Real Estate Investing – Really a good route & How to start?

Investing is not a gamble which many individuals try to avoid. I would say not really. It’s a money making tool like any job or business. I know many of you won’t agree with me and I can visualize many nodding their head saying “No way”.

Let say you go to a job with the knowledge acquired from school and work towards making money and settling down in life. Similarly, if you are educated properly on investing whether it’s stock or real estate, you will invest your money yourself towards goal to get better return for your investment to either run every day life or save for future or getting more things you wanted. The only difference, you are investing your own money instead of someone paying for your work. That’s the common sense behind investing.

There are different vehicles you can use to invest. You can start your own business with passion on certain field and make active income. Or you can invest in stock market or rental properties to earn a passive income. Passive income is different than active income. Like Rich Dad, Poor Dad author Robert Kiyosaki explains in his book and this quick video, Passive income gives freedom compared to Active income. How? When Passive income start replacing your active income, you will reach your financial freedom. You don’t have to work anymore to make active income.

Enough talk about Investing in general. Let’s talk specifically into Real Estate Investing. Real Estate has always been best vehicle to use other people money and invest your money to bring in passive income without actively work on it. By buying a rental property and making it work for you does three things,

  • Principal Pay down from rental
  • Appreciation
  • Cash flow to build passive income

There are also other advantage like equity build up if bought low and Tax advantage as well. You can learn more about Real Estate investing on websites like, etc., The websites can explain about different strategies like Flipping, Rental, Wholeselling etc., I would strongly recommend on Rental Portfolio building for your passive income.

Rental Property Investment
As per Rental Property Investment, some thinks real estate investing is getting the property at low value and keep it invested for long and earn rental out of it. Yes, buying low and selling high is always good but doesn’t happens all the time due to the nature of the market. Building Rental portfolio is buying one property every year or every two years with your saved up cash and mortgage grow your asset and cash flow adding up Passive income. That should be the goal!!

You can find good rental properties even in the peak real estate market. You might have to pay the market price but you are building the portfolio to get passive income via cash flow. Appreciation and Equity build up should be icing on the top. Try to learn about finding good rental properties and research your local area and find a good realtor to work on investment properties. Not all realtors are good in investment properties. Many realtors work with home owners which is different than working with realtor who has experience in dealing with investment properties. Build your team slowly with Realtors, Home inspectors, mortgage company, title company and so forth by communicating with realtor and other local investors.

Next jump on the field by testing your skill by looking at properties and estimating the expense required and may be try to put some offers together and figure out the numbers. Get yourself ready and start making offers on right property with the help of the realtor. Work with him to close the property and start getting it ready to put in the market as quickly as possible so it can start making money. Don’t sit on it for long!! Wallah you are an investor now and start managing the property and experience being the landlord for 6 months or year and start slowly looking for next one.

We will talk about Managing Rental property in the next post. I have helped many to buy property and manage on their own. If you don’t want to go that route, we can also manage properties for you. Check out Flat Rate Property Manage page to get more information.

Good read for any one debating to buy or rent?

I have talked to many clients who just called and inquired about the real estate market for years and never taken a decision to buy a home. They will never buy until they realize what a home can bring to them. It’s not all about money, it’s about well being and how a home can bring and enrich one’s life.

I came across this book from realtor forum and thought would recommend to clients who are still on the side lines and not able to make a decision.

Book Titled – Real Estate Smart: What Your House Does To Your Life, And Why You Should Know About It.

Author is a Realtor himself and trying to put the things into perspective for the consumers to make a wise decision depending on factors he evaluates in his book. He also talks about not buying too much square footage and waste your money in maintenance. I see lots of good reviews in Amazon and encourage to check it out. It’s FREE from Kindle if you own a kindle.

It might not be silver bullet but at least might help you all to think in different perspective to see the goodness of owning a home.

Decisions, Decisions, Decisions – Where to buy home in and around Houston?

In the last few years of being a realtor, many clients have asked the same question over and over again. I am might have addressed bit about it when I posted about my decision on buying house 2 years ago in Sugar land. I like to touch on the topic with an current updated market scenario and how people have made their decisions.

Houston is no longer cheaper place now. It’s cost of living has gone up as per last month report. Also affordable home prices are hard find these days. It’s growing in all side, north side new home constructions are happening near Conroe, east expansion is happening in Fullshear and Berkshire, Northwest area houses are popping up close to Hockley, Richmon and Rosenberg is now getting attention as houses got expensive in Sugar land area. Even though, Houston job market is under pressure from oil prices and job cuts all over the city. Housing prices haven’t really hit the plateau. It might have reached the stagnation point for some period due to the jobs and season but depending on next year economic growth, nobody knows whether bubble is going to burst or it just going to getting bigger.

Being said that, it’s consumer whether buyer or seller is in really hard seat and not able to make decisions properly. Buyers are thinking hard whether to buy now or wait because of job market, where to buy because they doubt about which area is going to grown and expand in the future. Sellers are not able to make a decision as well whether to sell it with current market price or wait for good buyer to make little bit more out of this market. It may seems like sellers market due to low inventory but it depends on the area/neighborhood.

Few things, I would strongly advise buyers. You already missed the boat on getting good deals. Market is on the higher end already and it’s tough to find deals in good area. If you find good home and really like and it comparable sales are not above 3-5%, I would say go far it. Winter is good month due to slower activity and might find good deal as sellers want to get out of house and move on. Find those deals and make some offers and get it close timely. Don’t expect and wait for real deals and lose what you found as well. If you kids, look for good school districts like Fort Bend, Katy, some Cypress and Houston areas and get houses priced within range of current market value. Even after the expansion of I10, Katy commute from downtown has not relived much of commuters headache. It actually became worse by many residents. I wouldn’t say commute to Sugar land from down town has become easier but still the same but not has horrible compared to Katy.

Take all those into considerations and make your decision wisely with help of experienced Realtor who can give good and timely advise.

Happy Thanksgiving to everyone!!!

Vote for Texas Proposition 1 & Reduce your property tax

Hello Clients & Texas Homeowners,
As a Texas REALTOR®, I want to tell you about an important measure on the ballot this November—it’s called Proposition 1 and it will directly benefit you as a Texas homeowner.

First, let’s look at the official language:

Proposition 1
“The constitutional amendment increasing the amount of the residence homestead exemption from ad valorem taxation for public school purposes from $15,000 to $25,000, providing for a reduction of the limitation on the total amount of ad valorem taxes that may be imposed for those purposes on the homestead of an elderly or disabled person to reflect the increased exemption amount, authorizing the legislature to prohibit subdivision that has adopted an optional residence homestead exemption from ad valorem taxation from reducing the amount of or repealing the exemption, and prohibiting the enactment of a law that imposes a transfer tax on a transaction that conveys fee simple title to real property”

I understand how this language might be scary and confusing, but here’s the breakdown of what this proposed amendment actually does.

1) Lowers property taxes by increasing the state-mandated homestead exemption, which saves you money … every year

2) Provides tax relief to seniors and disabled Texans by extending the full benefit of the new homestead exemption, which protects some of our most vulnerable homeowners

3) Prevents local governments from “undoing” the property tax relief the state is offering, which ensures you keep more of your hard-earned money

4) Prohibits state and local governments from slapping a sales tax on real estate transactions in Texas, which stops a tax that burdens consumers in 36 other states!

And … despite what you may have heard, Prop 1 does all this without harming our local school districts.

I hope you’ll head to the polls and Vote For Proposition 1—the Homeowner Tax Relief Proposition.

You can also learn more about it by visiting,

New tool for Buyers from CFPB – Know before you owe Initiative

Few weeks ago, I posted about the new rules which are implemented by CFPB to help consumer with the mortgage closing process.

With the arrival of new rules and forms that will rewrite the closing process just a few weeks away, Consumer Financial Protection Bureau (CFPB) joined National Association of REALTORS®’ 2015 to unveil online tools designed to help consumers and agents navigate the Know Before You Owe initiative.

The implementation of the Truth in Lending Act – Real Estate Settlement and Procedures Act Integrated Disclosure rule (TRID), which the CFPB calls the Know Before You Owe initiative, is expected to bring sweeping changes to the real estate industry. It will merge the existing HUD-1 Settlement Statement, Good Faith Estimate, and Truth-in-Lending disclosure form into two new closing forms: a Loan Estimate and a Closing Disclosure.

The new online tools—included in the CFPB’s “Owning a Home” website—expand on a detailed brochure about buying a home that the CFPB introduced in March, and which the agency will require lenders to give to borrowers.

“When you as a consumer shop for a great home, you should also be shopping for a great mortgage loan, and with the same amount of care,” Gene Koo, the CFPB’s assistant director of consumer engagement, said during an event at NAR’s Washington offices. He added that the agency would like consumers to be able to compare mortgages as easily as they can learn about foods from nutrition labels. “We’re eager to get these resources into the hands of consumers, and we hope that you will use them yourselves and with your clients.”

The additions to the CFPB website include:

a guide to each phase of shopping for and obtaining a mortgage,
a detailed worksheet to help households calculate the cost of owning a home and determine what they can afford given their other expenses,
and an interactive look at new the Loan Estimate and the Closing Disclosure—the two forms they will encounter after the new closing rules take effect on Oct. 3.

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