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Getting started in the real estate business is exciting and challenging. There are a few things that you should know first before you take this big step. Get as much advice as you can and make sure you have the financial backing. You can also invest in real estate development software
that can help your business run smoothly.

Real estate development software

Get your business equipped will all the right equipment, such as computers, phone systems and other office equipment, and then invest in the right software that will help your business function efficiently. With real estate development software you can work out the value of property and do investment analysis. It is also easy to do spreadsheets and keep track of all your data. You can calculate property purchase and sale values and it will analyse figures for you in regards to tenants and leases for investment properties. It will also track your expenditure, which is a particularly handy tool when you are first starting out as you will need to keep to a strict budget.

Research

Do you research beforehand and know whether there is room for your business within the local area. You don’t want to start up in an area that is already flooded with other real estate agents. There is no reason you can’t start up your business in an area where there are a few other agents, just be aware of who your competition is and budget accordingly for the right amount of advertising that is going to pull work your way.

Costs

Know what all your costs are going to be before you start your business. There will be once off costs when starting as well as ongoing expenses. If you don’t own the property where your office is you will have lease payments once a month and general monthly expenses like utility bills and the cost of running equipment and buying stationary. You will always have advertising costs as you will need to constantly advertise your business. It is likely you will have staff working for you so factor in the cost of wages.

Location

Choose the location of your business carefully. Having your shop front on a main street is the best position for you as you will be on display to more passing traffic. You need to be central to the area that you intend on servicing because you will find that you will be travelling a lot to visit properties for valuations, auctions and when homes are open for inspection. You might want to think about a location that is close to where you live or nearby to public transport. Make sure there is adequate car parking for yourself and your staff as well as your clients. Make it easy for people to choose you in the first place.

Write a business plan

As with any business it is vital that you write a business plan before you start. If you are borrowing money from the bank to start your business it is also highly likely that they will want to see your business plan. A business plan is important to help you plan where you intend your business to be in the future and it can help you stay on track.

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I think people may pick and choose statements from this survey to support their case about the housing market. There are factors that do not look so great, but you can find other factors that bode well for housing. This will lead to various stories about the decline of the American Dream of homeownership in general, about how homeownership is a great investment for the average American, or about how there are signs of a resurgence in homeownership in the future. My thought after skimming the results of the survey is that we need to rethink urban planning, which may be unusual for others to be thinking after looking at this document. There were two factors that I thought would be interesting for the real estate investor to delve into further.
    Americans may not want to own their homes? A rather dramatic statement is being made after the release of the report. The finding was one person out of three felt that renting was a better option. This is a shift away from the idea of homeownership that we have held in the past, and this may be a good thing for the country. It is positive news for the real estate investor looking into rental property. The housing market has been an economic engine for some time, and it will be again, but do we need to be building homes for the end user to buy? Our population will need housing, but they do not need to own that housing, particularly when their own finances cannot help them to meet thepayments (a fact that led to the housing crisis). I see this as an opportunity for the real estate investor. There is a greater market of potential renters who are not looking to become property owners, creating a need for a middle man. Someone has to own the place to live for others to rent. I see a positive mood towards renting as a positive for landlords.
    Hold on, there are signs that owning a home is increasing as a goal that some of our population wants to achieve. If you are looking into flipping houses, there is news in the survey that you should analyze. The idea that owning a home is desired is increasing among certain groups of young people. Most notable a third of young Hispanics want to own a home. Since I am looking at this from the perspective of living in Texas, where the Hispanic population will become a majority, I see this as a factor to consider. Currently, homeownership rates have been low in this community, but this survey has hit upon a trend that I have been noticing. Waiting for my daughter to come out of her elementary school, I hear the mothers talking. I have noticed a few times now that the conversation turns towards purchasing a home. Some people do not seem interested, but you do have a group avidly discussing how they could achieve this goal, and what they want in a home. These conversations are taking place in Spanish.  A real estate investor may be wise to incorporate features that Hispanics are considering for their homes, if they want to flip them faster. This means thinking about including features like more bedrooms and tile floors for one thing (note: although the survey is looking at Hispanics, we have to understand that there are different desires for the home from someone who is of Cuban descent to someone who is of Mexican descent).
    These trends do not come as a surprise. The real estate industry was already seeing the growing influence of the Hispanic market, and we were hoping for this market to blossom, since there are many potential sales there. We were  vaguely aware that some people buying homes should have been renters, and hindsight indicates that this trend may have been in the shadows. There may be a factor that helps us better make a business decision, so at least read this press release about the report. In conclusion, I think that this report highlights that this is a good time to obtain rental properties.

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Looking back at 2010, I am almost want to say that it was the year when the small real estate investor fled the market, but that would not be true. In the past, I had a good deal of activity with real estate investors, many of whom were looking at owning a few properties to create an income stream. Last year that activity declined, but going over my records, I saw that a good 10% of my business was from the small investor. Most businesses have been making predictions on trends for the coming year, and I guess that I decided to look at the market for real estate investment, because my first jobs this year were investment properties. Here is some data for you if you are considering becoming a real estate investor in 2011.
    The trend in the Houston market at the end of 2010 shows signs that may bode well for the investor. Housing prices are going up. This is a mixed bag. On the one hand, a rental property will cost more to purchase. On the other hand, you will not be loosing money by decreasing home values. Most home sales in Houston are at the higher end and lower end of the spectrum. Homes in the mid-value range (think somewhere around $200,000) are not selling well. This places the real estate investor looking for a purchase of a home in this price range in a strong position relative to the seller. Make a good offer, and you can quickly finalize the deal. The number of renters is also increasing. This is great, since you can probably find someone to rent the home to quickly. I have noticed in my own neighborhood that rental properties are finding tenants fast (within two weeks), while homes for sale can be on the market for many months. The interesting trend for the investor is that people are renting condominiums and townhomes in greater numbers. Most condominiums that I inspected last year were close to the Medical Center. Most townhomes were on the edges of downtown. We do seem to have people wanting to be living closer to the city center, rather than the outskirts.
    What kind of problems may you encounter? First is obtaining a mortgage. Lenders are perceived as being too tight with their money. This perception is fairly consistent among many of my clients. I think that you have to expect to have everything in place with your paperwork and credit history if you want to find a good loan. The lesson: go over your finances carefully, before trying to obtain a mortgage. If you try and fail, your credit score will suffer. Second is finding that perfect house/foreclosure. Be prepared to make repairs. Be prepared to have a good sized budget. There are homes which are reasonably priced, and that could require little work in order for them to be turned around for rent, but particularly with a foreclosure, you should understand that work may be needed. Last is dealing with renters. I do not think that renters are being anymore difficult to please than in the past, but they may be taking a closer look at which home do they want to rent. The real problem here is how involved do you want to be. You have to look at this as a business, and realize that you may have to devote more time to overseeing the rental property than what you may have expected. There are methods of making this easier; you have to research them. 
    One trend that the real estate investor may need to consider is the green home. Buyers are becoming more aware of this trend, and they may factor “green home” ideas into their expectations. Does the home have energy efficient features? They may be looking for ways to keep their utility bills down, so they will look for double paned windows or insulation, just as if they were considering buying the home. I guess that what this boils down to is quality. When I talked to renters last year, many acted as if they were buying a home, or that they may wish to buy the home that they were renting. I know that one renter did. I do not think that most renters will end up buying their rental home, but you should be aware that they may be thinking along these lines, so home trends may play a bigger part in their decision making process.
    I mentioned the areas near downtown and the Medical Center as great for renting, but is that it? I live in the Westchase area, and I have encountered quite a few renters in this neighborhood. People are looking for places to live which give them some convenience. Many people now work in Katy or Sugar Land, so they want homes there. (I had quite a few people working at the hospital in Sugar Land). For others, they are looking at schools or quality of life for their family, and again the western side of the greater Houston area proves to be popular. Younger professionals are the ones looking at the areas closer to the heart of our area.
    That is the outlook in brief. The real sticking point I feel will be obtaining the mortgage. Other issues can be worked out by working with a knowledgeable real estate agent. If you do the work right at the start, this may be a simple, reliable stream of income for you.

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I have been thinking a good deal about analytics lately, since I redoing some of my business reports. This set me off to consider what metrics would be important for a real estate investor if he was looking at a market report. I am still formulating some ideas on that topic, but when I heard that foreclosure sales went down, and that this possibly may be due to the poor quality of the housing stock that is left, I decided to write this post to share my thinking on the real estate market for investors.

Understanding real estate data

    You have to understand some things about data in the housing market. One, unlike the web, data cannot be retrieved in real time, so you will find certain market conditions being reported for either January and December around the middle of February. You will never know what is happening at this moment. When you hear comparison numbers, the analysis will be comparing what happened last January to this January. This is actually helpful, but you could be misled if you think the number is comparing January 2010 to December 2009. Two, the data is being presented might be meaningless. For example, more permits are issued than the number of housing starts, and the number of housing starts is greater than the number of completions. You may know 100 permits were pulled for a given area, but that does not mean that the builder will construct 100 homes. Three, data is presented in a way that is useful to the intended audience. A number is a number, and to understand its value, we need a context. That context will be driven by the goals of the people creating the reports. If you have a real estate investor’s association producing reports, you may obtain different bits of data, with different interpretations.

The Houston Real Estate Market for Investors

    When the statement was made that the foreclosure stock (the lifeblood of investors) may not be of the best quality, I was taken aback. I have been inspecting foreclosures that were good choices for investors. However, I gave the topic some thought about what I had seen around town. I also checked some real estate search engines to see what may come up. Over the last six months, I had inspections in neighborhoods or developments where the builder or owner never completed the project, and the homes went into foreclosure. Some of these units were near completion, but others required a good deal of work. When I conducted my search, many of the great deals were partially completed homes. Home buyers had been competing against investors for foreclosures, but home buyers would not purchase these partially complete homes, and most investors would not as well. I could not find anyone who was tracking the number of incomplete builds, but this may be a good value for real estate investors.
    The news also mentioned that housing starts are up. I noticed that construction was increasing on my travels around Houston, so I was not surprised by this number. When I did some checking, I discovered that Texas has the highest number of permits issued for residential construction when compared to the other states (this data comes from the December figures). Will this high number of permits, and the increase of housing starts, mean more new homes on the market (home completions)? This may be good news for real estate investors (less competition for foreclosures) and bad news (competing against new home sales, which bodes better for renting your property). I will take housing starts as good news, because that metric indicates confidence in the economy, which could mean higher returns for investors who manage their holdings well.
    The number of foreclosures does depend on the economy, so how is Texas faring? Here is a tricky topic to observe. We do not know how many homes are going into foreclosure, because the lenders are not going to advertise that number. We also do not know what lays in store for economic growth. The number of foreclosures depends upon the job market. If people are working, and they are earning well, then we will have fewer foreclosures. Texas has done well, but there are storm clouds on the horizon. The EPA could force changes which will cost industry in Texas, which may cause industry to lay off workers. (Debating the merits of the case is not in the scope of this blog; I will say that I applaud the decision by the EPA, but I acknowledge that there may be job loss due to this finding, simply because industry will be scared of the consequences). We also have to worry about what may be happening in other parts of the world. This past recession demonstrated that world markets are more connected than we thought. Actions in Greece or China could have a dramatic effect on our own economy. Didn’t think that a real estate investor in Houston had to worry about what was happening in Greece? My point is that although the economic forecast for Texas is good, we do have some factors to consider which may effect the economy this year.
    Let me go back to the number of pending foreclosures. There is some grounded speculation that lenders held off on foreclosures during the holidays that many homes were going into the foreclosure process. Remember, we will not have these figures for several months, because the foreclosure process can take some time, and reporting will take a bit longer. Most real estate search engines will permit you to search for foreclosures alone, so the fastest way to see a rise in foreclosures may be checking the number of listings on these sites (this will not be entirely accurate, but you can watch the trend). If this number does rise, consumer confidence can suffer, effecting the economy. The one stimulus plan that does not seem to be the focus of complaints is the one for housing through tax credits. This plan has placed many sellers in the position of rushing to have their home on market before the deadline, and many buyers to find homes before the deadline too. However, the program will end. It has helped consumer confidence in this market, but we will have to see what will be happening in the summer months. My guess is that is when we will see more foreclosures on the market (if they are coming).

Real Estate Investor Strategies

What can we glean from this data? If you are looking to sell a property, now is the time. Overall, you may be better to hold the property for next year, so renting is a good option for this year. If you have the funds and ability, you might find that buying partially completed homes could bring you great returns. You will need a good crew to complete the homes, and you will need to evaluate them carefully ( the weather will have caused damage). There are properties in prime locations which can be purchased cheaply. If you are looking for a property which requires little work, that you can turn around to rent or sell, you will have a tougher job. Some investors do not like working with Realtors, because they feel that they can save some money, but this may be the time that you want a Realtor who knows foreclosures as a source. A Realtor will be aware of listings faster than you. Lastly, be ready for the summer. Now matter your strategy or your beliefs about the economy, we will be seeing new data at that time, which can effect how you should act.
    Your real estate investing business is unique. I am providing a generalized summary based upon my own experiences and feelings. I hope that you will take a look at the figures coming out, take the time to understand them, determine their relevance to you, and then develop a plan of action. I have to refine this data. I did not include the performance of REITs  in this report, but that can be a key indicator for insights. The number of permits is a good value to see interest in an area. Housing starts is a good value for builder confidence; however, we did not look at housing completions, which can be a good indicator of economic conditions. Remember treat your real estate investments as a business (meaning evaluate all aspects of what you are doing).

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I am big on looking over reports to find an analysis that will give me insights into my business. This year has found me redoing my reports to better find the trends that I need to watch. Delving into numbers has me thinking about how those around me can find indicators of trends. Some recent experiences highlighted a way that real estate investors may wish to use to see signs that a client may be leaving.
    I come into contact with many renters through my home inspection business. I also meet them on the streets of my neighborhood on my walks. I could always tell that something was going on by observable signs, but how would an investor know when they may not go to the homes that they own? In three instances, I watched carefully as the renters were preparing to leave, and I noticed this trend. Your repair costs will go up, coupled with non-payment of rent. In a fourth instance, the investor’s repair cost went up, but the renter did not default on his rent payments when he was laid off from his job. He is still in the house.
    One reason that was given for non-payment was because of the needed repairs. However, reasons can be mis-leading, so an investor needs more discernable facts. Keep track of repair expenses for each month. If you have a home warranty insurance, ensure that they will give you a report or notification if the renter is calling them directly. If you have a property manager, then ask them to include this data in a monthly report. You should be tracking if they are paying rent. When you notice non-payment, begin checking the repairs column. If this is going up, you can take action.

Suggested strategies when you suspect the renter could be leaving

In most instances which I observe, the renters depart quickly, leaving a confused investor in their wake. With an environment where workers are being laid off, you may wish to contact the renter to create a new more affordable contract for a short time. You may want to put out feelers for possibly new tenants, and see if they will pay your price. The underlying theme here is to know what the going rate for a rental property in your area is. You might be too high.
    Another action would be to inspect the house. Find out what you need to really repair. Do not let the renter make all of the demands; there might be repairs being done that do not need to be done. If your contract requires them to pay the rent, and there is an agreement as to how repair situations will be handled, then you should enforce it. You are running a business, so you should find the balance between being nice and loosing your shirt.
    You may wish to look into selling the house. Depending upon your location, you might find that it is quite desirable. I noticed that a few rental properties in my neighborhood have been purchased (sometimes by the renters themselves). If the repair costs are too much, and you are worried about the renters leaving, then unloading the property might be a solution. You can move onto the next property.
    What strategies might you take? Is there another way for you to know this data? A good way to develop more metrics is to speak to other investors. Maybe by leaving a comment here, you can help someone else.

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I have not written a piece for real estate investors in a while, so producing a Housing Forecast for next year is a good re-entry topic. I have been reading a few articles about what may be happening in the coming year, and I am not sure that some people have all of their facts right. My determination will be based upon what I am hearing in the news, my business experience, and my own investments.  You should take this information as a guide to project your own forecast (not as an ultimate authority).


Housing Downturns- most writers seem to forget that housing markets take longer to make a recovery. Houston was in an odd position in comparison to most of the country; we already had a housing downturn before the national housing crisis of 2007. This means that our homes were reasonably priced. At this time, we have suffered a small decrease in average/median prices due to foreclosures. In this regard, Houston is a great real estate market.


Foreclosures- we may not be suffering from the number of foreclosures that other parts of the country have experienced, but this has been a problem effecting our neighborhoods. I inspected a home in one neighborhood where most homes for sale were foreclosures. If investing in foreclosures, I would not go into an area with more than 25% of the available houses being foreclosures. Over 15% foreclosures, I would not thinking of flipping the home, renting would be the plan here. We do not know how many more homes will be going into foreclosure. The general consensus is there will be more foreclosures coming onto the market next year. This may drive home prices lower. If prices do not go lower, we can expect them to stay level with the current market. Good news for home buyers. For investors, this is an indicator that it may be better to rent.


Economic Conditions- we are out of the recession, barely. Consumer confidence is the key figure to look at first. It is not positive. Again, Houston has fared better. That is positive for investors, because it means that buyers may be there. National news does cause concern with local buyers though. Disturbing news on this front are the reports that more job losses will hit our region. Until the recovery is stronger, and job losses end, consumer confidence cannot rise. I am going to be optimistic and hope for a strong economic performance at the end of Spring 2010. I base my opinion on statements made by various economists.


Real Estate Stocks-I like looking at my REITs (real estate investment trusts)to see what sectors in the real estate industry are doing well. The only REIT that I own that is doing alright is the medical real estate sector. Commercial real estate does not appear to good otherwise. For builders, I only look at stocks for firms in my region. Getting better is the prognosis. Building starts (new homes that are starting to be built) has gone up. Builders are trying to meet the demand that was created by the tax credit. With the extension of this credit, builders will see a good amount of new home sales. This is good news for home buyers, but not for investors. Builders are going out of their way to attract those buyers, which makes it harder for investors to move their properties.


The $8000 Tax Credit- if you have not heard (why were you not listening to the news, is it the fact that public radio has a fund drive going on now?), the tax credit has been renewed. From December 1,2009 to April 30,2010, you will receive a tax credit of $8000 or 10% of the home’s sale price if you sign the contract between those dates. Every buyer that I dealt with was aware of this credit, and it played into their purchase decision. This is good news for buyers and investors. For investors, this means that this credit will drive buyers into the market. I found that my business increased when the credit was coming to an end. I believe this pattern will hold for the next round of the credit. Most of the dates covered by this extension are the slower period for real estate sales in normal cycles. The credit will be ending at the time when buyers normally return to the market. Investors should be prepared to have their homes on the market before Spring comes.


Mortgages- lenders appear to be doing well, but this is not due to the fact that they are offering more loans. Buyers need to be aware of what they need to do to qualify for a loan. This could be bad news for many buyers, because they may not qualify. In turn, this is bad news for investors who are planning to sell homes; good for investors who want to rent. It will be after 2010 before lenders become more confident offering funds to borrowers.


My final take: 2010 can be a good year for the wise investor or buyer. The wild cards will be the number of foreclosures coming onto the market, and when will the recovery be strong enough to restore consumer confidence. I feel that we cannot say the real estate market in Houston is “normal” till 2011. Normal being homes prices rising steadily, consumers feeling good about making large purchases, foreclosure inventory going down, and mortgages being easier to obtain for a larger segment of the population. 

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Three weeks ago, I was having lunch with my daughters when an old friend walked by my table. I waved hello, and he called out that we should talk soon. Shortly thereafter he comes back to sit with us. We talk about our families and our businesses (and the effect of the current economy on both). He had been toying with the idea of investing in real estate, so he had some questions for me. His questions, and dealings with a few other investors recently, led me to consider some facts that you should watch out for when planning to begin buying real estate.

1. Have your funding in place before you start looking, and understand what the terms are. This may sound obvious, but some people fail to recognize that the mortgage field is changing. Different mortgage packages exist, and each is geared to different loan situations. You cannot always use loans for first time home buyers for investments. This misconception is more common than you think.

   
   

2. Beware of lenders who will not allow inspections, or are insisting on a small window in which they allow an inspection. Typically ten days is given to the buyer to inspect a home. For some foreclosures, the lenders gave my clients two or three days to have an inspection performed. I have always found major issues in these homes.

   
   

3. Lenders making unreasonable requests. Any request where they are rushing you or they are attempting to pay in very specific ways is what I would term as unreasonable. One lender demanded that they would only accept a cash payment for a property (according to a client). Any purchase backed by a loan was unacceptable. Others demanded funds before closing. I am not sure why these practices exist, but they seem off to me. Not to belabor a point which I have made before, but new real estate investors should have a team to help them purchase a house. A Realtor would be able to tell them what is normal in a sale process.

   
   

4. When you know something is wrong, deal with it before you rent or sell the house. Many home inspectors are not pest control experts, but when I see pest activity, I mention it. At that point, an investor should obtain a WDI (termite) report. If you are aware of a pest problem, handle it before others become aware. In Texas, landlords have to provide working water heaters to their tenants. If I report that there is an problem with a unit, look to see how bad it might be.

   
   

5. You may be buying the property “as is” with no hope of getting concessions for repairs. If I sell my home through a Realtor, I would fill out a Seller’s Disclosure form. I am required to be as honest as I can be. If I knowingly fail to disclose a major deficiency, the buyer could hold me responsible, and make me pay for it. Does the lender know the condition of the property? They may not, or it may be hard to prove that they did. Foreclosures can be in very bad shape. The cost of repairs can eat up the money that you saved by paying less. The lender may decide not to offer you any discounts in the rice if you discover that you must buy a new air conditioning system. If you discover a problem after the purchase, you will have little recourse against a lender.

   
   

In the coming months, we will be seeing more foreclosures coming onto the Houston market. Currently, the number is around 3000 per month, so an increase of units can be a great opportunity for investors. Houston has experienced a slight decline in home prices, but no where near the declines that other markets have see. This is a good fact for investors. However, do not jump into the market with some knowledge, and I hope these indicators will steer you away from a headache.

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Knowing some facts about Houston real estate can help the average buyer, but it can prove vital for the real estate investor. Entrepreneurs need to be up on statistical abstracts to spot the trends and forecasts to make wise home buying decisions.

Metrics: do you love them or hate them? I am a data junkie, so I like to pour over figures when making my business decisions. I carry that habit over to my personal finances too. The problem is that every entrepreneur, or home buyer, has to find the right data quickly. If we have to spend hours on deep statistical research, we may never find the factors that might convince us to buy a house.

My wife comes home to find me intently looking into the computer screen. She peers over my shoulder to see what mischief I may be doing. The Census Bureau she exclaims with a puzzled air. What do you think I would be using the internet for, I reply with a grin. Like anyone trying to jumpstart his business, I look at census data to make decisions about marketing or areas that I could target for investing. I wanted to be able to limit my search by zip code to find a more detailed picture. My first stop has always been government sites, because I find that the data there is extensive. One problem though was finding a way to drill down to more specific data points that could be of use to me. Since I did not see a simple method for finding zip code census data, I just assumed that there was no way for me to obtain it. Then I had a moment of insight, why not see if there was some means of gathering this information. I found these instructions:

1. At
   www.census.gov, select "American FactFinder" in the left
   column.
   

   
   

2. In
   the lefthand column, select the "Data Sets" button, then
   "Decennial Census".
   

   
   

3. On
   the Decennial Census page
   

   
   
   
   

   1. Select
      the data set: Click the radio button next to one of the following:
      

      
      
      
      

      • "2000
        Summary File 1" (to select age, race and hispanic origin,
        household relationship, owners and renters, etc) or
        

        
        

      • "2000
        Summary File 3" (to select migration, education, employment,
        income, housing characteristics).
        

        
        
      
      

   2. In
      the righthand column select "Detailed Tables"
      

      
      
   
   

4. On
   the Select Geography page,
   

   
   
   
   

   1. In
      the "select a geographic type" box, pick "5-digit
      ZIP Code Tabulation Area" at the bottom of the menu.
      

      
      

   2. Select
      the first 3 digits of the ZIP code
      

      
      

   3. Select
      one or more 5-digit ZIP codes and click "Add".
      

      
      

   4. Click
      on "Next" (If you don’t see the "Next" button,
      scroll right until you do.)
      

      
      
   
   

5. On
   the Select Tables page
   

   
   
   
   

   1. Select
      one or more of the tables from the list. Search "by keyword"
      or "by subject" if necessary.
      

      
      

   2. Click
      "Add"
      

      
      

   3. Click
      "Show Result"
      

      
      
   
   

This was great news for my real estate search efforts. I could produce a report for my real estate investors that would be helpful. I also produce reports for home buyers, and I thought that some of the data would be appreciated by them too. The problem was that I still had to filter out data that these real estate entrepreneurs needed into one easy page. Housing affordability, number of rental homes, number of foreclosures, and other factors may play a part in making the choice to buy your home. I wanted a quick way to provide news, tips, and real estate insights on one page.

Can all of the information you need to make a wise home purchase fit on one page? Probably not, but when I was studying different websites, I came across a data sheet from a site that was under my nose the entire time. I write guest posts for Homescape, which has become Homefinder.com. When this site went through an overhaul, I examined it once again. When I was comparing results for one specific zip code on several different search engines, I noticed that Homefinder had a “real estate snapshot” link at the top of the search results. Opening it up brought me to a concise data page that had the information that I provide to my clients, and the metrics that I wanted to provide to the real estate investors. With a few tweaks, I would have exactly the kind of sheet that I would need for my data sheets. If you are serious about being a real estate entrepreneur, or you are a home buyer wanting to understand the neighborhood that you are moving into, this sheet is great for you.

One bit of information not provided by the above sites is the data provided by your local county appraisal district. Since I am frequently looking at the sites for four different counties, I wanted to see if I could simplify this process. My search led me to eppraisal.com. With a name like that, I thought that they would provide appraisal data. They did not, but the site did provide another useful search site when looking for homes that includes providing you with the census style data that the real estate snapshot did, so this may be another site for you to use.

If you are looking for foreclosures, Homefinder’s real estate snapshot does have a search function at the bottom of the sheet. This is pretty good, but I found that the best option for the entrepreneur or home buyer would be Roost.com. Their search results are basically the mls (multiple listing service) used by Realtors with foreclosures added.

I think that these sites will be a good place to jumpstart your search in an effective way. If you are buying a home, wether real estate investor or potential home buyer, this data will help you make a wise decision, and for such a large purchase, do we not need to be smart about it?

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I noticed a little tidbit about a new requirement for property managers and landlords in Texas: you need to be able to provide to perspective tenants a set of criteria that you use to choose who will be your future tenant. I was trying to find the exact Property Code that deals with this issue, but I could not find it. I did discover that the rental application form used by Realtors created by TAR has a line referring to this form.

Real estate investors that I work with are not using property managers or Realtors to help them deal with these properties, so I thought I would go over this idea with you to make you aware of your responsibilities. The criteria form needs to be typed with clear definitions of what you will consider to be an acceptable client, or what might cause you to decide to not to rent to a potential tenant. Your selection process may include factors like a tenant’s criminal history, credit history, current income and rental history. Spell out clearly what your concerns are. For example, you may not want sex offenders at all, but what if a drug conviction is acceptable if the tenant can show that he successfully completed rehab? You have to consider the details which may cause you to have an exception.

On your application form, you should have a statement informing the possible tenant of their right to see this list. The statement is simple: state that this form is available upon request, and generalize what may be in the criteria (like the factors for the selection process mentioned above).

If you are unsure of your criteria list or the statement on the application, it may be worth it to consult a real estate attorney. The best prevention for loosing a law suit is to do everything properly when dealing with tenants and applicants. In that case, a lawyer can be worth it.

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As most home inspectors should be aware by now, the new SOP and report form go into effect in February 2009. There have been changes made that we need to be aware of, and that we need to include in our reports. I took a preliminary version of those SOPs to create a simple checklist for our inspections. The requirements are listed on the form, and then spaces are left for notes. In some cases, I put down Yes/No answers which can be circled.

I based it on the SOPs so we would have a quick reference guide to ensure that we are meeting these requirements as we are getting used to them. I also included space at the beginning for some basic information about the job to have on hand. I included reminders to write the serial numbers down for appliances. This is not a requirement, but it is a good practice. You can then say that this is the specific piece of equipment that was examined, in case a unit was changed out, and there is an issue with the new unit. If you come up with any ideas on how to improve this, let me know, so I can update this file. I created this one fairly quickly, so I probably will be making changes to it soon.

Note: there is a new hub page to help real estate investors navigate the site, and help them find other information which may be helpful.

For Real Estate Investors: please use an inspector, he says in a whining tone;) Alright, now that is over with, I am sure that you would like some type of checklist form. This may suffice, but you have to educate yourself on what would be considered a deficiency,how tests are performed, or what the terms mean. The SOPs are just a guide of the minimum requirements of what we home inspectors check. Otherwise, I think this may be a good starting off point for your checklist. You have to remember, home inspectors are not concerned with bad paint jobs, or dirty carpets. You may want to add notes about these concerns.

Here it is in pdf format:

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