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Real Estate Investments: Take Time to Weigh Investing Options

Real estate investments can be a blessing or a curse, especially in today’s market. Buyers, sellers and investors are constantly weighing their options and planning strategies. Few people want to lose money on investments or pay more than necessary. After all the definition of investment is the act of contributing money in order to gain profit.

Numerous real estate investments exist. Investors can purchase physical properties or paper real estate notes. Properties can range from a tiny parcel of raw land to a multi-billion dollar resort that caters to the rich and famous.

 

Many individuals are opting to purchase distressed properties such as foreclosure, bank owned and short sale homes. These properties generally require elbow grease and hours of physical labor to return them to their original luster. Some people prefer the hands-on, do-it-yourself approach, while others hire contractors to perform necessary tasks.

 

Distressed properties can make exceptional real estate investments as long as buyers fully calculate the true costs. This is particularly true for DIY people because they rarely factor in the cost of their time. If the job becomes larger than anticipated and contractors must be brought in, the buyer is already losing money on their investment.

 

Foreclosure homes are oftentimes purchased for the purpose of house flipping. Rehabbing and flipping houses is not for the faint of heart. Very few auction properties are in perfect condition. Most are in need of serious repairs or total renovations. Weigh this real estate investment option carefully unless you are exceptionally skilled in home repairs or able to purchase the house significantly under market value.

 

A lesser known, but generally lucrative real estate investment is that of probate properties. Probate is the legal process used to sort out and finalize matters when a person dies. If the decedent executed a legal Will and beneficiaries are in agreement, probate typically lasts between six and nine months.

 

If the decedent died intestate (without a Will) or family disputes erupt, probate can drag on for years. During probate the decedent’s estate is responsible for paying outstanding debts. If the decedent owns real estate with a mortgage note, the estate must continue paying toward the loan or face losing the property to foreclosure.

 

Many probate homes are owned outright. Oftentimes, beneficiaries do not want to be saddled with the responsibility of maintaining the home throughout probate. In some instances, the estate cannot afford to pay utilities, homeowners insurance and property taxes.

 

Probate properties can be profitable gems, but locating them requires a bit of detective work. Last Will and Testaments must be filed through the probate court. These documents are public records and can be viewed by anyone who wishes to see them.

 

The last will contains information about the estate administrator and real estate holdings. By locating the property address, additional information can be discovered by reviewing property deeds and tax records.

 

If the estate is small and few assets exist, this is a sign the estate could be in financial straits. Contact the estate administrator to discuss the option of purchasing the property. Most people do not realize they can sell real estate held in probate. Estate administrators are oftentimes relieved to learn they can sell the house and relieve financial burdens from the estate.

 

These are but a few real estate investment opportunities. The Internet provides a wealth of information about the various types of investment properties, along with financing techniques and investing strategies.

 

Take time to become educated about the opportunities available. Start small and learn as much as you can. Doing so could allow you to own a private island, beach bungalow or penthouse condo where you can spend your golden years doing whatever you desire!

Staging Your Home For Sale

Staging is what you do after you’ve de-cluttered, cleaned, repaired, painted and before you list your home for sale. Staging is all about small details. It adds emotional appeal, the spark that says “buy me.”

Before you list your house, look at it objectively. What features do you want to highlight? Decide on the desirable feature or focal point for each major room, then decide how you can draw the eye that direction when someone enters.

 

If there’s an attractive fireplace, add an interesting vignette of artwork, candles, or unique pieces on the mantel to draw attention to it.

 

Paint can also make an element “pop.” Whether it’s a mantel, the woodwork, or the back of built-in bookshelves, a different paint color draws attention.

 

Are there elements to which you don’t want to draw attention, like an awkwardly sized window or a poor view? Consider covering the window with blinds or drapes. Small rooms can be expanded with mirrors. Put one above a fireplace or over a table. A mirror on the wall facing the door of a small bathroom can give the room depth.

 

Look at each room with a fresh eye. Move furniture around until you have a pleasing arrangement. A wall lined with couches and chairs is typically not an appealing grouping. Perhaps place the couch in the center of the room facing the fireplace, or put the bed on an angle in the corner of the bedroom. Remove some furniture if the room seems crowded. Smaller furniture pieces will make a room seem larger.

 

Arrange vignettes of conversation areas. Use an area rug to pull pieces together.

 

Slipcover the sofa and chairs to freshen them if necessary. Buy pillows, particularly made of soft fabrics and in complimentary colors, to make the room pop. Place lamps in dark corners.

 

Instead of placing all the books upright in rows on the bookshelves, stack some on their sides, grouped by color and top them with a piece of pottery or a picture. Use baskets to hide things you don’t want seen. Group decorative items in odd numbers.

 

In the kitchen, oil wood cabinets to restore their luster. Consider buying new knobs and drawer pulls. Clear counters, except for a few decorative accents, like an attractive bowl of fresh fruit, a vase of fresh flowers, or a few attractive cookbooks.

 

Take an objective look at the bathroom faucets and replace if necessary. Vanities and counters can be a relatively inexpensive replacement if a bath needs to be updated.

 

Buy new towels for the baths and put them out only during showings. An attractive basket or stack of towels on the tub or counter looks nice. Add a basket of decorative soaps or spa-type lotions.

 

When showing your house, open blinds and curtains and turn on the lights. Make the rooms as light and bright as possible. Have fresh flowers in several rooms, especially the entry.

 

Be aware of scents. Put cinnamon sticks in a bowl of water in a warm oven. On the other hand, make sure odors that might be objectionable aren’t apparent. Don’t use heavily scented air fresheners. They don’t appeal to everyone.

 

By taking a thoughtful, objective look at your house before listing, you can move your home from “for sale” to “sold” in a crowded market.

Green Building and the Faltering Mortgage Market: Environmentally Sound Homes in a Recovering Economy

The following is a guest post from Houston, Texas real estate developer and entrepreneur Tracy Suttles.

Green building became a strong selling point for many condominiums and apartment buildings during the height of the real estate markets. The additional $500,000+ of construction costs were passed on to consumers, who readily paid for an investment in the environment. Not only could they feel good about themselves for supporting green Building, but they could also expect significant appreciation on that investment. Fast forward to today’s real estate market and environmentally friendly buildings seem challenged to make a case for long-term viability.

Green Building and LEED Certification

While not all green buildings are LEED certified, LEED certification provides a set of guidelines that ensure a building meets a set standard for environmental efficiency. In late 2007 and early 2008 consumers could expect to pay a premium for a LEED certified building; however, these consumers could also expect to benefit from these buildings in numerous ways. First, consumers expected to be able to charge future buyers the same premium, if not more, that they paid. Second, LEED certified and green buildings tended to be more energy efficient, saving consumers substantial money on heating and electric bills. Last, consumers were able to generally feel good about doing something positive for the environment.

Today consumers can still expect LEED certified buildings to save them significant dollars in utilities; however, they can also still expect to pay a premium. Builders must not only pay for the additional design and construction of these buildings, but they must also pay for consultants to certify the buildings.

Green Building and the 2009/2010 Real Estate Market

For many builders, it did not make sense to reverse course and redesign a cheaper, non-environmentally friendly building. As they struggle to compete with cheaper buildings that did not cater to the environment, many have found that consumers now place very little value on green building. Falling home prices do not seem to mix well with environmentally-friendly building. Even though finding low mortgage rates has never been easier, consumers are not willing to pay an additional $10,000-$30,000 for a green building.

It is important to note that as real estate price increased many municipalities began to mandate greener building. States, like California, at the forefront of this movement created substantial building mandates. Perhaps this also speaks to why consumers have very little willingness to pay substantially more for LEED certified buildings.

In the long run, green building and LEED certification will certainly save consumers money and be a valued asset to many builders. However, consumers have stated with their consumption patterns that in tough economic times, they will sacrifice the additional bells and whistles for a sound affordable home. Expect green building to make a comeback when the housing market recovers.

Custom-Made Business Cards: Making the Most of Your Business Card Investment

If you have taken the time, energy and invested the cash into your own custom-made business cards, then you’ll want to get them into the hands of your potential customers right away. The point of having a snazzy representation of your business on a wallet-sized piece of paper is to give these custom-made business cards out to as many people as possible; keeping them stashed away in your desk isn’t going to help anyone.

But how, and to whom, do you give out your custom-made business cards? If you are in need of some recipient ideas, look no further. All of these suggestions are easy, straightforward, and will get your custom-made business cards into the hands of decision makers within days – and will most likely increase your sales to boot.

Post ‘Em

Wherever people gather is where you should post a couple of your custom-made business cards. And make sure to post several, and not just one, to encourage people to take them. Think about it: it’s easier for someone to slip your custom-made business card in their wallet than it is for that same person to take their pen and paper out and write down the necessary information, and then put it somewhere they’ll find it later. Additionally, if there are several business cards left, interested parties won’t hesitate to take one – as long as it’s not the last.

With this in mind, take some thumbtacks whenever you leave the house. Whenever you’re in the area of a grocery store, thrift shop, school, mall, recreational center, library or other general community area where people meet, tack up some of your business cards for all to see.

Mail ‘Em

Whenever you pay a bill or send a letter, put one or two of your custom-made business cards into the envelope. The person on the receiving end may need your services, and you’ll be in a prime position to get their attention when they least expect it. Similarly to the previous suggestion, try putting more than one card into the envelope, just in case the recipient wants to give one to someone else as well.

Pass ‘Em Out

Take a bunch of your custom-made business cards with you everywhere you go. When you pay a cashier, leave one of your custom-made business cards behind with your payment. If you stop to talk to someone while walking your dog, give them one of your custom-made business cards, too. It’s easy to get creative with this idea – all that limits you is the amount of new people you encounter on a daily or weekly basis.

Create the Perfect Business Card: Creating Memorable and Useful Free Business Cards

Just because you choose to make free business cards doesn’t mean that customers, and sales, will pour in the door. You need to actually make business cards that not only fit your budget (free, or pretty close to it), but ones that attract business as well. Not an easy task.

First of all, make sure that your free business cards include the basics, first: business name, address, phone, fax, email, the employee’s name and title. Then, add any color, design or logo features that your customer associates with your business.

Next, find the Unique Selling Proposition (or USP as it’s known in marketing circles) for your business. In other words, this is the top selling feature for your business, or benefit to the customer, to doing business with you. This could be something along the lines of, “Get it Write, Everytime!” for a writer, or, “No Job Too Small” for a plumber. Then, make sure that the USP is prominently displayed on the free business card you are creating.

Then make an offer for something free on your business card. It doesn’t have to be big, or expensive, but it has to have value for your potential customers. Make a trial something-or-other, free taster or seminars are usually good bets to have on your free business cards, but feel free to get creative here to garner even more attention.

Finally, review the following suggestions to ensure your business card packs the most marketing punch possible, and that your client refer to it often – keeping your business name at the forefront of their mind:

  • Is it obvious from the free business cards you created what your business does, and who your customer is?
  • Create a buying discount co-op on the back of your free business cards: ask other businesses that are supportive or work in tandem with you, and offer discounts for each one right on your card(s).
  • Add anything that is useful to the consumer on your free business card: a writer could create a list of common grammar mistakes, an electrician can detail what to do in an electrical emergency, and so on. Tailor your ideas to your business’ specific products and services.
  • Add something unusual to your free business cards to create excitement and interest: a baby’s footprint on the back of a kid’s shoe store business card, for instance.

And remember, if any of these tips you want to use were accidentally missed during printing, you can easily purchase some sticky labels created with all of the necessary information, and add it to the back of each and every free business card you’ve made.

Rainy Day Funds: Alaska’s Experience and the Permanent Fund

Most states in the nation have adopted some form of a Rainy Day Fund (RDF) to mitigate downturns in the economy. RDF’s are established to help governments stabilize operating budgets by saving in boom times and using the RDF savings to cover expenses during recessions. The resource-based economy of the State of Alaska has a history of following this sort of a boom and bust cycle. In 1976, the State of Alaska began making payments into the Alaska Permanent Fund in part to save for a rainy day. It would be an understatement to say the fund could now to fund any state fiscal gap. Jackstadt and Lee point out in their paper, Economic Sustainability: The Sad Case of Alaska, that Alaska was one of the few states that could have produced a permanently sustainable economy. The political means to develop this type of economy was never up for the task. It also demonstrates the danger associated with depending on politics to implement long-term economic policy.

Many scholars point out that being fiscally conservative dictates saving for a rainy day when surplus revenues are available. Political conservatives are likely to rebate taxes in situations were there are surpluses to the treasury. Establishment of mechanisms for funding appropriations to a RDF will ensure their success. RDF’s are a double-edged sword for many states. There needs to be political support to establish a RDF and political pressure to spend from the fund increases as the fund grows. States need to judge their vulnerability to recession and how their revenue base is dependant on the economic cycle.

The generally accepted norm for a RDF is 5% of the annual general fund expenditures of a state. Funding formulas that are not constitutionally mandated will allow state legislatures to ignore required appropriations. There are many ways to determine funding levels for RDF’s. Suggestions include spending 99% of the approved budget and retaining 1% to cover the cash reserve and emergencies. States can skim off excess revenue that occur during the year, taking those funds that are beyond forecast revenue into the RDF. One state gauges deposits to its fund based on the growth of personal income. Taxes collected on personal income beyond 2.5% in one year go to the RDF. Literature suggests revenue diverted to a fund will dampen unsustainable growth.

States vary widely on requirements for tapping their RDFs. One method is the use of super majority vote of the legislature. Virginia allows use of its RDF when projected revenues drop below 2% of estimate. The government is then only allowed to recoup half of the shortfall. The purpose of most RDFs is to cushion short-term drops in revenue and not to attempt to recession-proof an economy. Tight constrictions on the use of RDF resources can also mean the loss of other economic opportunities. Virginia, Alaska, Colorado, Delaware, Louisiana, Oklahoma, South Carolina and Texas have instituted constitutional protections to protect the RFDs against all but true emergencies.

Knight and Levinson (1999) summarize the impacts of RDFs on state fund balances. RDF balances boost overall savings. States that have successful RDF programs also have higher rates of savings. RDF balances seem to increase total saving on a dollar-for-dollar basis. States with fully funded RDFs experience less volatile fiscal cycles. Budget stabilization funds have real impacts on state fiscal policy and economic wellbeing

Types of Business Budgets: Understanding Volume, Operating and Capital Forecasts

Businesses need to be able to forecast the future to appropriately allocate resources. Four separate areas need to be budgeted for accurate measurements.

Budgets are an important part of strategy for a company. A business needs accounting to know where it has been, but forecasting is necessary to know the direction it is going.

Volume Budgets

The beginning step in budgeting should be related to volume. Every business needs to have some idea how much in the way of goods or services they expect to sell.

A manufacturer needs to know how many widgets they expect to produce, and in the same way, a hotel has to have some idea how many room nights they will sell.

Expenses and revenues will both follow from the expected volume, so every attempt should be made to have an accurate volume budget. It is not enough to simply take last year’s amount.

That may be an effective starting point, but consideration needs to be made on things that have changed. Is there a new competitor that will take away business, or can this company expand to new markets?

Revenue Budgets

The second component is the revenue budget. Volume helps determine the amount of revenue available, but another component is what price can be charged and received for each items.

In the case of the hotel, the room nights may be budgeted at 3,000, but what price will they fetch? Will each night be the same, or vary based on the day of the week, or holiday periods?

Expense Budgets

Once the revenue is derived, the next step is to calculate the projected expenses. Expenses cannot be allowed to exceed the amount necessary to achieve the expected profit.

If expenses are greater than the revenue generated, many companies inflate the revenue expected, rather than make the hard choices to reduce expenses. This can be short sighted, since revenue is often out of a company’s control, but expenses generally can be achieved, though it may be painful.

Capital Budgeting

The three items above make up the operating budget. There is a separate category of capital expenses, that is, items that have a useful life of greater than one year.

Capital items are usually budgeted separately, mainly because they are higher cost. The funds available are not commingled, but sometimes capital purchases are curtailed due to operating budget shortfalls.

Operating budgets are usually annual, but capital budgets are often prepared for multiple years and adjusted each year has necessary. A good capital budget is an important part of a proper long-range plan.

You Need Professional Help – Find a Great Web Developer!

Web sites are becoming more and more important to all businesses each day. Many businesses, however, find building web sites very frustrating. This is for two reasons. First, most businesses are doing things that they have never done before with their sites. Second, many companies do not have the employees that they need, or do not have established relationships with experienced partners that can help them with their web development needs.

As a result of this situation, most web sites are full of major problems. You will find even find that this is the case with major sites by large corporations. Many of these sites are hard to use and unreliable.

How can a business avoid this? The best way is to have clear ideas for what you want to do with your site, and find the best people you can to help you with it. Here are some traits that you should look for when considering a candidate for a web development position, or when looking for an outside web consultant:

  • The candidate should understand and be interested in your business goals.

    This comes first, because you don’t want to be working with someone that doesn’t grasp your business and care about it like you do. For some companies, this will mean working with niche companies that specialize in your area, or looking for very specialized talent. This is also at the top because you shouldn’t look for help unless you know your goals for the site!

  • They should work with your choice of technology and complement your company’s skills.

    Every developer has tools that they are most comfortable working with. It is important that the people you choose work with tools that are compatible with your company’s. You will want to be able to control the site, and if you are dependant on your developer’s skills, you will have a major disadvantage.

  • Anyone you hire should bring new ideas to your project that work with your business plan.

    To be successful, your site must be fresh and you need to be as open to new ideas as you can. You must be able to react quickly to Internet trends, and be able to move to take advantage of them. Someone that can bring new ideas to your project can help you look at your site in ways you may not have thought about, and give you the flexibility that you will need to succeed.

Forget About the Shortage of IT Workers!

Attracting and retaining skilled IT (information technology) workers is becoming one of the key factors to many companies’ e-business success. If your business is like most, you are having trouble getting enough talented help to fill your positions. This means that that you may be delaying or even losing e-business opportunities.

The standard advice won’t work
Unfortunately, most companies are getting inadequate advice on how to solve their IT staffing problems. The standard advice is to hire people away from your competitors, and do everything you can retain your IT employees. For most companies, these tactics won’t do the trick. Why? Because your competitors are following the same exact advice. They are are hiring away your technology workers and will do their best to retain them.

Most companies look at this problem as a shortage of skilled workers, and attempt to solve that problem. Trying to solve the problem of too few workers usually is impossible, because there are just too few good people to go around. At best, this strategy will allow you to tread water.

Forget about the people shortage
Successful companies must look at the problem another way. Yes, there is a shortage of skilled IT people. But this also represents an excess of IT work. Companies need to look at the problem of eliminating some of this excess work. This may be the most important and effective strategy in combating the shortage of people.

At first glance, it may seem like it is impossible to eliminate your needs for computer people. Businesses are becoming more and more computerized and every day e-commerce becomes more important. How can one reduce the need for IT people in an environment like this?

10 Ways to Reduce Excess IT Work

  1. Improve your project efficiency
    There are several ways to reduce your need for more IT staff. One of the first things you should look at is the efficiency of your IT projects. About half of all IT projects fail to meet their goals, budget and schedule. Most of the time these projects fail because of business, not technological, issues. One of the reasons many IT projects fail is because they don’t start with clear business goals. Few projects can succeed without these goals. Make sure that any IT project you start on has clear business goals, and well-defined specifications on how the resulting system should work.

What is E-Business?

What is e-business?

This is a question that many people ask. Many other people have misconceptions about what e-business is.

E-business is not putting your catalog on the web, or even doing business online. Putting your catalog online is just using the web as another form of advertising. Doing business online is e-commerce, but isn’t necessarily e-business.

E-business is integrating Internet technology into your business. It is using Internet technology to do things that were not previously possible.

E-businesses…

  • Use the Internet throughout their business process, including purchasing, marketing and fulfillment
  • Utilize email as a primary method of communicating with their clients and suppliers.
  • Access all of their business information through the Internet or through intranets.
  • Use the Internet to automate work that was previously done manually, such as collecting information and entering it into databases, or answering customer requests.
  • Actively work to give customers and suppliers access to information within their systems, and also the ability to influence the workings of their company and systems. Examples of this are many. For example, a company like Ebay allows anyone to sell anything for any price on their site. Ebay doesn’t control the suppliers or consumers, but instead creates a place where buyers and sellers can work together effectively.
  • Take advantage of the unique qualities of the Internet for communication and interaction.
  • Automate anything and everything that can be automated, and focus their remaining resources on doing well those things that should not be automated..

This list is by no means comprehensive. Most businesses can’t do all of these things yet. As a result, most businesses are not yet e-businesses. It is clear that successful businesses in the future will be e-businesses.

Finally, e-business isn’t really something a company does. It is something a company becomes.

Some of the most insightful commentary about what an e-business is can be found at the Cluetrain site. The authors of the Cluetrain “manifesto” take a half-militant/half tongue-in-cheek view of what companies must do in order to succeed as e-businesses.