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How Small Business Owners Can Strike a Financially Viable Real Estate Deal

How Small Business Owners Can Strike a Financially Viable Real Estate Deal

If you want to improve your finances and have income diversity, real investment is one of the best choices. Many small and large businesses are looking at it seriously and you should too. If you are a small business owner, you will have to focus on what is important. And in most cases, it would be the cash flow and profit. If you have a nice sum of money, it is recommended that you invest it in real estate. You may even turn it into a small side business since the profits can be huge.

Real estate is one of the wisest investments you will ever make. It’s safe (most of the times) with high rewards as well. Real estate prices are rising almost everywhere, and the returns can be as high as 15%, given that you play well.

Many buyers still go the traditional route when it comes to buying a property. However, is it always the right thing to do? Not really. There is a lot you can do to find a killer real estate deal, one that costs you less and gives you a very high ROI.

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So how does one find such a deal? Here are some tips.

1. Look at a Lot of Options and Compare them All

It is all about numbers. Look everywhere for sales. Subscribe to online real estate agents, talk to your friends and family members about your intentions, so they can refer you to an agent or let you know of someone looking at selling a property

You will receive hundreds of leads, but only a few will be worth it. It’s basic, a lot of the deals will be too expensive and a lot will be with really low ROI. You should collect all the leads and then chop them gradually, first eliminating the properties you cannot afford. Next, eliminate the properties based on how much return they are going to provide you.

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You will also need to keep in mind the pros and cons of buying a new property versus the old one, I got a chance to speak with Tamir Davies of Sellhousefast, a property specialist with years of experience in the industry, according to him, “Though, in all the excitement, buying a property is still a difficult venture and an expensive one too; thus, families, couples and those purchasing alone are opting for new-build properties which are energy efficient, brand spanking new and come with a builders guarantee and a ten year warranty.” That goes to make a point that new builds are often the better choice.

Once you have a few left, compare them all. When you plan on selling in mind, consider how much renovations they need and if such renovations will help the property. Addition such as a pool, can push a property’s value by up to 20%. You should study the real estate market deeply. Also, it is important to compare two options. For example, if you are in Chicago you should see what’s happening in the Chicago real estate market and then compare it to other markets such as Los Angeles and Tampa, both offering high returns.

2. Bank-foreclosed property Is a Good Option

While foreclosure is sad, someone’s loss may end up being your gain. When a borrower fails to pay back a loan, the lender may put the mortgaged property on sale, allowing you to get it at usually a low price.

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Banks are good at giving loans, and not managing houses. They are interested in getting back their money, hence they will often sell a property at a cost much lower than its market price. It’s often a deal you do not want to miss. However, you will have to study about buying foreclosured houses. Having the right information will make help you get the right property. You may even ask for discounts based on the condition of the house.

3. Be Quick and Offer Wisely

Believe it or not, at times sellers will sell a property to the first bidder. This may be due to them being in a financial crunch or simply not being in a position to afford the property. Whatever it is, it can be your gain.

You do not have to seal the deal the day you check a property, but do not be late in making an offer. You can also avail discounts by promising to pay lump sum money.

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4. Approach Owners Privately

This may not look like a very good idea, but works in several cases. You can look beyond listings and find homeowners privately. However, only make an offer if you are sure of the home owner looking at selling a property.

The problem with listings is that there are often too many offers. The real estate market is hot and everyone is trying their luck. This is also partially why a lot of homeowners still prefer to just put a ‘for sale’ sign outside of their property instead of posting an add online. You should look for such a homeowner and speak to them about the property.

You may also find absent homeowners. So if you find a deserted house, look for a homeowner and approach them privately asking if they’d be interested in selling the property. But make sure to make this offer in a subtle manner, so that you do not end up offending them or sounding too desperate. Highlight the benefit of selling the property. Some pointers that may help you strike the deal include highlighting the maintenance cost, how the property is losing money and taxes.

We hope following these simple tips will help you get the property you want. If you are looking at starting this as a business, remember to not count on it as your primary business till everything is in place.

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Ahmed Raza

CEO of Samurais.co

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Last Updated on March 4, 2019

How to Use Credit Cards While Staying Out of Debt

How to Use Credit Cards While Staying Out of Debt

Many people will suggest that the best thing to do with your credit cards during these tough economic times is to cut them up with a pair of scissors. Indeed, if you are already in huge debt, you probably should stop using them and begin a payback strategy immediately. However, if you are not currently in trouble with your credit cards, there are wise ways to use them.

I happen to really love my credit cards so I will share with you my approach to how I use mine without getting into deep financial trouble.

Ever since about 1983 when I got my first Visa card, I continue to charge as many of my purchases as possible on credit. Everything from gas, groceries and monthly payments for services like my cable and home security monitoring are charged on credit. Despite my heavy usage, I have maintained the joy of never paying any interest fees at all on any of my credit cards.

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Here are some tips on how best to use your credit cards without falling into the trap of paying those nasty double-digit interest fees.

Do Not Treat Credit Cards as Your Funding Sources

Too many people treat their credit cards as funding sources for major purchases. Do not do this if you want to stay out of trouble. I use my credit cards as convenient financial instruments so I do not have to carry around much cash. In fact, I hate carrying cash, especially coins. When you buy things on credit, the purchases are clean and you will not get annoying coins back as change.

I do not rely on my Visa, MasterCard or American Express to fund any of my purchases, large or small. This brings me to my golden rule when it comes to whether I will pull out any of my credit cards either at a retail or online store.

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I never purchase anything with my credit cards if I do not have the actual cash on hand in my bank account.

If I really cannot pay for the item or service with cash that I already have at the bank, then I simply will not make the purchase. Remember, my credit cards are not used as funding sources. They are just convenient alternatives to actual cash in my pocket.

Make Sure to Always Pay Off Balances in Full Each Month

The next very important part of my overall strategy is to make absolutely sure that I pay the balances in full each and every month no matter how large they are. This should never be a problem if the cash has been budgeted for my purchases and secured in the bank. I have always paid my full balances each month ever since my very first credit card and this is why I never pay interest charges.

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Using Credit Cards with Rewards

Most of my credit cards are of the “no annual fees” type, including one MasterCard on a separate account I keep at home as a spare in case I lose my wallet or incur any fraudulent charges. However, I do use a main Visa card which does have an annual fee because all purchases on that card reward me with airline frequent flyer points. For me, the annual fee is worth it since I do travel and I get enough points to redeem many free flights.

You have to decide for yourself if you will charge enough purchases on credit each year without paying interest charges to warrant a credit card that rewards you with airline points (or other rewards). In my case, the answer is “yes” but that might not be the case for you.

I occasionally use a MasterCard or American Express card on small purchases just to keep those accounts active. Also, I have been to the odd retailer that accepted only a certain type of credit card, so I find that having one from each major company is quite handy. Aside from my main Visa card which earns the airline points, the rest of my cards are of the “no annual fees” variety.

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So this is how I use my credit cards without getting into any financial trouble with them. This strategy is recommended only if you are not in debt, of course. In fact, it is worth keeping in mind once you’re out of debt so that you can keep your credit cards active and treat them responsibly.

What are your credit card usage strategies? Let me know in the comments — I’d love to hear what methods you use.

Featured photo credit: Artem Bali via unsplash.com

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