In the old days people generally only bought land and improved Real Estate in the areas in which they lived or traveled often. Today, thanks to the blossoming of the Internet, one can purchase land all over the United States from the comfort of home. While there are some cautionary measures to be taken, the profits that can be realized are immeasurable.
Why land?
Unlike improved Real Estate (IE a house on land), raw land can be purchased for much less. When you see homes appreciate, what do you think is appreciating? Is it the decaying materials used to build the home? Is it the look of the home? In fact, the large part of the increase is because the raw land the home sits on has went up in value, which is normally due to demand.
Buying a home can be a very stressful situation. For many, this is not even an option because of large down payments needed and/or credit and employment issues. It is extremely common for raw land to be bought and sold on owner financing. If you look around, you will see millions of acres of land up for sale daily where the potential buyer simply needs to say yes and start making payments.
Land comes in all sizes, locations, and prices. You do not need to be a rich mogul to get started building your land portfolio. In fact, if you have a couple dollars to your name via cash or credit, you can start right now.
It’s all about profit!
Every single day of the year land is being sold at wholesale prices on the Internet. The Internet has made it easy for owners of land to sell their parcels and many offer their land under retail value for a quick sale. The Internet is also full of sellers who own land and don’t know the real value of their land. I have seen parcels being sold for as little as 20% of their real worth!
By purchasing land online you can gain land at wholesale prices thus gaining instant equity. Additionally, you can have enough room to sell that land at a discount to another party and still make money. Cash is king, so the more you have, the better deals you will get. However, even if you have little cash, you can still get super deals on land with owner financing.
What to look out for.
As with anything in life, there are some risks associated with buying land online. However, you can reduce or practically eliminate your risk by doing some common things. First, make sure the seller is going to issue you a WARRANTY DEED on the land you are going to by. Do not accept a quick claim deed. Ask your seller if the title has any liens, judgments, or back taxes. Sometimes the answer is yes. This is not a bad thing though. Simply figure in the amount owed into the purchase price. Many times a seller will lower the price of the land to move it before more penalties are assessed.
Many times sellers won’t have pictures of the actual lot for sale, but the general area. This normally happens with parcels that are cheaper because the seller might not live in the area and it is not financially viable to travel there to take a picture. When this is the case, make sure the place exists first and then do some research on the area. For example, go to a search engine and type in the county, city, subdivision, or other data that is identifiable like a lake.
Finally, ask the seller what the taxes and HOA fees, if applicable, are.
There are many places online with land for sale like MartinelliDevelopment.com, who offers land with guaranteed approval on financing. If you decide to try the auction route, Ebay.com is a good start. Most of the land sold here is cash only. Buying land online is a great way to make money and build a solid land portfolio for future wealth.
Copyright 2005 JakeTruman.com
Turn on the TV at almost any time day or night and you will find news and talk shows informing us that there is a Real Estate bubble. What is a “bubble” and how do they know? The simple principle of what goes up must come down is being applied in general thought now and many in the public are starting to buy it. Let’s sit down, think logically and see if there is indeed a bubble or if there is room to grow.
Challenge 1: The “Investors” are driving the market upward and when they leave, everything will crash.
This of course is completely false. Let’s start by looking at home loans 5-10 years ago. A person with a decent credit score would have to pass a bunch of hurdles and put down 5-10%. On a $200,000 homes, this meant coming up with $10,000 - $20,000. The Internet was around, but still a mystery to most. Fast forward to today. The Internet is widely used by everyone from the grade school child to the senior citizen. The flow of information is simply amazing and because of this people are being educated quickly. People are no longer limited to just those they personally know. Loans are now easier to get. Someone with decent credit can walk into a home with zero down now.
How many people do you know that pay rent on time? How many of those people have $10,000 or $20,000 or more in their account? Thanks to the recent relaxation of loan qualifications, these people were locked out of owning a home as recent as 5-10 years ago can now walk into a home and enjoy the American dream. You see, it is not solely investors driving the market (many are regular people), but the millions and millions of Americans who can now walk into a home with little to nothing down.
Challenge 2: Don’t forget about the Tech market crash.
You can’t go far without hearing some so-called expert performing a “remember the Alamo” yell about the tech stock crash years ago. Why is this not relevant? The first reason would be that you can live in a home and everyone needs somewhere to live. A stock is just a piece of paper that you can put in the shredder or in a drawer. If it goes to zero you have nothing. What if a home went to zero? You would still have it to live in and enjoy.
The tech market crashed because you had brick and mortar CEO’s and personnel trying to run Internet based companies. You had people with no real knowledge of how to make money on the Internet coming up with all sorts of ridiculous ideas. It was destroyed because the majority of the people running the show were not properly qualified and the people investing did not care. To compare this crash with Real Estate is like comparing the Enron fiasco to why you burnt the tri-tip on your BBQ.
Challenge 3: Interest rates will go up and everything will crash.
Will it now? Rates have not jumped up overnight nor will there. Think about this. Let’s say you are looking at a home that will require you carry a mortgage of $200,000. Right now you can get it at 6%, but you wait and tomorrow when you wake up, rates went up and it will now cost you 8% (which is a major jump). The difference? $250 per month. If you bought a home just $20,000 less, your mortgage difference would drop to only $100 per month more. This was a huge jump, but would $250 per month stop everyone from buying? Not even close. It would cause some to lower the amount of house they bought slightly. For most, they still buy.
There are more loans for people with bad credit and low incomes than ever before. These are not some wildly high percentage loans either. The ease of loan approval has created millions of buyers all over the country. I would submit to you that if homes in an area come down and correct a little, it is not because of a “bubble”, rather because the homes were overpriced in that area to begin with and/or the area’s value decreased.
Copyright 2005 JakeTruman.com
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Unless you have been living in Siberia, you know that Real Estate is on fire in many places around the country. In fact, you would be hard pressed to find a city where this was not the case. Las Vegas is one of those places that property values keep spiking upward, with no end in sight. The real spike came over the past 18 months. The city remains a juggernaut, chewing up raw land by the minute.Vegas: The new frontier
Unlike many other markets, which are being falsely inflated by nothing more than buyer frenzy, Las Vegas has many solid factors behind its ascent. When so-called analysts speak of a possible Real Estate “bubble”, Las Vegas is not one of the places included. Looking at the factors behind the growth leads one to the understanding of how undervalued Las Vegas really is.
Solid Indicators
I. City Growth – Las Vegas has been growing by leaps and bounds for decades now. It is not some flash in the pan city that has started to grow just recently and not one that will stop any time soon. There are currently 6,000 new residents each month. Going by the actual numbers and not faulty percentages, Las Vegas is one of the top growing places in America.
II. Land Scarcity – One of the main factors behind home appreciation is the land value. When land in a desired area is in short demand (or completely accounted for), value goes up. The city of Las Vegas is running out of land. At first glance it might seem like there is a lot of land left, but when you factor in how fast the city grows, land is in short supply. It has been estimated that the city will be out of land within 4-5 years. Hot areas like Summerlin have all their land accounted for.
III. Job Growth and Diversity – Las Vegas leads the nation in getting educated workers to move to the city. Tech oriented jobs are on the rise. Qualcomm recently broke ground on a new facility in North Las Vegas citing their belief in the area and the work force. The Las Vegas area is experiencing tremendous job growth and will continue to do so.
IV. Home Sales – Even with the glut of new home developments, Real Estate is still climbing upward and being eaten up at a furious pace. The resale market alone experiences over 3,000 sales monthly of homes and approximately 700+ condos monthly. The new development market is very hot. People literally camp out waiting for a new developer to open up the waiting list. It is not uncommon for new developers, who have not even built one model, to have a waiting list of 6-8 months almost instantly. New high-rise condo developments, like Donald Trump’s new towers are being sold hand over fist.
The median home value in Las Vegas has climbed just passed $300,000 and it will go higher, much higher. As of this writing, the market is favorable to buyers, but that will change as soon as next year when inventory falls. If you would like to learn more about the Las Vegas market, view more articles at my Real Estate (JakeTruman.com) web site. I fully expect the median home price in Las Vegas to top $500,000 in the coming 2-4 years.