Renting anApartment in Uptown Dallas TX

The Ability to Save Money

Being able to save up a great deal of money for the purpose of making a down payment on a dream home is just one of the many great advantages to renting a property. Many homeowners were able to realize their dream of homeownership only after living in a rental property for a certain amount of time. Although renting is often criticized as throwing money away because it does not result in equity, the ability to save money while renting is unparalleled

Rent for an apartment is usually considerably less expensive than the monthly mortgage on a home. The home is also typically much bigger than the rental property but in cases where the renter is renting for the sole purpose of saving money, the value of renting cannot be denied. Depending on how long the renter stays in the apartment, they may save hundreds or even thousands of dollars during the course of the rental agreement.

No Maintenance Properties

Another advantage to renting a property is there is typically little or no maintenance required by the renter. This is especially true in an apartment situation. The renter may be responsible for small items such as changing light bulbs but more extensive repairs such as leaks in plumbing or clogs in drains are typically handled by the maintenance staff of the rental property.

Additionally common areas such as grassy areas or gardens are maintained by the maintenance staff. The exception is usually when the renter rents a home as opposed to the apartment. In these cases the renter may still not be responsible for small repairs but might be obligated to take care of items such as maintaining the grass.

Worthwhile Amenities

Another advantage to apartment living is often the amenities offered to residence. Such amenities might include usage of the pool, an exercise room, meeting spaces and a theater room. In most cases these amenities are offered free of charge to resident and their guests. Many renters who might be able to purchase a home would not likely be able to purchase a home with amenities such as a pool, fully equipped exercise room and a home theater.

These items are often considered luxurious and are not available in the majority of homes which are on the market at any particular time. In fact searching for homes which specifically have these features may severely limit the number of search results and may result in no search results at all when these features are searched in conjunction with a typical price range. However, those who rent can enjoy access to these amenities. They may pay more in rent than those in a comparable apartment complex without these amenities but they are also still likely saving a considerable amount of money each month as long as they are budgeting wisely and have chosen a rental property within their price range.

Rent to Own Rip Offs Frisco TX

Even though rent to own may be good for a short period of time, it proves to be an expensive way for someone to buy something they intend to keep. Rent to own merchandise for example, may sound quite compelling at a few dollars a week. The agreement is normally for around 15 – 20 months, which is where the company makes their money. Although you may be paying just a few dollars a week, the total amount quickly adds up to nearly twice the cost of the item.

In most cases, rent to own houses are put up on the market by the owner. This way, you’ll deal directly with the owner. It will start out as a traditional lease, then proceed to a rent to own basis if you decide you want to keep the home. You and the owner will then work out an arrangement, which will normally be quite a few years. Some owners are very flexible and will work with you just to get the price they want for their home, while others will charge you quite a bit more, in order to make a hefty profit.

Along with paying rent, you’ll also have to pay applicable sales tax as well. Like merchandise, rent to own real estate has its disadvantages. Even though it can be great for those with not so great credit, you’ll normally end up paying back a lot more than you would with a mortgage. After all, the owner of the property is not getting in to a “rent to own” situation just to be nice and help you out. They are doing to make a profit and a nice hefty profit at that. Some owners have become quite the experts at making the down payment high and the terms of the deal almost impossible for you to adhere to. The down payment is usually nonrefundable if you choose not to buy. In a typical situation an agreed-upon portion of your monthly lease payment will be credited towards the purchase price if you exercise your option to buy the property. If you choose not to buy, you do not receive these credits back.

Some people have found themselves out several thousands of dollars and out of the home as well, just to learn that they were the forth or fifth family to have tried to “rent to own” that particular property. Most “rent to own” situation include some kind of time limit for you to secure your own financing so at the end of the day you will still have to take out a mortgage and most people fail to include this cost into the overall cost of the term “rent to own” situation.

If you have bad credit and can’t get approved for a mortgage, then rent to own would be your next best option. Although some don’t like to do it due to the price, for many it’s a better alternative than an apartment. With rent to own houses you are paying money towards the home, instead of just paying rent. In some cases this is fine, although you should make sure to double check with the owner before you agree or commit to anything. This way, you’ll know how much you’ll be paying for the home – and for how long.

What Is The Definition Of Cap Rate?

Cap rate has two main components which area: net operating income (NOI) and price or estimated value of the property. NOI is found by subtracting all expenses from the gross income of the property. When the NOI is divided by the price or value of a property, you are left with the cap rate.

You can move the components of cap rate around in order to determine each of the variables in the equation. The different equations used to determine any of the three variables are below:

NOI / Price = Cap Rate

NOI / Cap Rate = Price

NOI = Value x Cap Rate

As you can see, depending on the information you have regarding the property, you can determine any of the three variables.

That’s great, you say, I can determine these three variables! But how does it affect my commercial real estate endeavors?

To show the main differences between cap rates, I am going to divide investments into three major categories:

Safe investment: Cap rate of 5%
Average investment: Cap rate of 10%
Risky investment: Cap rate of 20%

What the buyer wants out of the property determines what a buyer is looking for.

For example, property being sold at a 5% cap rate is often characterized by low vacancy percentages (less than 5%-10%), beautiful property grounds, good management, up to date amenities, and rents or leases priced at market rate. There is a positive and strong cash flow every month because the property is operating at its full potential.

This property’s value is greater when operating at peak performance, so a higher price is asked by the seller, making the cap rate lower. Those who buy at low cap rates are often looking for retail, already performing property that brings in a steady cash flow every month. A buyer such as this is often part of a REIT, or real estate investment trust, or a professional, such as a doctor or lawyer, who wishes only to deal with good properties and watch the cash flow in.

A property being sold at a 10% cap rate is often characterized by higher vacancies (around 10%-20%), average grounds, an average management team and average amenities. There is definitely some room for improvement with these properties. A buyer who picks up a property like this is looking to make those improvements by increasing rates, renovating and fixing up the property, as well as employing a well operating management team.

The sole purpose of this type of buyer is to create value in the property where it is lacking. It does take some work, and is more risky than the 5% cap rate property, so the asking price is less. Hundreds of thousands of dollars can be created in this difference between an average and good operating property.

A property being sold at a 20% cap rate, or more, is usually considered a very distressed property with vacancies of 20% and more, rundown grounds, old buildings that are falling apart, a poor management team and even a problem owner. Because of the risk, low operating income and problems with the property, a person who is willing to undertake such a property must not be afraid of a little (or much) work and the risk involved in attempting to turn a property of this type around.

However, there are hundreds of thousands, sometimes millions of dollars to be made in these properties! It takes a keen eye and some varied and creative scenarios to determine if the property will perform as you expect it will.

As you can see, the cap rate can be great for one person, and horrible for another, depending on the type of investor the buyer is!

As a seller, the seller wants to sell the property at the lowest cap rate possible because that means it is being offered at the highest price possible. It definitely depends on the condition of the property, operating income, expenses, vacancies and management team to determine what the seller can get for the property. The market will dictate what the right price is for a property.

Cap rates are considered the best way to determine the value of a property. Remember that a bank, or other type of lender, will be looking at the NOI of a property compared to the debt in order to determine if it is a safe investment for the lender. To a lender, the debt coverage is more important than the cap rate. However, if you can get the cap rate higher by getting a lower purchase price, then you can get a smaller loan, and possibly be able to cover the loan with the current NOI. It is a matter of working the numbers to see if a deal is feasible.

When you investigate commercial properties, use the cap rate to determine if the subject property fits your specific criteria. Always create future scenarios and manipulate the property’s income and expense sheets to determine if you can get the money out of the property that you hope to get.

Gold mines can be found in higher cap properties, so check it out and see what you can discover in your own community.

You’ve decided to make the plunge and sell your home. More than a few people have innocently asked me, “What happens to my mortgage when I sell my home?”

If you own a home, you undoubtedly are carrying a mortgage on it. A mortgage is simply a loan from a bank or financial institution for percentage of the value of the home, which you pay to the person you purchased the home from when you bought it. Depend on the type of mortgage you have, the amount due on the loan should have decreased during the time you lived in the home and made monthly payments.

When you go to sell your home, the simple question is what happens to the then due balance on the mortgage? The simple answer is the financial institution is going to be paid out of the proceeds of the sale before you see anything. As a result, it is critical that you calculate in the loan repayment amount when determining if it makes sense to sell a home. If you have a home worth $300,000 and owe $280,000 on the mortgage, you are going to realize little or no profit after the costs associated with the sale and probably shouldn’t sell it.

If you have plenty of equity built up in the home, your mortgage can still end up costing you more than you originally expected. Many modern mortgages have restrictive penalties built into them. These penalties are designed to encourage you to hold onto the home for a set period of time, usually a couple of years, so the bank can recover a certain amount of interest up front. Put another way, the bank is trying to lock in a certain amount of profit on the loan.

When it comes to these restrictive penalties, lending institutions get pretty creative. Many will include a penalty if you sell or refinance the property within the first two years of the loan period. The penalties can be anything from the equivalent of three months of payments to a preset amount or even a percentage of the loan. State law often influences these issues, so you need to read your mortgage loan documents closely.

Regardless, you mortgage is going to be paid off as part of the sales process. The exact amount will depend upon the nature of your loan.

No Tire Kickers Please!!!

If you have ever put your house on the market, you know the frustration potential buyers can cause you. It is fairly shocking how many people will come to an open house or ask for a private viewing, yet have no intention of buying the home. In fact, many of them seem to have no intention of buying ANY home in the near future. They are just out poking around in the business of other people.

A common excuse offered by such people for not making an offer is they have not got their financing worked out yet. Yes, they love the property. In fact, it is perfect. They wouldn’t feel comfortable making an offer, however, until they were sure they could get financing. After you hear this a few times, you will realize these people are just wasting your time. Instead of grinding your teeth, there is a way to stop these people in their tracks.

Allow me to introduce you to a mortgage broker. Unlike representatives working for a particular mortgage lender, a mortgage broker is an independent person who helps buyers find the best loans among a pool of lenders. The process is analogous to a travel agent shopping the best flights for a client, but much more money is on the line.

A mortgage broker is always looking for their next client. They are only compensated when they close a loan, so they are highly motivated to pick up leads. They are so motivated that they will actually come to your property during an open house. A mortgage broker will literally sit their all day and take applications from potential buyers. Heck, the broker will probably bring appetizers and other “marketing” materials.

You can probably see where I am headed with this advice. If you find a lot of buyers are using financing excuses, you should consider asking a mortgage broker to attend any open houses. When the buyer makes the excuse, you can introduce to the broker to them. It’s like throwing blood to a shark. The broker will help legitimate buyers and wind up those who are just wasting your time. The best part of it is they will do it all in a very polite manner.

Everyone dislikes buyers that have no intent of actually buying a home. In exchange for wasting your time, you can cut their excuse off at the knees by having a mortgage broker present.

Real Estate Investing Frisco TX - Rehab Properties

My answer is always the same. “Easy. Value!”

I usually get a strange look, but it’s true. In a neighborhood, I am looking for clues to assess the value of the property, plain and simple.

Well, maybe not so plain and simple, I know. So let me explain.

Normally, my rehab properties are not in the expensive areas of town. It’s rare that you’ll find a rehabber meeting his or her investment goals buying in the expensive parts of town. There are generally fewer homes needing rehabbing and the fixer-uppers that are there are going for top dollar. It’s safe to say the bulk of the investor activity is taking place in the mid-to-low range of home prices.

That’s not to say I wouldn’t look in, or buy in, the swank neighborhoods. Occasionally there are bargains to be scooped up there, but not with enough regularity to focus on.

But, there are some places I definitely WON’T invest in.

I won’t TOUCH the urban war zone. Let me describe what I mean.

“You don’t go there because it’s common knowledge that you shouldn’t. If you happen to wander in that area, you are given suspicious looks by all the folks walking the streets and sitting outside their houses. Your car definitely doesn’t belong there! It seems nobody takes any pride in their dwelling, and trash seems to be a normal part of the décor.”

Do you know of places like that? If you are living in a town of any size, you probably know of a neighborhood that fits the above description.

Watch out for is neighborhoods in serious decline. If the area looks like it soon WILL BE an urban war zone, pass on the deal. You don’t need a property that is hard to rent or sell. The holding cost can take your good investment into the red! You can drive through and pick up many clues in this regard.

– See if there seem to be a high number of “for sale” signs. If a mass exodus is in progress, you DON’T want to be where everyone is trying to get out.

- Check crime statistics with the local police

– Check recent real estate sales if you can get a peek at the MLS.

– Ask an appraiser about what values have done in that area over the last couple of years. Areas in decline usually stand out in your appraiser’s mind, so an appraiser can be a wealth of information.

- Talk to other investors and wholesalers.

– Talk to your title company contact…they often know trends for a given area very well!

Another tactic is to work it the other way. Find out what’s hot before you start driving and looking!

Talk to your investor friends, wholesalers, appraisers, and title company contacts about what areas are hot for investors these days. That way, you start learning positive areas and you have the benefit of someone else having gone before you. Of course, do your own checking but find out where investors are putting their money will give you clues about where you want to invest.

I would recommend against asking family and friends not related to the real estate industry about neighborhoods. This is often the worst assessment of value you’ll ever find. The reactions you’ll get to areas from uninformed family and friends will often be negative based on hearsay. Get your information from reliable sources and ensure it is based on fact.

True enough, there are LOTS of neighborhoods that are much better than war zones, yet not in the expensive areas of town. That’s where my best investments live.

So, what do I mean by value?

If a property is in an area where you WILL invest, it comes down to the deal itself. For me, the better the deal, the less I worry about the neighborhood. As a refresher, here are the basics of property analysis:

- What can I buy it for?
- What will it be worth all fixed up?
- How extensive is the rehab?
Those are the basic questions that must be answered in an individual property analysis, but that’s an article…perhaps a book…for another day.

In conclusion, determine whether you will invest in a neighborhood, then evaluate the deal itself. You will probably find that there are some neighborhoods where you won’t invest unless the deal is a home run. By the same token, there will likely be areas that you feel confident enough about that you’ll take an average deal because you like that particular area.

You are the investor, and these are the kind of exciting decisions that investor get to make! Isn’t that what makes this fun!

Eco Friendly Homes Frisco TX

Some of the standards for ecologically minded homes include increased insulation. To be really energy efficient, a home should be insulated beyond the minimum local requirements. This includes floor insulation, which in some cases is built right in to the concrete foundation. In addition to the walls, floors and ceilings, windows should also be insulating. Therefore, double paned and/or vinyl windows are becoming the “green” standard.

Energy efficiency should be continued throughout the home. Low water use toilets are a must, and those that have different flush options are extra eco-concious. These options allow you to have a more efficient flush for solid waste, while liquid waste just gets much more conservative flush. Shower heads, washing machines, faucets and dishwashers can also be equipped to limit the water used without compromising function. Air conditioners, refrigerators, heaters and all other appliances within the home should be of the highest standard of energy efficiency. In addition, compact fluorescent lights should be used throughout the home, or replaced by LED lights wherever those are suitable.

Beyond energy efficiency, use of non-toxic, ar at least less-toxic, materials is important in “green” homes. Look for a home with low VOC paints. VOC stands for volatile organic compounds, which are toxins that gas-off from conventional paint. Remember the lighter the pigment, the lower the VOC’s, so white or off-white walls are healthier than some of the bolder, trendy colors. This is because it is the paint base that is quality controlled, but it is impossible to take the VOC’s out of some pigments.

Another finishing detail that is popular for eco-friendly homes is bamboo or cork flooring. Bamboo is popular because it grows so quickly. It takes about five years to grow bamboo to the right size to make flooring. It is versatile and comes in a variety of styles and colors. Cork is an option because it is sustainable to harvest – removing cork does not damage the cork tree, as it replenishes its cork bark every year anyway. Cork makes a lovely, soft and springy floor surface that is also naturally warmer than many other flooring options.

For our final indoor consideration, eco-friendly homes will use more natural fabrics such as wool and cotton for carpets and window dressings.

Outside the home leaves plenty of room for “green” considerations, too. Xeriscaping is a popular means of landscaping utilizing plants native to the area being built in. These plants are naturally drought-resistant because they are acclimatized to the local environment, needing less watering and maintenance than lawns or beds full of foreign flowers.

Another “green” outdoor trend is utilizing permeable paving stones. These actually absorb water, which then is naturally filtered through the earth and goes back into the ground-water supply. These avoid the toxic run-off that can be caused by water rushing over cement and into drains, carrying oil and exhaust residue straight into the drainage system, which ultimately ends up being a nearby body of water.

If a home you are looking at is being promoted as being “green”, don’t hesitate to ask the builder about some of these features. If they don’t measure up, don’t buy it.

Frisco is the fastest growing city in the United States and the  ZIP code 75034 has begun to exhaust its ZIP plus fours.  More than 10,000 residential addresses and 400 commercial addresses will use the new 75033 ZIP code beginning July 1. Over the last decade, new businesses have followed nearly 90,000 new residents into the city — bringing about the need for the new zip code.
Frisco gets new ZIP code
New Zip Code, 75033, Announced for Part of Frisco TX

The boundaries of the new ZIP code are Highway 380 to the north, Preston Road to the east, FM 423 to the west and Main Street to the south. Even numbered addresses on Main Street will use the new ZIP code, while odd numbered addresses will retain their 75034 code. No changes were made to Frisco’s other ZIP code, 75035.

View New Frisco TX Zip Code Area in a larger map

Frisco Mayor Maher Maso said “it’s never a fun thing to go through, especially for those that are getting the new zip code, but it’s something that we have been expecting for a long time.”

** Do NOT submit a ‘Change of Address Request’ **

 
McKinney Boyd of the United States Postal Service said residents should not file a change of address form with the postal service. Instead, they should go to the Frisco Post Office and ask for a post card that will allow them to notify newspapers and magazines of their new address. Any stationary and return address labels that have the old ZIP code may be used after July 1, as they will still be deliverable until July 1, 2012. To see if you will be affected by the Zip Code Change, please see the list of subdivisions below: Questions and Answers