Real Estate Verses Stock, Part 4 - Inflation Hedge

In the first three articles, we discussed your ability to leverage large real estate assets with very little of your money and have all your expenses paid with other people's money (OPM), so you can reap huge profits as your real estate investment appreciates.   Unfortunately, no discussion of money can avoid the subject of INFLATION. 

Inflation is the increase in the prices of all goods and services, which is realized as a decrease in the purchasing power of your dollars.   Because of inflation, today's dollars are worth more than tomorrow's dollars.  Typically, the Consumer Price Index, All Urban Consumers, All Items is the best measure of inflation.  Inflation can steal your investment profits unless you have the right investment, real estate.

In Part 2 we discussed the actual appreciation rates for the various investments.  Those rates were not inflation adjusted. The actual annual appreciation for a saving account since 1963 was just 0.6% as measured by the return on 3-month US Treasury Bill.  But over the same time the annual inflation rate was 4.4%.  Investing in a savings account is like throwing money away.  It loses buying power.

The value of stock, a financial instrument, is based on the fortunes or losses of the corporation issuing the stock.  The value of a company will decline as inflation erodes the profits of the issuing corporation.  Over time, as inflation is reduced, the fortunes of the company may improve and subsequently the value of its stock.  The annual appreciation of stock since January 1963 is 7.98% as measured by the S&P500 index including splits and dividends.  During the years between 1963 and 1983, the value of stocks actually declined when adjusted for inflation.  It took the longest economic expansion in US history, starting in 1983, to make stock out perform inflation.

Real estate is durable good, which means it yields services or utility over time.  The investment value is intrinsic to the real estate because it is not to a piece of paper backed by the performance of a company.  Real estate investment, as a durable good, will increase in value as inflation increases its replacement cost.  In many ways the bottom of the real estate correction is the cost of new home construction. 

Unlike a savings account and stocks, real estate investment is the only true hedge against inflation. The annual appreciation of real estate since January 1963 is 6.16% as measured by the average price of a US home.  Like stock this is above inflation rates.  However, at no time did real estate lose value relative to inflation and this is assuming that OPM only covers 90% of the expenses including the mortgage!  This inflation hedge is protected in large part by the massive leverage enjoyed in real estate investments.  Historically, real estate is the only investment hedge against inflation!

Real estate investments have made more millionaires than perhaps any other form of investing and there are eight powerful reasons why.

YellowMustang Holdings has helped many of our clients achieve their investing goals by first understanding these eight basic investing advantages that has made real estate the most successful investing method of all time. In the first four articles we showed you how enormous these benefits can be and we are only half way through these articles. The next article is on taxes.

Mary Thomsen

YellowMustangHoldings.com

Owners of numerous rental properties around the United States, Mary and her husband have spent many hours helping others get started with buy and hold investing. With the change in the market, we are changing our strategies to maximize the advantages waiting for investors. Our exposure to various markets has led to a real estate marketing business. Available properties may be found on our web site http://www.yellowmustangholdings.com or visit our blog at http://www.my-us-wholesaleretaildeals.com/

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Real Estate Attorney or Lawyer's Role When Selling FSBO

The role that the Real Estate Attorney/Lawyer plays in the selling of your home by for sale by owner makes him/her a necessary addition to your team. Like any other aspect of the law, real estate law should be left to the professionals. Unless you are legally entitled to practice Real Estate law in your State/Province you need professional help. Below are some of the details that your Attorney/Lawyer will take care of.

Your Attorney/Lawyer will review the contract of purchase and sale and advice of potential problems. The seller is typically responsible for preparing the transfer, which is the document that transfers the title of the land from the seller to the purchaser.

They will review transfer documents received from the buyers lawyer, which includes the statement of adjustments which shows credits and debits for seller and buyer, for items such as purchase price, property tax, strata fees where applicable, water account, tenant rent or damage deposits, commissions to be paid to Real Estate Agents, down payment paid by buyer and transfer of title.

They will converse with the buyers Lawyer if necessary and resolve any problems or concerns regarding title issues and or accuracy of figures. Obtain a mortgage balance statement from the seller's mortgage lender to determine the amount necessary to pay and clear the mortgage balance on the day of closing.

If you are selling one property and purchasing another property with closings on the same day, you may need to arrange interim financing. This is a temporary loan to ensure that monies are in place to complete your purchase.

As you can plainly see the Attorney/Lawyers role is vital to the sale of your home. Make sure you have one on your team before you attempt to sell your property.

Hans Anderson is a Real Estate Investor, whose passion is helping people purchase their own investment properties. Visit: http://thetruthaboutforsalebyowner.com/index.php and http://realestateinvestingfacts.com/blog.

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Real Estate Bird-Dog - 3 Good Reasons to Start Your Services in Real Estate

Becoming a real estate bird dog has never been easier as there are so many online e-course that teach you how to start this business without having to have huge capital and the know-how.

Some of these courses are free and some may require you to sign up and pay for certain amount of fees before you begin the course.

Below are 3 good reasons to start a bird dogging business:

Zero risk and no investment

As you may be aware, there is no risk of locating profitable property leads for potential investors because you don't need to purchase or enter into a contract with the seller. What this means is, you have zero risk by being involved in this business except the gas that you incur when driving around your neighbor-hoods scouting for distressed or ugly properties for sale.

Work in your spare time

There is no need for you to start this business on a full time basis because you don't need to. Actually this is an ideal part time work for those who are holding a full time job and the best thing is you can control your own working hours.

Learn the ins and outs of real estate investing

If you don't already have the know-how of real estate investing, the best place to learn is to become a birr dog because not only that you can earn some extra money during your spare time, but you get the opportunity to learn the technical aspects of real estate investments from your investors.

By working for your investors, there will be some form of informal mentoring happening and you can pick up the ins and outs of real estate investments in the process.

If you are serious of bird dogging real estate, sign up for 100% free e-course on how to become a real estate bird dog at http://www.property-profiler.com

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Real Estate Agents And Brokers - The Ultimate Real Estate Wholesalers?

Real estate agents and brokers can be the ultimate real estate wholesalers. This is one of the reasons why, after many years of investing without a real estate license, I decided to finally get licensed. Let me explain.

Let's take a look at what a typical wholesale deal might look like for a real estate investor that is not licensed. You find a deal and get it under contract from the seller at a price that you can sell it for and still make a profit. Then, you start marketing the deal to your contacts, which include other real estate investors. You also market to the general public to find new investors or maybe a retail buyer who will live in the property.

In many cases, as a real estate wholesaler, all you have is a contract to buy the property at a fixed price and you are looking for someone to assign this right to purchase the property to for a fee.

Well, isn't that similar to what a real estate agent does? There is a contract with the seller where the seller has agreed to sell at a certain price (the listing agreement). The agent then tries to find an investor buyer or simply a home-buyer interested in purchasing the house. The "wholesale" fee that you get from selling the house is the agreed upon commission.

Now, if you are a real estate investor, you are probably thinking, but the commission is only a couple percent and my wholesale fees are usually much more than that. I will concede to you on that, but, and it is a big but, as an agent you have hundreds of houses that you can wholesale and not just the ones that you get a contract on yourself.

You can, with a real estate license, go out and sell any house that any other real estate agent has gotten the agreement of the seller to sell for them. This means that you have a lot more inventory that you can decide to market so that you can spend more of your time building your buyers-list of investors and retail homebuyers and spend less of your time putting houses under contract.

Alternatively, if you like hunting for houses to tie up, then spend your time trying to list houses and let a network of hundreds of other real estate agents and brokers sell your properties for you.

This is how I look at the role that a real estate agent/broker plays and why I ultimately decided to get my real estate license after all of these years.

James Orr is a professional real estate investor, marketing expert and founder of the LearnToBeRich.com on-line investment game.

He works with a network of real estate agents, brokers and real estate investors across the United States with the AnalyzedDeals.com website.

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Use Real Estate Leads to Grow Your Real Estate Business

As use of the internet has increased, so to, has its value in connecting service providers with home owners. One of the best ways to grow a real estate business is to connect with more clients by using real estat leads.

There are many ways to get real estate leads:

• Direct Mail


• TV Advertising


• Referrals


• Cold Calling


• Internet

If you operate a fast pace business and do not enjoy cold calling or stuffing envelopes for new business, I would suggest internet leads. There are many lead providers on the internet but just like any business only a few are worth dealing with.

Internet sales leads have been around since the beginning of the internet. At the beginning of the internet most real estate leads were generated through mass email campaigns. Now most are generated through search engines like Google, Bing, and Yahoo.

If you would like to grow your real estate business then get started with an internet lead generation company. Just make sure you pick the right company for your needs. Over the years many professionals have been taken advantage of by unethical real estate lead generation companies, so choose carefully.

Here are some tips when selecting a lead generation company. Make sure the real estate leads are only delivered to one real estate professional, meaning they are only sold once. Many lead providers sell their leads multiple times to professions is the same area which makes it harder for an agent for investors to close the lead.

Make sure the leads are delivered to you within seconds after the lead has been generated. Professionals who follow up with real estate leads within 2 hours after the lead has been generated dramatically increase the chances of closing a deal.

Make sure you are only charged for leads you receive and do not pay any monthly fee or sign up fee. If a company really wants to work with you and become a long term part of your marketing they should not charge any set up fees or monthly fees.

If you can not get in contact with the home seller or home buyer because of in correct lead data the company should credit you the cost of the lead. All too often realtors and investors sign up with a lead generation company and they start receiving leads that are not quality leads. They either can not get in contact with the person or the person does not want to talk with them. Make sure you can get a refund for faulty lead information.

For top quality motivated Real Estate Leads check out the honest company that is connecting more motivated home buyers and sellers with real estate professionals nation wide than any other company on earth.

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Real Estate Lead Generation - An Agent's Guide to Success

Lead generation is one of the hottest topics in the real estate industry, and with good reason. Leads are the first step in the business relationship. So without them, you have no business.

But real estate lead generation is also one of the most confusing topics for new real estate agents (and even some of the veterans). In fact, ever since I've been involved with real estate marketing, one of the most frequent questions I get is: "How do I generate real estate leads?"

Rethinking Lead Generation

My goal with this article is to change the way you think about lead generation. Back in the "old days," purchasing real estate leads was a popular strategy. And while a lot of agents still use this approach to real estate lead generation, it is by far NOT the most effective way to go about it.

Think about it for a moment. When you purchase real estate leads, you are basically buying the names and phone numbers of people who (A) don't know you, (B) haven't asked to be contacted by you, and (C) could very well have an agent by the time you contact them.

In other words, you will be cold-calling strangers, in an age when cold calls are dying out. This is not the best way to approach real estate lead generation. When I listed a home on the MLS a few years back, I was annoyed at the number of real estate folks who contacted me each day. "Do you have an agent? Need help selling your home? Can I come over and give you a CMA?" It struck me as both desperate and annoying. There is a better approach to real estate lead generation!

Make People Want to Contact You

One of the best things you can do to generate real estate leads is to make people actually want to contact you. Think about the difference in mindset here. In the previous scenario of cold calling, you are contacting strangers who don't know anything about you. And because we live in an age of skepticism, they will have a level of distrust right from the start.

But instead of contacting strangers to introduce yourself, what if they contacted you and introduced themselves? For one thing, they would be much more inclined to listen to what you have to say. They would be more trusting and receptive as well. In other words, you would have a much easier time building a business relationship with them. Now that's the way to go about real estate lead generation!

How to Generate a Response

Sure, having people call or email you is the ideal scenario for lead generation. But how do you go about it? How do you motivate people to initiate that critical first contact? Well, there are several things you need to do. Here's a summary:

1. Be Visible

Obviously, people cannot contact you if they don't know you exist. This is where your business visibility comes into play. Online visibility is a big part of this, which is why search engine optimization is such a hot topic among real estate agents. The more visible you are online, the more likely people will be to find you.

You can also increase your business visibility by publishing articles in your local newspaper, publishing articles and press releases online, being active in your community, conducting free seminars, and other aspects of PR. Visibility and awareness are the first steps to generating real estate leads.

2. Be Valuable

The agents who are most successful with real estate lead generation are those who understand the concept of "perceived value." When a person perceives something as being valuable, they naturally want that thing. In real estate terms, this perceived value comes from many elements:

A real estate agent with unique knowledge of a certain niche ... or one who offers access to the best listings ... or one who has a proven (and illustrated) track record of client success ... or one who streamlines the process by networking with mortgage folks ...

These are all ways a real estate agent can increase his or her perceived value, which is the value your audience perceives you to have.

You can also create an item with a high perceived value, and you can in turn use this perception of value to generate leads. Let's examine the concept of "free reports" as an example. Many agents use this approach to real estate lead generation, but they botch the strategy because the report in question does not have a high enough perceived value -- not by a long shot.

A report entitled "Top Ten Home-Buying Tips" does not have a strong perceived value and therefore will not generate many leads. Why? Because (A) it is generic, (B) it does not identify closely enough with the target audience, and (C) it's information that you can find anywhere. It is not exclusive "must read" information. It will not motivate the average reader.

So how do you increase the value of such a report? Easy. You make it a "must read" document. Instead of basic home buying tips, why not boost the value and put people under pressure to read the piece? Why not promote something like this: "Which Happytown Schools Are the Best? Exclusive Report Tells All."

This kind of document would have a much better chance of motivating people and generating leads. It would be easy to tie into real estate, too, so most of your leads would be qualified ones. But this is just something I came up with off the top of my head. You could create an even better "hot button" report with a little imagination and knowledge about your community.

To take this approach even further, you can add a visual element. Have a graphic designer create an eye-catching cover for your report, along with some thumbnail-sized versions to put on your website.

3. Be Trustworthy

People don't trust strangers. We talked about that already. So if you cold call people as a stranger, you already face an uphill climb in terms of real estate lead generation. The key, then, is to inspire trust among your target audience. This will help you overcome the natural skepticism people have and make them more likely to contact you.

How do you generate trust? Testimonials help, especially when you use the former client's full name, photo, and neighborhood. A long track record helps too, as do professional certifications and sales awards (just be sure to tie these back to the success and satisfaction of your former clients).

You can also generate trust by sharing your expertise with people. A real estate blog is a great example of this. If you publish a real estate blog over a long period of time, and people find that blog online (through search engines or otherwise), they will feel as if they already know you a little. If you publish quality content, people will realize that (A) you know your market, (B) you are active in that market, and (C) you obviously like to help people. Suddenly, you're not such a stranger ... you're a perfect candidate to be their real estate agent.

Lead Generation Success

Being visible, valuable and trustworthy will make your real estate lead generation efforts pay off in the long run. Is all this effort worthwhile? Well, let me ask you this. What would it be worth if you never had to call or email a stranger again? That's a goal worth striving for, isn't it? That's the kind of thing that can happen when you change the way you think about lead generation.

* You may republish this article online if you retain the author's byline and the active hyperlinks below. Copyright 2007, Brandon Cornett.

Learn More
Brandon Cornett is a real estate marketing specialist and owner of ArmingYourFarming.com. For more tips on real estate lead generation, visit the author's website at http://www.armingyourfarming.com

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Real Estate Marketing Slogans; A Brand Of One

Real Estate Marketing slogans arouses interest in your
audience and can be the vehicle that helps establish
your "name brand" and invigorate your real estate
career.

A good, well crafted slogan can propel your business
in quantum leaps, while a poorly considered one can
be as effective as none at all. Real estate
marketing slogans can work equally well online and
offline, but they must be good enough to appeal to
mass, targeted audiences.

Consequently, agents work hard and long for the right
words to coin the right phrases, for the perfect
slogans. After all, their slogans may be powerful or
aspiring enough to define their careers.

Realtor Alert! Real estate marketing slogans don't
have to be over intellectualized to create huge "brand
names." Catchy and clever works every time.

For example, Century 21, ERA, & Coldwell Banker are
national and/or regional real estate companies whose
corporate names serve as their "real estate marketing
slogans". Examples of some gigantic, non-real estate
companies are Xerox, IBM, Pepsi and Coke.

Successful Realtors know the importance of using real
estate marketing slogans to create "name brands", but
when conjuring up a slogan for yourself why not
something as simple as your name.

If Mike, Bill and Hillary can pull it off you can,
too. Of Course you know who I mean, which epitomizes
the power of a name.

Creating A Slogan!

Now, I can go to the yellow pages, write down a bunch
of real estate marketing slogans and throw a bunch of
them at you to jump start your creative juices, but
you can do that yourself.

A more constructive approach in creating your own
slogan is to make a list of 10 slogans that reflect
who you are, what niche real estate market you want to
be known for, and your interests and personality in
general.

Use the yellow Real Estate Agents section of your
local yellow pages to get ideas, then strive for
phrases that uniquely characterize you.

Imagine being the Madonna, or "leave the driving to
us" of the real estate industry.

Is it possible? Absolutely, but you'll have to create
a slogan first! Then you'll need to use and publicize
it every opportunity you get; in your ads, on your
business cards, letter head, website, vanity car tag,
etc.

Don't expect instant success right out of the gate.
It'll take a while, but you'll be amazed at how much
you can accomplish in a year or so. And if you have a
real estate marketing system that reaches a minimum of
10 prospects a day the numbers can quickly add up in
your favor.

10 contacts a day x 20 days a month = 200 contacts a
month

200 contacts a month x 12 months a year = 2,400
contacts a year

Without too much effort you can passively market your
slogan to a minimum of 2,400 prospects a year.

I wonder what impact having your marketing slogan on
your car would have?

No matter where you live, or what market you're in
you're missing out on massive amounts of free
marketing if you don't have a car tag of some kind
advertising the fact that you're a Realtor.

And what about advertising your slogan through the
penny, nickel and dime publications? Think cheap
advertising, high visibility, and lots of readers of
your slogan to drive business opportunities your way.

So, create your own unique, real estate marketing
slogan; then publicize it heavily; freely and/or
inexpensively, but heavily.

Can you see the impact that this might have on your
real estate marketing results? I can!

Lanard Perry is the author of "Farming Expired Listings." Learn how to average 1 or more listings a week. Visit http://www.farmingexpiredlistings.com and http://www.real-estate-marketing-talk.com for more business building ideas.

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