By Jeffrey Funk

Fractional ownership is a concept that started with jets. It allowed those who wanted occasional access to jets to own part of them for use and not have to worry about tarmac fees, and maintenance. This allows the buyer to enjoy the benefits of enjoying a jet without paying the full price of full ownership. These days, fractional ownership can be applied to just about anything with fractional ownership in real estate becoming more popular.

When many people hear about fractional ownership, they think that it is the same thing as purchasing a timeshare but the two are very different. The only thing one owns after purchasing a timeshare is the right to use that piece of property for a certain period of time. The value of a timeshare also usually decreases over time. With fractional ownership, the buyer has an actual title and deed, which they can then do whatever they would like with it. They can leave it to a loved one in their will or even sell it. Also, if the value of the property increases over time, the value of the fractional ownership will also increase.

Buying into fractional ownership has the advantages of investing in a low maintenance piece of property. In fact, there is virtually no maintenance with these opportunities. One never has to worry about upkeep, repairs, or housekeeping. This is because of the initial purchase, there is a small yearly fee, which will take care of everything related to the property. This fee will also cover any amenities the property features such as swimming pools, fitness centres, and golf courses. Many other amenities that are exclusive to fractional ownerships are the perks that they include. With many fractional ownerships, Owners may have the staff at these communities pre-stock the fridge before the owner arrives, pick them up at the airport, rent a car and have it ready for them at the property, and make dinner reservations.

There are many beautiful communities that are now offering fractional ownership. One of these is Lighthouse Key resort and spa in Orlando, Florida. This beautiful resort community is currently selling shares in 1/13th increments. This will entitle the buyer to use the property for four weeks out of the year. This property has two-bedroom units available for approximately $40,000 and four-bedroom units available for $80,000. Another perk that this community offers is that if the buyer can’t use all four weeks, the remaining time can be placed into a rental program, allowing the owner to actually make money off of their property.

The small yearly dues at Lighthouse Key include the usage of the community amenities such as a billiards and arcade room, a movie theatre, a luxurious clubhouse, a fitness center, and a beautiful pool.

To decide if fractional ownership is the right choice for you, you must look at such factors as to whether you will gain full use of the property year after year and if the property has any likelihood of increasing in value. The current market and the cost of entry should also be analyzed. Fractional ownership can be a wonderful way to create a beautiful getaway that you can visit year after year without paying the full cost.

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By Narayanan Vk 

Investing in Pre-foreclosure could be the most profitable segment of real estate investing market. So how does the pre-foreclosure work? It is quite simple when a person purchases a house; they usually have a small down payment and get a mortgage or loan for rest of the balance of purchase price. This real estate loan is been secured by the property in the type of a mortgage or deed of trust. If in case the lender does not receive their payments, they might file foreclosure to recover their debt.

Pre-foreclosure process permits the lender to foreclose on any liens or hindrances in order to take the property and become the lawful head of the record, thus permitting the lender to resell the property and pick up the original loan amount plus costs related with the real estate foreclosure. The foreclosure processes can as well lengthy depending upon state to state, but up until the public auction, the home owners own the property and have several other substitutes available.

It is further very important to realize when speaking about real estate pre-foreclosure, we are speaking about getting the property any time before the public auction sale. The sooner you get in touch with your home owner in pre-foreclosure, the more you would have to structure a deal and purchase the property. Buying at foreclosure could be the most excellent way of investment, as it would be really cheaper than any other property.

Many people do carry the fallacy that people purchasing homes in foreclosure are taking benefit of another person’s misfortune. This is just not true. The lender made a loan in fine confidence and the borrower agreed to pay back the loan. If the borrower does not make the necessary payments they have out of order the agreement and the lender have to protect their financial interests and might foreclose that reason on the property as agreed to by all parties when the loan was at first made. Anytime there is a foreclosure existing, the borrower has broken the terms of the liable contract and your involvement solves a problem the home owner created.

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By Thomas Campenni

Every day when I read the paper or listen to news on TV or radio, I am bombarded with stories about how bad the housing market is. The experts repeat that the real estate market has crashed and burned. Loans in a variety of forms Cheap Money, Easy Money, No Money Down are to blame. But wait a minute, some say, it is real estate taxes that are the real problem. Too much inventory is another favorite rallying cry of the media.

Well, here is a little secret… there is no problem in the real estate market. The “market” is working just fine. The market is correcting itself because prices, the cost of credit and inventory have not been in balance. One of the reasons for this unbalance is the reporting that has been done in the news media. Just over a year ago, news outlets carried stories about the rising real estate market. People were buying properties not yet built and flipping those properties for huge profits. The media gurus shouted “buy at any price; it will be worth more tomorrow.” What the average investor forgot were the fundamentals of investing. Every time an individual invests in anything, but especially real estate, he/she must remember that there are economic principles that must be adhered to by the investor. People who buy real estate with the intent of making a quick dollar are not investing, they are gambling. The value of real estate is determined by paying today for the present worth of future benefits.

An investor must assume that the price or cost of a property is what the property is worth at the time the contract to buy it is signed. Any added value past that date of agreement historically has developed over time. Consequently, the investor buys a property for “$x” and believes that “$x” will increase to “$y” during the time period of his/her ownership. The factors influencing the increase in value include inflation, government policy, supply and demand, etc. The investor believes that this particular vehicle is the best use of his/her investment funds because it will return the highest amount over the time the funds remain in the investment.

When those fundamentals are forgotten is when the investor will not be a successful investor. Real estate is a sound choice for increasing your wealth. Whether one invests in real estate, the stock market or a CD, it is always with the intention that you are paying in today’s dollars for a return in the future. So, when the pundits begin hyping another “golden opportunity,” look at the fundamentals on investing before taking their word.

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By William King 

If you are planning to invest in Real Estate, consider investing in a pre-construction property. Pre-construction properties refer to land assets that are either yet to be developed or are in an under-developed stage. Investing in such pre-construction properties makes a lot of sense, as it entails significant savings in terms of costs.

Make wise investment
When a builder or a construction company acquires a land and plans a residential or complex on it, it invites investors to book flats or commercials galas for themselves. The builder does this to raise funds to incur his operating expenditure i.e. cost of constructing or initiating the project work. Costs per square foot, at this stage are low, hence it benefits an investor. Even if the investor plans to invest by taking a loan, it is easier for him to repay, as he is supposed to pay in phases. As the cost appreciates, in accordance with the market, the property cost also escalates. Thus, if you plan to sell the property after it is complete or even at its under-construction stage, you are bound to reap profits, as its costs are likely to have increased manifold.

However, any investment decision needs to be taken thoughtfully, and will guarantee profit only if it is well-researched. Therefore, an investor must always first decide the investment criteria before making Real Estate investments.

Things to consider
First, you decide your pre-construction investment limit and set a target area. Then get in touch with a reputed broker to understand the investment potential of that particular area and check out the available options. Together with the broker evaluate the property’s prospects post construction and determine the likely returns on the investment. Study the risks and rewards of pre-construction investment. Formulate a strategy which will involve all the possible questions you want to ask right from whether the construction is legal with all the necessary permissions to confirming if basic amenities like water supply and sewage are in place.

Second, timing is very crucial for those interested in investing in pre-construction properties. An investor must strive to get into a pre-construction deal before it is made public. Early involvement in these investments will get you competitive rates and give you sufficient time to evaluate related incentives. Once the pre-construction period is over, the builder may increase the price of the Real Estate property, which could entail an extremely profitable deal for you.

Join your likes
Investing in pre-constructions also gives you the flexibility of teaming up with other investors who are seeking investment options like you. This is the best way to evaluate the Real Estate market conditions and gather important information related to the pre-construction investment.

One of the important aspects of getting into this kind of deal is that you will learn to identify investment opportunities and pick the best one. You can follow the well-designed strategies of a Real Estate broker to take the right decision at the right time, without wasting time.

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By Kalinda Rose Stevenson, PhD

The most successful real estate investors understand the difference between good debt and bad debt.

From a consumer perspective, no debt is good debt. The basic consumer goal is to be debt free.

This is not the way that the most creative real estate investors think about debt. They regard debt as an investor’s best friend.

The reason for this is OPM. OPM is a short-hand way to refer to “Other People’s Money.” OPM is just another term for good debt.

In addition to OPM, another way that investors talk about using borrowed money is the word, “leverage.” Consider using a crowbar to move a heavy object. The crowbar allows you to move the heavy object. Good debt is an example of leverage.

With a lever, you can move something you could not move without it. The lever means that you don’t need as much strength to move the object as you would need without the lever.

This concept from physics is relevant to borrowed money. You can use someone else’s money as a lever to accomplish a bigger task than you could accomplish with your own money.

Consider a situation when you don’t have enough of your own money to buy an investment property. When you treat borrowed money as a lever, you can use the borrowed money to buy the property you could not afford with your own money. This is the power of leverage.

This is an example of good debt. You use borrowed money to create wealth. Debt is a tool you can use to buy what you could not buy with your own money. If the investment creates profit, you create profit from the leverage of good debt.

This is not what happens when you take on consumer debt. If you buy an item, such as a plasma TV for $3000, you have taken on bad debt. The TV costs you money. It does not become a means to create profit. This is the difference between good debt and bad debt.

Consumer debt does not give you leverage. It is not a tool you can use to create wealth. This is why consumer debt is bad debt.

The critical distinction between good debt and bad debt is whether or not the debt is a tool to create more money. If you borrow the $3000 and use it as a tool to create profit, this is the definition of good debt.

If you want an example of using debt to create wealth, consider Donald Trump. He carries tremendous debt, which he leverages to build properties that in turn create even more wealth. Some of the richest people on the planet have the greatest amount of debt.

This means that good debt is one of the fastest routes to creating wealth. You can call it leverage or OPM if you want, but these terms mean the same thing. You are using borrowed money to make money.

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