Posts Tagged ‘Real Estate Investment’

Educational Webinar: Understanding CAP Rates

Friday, June 26th, 2009

By Jon Swire

If you are interested in real estate investment, but need some help in learning some of the intricacies of the investment process, then visit There’s No Free Lunch in Real Estate News & Events page to access a wide range of tools, information, and resources. These webinars are helpful learning tools to start you on a path toward financial freedom!

My most recent webinar is focused on helping you Understand CAP Rates, and how to accurately calculate the most important metric in income property investing. I’ll show you how to avoid common pitfalls and make sure the deal you’re considering makes sense. My goal is to guide your choices for potential investments and ensure you earn the greatest return on your investments.

You can gain access to this webinar by simply clicking here.

I look forward to helping you develop your real estate profile and turning today’s market into your future wealth!

Jon Swire
There’s No Free Lunch in Real Estate

Buying Your First Investment Property

Tuesday, April 7th, 2009

By Jon Swire

Are you finally ready to take the plunge and buy your first investment property? Have you finally saved enough money to start investing in real estate, but don’t know where to begin? If so, you’re going to want to read my tips on what to buy and where to start to maximize your investment.

For most first-time investors, the choice is usually between a Single Family Home or a 2-4 unit property, commonly called Duplex’s, Triplex’s and Fourplex’s. There are large differences between both and you should fully understand them before plunking your money down. In this segment we’re going to focus on Single Family Residences or SFR’s for short.

SFR’s provide an investor with the greatest leverage possible, meaning you can put the least money down. It’s not unusual to buy these types of deals with 10% down, meaning on a $150,000 home, you’ll only need to come up with $15,000 plus closing costs. This makes these types of investments very affordable for most young investors who don’t have a lot of capital to begin. Be prepared, however, to feed the alligator every month, because these properties typically don’t debt cover, which means the rent you collect every month probably won’t be enough to cover your mortgage payment, tax bill and any other expenses you have.

Most often these properties are purchased as pure speculation or appreciation plays, meaning the goal is to create equity over time. For example, if you bought a property for $150,000 with 10% down, and were able to resell it in 3 years for $175,000, you’d earn $25,000 on your $15,000 investment, which equates to a 167% ROI over a 3 year hold!

Not bad, but be careful when buying these types of deals, because your goal is to come as to close to breakeven as possible, so you don’t have to come out of pocket. And remember, if you’re tenant moves out for any reason, you won’t have any money that month to cover the mortgage or expenses, so make sure you have 3 months of mortgage payments in reserve for a rainy day.

And remember, the more SFR’s you own, the more tenants and properties you have to manage. It’s easier to own a 10-unit apartment building than 10 SFR’s since you only have 1 roof and 1 lawn to mow, versus 10 roofs and 10 lawns. Finally, as soon as you’re able, take your equity gains from the SFR’s and 1031 into properties with multiple units so you can begin your climb up the Property Ladder.

For more information, tips, and services visit http://www.theresnofreelunchinrealestate.com/

Buying Your First Investment Property – Part II

Tuesday, April 7th, 2009

By Jon Swire

Are you finally ready to take the plunge and buy your first investment property?

In Part I of this segment we discussed the pros and cons of making a Single Family Residence your first investment. Now I’d like to discuss the benefits of 2-4 unit properties, also called Duplex’s, Triplex’s and Fourplex’s.

2-4 Unit properties typically require 10-20% down, providing an investor with the ability to get pretty good leverage and come out of pocket with a smaller down payment compared to traditional multi-family properties consisting of 5 or more units. Remember, your goal is to find a property with a high CAP Rate and low GRM, so you debt cover each month. This means the rental income you collect each month will be enough to cover all expenses (taxes, insurance, utilities, etc.) plus the mortgage.

Like SFR’s, these properties are often purchased as pure speculation or appreciation plays, meaning the goal is to create equity over time. Unlike SFR’s, 2-4 unit properties have a lower Vacancy Loss Risk since there are more units to spread the risk over. So, if one of your tenants vacates, you’ll still have the rent from the remaining units to help pay your mortgage and monthly expenses. Remember, however, that you may still need to come out of pocket, so make sure you have 3 months of mortgage payments in reserve for a rainy day.

2-4 unit properties are a great place for you to cut your teeth and learn the basics of Property Management. They’ll provide you with the opportunity to rent units, negotiate leases and perform routine maintenance. I suggest you hire a local property manager for the first 6-12 months of ownership so you can ride shotgun and learn the basics of management before you completely take the task on yourself.

Like SFR’s, once you’ve built up some equity in these properties, you’ll want to sell them and do a 1031 Exchange into a multi-family property consisting of 5 or more units. 2-4 units are one of the first rungs in the Property Ladder and a great place to begin on your way to building a real estate portfolio that will generate enough passive income for you to retire on.

For more information, tips, and services visit http://www.theresnofreelunchinrealestate.com/

“Knowledge is Power”

Tuesday, March 31st, 2009

By Jon Swire

View my video blog discussion real estate investment and education

I am a strong advocate of the saying, “Knowledge is Power!” I truly believe the more you know the more equipped you are to take advantage of opportunities that come before you. I know from experience that this rings true in the world of real estate investing. Today’s market is perfect time for you to educate yourself on smart investing tactics and begin to build the foundation for your future wealth. Like the 90s, these conditions are prime opportunities for those who have the tools and knowledge about investing to garner a steady passive income for years to come.

Many people are held back by fear and are unwilling to take risks, but today’s economic state is ripe with opportunities if you have the right tools. My program will give you all the tools you need to be prepared for a future investments and become comfortable with how investing works.

Thanks for visiting.

There’s No Free Lunch in Real Estate