

https://www.biggerpockets.com/blog/2015-07-06-ultimate-guide-systems-outsourcing-real-estate Learn more about your ad choices. Visit megaphone.fm/adchoices