Harsh Truth about Houses Pt 1
Real Estate is a beast
Getting an understanding of all the concepts and information that goes into investing or selling a home there are a couple of terms you should know to help you decide what the price should be, how the market is and who you are dealing with.
Comps
So comps are short hand for comparable, and it pretty much is how you evaluate the price in relation to the area you are in. It is basically a home sold within the same general area that has a similar structure. So if you have a home that is 2beds 2 baths and 1200 sq ft. a comp would be something that has the same or similar beds, baths and sq ft. or if not the exact somewhat similar. So a 2 bed 2 1/2 bath with 1350 sq ft. could be a comp because it is similar but not exact. Distance is also a factor is that comp is 2 miles away its useless but if it is half a mile away it will be much more valid. So whatever the sale price for that home is would be one comp for the property you are trying to quote. Finding about 3 or 4 comps for one property and getting the average of them will get you a good maximum but, considering repairs needed and current state of the neighborhood and the type of land you have will factor into what whether you add or subtract from the total of that number.
Real Estate Investors
REI (Real Estate Investors) are a special sector in the Real Estate market. These are people who use Hard Money lenders or Cash to purchase homes and sell, populate them for income. Some Real Estate Agents/ Realtors can be investors but a REI does not need a license to invest into a property. This is because since they are mainly using cash they skip over the many steps that a traditional Agent or Broker. This makes the process much quicker and uses a lot less paperwork because working with an Investor they handle most of everything dealing with the paperwork and titling of a purchase and/or sale. There are different forms of REI's these being a wholesaler, a Fix and Flipper, and a Buy and holder. Depending on who you are dealing with will determine how they evaluate the property because each Investor has different goals.
I will continue to tomorrow about some more truths about houses. Tune in!!
Getting an understanding of all the concepts and information that goes into investing or selling a home there are a couple of terms you should know to help you decide what the price should be, how the market is and who you are dealing with.
Comps
So comps are short hand for comparable, and it pretty much is how you evaluate the price in relation to the area you are in. It is basically a home sold within the same general area that has a similar structure. So if you have a home that is 2beds 2 baths and 1200 sq ft. a comp would be something that has the same or similar beds, baths and sq ft. or if not the exact somewhat similar. So a 2 bed 2 1/2 bath with 1350 sq ft. could be a comp because it is similar but not exact. Distance is also a factor is that comp is 2 miles away its useless but if it is half a mile away it will be much more valid. So whatever the sale price for that home is would be one comp for the property you are trying to quote. Finding about 3 or 4 comps for one property and getting the average of them will get you a good maximum but, considering repairs needed and current state of the neighborhood and the type of land you have will factor into what whether you add or subtract from the total of that number.
Real Estate Investors
REI (Real Estate Investors) are a special sector in the Real Estate market. These are people who use Hard Money lenders or Cash to purchase homes and sell, populate them for income. Some Real Estate Agents/ Realtors can be investors but a REI does not need a license to invest into a property. This is because since they are mainly using cash they skip over the many steps that a traditional Agent or Broker. This makes the process much quicker and uses a lot less paperwork because working with an Investor they handle most of everything dealing with the paperwork and titling of a purchase and/or sale. There are different forms of REI's these being a wholesaler, a Fix and Flipper, and a Buy and holder. Depending on who you are dealing with will determine how they evaluate the property because each Investor has different goals.
I will continue to tomorrow about some more truths about houses. Tune in!!
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