Marco Santarelli, Author at Norada Real Estate Investments

Canada Interest Rate Hikes October 2023: What You Need to Know

October 24, 2023 by Marco Santarelli

If you are a Canadian homeowner, borrower, saver, or investor, you might be wondering what the Bank of Canada (BoC) will do with its policy interest rate in October 2023. The BoC is the central bank of Canada and it sets the target for the overnight rate, which is the interest rate at which major financial institutions borrow and lend one-day funds among themselves.

The overnight rate influences other interest rates in the economy, such as the prime rate, mortgage rates, savings rates, and bond yields. The BoC adjusts the overnight rate on eight fixed dates each year, based on its assessment of the economic outlook and inflation pressures.

The next interest rate announcement is scheduled for Wednesday, October 25, 2023. As of October 2023, the overnight rate is 5.00%, which is the highest level since December 2007. The BoC has raised the overnight rate by 0.25% four times in 2023, most recently on July 12, 2023.

The Prime Rate and Its Impact

The prime rate is the interest rate that commercial banks charge their most creditworthy customers, such as large corporations. The prime rate is usually linked to the overnight rate and it influences other lending rates in the economy, such as variable mortgage rates, lines of credit, and personal loans.

The prime rate also affects the returns on some investment products, such as money market funds and guaranteed investment certificates (GICs). As of October 2023, the prime rate in Canada is 7.2%, which is also the highest level since December 2007.

Economic Indicators and BoC's Response

The BoC has been tightening its monetary policy in response to the strong economic recovery from the COVID-19 pandemic and the rising inflation pressures in Canada and globally.

The Canadian economy grew by an annualized rate of 6.5% in the second quarter of 2023 and by an estimated 5.0% in the third quarter of 2023. The unemployment rate fell to 5.2% in September 2023, which is close to its pre-pandemic level. The inflation rate rose to 4.8% in August 2023, which is well above the BoC's target range of 1% to 3%.

Future Outlook and Analyst Predictions

The BoC has indicated that it will continue to raise the overnight rate gradually until it reaches its neutral level, which is the interest rate that is consistent with a balanced economy and stable inflation.

The BoC estimates that the neutral level of the overnight rate is between 2.5% and 3.5%. However, some analysts expect that the BoC will have to raise the overnight rate above its neutral level to contain inflation and prevent overheating of the economy.

Factors Affecting the Interest Rate Outlook for 2023

The interest rate outlook for 2023 will depend on several factors, such as:

The pace and composition of economic growth in Canada and globally, especially in the United States, which is Canada's largest trading partner.
The supply and demand conditions in various sectors and markets, such as energy, housing, labor, and commodities.
The inflation expectations of consumers, businesses, and financial markets, can influence actual inflation outcomes.
The actions and communications of other central banks, especially the U.S. Federal Reserve, can affect global financial conditions and exchange rates.

Based on the current economic data and projections, there is a high probability that the BoC will raise the overnight rate by another 0.25% to 5.25% on October 25, 2023. This would imply that the prime rate would increase to 7.60% and that variable mortgage rates would also rise accordingly.

However, there is also a possibility that the BoC will pause its rate hike cycle or even cut the overnight rate if there are significant downside risks to the economic outlook or inflation outlook.

If you are planning to borrow or invest money in Canada in October 2023 or beyond, you should keep an eye on the BoC's interest rate announcements and monetary policy reports. You should also compare different interest rates and products from various lenders and financial institutions to find the best option for your needs and goals.

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Southwest Florida Builder Offers Affordable Turnkey Homes Amid Housing Crisis

October 24, 2023 by Marco Santarelli

A Ray of Hope in the South Florida Housing Market

In a housing market plagued by rapidly rising prices and interest rates, the dream of owning a home in Southwest Florida seemed increasingly out of reach for many. Recent reports suggest that home prices are poised to surge by an additional 4-5% next year, further complicating the situation for first-time homebuyers. However, one local builder in Southwest Florida is offering a glimmer of hope to those aspiring to own a home.

According to a report by ESPN SWFL, Scott Friga of Friga Tyme Construction has embarked on a mission to make homeownership a reality for more people. Recognizing the challenges in the housing market, he decided to take action.

A Builder's Vision for Affordable Housing

Scott Friga was prompted to act after a conversation with his son, who, despite earning a six-figure income, was only approved for a $300,000 loan. This realization struck a chord with Friga, who saw how even individuals with stable incomes were struggling to afford a decent home for their families.

What sets Friga Tyme Construction apart is their innovative approach. Friga envisioned offering a 1364 square-foot living space with a 3-bed, 2-bath open floor plan, all with a turnkey solution. This comprehensive package includes permits, realtor fees, the lot, and everything needed to make homeownership hassle-free. The best part? The price is set at an incredibly affordable $279,900.

Expanding the Reach

This Southwest Florida builder is on a mission to provide affordable housing options to as many people as possible. As of now, they own 11 lots and have offers on approximately 20 more. Construction is already underway, and the focus has been on acquiring land in areas like Lehigh Acres, where favorable pricing can be secured.

Many of the lots are purchased from individuals who inherited land or people who held onto the property with the intent to sell later. Friga is also considering expanding into Cape Coral, provided he can secure pricing that aligns with his mission to sell homes for $279,900 or less.

Commitment to Affordability

Scott Friga is not merely building homes; he's negotiating with suppliers and partners to bring down construction costs. His commitment to affordability is unwavering. He stated, “If I can save $5,000 on lumber, I'm going to charge $5,000 less for the house.” The primary goal is to help families achieve the American Dream by making homeownership more accessible.

However, one thing that's clear in Friga's plans is his dedication to the cause. He emphasized that his intention is not to sell homes in bulk to investors. When someone approached him with an offer to buy 10 homes, Friga's response was unequivocal: “That's not why I'm doing this.”

A Beacon of Hope in Challenging Times

In a South Florida housing market characterized by soaring prices and financial barriers, Scott Friga and Friga Tyme Construction offer a much-needed solution. Their commitment to providing affordable turnkey homes ensures that more families can achieve their dream of homeownership, even in the face of an impending housing crisis.

The Future of Affordable Housing

As the housing market continues to evolve, the innovative approach taken by Scott Friga and his team may serve as a model for addressing the affordability challenges faced by homebuyers. The impact of their initiative could be far-reaching, making homeownership a reality for a more diverse range of individuals and families.

In a time when the South Florida housing market seems increasingly unattainable for many, Scott Friga and Friga Tyme Construction provide a glimmer of hope. Their turnkey homes priced at $279,900 offer an affordable solution to the housing crisis. As they expand their reach and negotiate for cost savings, their commitment to affordability is unwavering. The aim is clear: to help individuals and families achieve the dream of homeownership. With the housing market facing challenges, this innovative approach shines as a beacon of hope.

Top Reasons to Invest in South Florida Turnkey Homes

South Florida offers unique opportunities and advantages for real estate investors. Here are some compelling reasons to consider investing in turnkey homes in this region:

1. Strong Rental Market

The South Florida rental market is robust, with a consistent demand for rental properties. The area attracts both long-term and seasonal renters, making it an attractive destination for real estate investors seeking rental income.

2. Appreciating Property Values

South Florida has experienced a steady appreciation in property values over the years. Investing in turnkey homes can provide the potential for long-term capital gains as the real estate market continues to grow.

3. Diverse Investment Options

South Florida offers diverse investment opportunities, including single-family homes, condominiums, and multifamily properties. This variety allows investors to choose properties that align with their investment goals and risk tolerance.

4. Favorable Climate

The year-round pleasant climate in South Florida makes it a popular destination for residents and vacationers. This climate advantage contributes to the region's rental demand and attracts potential tenants.

5. Tourism and Seasonal Rentals

South Florida's tourist attractions and events draw seasonal visitors. Investing in turnkey homes can provide opportunities for short-term vacation rentals, catering to the influx of tourists during peak seasons.

6. Tax Benefits

Florida is known for its tax-friendly environment, including no state income tax. This tax advantage can be particularly appealing to real estate investors, allowing them to keep more of their rental income and profits.

7. Property Management Services

Many turnkey property providers offer comprehensive property management services. This can help investors handle property maintenance, tenant management, and other aspects of real estate investing with ease.

8. Diverse Economic Growth

South Florida boasts a diverse and growing economy, with sectors like technology, finance, healthcare, and hospitality thriving. A strong local economy can lead to job opportunities and attract potential tenants to the area.

9. Stable Real Estate Market

South Florida has historically shown resilience in its real estate market, even during economic downturns. This stability can provide investors with a sense of security and long-term potential for returns on their investments.

10. Lifestyle and Amenities

Investing in South Florida allows access to a vibrant lifestyle with beautiful beaches, cultural attractions, and a range of amenities. This appeals to tenants seeking a high-quality living experience.

Federal Reserve To Extend Interest-Rate Pause: Jerome Powell

October 24, 2023 by Marco Santarelli

The Federal Reserve, led by Chair Jerome Powell, has sent a clear signal that they could maintain current interest rates at the upcoming policy meeting. The pause in hikes of interest rates can be extended. However, Powell also cautioned that inflation remains persistently high, leaving the door open for potential interest rate increases if the economy remains robust.

According to Powell, “Additional evidence of persistently above-trend growth, or that tightness in the labor market is no longer easing, could put further progress on inflation at risk and could warrant further tightening of monetary policy.” Powell emphasized the need for caution due to uncertainties and risks, hinting that the central bank is unlikely to raise rates at its next meeting in November.

Powell stressed that the Federal Reserve is treading carefully, aiming to strike a balance between being too aggressive and too passive in its monetary policy. He acknowledged that the Fed's rapid rate hikes could still lead to “meaningful tightening” in the near future. Other Fed officials have also urged patience and caution in evaluating economic direction and inflation trends.

He outlined the potential consequences of both doing too little and doing too much. Insufficient action could lead to entrenched above-target inflation, necessitating more drastic monetary policy measures. On the other hand, excessive tightening could harm the economy unnecessarily. The Fed faces a delicate balancing act.

His remarks have set the stage for the upcoming Federal Open Market Committee meeting on November 1. They also come just days before a 10-day period during which Fed officials are prohibited from making public statements. This blackout period adds significance to Powell's words.

Powell highlighted the Federal Reserve's vigilance regarding the recent surge in long-term bond yields, which have increased more than 50 basis points since the last policy meeting in September. Some other Fed officials have suggested that elevated long-term interest rates could reduce the need for further Fed action.

Are There Any Prospects of an Interest Rate Hike?

When asked about the impact of higher yields on the Fed's rate decisions, Powell acknowledged that it could reduce the impetus for rate increases. He clarified that as long as bond yields are rising for reasons other than expectations of Fed rate hikes, it acts as a tightening of financial conditions, aligning with the Fed's objectives.

Powell recognized progress in inflation during the summer but expressed concerns about September's data. Shorter-term measures of core inflation, which exclude volatile food and energy prices, have shown a decline over the most recent three and six months, falling below 3%.

The job market remains strong, but signs of gradual cooling are emerging. Wage growth is declining, approaching levels consistent with 2% inflation over time. The Fed paused its rate hikes last month, but future rate hikes are still on the horizon.

Aside from economic factors, political uncertainty, including conflicts and government shutdowns, can influence the Fed's decisions. Geopolitical tensions are high and pose risks to global economic activity. These factors add to the complexity of the Fed's decision-making process.

Although a rate hike in October seems unlikely, there's still uncertainty about the future. Economists are divided on the possibility of a recession, and the chance of a rate hike at the December meeting remains a topic of discussion.

While the Fed may maintain its current rates in the upcoming meeting, the future remains uncertain. The central bank faces a range of challenges and uncertainties, requiring a cautious and balanced approach to monetary policy.

Why is Investing in Real Estate Good?

October 23, 2023 by Marco Santarelli

If you are looking for a way to grow your wealth and generate passive income, you might want to consider investing in real estate. Real estate is one of the oldest and most popular asset classes, and it has many advantages over other types of investments. Here are some of the key reasons why investing in real estate is a good idea.

Why Is Investing in Real Estate Good?

Cash flow

Real estate can provide you with a steady source of income from rent, which can cover your expenses and generate profits. Cash flow can increase over time as you pay down your mortgage and build equity, or as you raise rents in line with market demand. Cash flow can also help you weather economic downturns or market fluctuations, as people always need a place to live or work.

Appreciation

Real estate can appreciate in value over time, as the demand for property exceeds the supply, or as the property is improved or developed. Appreciation can result in capital gains when you sell the property, or increase your net worth while you hold it. Appreciation can also be enhanced by using leverage, which means borrowing money to buy more property than you could with your own cash.

Tax benefits

Real estate investors can enjoy various tax breaks and deductions that can lower their taxable income and save money at tax time. For example, you can deduct the interest on your mortgage, the depreciation of your property, the maintenance and repair costs, the property taxes, the insurance premiums, and more. You can also defer capital gains tax by using a 1031 exchange, which allows you to sell one property and buy another of equal or greater value without paying any tax on the profit.

Diversification

Real estate can diversify your portfolio and reduce your risk exposure to other asset classes, such as stocks or bonds. Real estate has a low or negative correlation with other assets, which means that it tends to move in different directions or remain stable when other assets fluctuate. By adding real estate to your portfolio, you can improve your return per unit of risk and achieve a more balanced and resilient portfolio.

Leverage

Real estate allows you to use leverage, which means borrowing money to buy more property than you could with your own cash. Leverage can amplify your returns by increasing your cash flow and appreciation potential, as well as allowing you to take advantage of low interest rates and tax deductions on your debt. Leverage can also help you build equity faster, as you pay down your mortgage with the income from the property.

Control

Real estate gives you more control over your investment than other assets, such as stocks or bonds. You can make decisions that affect the performance and value of your property, such as choosing the location, the type, the quality, the tenants, the rent, the improvements, the management, and more. You can also influence the market conditions by creating value through development or renovation, or by creating demand through marketing or networking.

Tangibility

Real estate is a tangible asset that you can see, touch, and use. Unlike intangible assets, such as stocks or bonds, real estate does not depend on the performance or reputation of a company or an issuer. Real estate also has intrinsic value that does not disappear or fluctuate with market sentiment. Real estate can also provide you with personal satisfaction and enjoyment, as well as social status and recognition.

Accessibility

Real estate is an accessible asset that anyone can invest in with some research and planning. You do not need a lot of money or expertise to start investing in real estate, as there are many ways to do it depending on your goals and resources. You can buy a single-family home, a multi-family property, a commercial property, a land plot, a REIT (real estate investment trust), a crowdfunding platform, and more. You can also find information and guidance from various sources, such as books, podcasts, blogs, courses, mentors, agents, brokers, lenders, etc.

Challenges and Risks of Investing in Real Estate

As you can see, investing in real estate has many benefits that make it a good idea for anyone who wants to grow their wealth and generate passive income. However, investing in real estate also comes with some challenges and risks that you need to be aware of and prepared for. Some of these include:

Illiquidity

Real estate is an illiquid asset that cannot be easily converted into cash without losing some value. Selling a property can take time and money, depending on the market conditions, the location, the condition, the price, the marketing strategy, etc. You also need to pay commissions and fees to agents, brokers, lawyers, appraisers, inspectors, etc., which can reduce your profit margin.

Volatility

Real estate is subject to market cycles and fluctuations that can affect its value and demand. Real estate prices can rise or fall depending on the supply and demand, the economic conditions, the interest rates, the consumer confidence, the government policies, the environmental factors, etc. Real estate demand can also vary depending on the location, the type, the quality, the amenities, the demographics, etc.

Management

Real estate requires active management and maintenance to keep it in good condition and generate income. You need to deal with tenants, repairs, vacancies, taxes, insurance, legal issues, accounting, etc., which can be time-consuming and costly. You can hire a property manager to handle these tasks for you, but you still need to oversee their work and pay them a fee.

Liability

Real estate exposes you to potential liability and lawsuits from various parties, such as tenants, buyers, sellers, contractors, neighbors, authorities, etc. You can be held responsible for any damages or injuries that occur on your property, or any breaches or disputes that arise from your contracts or transactions. You need to protect yourself and your property with adequate insurance and legal advice.

To sum up, investing in real estate is a good idea if you are looking for a way to grow your wealth and generate passive income. Real estate can provide you with cash flow, appreciation, tax benefits, diversification, leverage, control, tangibility, and accessibility. However, you also need to be aware of and prepared for the challenges and risks that come with real estate investing, such as illiquidity, volatility, management, and liability. You need to do your research and planning before you invest in real estate, and seek professional help when needed.

30 Secret Websites to Make Money Online in the US 2023

October 16, 2023 by Marco Santarelli

Making money online has become increasingly popular in recent years. The internet has opened up numerous opportunities for individuals to make money online. Many people are searching for secret ways to make money online, but they are not sure where to start. From freelancing to affiliate marketing, the possibilities are endless.

The rise of the gig economy and online businesses has opened up countless opportunities for people to earn money from the comfort of their own homes. In this article, we will look at some of the best secret websites that you may not have heard of, which can help you make extra money online directly or indirectly.

Secret Websites & Ways to Make Money Online in the United States 2023

If you are a beginner, making money online will become an increasingly popular way to earn some extra cash or even start a full-blown business. However, with so many options available, it can be difficult to know the trusted sites to make money online. Here is the list of the best secret websites to make money online.

1. UserTesting.com – Testing Websites and Apps

UserTesting.com is a website that pays people to test websites and apps. If you sign up for UserTesting.com, you can make money by testing websites and apps and providing feedback. Each test takes about 20 minutes, and you can make up to $10 per test. If you're looking for an easy way to make money online, UserTesting.com is an excellent option.

2. Speechify.com – Transforming Text To Audio

An excellent website for content creators is Speechify.com. Speechify.com is a platform that transforms your texts into audio. It's a great way to produce more content for your podcast, YouTube channel, or any other audio content. You can use it to convert books, articles, and documents into audio files. To get started, sign up for a free account, copy and paste the text you want to convert into audio, and Speechify.com will do the rest.

3. Task Rabbit

Task Rabbit is a platform that connects people who need help with tasks to people who can complete those tasks. You can earn money by completing tasks such as cleaning, moving, and handyman services. You can set your own rates and choose the tasks you want to complete.

4. Starter Story

It is a website that features stories of entrepreneurs who have started and grown successful businesses. It's a great resource for aspiring entrepreneurs who are looking for inspiration and guidance. In addition to being a great resource for entrepreneurs, Starter Story can also be a money-making opportunity.

One way to make money with Starter Story is to become a contributor. Contributors write articles about their own entrepreneurial journeys, and they are paid for their work. Starter Story also offers a variety of other ways to make money, such as:

Affiliate marketing: Affiliates promote Starter Story products and services in exchange for a commission on sales.
Course creation: Entrepreneurs can create and sell courses on Starter Story about their specific areas of expertise.
Consulting: Entrepreneurs can use Starter Story to find clients who are looking for their help.

5. Cliqly

It's an email marketing platform that rewards business owners for sending emails by paying them cash rewards per email opened. When you become a new user of Cliqly, you're immediately granted access to 5,000 free email subscribers to kickstart your email marketing journey.

The process is simple: you're guided to send emails to your list every day, and Cliqly compensates you based on the number of link clicks your emails generate.

If your subscribers click on the affiliate offers embedded in the emails you send, you earn a solid 10 cents per click. One of the most appealing aspects of earning through Cliqly emails is that you don't need to create the emails from scratch.

The platform provides you with pre-written draft emails that you can easily choose from. All you have to do is select a draft, review it, send it to your subscribers, and then watch the commissions roll in. Also, by referring others to join Cliqly under your unique referral link and upgrading their accounts, you receive a 100% commission on their upgrade fee.

6. Teachable.com – Creating Online Courses

Teachable.com is a website where you can create and sell online courses. If you have expertise in a particular area, you can create an online course and sell it on Teachable.com. You can use their drag-and-drop course builder to create your course and add your content. Once your course is ready, you can set a price and start selling it. Teachable.com takes care of everything from payment processing to course delivery.

7. Homestyler.com – Making Money Through 3D Designs

Another website on our list is Homestyler.com. It's a website that allows users to make 3D designs of products and homes for free. Previously, people would pay professionals to create 3D designs for them, but with Homestyler.com, you can do it for free. By signing up for a free account, you can get unlimited 1K rendering, free 2K, and video render using Home Styler points. But how does it help you make money? You can use these designs to sell your services on websites like Fiverr.com. If you type in “3D design” on Fiverr.com, you will find thousands of people offering 3D printing designs and technical engineering drawings.

8. Medium.com – Selling Your Articles

Another website on our list is Medium.com. Medium.com is a platform where people can publish their articles and get more traffic. According to SimilarWeb, Medium.com has about 142 million visits every single month, with an average of almost 2% of readers. You can make money on Medium.com by writing and publishing your stories. You can earn money through reading time and referred membership. To get started, apply and get accepted, publish your stories and earn money through reading or reference, and then get paid every month.

9. Veed.io – Creating Great Videos

If you're a content creator, you'll love veed.io. It's a website where anyone can create a great video using AI. You can create your first video for free, and you can do more than ten minutes of a project using this particular website for free. The reason why Veed.io is so great is that it has fantastic AI that helps you use another person's voice to read your texts. You can use this feature to have a British, American, or any other accent without having to pay for it.

10. Gigwalk

Gigwalk is a platform that pays users to complete small tasks in their local area. These tasks may include taking photos of businesses, testing apps, or verifying addresses. The pay varies depending on the task, but it can be a good way to earn some extra cash on the side.

11. Sweatcoin

Sweatcoin is an app that pays you to exercise. The app tracks your steps and rewards you with Sweatcoins that can be redeemed for products, services, or cash. It's a great way to stay motivated and earn some extra money while staying active.

12. Respondent

Respondent is a platform that pays users for sharing their knowledge and experience. Unlike other similar websites that pay pennies for completing tasks, Respondent pays anywhere from $100 to $750 an hour for participating in studies. Getting started is easy, just sign up using a work email on the website and personalize your skills and interests.

13. Product Tube

Product Tube is a premium video survey app that rewards users for making short videos about everyday products. You can earn money by creating short at-home videos, recording videos at the store, or exploring new product concepts provided by the app using augmented realities. The app claims that you can earn between $50 and $80 per hour by posting these video reviews.

14. BestMark

BestMark is a secret shopping website that you can sign up for to start earning easy money and get free food and services in the process. As a secret shopper, your job is to perform tasks and then provide details about your experience. You can earn as much as $35 per hour depending on the assignment.

15. Side Hustle Database

The Side Hustle Database is a tool that lets you sort through hundreds and eventually even thousands of different side hustles and make money opportunities by using the various filtering options provided. You can find make-money opportunities that will only have the potential to earn you over $100K per year or find fast money or even free money.

16. Wrapify

Wrapify is an app that pays you to professionally wrap your car and drive it as you normally would. The more you drive, the more Wrapify will pay you. You can make between $200 and $400 per month for doing something that you would already be doing anyway.

17. Prolific

Prolific is a research platform that allows you to participate in paid studies. You can earn up to $10 per hour by participating in studies related to a wide range of topics, including social sciences, psychology, and consumer behavior.

18. Amazon Mechanical Turk

Amazon Mechanical Turk is a platform that lets you earn money by completing simple tasks, such as identifying objects in a picture or transcribing audio recordings. While the pay is not very high, it can be a good way to earn some extra cash in your spare time.

19. Swagbucks: Rewards for Surveys and More

Swagbucks is a platform that lets you earn money by completing simple tasks, such as watching videos, taking surveys, and playing games. You can earn Swagbucks that can be redeemed for cash or gift cards. The website has paid out over $500 million in rewards to its members.

20. InboxDollars

InboxDollars is a platform that lets you earn money by completing surveys, reading emails, and playing games. You can earn cash or gift cards by completing

21. Rumble.com

Rumble.com is a video platform that allows creators to monetize their content. It is similar to YouTube, but it offers multiple ways to earn money. Rumble has 44 million users per month, and it partners with companies like MTV, Xbox, and Yahoo to help creators earn money. If your video is approved by one of their partners, you can earn $50. You can also earn an additional $100 if your video makes it to the home page.

22. Fundrise.com

Fundrise.com is a real estate crowdfunding platform. If you want to invest in real estate but don't have the upfront capital, Fundrise allows you to invest as little as $500. You can invest in projects like townhouse complexes and earn returns.

23. CafePress.com

CafePress.com allows you to create and sell customized merchandise. You can create designs for t-shirts, mugs, and other items, and earn money every time someone buys your product.

24. Etsy.com

Etsy.com is an online marketplace that allows you to sell handmade or vintage items. If you are skilled at crafting, this website is an excellent way to earn money.

25. Qmee.com: Paid Search Engine Results

Qmee.com is a website that pays you to search the internet. You can download the Qmee browser extension and earn money by clicking on sponsored search results. You can also earn money by taking surveys and completing offers.

26. Print on Demand (POD) platforms

POD platforms allow you to sell custom-designed products, such as t-shirts, mugs, and posters, without having to worry about inventory management. When a customer places an order, the POD platform prints and ships the product directly to the customer. Some popular POD platforms include Redbubble, Printify, and Teepublic.

Teespring is another POD platform for creating and selling custom apparel. Teespring allows you to create and sell custom t-shirts and other apparel, and earn profits from the sales. However, the amount of money you can make will depend on various factors such as the quality of your designs, your marketing efforts, and the demand for your products. The website provides a variety of customizable products, including t-shirts, hoodies, tank tops, mugs, and more.

27. Virtual Jury Duty

Virtual jury duty is a way to earn money by participating in mock trials online. You are typically paid $10-$20 per hour for your time. To qualify, you need to be a US citizen and at least 18 years old. Some popular virtual jury duty platforms include Jury Duty Solutions and Online Verdict.

28. Google Opinion Rewards

Google Opinion Rewards is a survey app that allows you to take short surveys and earn money doing so. You can take these surveys whenever you have a few free minutes, and the money is sent directly to your PayPal account. While this app won’t replace your day job, it’s an easy way to earn a few extra dollars in your spare time.

29. Enroll

Enroll is a platform where users can sign up to become testers for various websites, mobile apps, and digital products. As a tester, you will be asked to complete various tasks such as navigating through a website, testing out features on an app, or providing feedback on a digital product.

30. Foap

Foap is a great platform for amateur photographers to monetize their skills and make some extra money. The process is simple: you sign up for a free account, upload your best photos to the platform, and wait for brands and agencies to browse and purchase your photos. Foap charges a commission fee of 50% for each sale, but it's still a decent way to earn some extra cash without investing in expensive gear or equipment.

These are just a few of the many websites that can help you earn money online in 2023. With so many options available, finding the one that best suits your skills, interests, and schedule is important. Remember, making money online requires dedication and effort, but with the right mindset and tools, anyone can earn a significant income online.

Secrets to Finding a Trustworthy Property Manager in 2023

October 16, 2023 by Marco Santarelli

Property management, in its broadest terms, is the oversight of real estate. This can encompass everything from personal property to capital assets. Property management is a service provided by local businesses who do their best to manage your assets. The current state of the local and national economy will play a huge role in their decision making process. Before you invest your hard earned capital, you have to ask the question – is their personal best sufficient for the betterment of your business?

The question of whether it makes good financial sense is important. Many of the smaller investors just don't have the answer. Lack of knowledge prevents them from bringing on professionals – leaving them to manage the property on their own. Does this short-term savings result in long-term profits?

Individuals looking to invest $250,000 in assets wouldn't just turn it over to a financial planner. You want to know everything there is to know about the person managing your assets. So why wouldn't you do the same when searching for a competent property manager?

QUESTIONS TO ASK WHEN HIRING A PROPERTY MANAGER

The interview starts (and ends) with you. Ask yourself the following questions:

What do you believe are the day-to-day responsibilities of a property manager?
Will you be managing the property on your own?
Will you be living close to the property you wish to manage?
Do you have sufficient time in your schedule to effectively manage this property?
Do you have a good understanding of all the day-to-day tasks that come with managing the rental property? If the answer is yes (as it should be), expand on what you're thinking.
Does it make good financial sense for you to manage the property? Have you considered the time you'll need to devote to learning new things? Did you think about the legal responsibilities, how to market the property effectively (to bring in the best tenants), and how to best screen those tenants once they fill out an application? How about your involvement with the accounting department? This is a big question with several integral sub-questions.
Can you be on call and ready to respond 24 hours per day, 7 days per week, and 365 days a year? Even on major holidays? This can include responding to maintenance issues and related problems.
Are you experienced at answering the phone? Can you handle phone calls professionally, show available properties to prospective tenants, collect rental payments, and use the eviction process properly (within the confines of the law) to deal with troublesome tenants?

If you can't answer yes to all of these question, then you should seriously consider a property manager. This could save you time, money, and unnecessary headaches down the road. If you don't have the experience (and don't feel as though you can pick it up on your own), then it's time to think about bringing on a professional.

FINDING A TRUSTWORTHY PROPERTY MANAGER

If after asking yourself the essential questions, you're now considering hiring a property management company, the first test you need to perform is pass/fail. Either they pass with flying colors, or they fail miserably. There is no middle ground. Call each of the companies you're considering. With the first call, if they're worth your time, they will pick up after a few rings. This is what you want along with a positive vibe that your business is important to them. If they don't pick up, but return your call relatively quickly, that's acceptable as well.

If the property management company doesn't pick up on the first call, or return the call quickly, then they aren't worth your time. If they seem unprofessional, then you should also pass on giving them your business. Imagine how they will treat your tenants if they're giving you the run around. Or worse when you find yourself in the middle of a dispute. There are reputable companies out there that will value your business. Don't settle for anything less than the best.

QUESTIONS TO ASK A PROSPECTIVE PROPERTY MANAGEMENT COMPANY

You should now have a short list of a few different companies you're considering. If they successfully passed the first barrier, it's now time to move on to the interview. These are the questions you need to ask:

A. Rent and Marketing Questions

How will you determine the rent, as well as market my rental property?
Will the rental rates be in line with other properties in the area? More competitive? Less competitive?
Do you understand how to effectively market this property? How do you plan to rent this property at the current rates being imposed by the market?
Are you familiar with the area (along with the different rental properties)?
Do you possess the correct property management license? Are you insured and bonded by the state?
How do you plan to attract great tenants to our rental property?
Do you have a website? If so, how many? How will your website benefit our rental property?
What is your familiarity with Search Engine Optimization (SEO)?
How will you respond to questions, comments, and concerns by our tenants?

B. Renting to Only Qualified Tenants

What is your process for qualifying prospective tenants to rent at our property? What makes the tenant attractive or unattractive?
Make it clear that every prospective tenant must agree to the following: to have their employment verified, their credit run, and a background check to verify that they don't have a criminal history. This must be done according to regulations and requirements set forth by the town, state, or the federal government.

C. Keeping Up With Maintenance While Renting Available Units

The condition of the rental units can change over time. To maintain the condition of the property, it's essential that inspections and maintenance be performed in a timely manner.
Routine maintenance and emergency repairs should be performed by in-house staff. This will reduce wait time and ensure 24/7 availability.
The property management company should conduct regular inspections of the rental units. While tenants are secured by their lease, it's important to make sure they're taking care of their rental unit. This can help with enforcing the rental agreement.
When an existing tenant moves out, the rental company must check for normal wear and tear, as well as any damage. This will determine whether or not the tenant is entitled to a full or partial refund of their security deposit (or no refund at all).

D. Collecting Security Deposits and the Monthly Rent

If you're not using your time wisely, then you're wasting money. The rent must be collected on time (usually the 1st of the month) for all tenants. These funds must be deposited in a timely manner. Detailed reports should be created and provided to the property owner.
If a tenant is unable to pay their rent on time, it's imperative that the property manager be able to handle this in a timely manner. The company should be familiar with all applicable laws and procedures pertaining to collecting past due rent. Knowledge of the eviction process is essential.
Find out how the property management company will keep you on top of things. Will they give you access to an online portal (accessible 24/7) to the landlord or investors who have a stake in the property?

E. Timely Reporting

The landlord/investor(s) should be provided financial statements (that are detailed and accurate) on a regular basis. Each statement should include how much rent was collected for the month, how much is outstanding (if any), expenses that were incurred (if any), and how many tenants moved in as well as left during that month. The statement should list the total profit and total loss for the month.
Compliance is extremely important now days. The property management company must log events that would fall under fair housing. The Americans with Disabilities Act is a good example of that.
The system (with an integrated database) should make it easy to pull maintenance records for any unit in the rental property. If appliances were upgraded or replaced in a particular unit, that should be available in the database. Having complete and detailed records for each rental unit is important.
When work, upgrades, or regular maintenance need to be performed it should always be reported to the landlord or investor(s) in some form or another. This will keep the surprises to a minimum.

SOME FINAL THOUGHTS

In finding the best property manager, you'll see firsthand the good, the bad and the ugly. This is all part of the process. It's rare to find that diamond in the rough without some trial and error. Be persistent, stay confident, and remain focused on the task at hand. This will ensure a positive experience for you and your tenants.

New Housing Market Data Shows Buyers Are Backing Off

October 12, 2023 by Marco Santarelli

The housing market is experiencing a shift this fall, with new listings showing a slight increase. However, the elevated mortgage rates are causing many potential buyers to retreat. Let's delve into the details of this evolving housing market scenario.

Current Trends in the Housing Market

According to a new report by Redfin, new listings have increased by 2% since the beginning of September, offering a slightly larger inventory for potential buyers. Despite this uptick, the total number of homes for sale is down by 14% from the previous year, suggesting a persistent seller's market. The median sale price is showing a steady 3% year-over-year increase.

Advice for Home Sellers

For sellers, the current market presents an opportunity to take advantage of rising prices. Despite the low demand, the median sale price has experienced a 3% increase. However, due to the increasing number of homes with a price drop and the impact of high mortgage rates on buyers' budgets, setting a fair price is crucial. Redfin agents recommend pricing homes fairly to attract buyers.

Advice for Homebuyers

On the other hand, potential homebuyers are hesitating to enter the market as mortgage rates reach their highest point in more than two decades. The median monthly mortgage payment has climbed close to $3,000. Despite the challenges, there's hope for buyers to make a move, especially with the slight increase in new listings. Shopping around for mortgage rates and considering buying down a mortgage rate are viable strategies to navigate the current market.

Key Housing-Market Data – October 2023

Here's a comprehensive analysis of the key data points and what they indicate about the housing market for the week ending October 8, 2023.

1. Median Sale Price: $370,000 (2.7% YoY increase)

The median sale price represents the middle point of all home sale prices. A 2.7% year-over-year increase in this value suggests a general upward trend in home prices, indicating demand and appreciation in property values.

2. Median Asking Price: $388,223 (5.2% increase, the biggest in a year)

The median asking price is the middle point of all homes listed for sale. A significant 5.2% increase in the median asking price, especially the highest in a year, signals a robust demand in the housing market, potentially indicating a seller's market.

3. Median Monthly Mortgage Payment: $2,736 at a 7.49% mortgage rate (10% increase)

The median monthly mortgage payment is influenced by both home prices and mortgage rates. A 10% increase indicates higher costs for homeowners, potentially impacting the purchasing power of prospective buyers and affecting overall market demand.

4. Pending Sales: 73,943 (-11.6%)

Pending sales represent the number of homes that have a signed contract but are yet to close. An 11.6% decrease in pending sales suggests a decline in immediate buyer interest, possibly due to factors like high mortgage rates or economic uncertainties.

5. New Listings: 81,964 (-3.9%, smallest decline since July 2022)

The number of new listings entering the market is a vital indicator of market activity. A smaller decline of 3.9%, especially the smallest since July 2022, indicates a potential stabilization or improvement in the supply of homes for sale.

6. Active Listings: 827,406 (-14%, tied with the previous week for the smallest decline in four months)

Active listings represent the total number of unsold homes available in the market. A 14% decrease, even if it's the smallest decline in four months, still indicates a lower inventory of homes, contributing to a seller's market environment.

7. Months of Supply: 3.2 months (+0.2 pts.)

Months of supply is the estimate of how long it would take to sell the current inventory of homes at the current sales pace. An increase of 0.2 points to 3.2 months suggests a slight easing of the market, but it still remains within the range of a seller's market.

8. Share of Homes Off Market in Two Weeks: 39.5% (up from 36%)

This metric reflects the proportion of homes that are off the market within two weeks of being listed. A higher percentage (39.5%) suggests that a significant number of homes are being sold quickly, indicating a competitive market.

9. Median Days on Market: 32 (-2 days)

The median days on market represent the average time it takes for a property to be sold. A decrease of 2 days to 32 days indicates a relatively fast-paced market with homes selling quicker.

10. Share of Homes Sold Above List Price: 30.7% (up from 30%)

An increase in the percentage of homes sold above the list price (30.7%) suggests strong demand and competition among buyers, potentially resulting in bidding wars and higher selling prices.

11. Share of Homes with a Price Drop: 6.8% (+0.2 pts., highest level in a year)

A higher percentage of homes with a price drop (6.8%) and its increase indicates that some properties may be overpriced or the market is becoming more price-sensitive, encouraging sellers to adjust their prices to attract buyers.

12. Average Sale-to-List Price Ratio: 99.3% (+0.3 pts.)

The average sale-to-list price ratio measures the difference between the listed price and the actual sale price. An increase to 99.3% suggests that, on average, homes are selling very close to their listed prices, showing a strong seller's position in negotiations.

Overall, the housing market data portrays a dynamic scenario with sellers benefiting from rising prices and a seller's market environment, while buyers face challenges due to increased mortgage costs and stiff competition.

Additional Insights

Despite the challenges posed by the high mortgage rates, there are opportunities for both buyers and sellers in this evolving market:

Opportunities for Sellers

1. **Leveraging Rising Prices:** Sellers can take advantage of the continued rise in median sale prices, showcasing their properties at competitive rates.

2. **Strategic Pricing:** Sellers should carefully consider the pricing of their homes, aiming for a fair and attractive price to entice potential buyers.

3. **Prompt Sales:** Well-priced, move-in ready homes are still selling quickly in many parts of the country, indicating a demand for properties that meet buyers' expectations.

Opportunities for Buyers

1. **Choosing the Right Moment:** Despite the high mortgage rates, buyers can look for moments of reprieve to enter the market, keeping an eye on the small increase in new listings and slight decreases in daily average rates.

2. **Exploring Mortgage Options:** Buyers should shop around and explore different lenders to secure the best mortgage rates, ensuring they make an informed decision that aligns with their financial capabilities.

Challenges in Housing Market Will Impact Economy: Fed Needs to Respond

October 12, 2023 by Marco Santarelli

In the face of housing market challenges, urgent calls for the Fed to halt rate increases to stabilize the economy. The Housing Market Will Drag the Economy into a Hard Landing Unless the Fed Takes These ‘Simple Steps,' Trade Groups Warn.

Housing trade groups have urgently called on the Federal Reserve to cease immediate interest rate hikes, stressing the necessity of two critical “simple steps” to avert a looming hard landing that could thrust the economy into a recession.

Warning of Broader Risks

The National Association of Home Builders (NAHB), the Mortgage Bankers Association (MBA), and the National Association of Realtors (NAR) have sounded a warning that more rate hikes could significantly heighten the probability and impact of a recession, posing substantial risks to economic growth. This concern is exacerbated by the historic spread between 30-year mortgage rates and the 10-year Treasury yield, reflecting deep-seated uncertainty regarding the Federal Reserve's future direction.

Housing's Weight on the Economy

The housing industry is a significant pillar of the US economy, accounting for an estimated 16% of GDP. A sudden slowdown in new and existing home sales could potentially trigger a broader economic downturn if a sales rebound does not materialize swiftly. The housing market's health is intertwined with the nation's economic stability.

The Urgency of Two ‘Simple Steps'

To navigate this delicate situation, the trade groups implore the Federal Reserve to make two explicit statements:

“The Fed does not contemplate further rate hikes;”
“The Fed will not sell off any of its mortgage-backed securities holdings until and unless the housing finance market has stabilized and mortgage-to-Treasury spreads have normalized.”

The Fed's ongoing quantitative tightening, with a reduction of its balance sheet by about $1 trillion since March 2022, emphasizes the urgency of clarity in the Fed's actions and plans. These steps would provide much-needed certainty to the market about the Fed's rate path and its MBS portfolio plans, consequently reducing volatility for traders and investors.

A Call for Market Certainty and Stability

Implementing these two steps could not only enhance home builder sentiment but also stimulate a fresh supply of homes to the market. A surge in home supply would contribute to mitigating inflationary shelter costs, a significant driver of the recent increase in inflation. By doing so, the housing sector can avoid precipitating the hard landing that the Federal Reserve has been diligently striving to prevent.

The ball is now in the Federal Reserve's court to heed the warnings from housing industry trade groups. The fate of the housing market and its impact on the broader economy hinges on these ‘simple steps' and the resolve of the Fed to navigate this precarious situation with prudence and foresight.

Source: https://www.cnbc.com/2023/10/10/housing-industry-urges-powell-and-fed-to-stop-raising-interest-rates.html

New Concerns Arise: Today’s Housing Market Looks Like a Bubble

October 12, 2023 by Marco Santarelli

The housing market, a critical component of the economy, has recently caught the attention of Sheila Bair, a key player who witnessed the subprime mortgage crisis of 2008. She expresses concern that the current housing market may be heading towards an unsustainable trajectory.

Bair draws attention to the drastic change in median home prices. In August 2019, the median home price for an existing home was just $278,200. However, by August 2023, this figure had surged to $407,100, signifying a substantial rise.

The rise in prices is being seen as a classic supply-demand imbalance, indicating a potential bubble in the housing market. This imbalance is attributed to years of rock-bottom mortgage rates, fueling speculative buying and driving prices to unsustainable levels.

Factors Contributing to a Potential Housing Bubble

A housing bubble can be the result of speculative buying, akin to the subprime mortgage crisis, where individuals with limited financial capacity were purchasing homes with minimal down payments, leading to a subsequent collapse when home prices dropped.

Additionally, irrational exuberance can also contribute to a bubble, wherein a surge in prices triggers a buying frenzy.

Expert Opinions and Market Insights

Sheila Bair emphasized the need for home prices to correct downward. However, she noted that the scarcity of available homes on the market might prolong the bubble.

Legendary investor Jeremy Grantham and Fannie Mae CEO Priscilla Almodovar also express concerns about a housing bubble, foreseeing a potential plunge in home prices due to the global real estate bubble and high mortgage rates.

Contrarily, some in the financial sector, like Goldman Sachs and CoreLogic, are optimistic, predicting a steady rise in home prices despite high mortgage rates.

Market Comparisons and Lessons from the Past

Comparisons with the mid-2000s housing bubble reveal key differences. Homeowners today generally have more equity in their homes, providing a buffer against price drops. Furthermore, stricter mortgage lending standards reduce speculative buying, contributing to market stability.

Lawrence Yun, Chief Economist at the National Association of Realtors, dismisses the possibility of a significant drop in home prices, citing a housing shortage. He underscores the need to induce more supply to mitigate the growing social inequity.

The current state of the housing market, marked by soaring prices and a significant shortage of available homes, raises concerns of a potential housing bubble.

Stakeholders, including experts and financial institutions, hold varying views regarding the trajectory of home prices. While some fear a plunge akin to the 2008 crisis, others remain optimistic about the market's stability.

The evolving dynamics of the housing market call for continued monitoring and proactive measures to ensure a sustainable and balanced real estate environment.

Source: https://edition.cnn.com/2023/10/11/economy/housing-market-bubble-sheila-bair/index.html

Free Real Estate Comparative Market Analysis: A Guide to Analyze Markets

October 7, 2023 by Marco Santarelli

Are you considering investing in real estate and finding it challenging to determine the ideal starting point? The key to a successful real estate investment lies in selecting the most suitable real estate market. Robust real estate markets are distinguished by several factors, including high demand, low vacancy rates, and consistent appreciation.

Free Real Estate Comparative Market Analysis

Real Estate Comparative Market Analysis (CMA) is a comprehensive evaluation of a property's value in comparison to similar properties in the same area. It provides crucial insights to buyers, sellers, or investors about the property's market worth.

This analysis considers various factors like location, size, features, and recent sales of comparable properties. Obtaining a free CMA helps in making informed decisions in the real estate market without incurring any cost for this valuable assessment.

Utilizing free resources for CMA is essential, and several platforms offer these services without any cost:

Realtor.com: This platform provides CMA data to real estate professionals, aiding in accurate property valuation.
New Way Mortgage: Offers valuable information on the value of your home, aiding in understanding its market position.
Real Estate CMA Software: Utilize software like iSite Lite, Remine, FlashCMA, iCMALive, Immobilien CRM, and iSite Free, which provide free CMA tools, streamlining the analysis process.

Real estate agents and brokers heavily rely on CMAs to guide sellers in setting appropriate listing prices and to assist buyers in making competitive offers. The core of a CMA lies in utilizing “comps,” which are recently sold homes similar to the subject property. Here's how you can perform your own CMA:

Research Comparable Properties: Investigate comparable properties on real estate listing sites, considering aspects like location, size, and features.
Analyze the Neighborhood: Assess the neighborhood's desirability, amenities, and overall market trends.
Evaluate the Subject Property: Understand the subject property's features, condition, and unique selling points.
Select Similar Properties: Choose properties that closely resemble the subject property in terms of size, style, and features.
Adjust for Differences: Factor in variations between the subject property and the chosen comparables, considering any upgrades or drawbacks.
Calculate Sold Price per Square Foot: Determine the sold price per square foot for the selected comparables.
Determine the Subject Home's Value: Based on the analysis, determine an estimated value for the subject home.

How to Analyze a Real Estate Market Before Investing?

A rental property is only valuable to you if a person is willing and able to use your property and pay you rent. If you buy a house standing by itself in the middle of a desert, your prospects of finding a paying tenant are poor. You want a hassle-free cash-flow property near lots of well-paid people. Those people want to live near their jobs and the amenities they enjoy.

For a property to be suitable, it must be located in a market that passes the following litmus tests:

1) Large and Growing Population

Population centers have upward or downward momentum. If a city is growing, it will likely continue to grow. A city's losing population has a hard time stopping that trend. As a population center starts to grow, the growth fuels itself. More people attract more people and the rate of growth can be dramatic.

The current population is moving away from small towns and towards urban centers. There is a highly educated, entrepreneurial segment of the population that is moving from urban centers to small towns and telecommuting, but in terms of the total number of people, the safer bet is that big cities will keep getting bigger.

You can find lots of information on population trends and housing trends at www.census.gov and www.ofheo.gov.

HINT: If a specific geographical area doesn’t have enough population to be studied by www.ofheo.gov, you might call that a clue and stay away.

2) Diverse Employment and Job Growth

People are attracted to an area primarily because of jobs. Many people would prefer to live in the beautiful mountains than the suburbs, but there are very few jobs in the mountains. If you look for job growth, you will find population growth and increased capacity to pay. Where there is population growth you will have increased demand for housing. Increased demand along with increased capacity to pay means higher rents and sales prices. If you are an investor these are good things.

3) Low Cost of Living Compared to National Standards

In tough economic times, companies that do business on a national level will save money by relocating to low-cost, business-friendly areas of the United States (and abroad). For example, many Americans are relocating to Texas because the cost of living is low, the quality of life is high, and that is where the jobs are headed. Workers and employers are leaving California, New England, and other high-cost areas in the US and relocating to where it is more affordable.

Housing in many parts of Los Angeles costs about twelve times the annual wage of its occupants while in Dallas housing is only about three times its occupant's annual wage. Americans are tired of being house poor and they long for a return of the day when a single income was enough to be middle class. Today’s families are making housing choices primarily on proximity to their jobs and secondly on the overall affordability of the area.

Dallas Affordability Ratio
$243,100 median home value / $67,900 median household income = 3.5 times
Los Angeles Affordability Ratio
$635,000 median home value / $54,514 median household income = 11.6 times

4) Natural Resources / Cash Injected into the Baseline Economy

Every town needs something that draws outside cash into the community. Economist Richard Maybury calls the injection of cash into a community a “cone:” “Conventional wisdom says that when the government expands the money supply, the money descends on the economy in a uniform blanket. This doesn't seem right, the money is injected into specific locations causing hot spots or cones.” Excerpt from The Clipper Ship Strategy by economist Richard Maybury: www.RichardMaybury.com. Examples of cones: are recipients of federal stimulus packages, natural resources (oil wells), destination tourist attractions (Disneyland), and agricultural exports (Napa Valley). Cones draw money into the community.

Every city needs firefighters, nurses, librarians, waiters, and waitresses, but these support and service occupations exist to serve the local population; they do not import fresh cash into the local economy. They service the cones but do not create them. Without a natural resource or commodity to import cash into a local economy, the service and support jobs will quickly dry up. Service and support jobs recycle money between themselves, but a large percentage of what these workers spend leaves the local economy in the form of food and clothing imports, taxes, traveling abroad, etc.

Without a regular injection of cash from the outside world, all the cash and jobs will eventually leave a local economy, leaving behind one of those desolate gas station towns clinging to the side of an interstate. Get your investment dollars as close to the cone as possible. An oil field worker is closer to the cone than an oil field worker’s barber. The injection of money (cone) created by oil consumption will keep the oil worker employed, but when the general economy gets tight, the oil field worker’s spending may not be enough to keep the barber in business.

I like investing in lower-middle-class, blue-collar areas close to manufacturing and distribution centers. Manufacturing and distribution centers are somewhat reliable cones. The jobs and tenants they attract are fairly stable, semi-skilled, and well-paid. The government has unlimited ability to inject money into specific locations, creating some of the largest cones. However, government spending comes and goes at the whims of politicians. If you are investing near a large government cone, make sure there are at least four additional cones (baseline industries importing money into a local economy) so when the government cone moves on you won’t be stuck in a decimated housing market.

I’m sure you can name quite a few single-cone towns where the sole employer is a military base, college, or steel mill and every other job exists to serve the population of that baseline employer. The housing values of those ‘one horse’ towns are tied entirely to the success of a single industry which is never a good environment for your real estate investments.

5) Healthy Ratio Between Rents and purchase Prices

Common sense dictates that there should be a small premium attached to home ownership compared to rent. However, there are many high-priced real estate areas where it is drastically more expensive to own than to rent the same house. Why buy when there is such a vast pricing disparity between renting and ownership?

When the homeownership premium is too high it encourages foreclosures; if your home is declining in value and it is much cheaper to rent than own, you will be more willing to walk away from your home.

The inverse of this statement is also true. If it is cheaper to own than rent and home values are stable, you will do everything possible to keep paying your mortgage. In most of Dallas, for example, it is the same cost or cheaper to own than to rent. This substantially reduces the temptation and need for an owner to walk away thus further perpetuating a cycle of stable home values and rents. Stable appreciation and positive cash flow over the long haul result in hassle-free investment performance compared to the roller coaster of price speculation that many ‘investors’ get caught up in.

In the most recent real estate boom and bust in California, Florida, Arizona, and Nevada many speculators ignored the fundamentals of cash flow and overpaid for properties relative to the cash flow those properties could produce. There was a buying frenzy that drove prices up. When the prices peaked, speculators ran to the exits and prices crashed. Yes, you can make a lot of money in a short time, but you can also get creamed. Slow and steady wins the race.

6) Access to Quality of Life Amenities (arts, entertainment, low crime, warmer climate)

People will move to a new area for a job, but they and their families will stay longer if there is a high quality of life: an arts scene, amenities, restaurants, good schools, a low crime rate, and nice weather.

The United States is experiencing a population migration away from the colder parts of the Northeast and Midwest into the warmer climates. Not only are warmer climates more desirable to live in, but they often result in less expensive real estate maintenance. Freezing temperatures are harder on real estate than hot summers.

7) Comparatively Low Cost of Government

When you pay more taxes you have less money to spend on other things. Businesses are attracted to areas with a low cost of government. In places where taxes are low, businesses are generally more prosperous. Profitable businesses are good for real estate owners.

There are seven states with no state personal income tax: Alaska, Florida, Nevada, South Dakota, Texas, Washington, and Wyoming. How can Texas, a state with no income tax, finish the year 2008 with a $11.7 billion SURPLUS when the national economy is in shambles and forty-four states finished the year with major deficits? Texas has a history of conservative spending, balanced budgets, a reluctance to borrow money, and a very stable economy.

If a government is continually borrowing to fund its operations, the cost of that borrowing is passed on to the taxpayers in the form of higher taxes and/or lower services. When you own real estate, your silent business partners will always be the taxing authorities of the federal, state, and local governments. I prefer that business partners be as silent as possible.