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January 2012
| Meet Jan 31, 7pm, Comfort Hotel
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Victoria
Real Estate
Investors Club
Newsletter
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|  Hi Folks!
2012 has started at a gallop for us! Planning to spend more time in Phoenix, brainstorming our business mission, upcoming travel to France, a new 4' x 8' whiteboard with our lives all layed out, getting a new Will, etc. It's all very exciting and invigorating!
As opposed to the Victoria RE market which is slow and steady. Sometimes slow and steady is good! As investors the steadiness is nice but largely irrelevant. If eveything is cash-flowing, the ups and downs of the market don't matter so much. Our friends and neighbours are buying in Southern Vancouver Island because there are always great deals out there. The guy across the hall bought a place in Langford and made it cash-flow by renting part of the long driveway and garage to an RV owner for $500/mo. Creative!
The Phoenix RE market is ccoling down from red-hot to hot. In other words it's correcting. This is a good sign for those who bought properties there (us). See the News article to the right.
What about those 2.99% mortgages that everybody is offering? Great time to replace that old mortgage people! See the News article to the right for one person's explanation why that's happening.
I'm not sure how it's going to work out but Dave Dzidzic (maybe the brother of Mark who spoke at the club Feb. 09) is offering a lease-to-own program to Canadian investors to allow Phoenix folks who lost their homes to get back into them. Creative! See article to the right.
Ok, who wants to network with other investors but has a great set of excuses for not attending the monthly meetings? You folks must check out the monthly breakfast meeting (Feb 18) were the price is right (a cup of coffee at minimum), the atmoshpere is relaxed and you can talk to anyone you want.I've included a couple of articles way below on 10 Tips to Get Started and How do Hard Money Lenders Make Money? for the newbies.
Our friend Cornell is still bringing Opportunities to the club. This one is from Equador and he is a Motivated Seller! See article way below.
Cornell is also bringing his friend Jean Doucet back to speak at our Jan 31 meeting (last time was May '09). They will speak about lease-options (rent-to-own) and reveal just how creative you can get with this investing vehicle. See you then.Take Care - Gord
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January 31, 2012 Meeting
|  Topic: Use Rent to Own purchase as an investment!
Speaker: Cornell Pidruchney and Jean Doucet Cornell has been investing in RE for some time and likes Rent-To-Own. He thinks creatively and flexibly and wants to share his insights with everyone. He will have a SPECIAL GUEST from Vancouver, his personal friend & Real Estate Mentor, seasoned real estate investor JEAN DOUCET, who has completed over 100 creative real estate deals in the last 10 years. Jean's specialties include home rehabs, wholesale flips, joint ventures and about 50 lease-options! His wholesale flip last summer made a net profit of over $230K in about 3 months! Jean will be happy to share with us his creative expertise, and will be available to answer questions! 7 - 9 pm Tuesday January 31, 2011 Comfort Hotel 3020 Blanshard St $15 at the door (no charge for annual or REAG members) There's always an after-meeting meeting at Redd's down the hall and up the stairs for networking, socializing, eating, etc. |
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Next Breakfast Meeting
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Sat, Feb 18,
9:30am
Princess Mary Cafe
On West Bay in the inner harbour, at 453 Head St in Esquimalt
reserved under Real Estate Club
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ad
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Cheri Crause
Royal LePage Coast Capital Realty
1933 Oak Bay, Victoria
250-592-4422
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ad
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AINEY
CONSTRUCTION
250-818-9725
Renovations, Additions, Roofing, Siding, Fully Licensed and Insured
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ad
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Mike 
Patterson
Plumber
250-880-0104
When you need a trustable, reliable, and reasonable Plumber who can do the job right the first time.
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| ad |  Andy Vickers Mortgage Broker Harbour View Mortgages Home purchase Investment Multi-Unit Properties Refinance Construction Commercial Land avickers@dominionlending.ca 250-477-7555 |
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OPPORTUNITIES
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NOTE: Cornell's a creative and inspiring guy!Some days I think he's in the business of giving away money! OTOH if you take his ocean-front deal that's outlined below, move down there and end up having beach crabs as your only neigbours for the next 5 years while he invests your down payment at 25% thereby paying for all his gas for the next 5 years, don't come crying to me. Check him and his beach out thoroughly before handing over the $$.
Cornell says:
We came to Ecuador in 2008 and bought this gorgeous beachfront lot together with some of our American friends, planning to build a bunch of condos on it. Well, now my wife wants a 10-acre farm on Vancouver Island so she can put her horses on it....so guess what????? I guess we won't be moving to Ecuador to retire after all.... :-(
This beautiful stretch of beach is just 45 minutes south of Manta in the beautiful little tourist/fishing village of Puerto Cayo. How about having your own 1/2 an acre of beach front sitting directly on this stretch of sand? It is easily accessed by the Ruta del Sol (think Hwy. 101 California without ALL the traffic), Ecuador's coastal highway, about a 40 minute drive south of Manta, Ecuador. Warm waters, miles of waves and sand to explore.
There is water and power available at the lot's edge just waiting for you to start your dream home. The lot can be used commercially also if you wish. The traffic along this highway is light, but you would have great exposure for pursuing a business on this property. It is large enough to have your own mini resort, restaurant, B and B or whatever is your business passion.
This lot is located at the end of the future planned City Malecon (Oceanfront Boardwalk), and about a mile from the cute little beachfront restaurants downtown! It's the last dual commercial-residential zoned lot available.
Wait....there's MORE! ....you also get a 1/4 of an acre lot that is just across the street! This makes an incredible deal. You could use this for building another home or business.
Or you could also sell it separately and offset the price of this lot. Oh...the price...you would think 1/2 an acre on the beach AND a 1/4 of acre across the street would be WELL over $100,000.00, but I am offering these two lots for $85,000. The property has title insurance that comes included in the price...thus providing peace of mind with the purchase.
I will even provide seller financing with a $50,000 initial down payment.
With the massive influx of foreigners coming to live and invest in Ecuador...this will be an excellent long term investment. View Photos of this property at the following Realtor websites:
1) Ecuadorean Coastal Properties: http://www.ecuadoreancoastalproperties.com/index.php?page=puerto-cayo
2) Ecuador Home Sales: http://www.ecuadorhomesales.com/land.htm
Now here's the SPECIAL DEAL with this property: The title is owned by my Offshore Corporation (Belize IBC) so the buyer gets a free offshore corporation! AND....I'm willing to provide A LOT of vendor financing, perhaps up to 50% of the $85K, AND......I am open to TAKING TRADES FOR SOME/ALL OF THE BALANCE! For example, nice vehicles, boats, other real estate (preferably in Canada or condos in Florida/Hawaii, etc.) So far one guy has offered me a $125K lakefront lot in New Mexico...but it's too far away and I don't want to build on it so I said NO. JUST EMAIL or CALL ME IF YOU ARE INTERESTED AND WANT TO CHAT & DISCUSS SOMETHING CREATIVE:
Cornell Cell: 250-616-9053 (Nanaimo, B.C., CANADA)
Thanks!
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10 Tips To Get Started in Real Estate Investment
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By Laine McKenna 1) Scour neighborhoods you like looking for home foreclosures. Compare the asking price of the homes. Research how much recent foreclosures sold for.
2) Research the market values in the neighborhoods you are interested in. Identify potential opportunities. Are there any fixer-uppers in the neighborhood? Any homes that structurally are in great shape but simply need some upgrades? If you have a knack for spotting those "diamonds in the rough," you can really make a killer on this, especially if you can sell this vision later on to potential buyers.
3) Determine how much capital you are able to invest, and how much capital you are willing to invest. This goes along with establishing a good working relationship with a financial advisor and your bank. Don't dive in head-first. Better yet, wear a helmet. Know what you're getting into. And don't be afraid to ask questions around the industry when it comes to trends.
4) If you're looking for something long term and want to rent out your property, research areas with low vacancy rates. These areas include bustling parts of town where professionals may live, which will likely improve the attractiveness and practicality of your property. It will also mean you'll likely never have to worry about finding tenants.
5) You don't have to stick to homes and actually may find better options when it comes to units in townhomes and condominiums, which may give you more options for tenants.
6) Research the amount of time required to devote towards maintaining your investment property. Understand the costs associated with maintaining the property and any repairs that may be required.
7) Consider joining a real estate investment group which will allow you to purchase a set of apartment blocks or condominiums without the hassle or huge investment involved with owning the entire building. For a percentage of each tenant's month rent, investment groups can take care of things like maintenance, advertising vacancies, and even identifying the right tenants.
8) Consider flipping homes but purchasing at a low price, adding upgrades, and re-selling them at a higher price. This is a method to gain wealth quickly. You could also "flip homes" even quicker without adding upgrades but this isn't something a beginner should venture into.
9) Consider taking real estate courses so you understand the ins and outs of the business.
10) Attend real estate investment seminars, either in person, or online, and learn from trained professionals. This includes learning from professionals who are experienced on the other side - mortgage companies, banks, etc.
Direct Express Realty is a realtor specializing in . Contact Direct Express to in St Petersburg.
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How Do Hard Money Lenders Make Money?
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By Dave DinkelSo called "Hard Money Lenders" are what are also referred to as predatory lenders. This means they make loans based on the premise that the terms to the borrower have to be such that they will gladly foreclose if necessary. Conventional lenders (banks) do everything they can do to avoid taking back a property in foreclosure so they are the true opposite of hard money lenders.
In the good of days prior to 2000, hard money lenders pretty much loaned on the after Repaired value (ARV) of a property and the percentage they loaned was 60% to 65%. In some cases this percentage was as high as 75% in active (hot) markets. There wasn't a great deal of risk as the real estate market was booming and money was easy to borrow from banks to finance end-buyers.
When the easy times slowed and then stopped, the hard money lenders got caught in a vice of rapidly declining home values and investors who borrowed the money but had no equity (money) of their own in the deal.
These rehabbing investors simply walked away from the properties and left the hard money lenders holding the properties that were upside down in value and declining every day. Many hard money lenders lost everything they had as well as their clients who loaned them the money they re-loaned.
Since then the lenders have drastically changed their lending standards. They no longer look at ARV but loan on the purchase price of the property which they have to approve. The investor-borrower must have an acceptable credit score and put some money in the deal - usually 5% to 20% depending on the property's purchase price and the lender's feeling that day.
However, when all is said and done, hard money lenders continue to make their profits on these loans from the same areas:
Interest on the loans which can be from 12% to 20% depending on competitive market conditions between local hard money lenders and what state law will allow.
Closing points are the main source of income on short-term loans and range from 2 to 10 points. A "point" is equal to one percent of the amount borrowed; i.e. if $100,000 is borrowed with two points, the charge for the points will be $2,000. Again, the amount of points charged depends on the amount of money borrowed, the time it will be loaned out and the risk to the lender (investor's experience).
Hard money lenders also charge various fees for almost anything including property inspection, document preparation, legal review, and other items. These fees are pure profit and should be counted as points but are not because the combination of the points and interest charged the investor can exceed state usury laws.
These lenders still look at every deal as if they will have to foreclose the loan out and take the property back - they are and always will be predatory lenders. I would guess that 5% to 10% of all hard money loans are foreclosed out or taken back with a deed in lieu of foreclosure.
So except for the stricter requirements of hard money lenders, there have been no fundamental changes as to how hard money lenders make their profits - points, interest, fees and taking properties back and reselling them.
Hard money lenders also look at the investor's ability to repay the loan each month or to make the required interest only payments. If you go to borrow hard money, expect to need some of your own money and have some in reserve so you can carry the loan until the property is sold.
Dave Dinkel has over 35 years experience in real estate investing which has given him a unique perspective into the real estate market. http://www.DaveDinkel.com is the place to interact with Dave Dinkel. You can read some of the latest informative Real Estate articles he has written. Here you can discover and educate yourself on topics ranging from foreclosure, For Sale By Owner(FSBO) Sales, Credit and much more.
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