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Daniel Godbout

How Inflation Could Affect Your Next Real Estate Move

Graph of Inflation sharply increasing over a world map

Inflation has become an increasingly hotter topic over the last couple of years and seems to be peaking in our current economic environment. Talks of another recession have been looming for months, and there’s no industry that’s not on high alert because of it.

Certain industries feel the effects much stronger than others, but what about the real estate sector? How does inflation directly affect the housing market, and what does this mean for your strategy?

In this article, we’ll answer those questions and more. Continue reading to understand how inflation could affect your next real estate move.

Rising Rates

Last October, inflation rates rose to 6.2%, which is the highest they’ve been since November of 1990. This is a drastic increase from the 2% that we’ve become accustomed to over the last five years.

When you think about this in terms of your everyday life, it means that you’re spending more money on just about everything imaginable. When you’re at the gas station, paying utility bills, and buying your food, the drain on your wallet seems like it becomes worse with each trip.

The bottom line is our money isn’t going nearly as far as it used to. So how does this specifically affect the housing industry?

It shouldn’t surprise you that inflation is hitting the real estate market hard, as well.

According to most investors, residential real estate has always been a safe investment during heavy inflation. During the 1970s (another period of heavy inflation), prices of homes increased relative to the size of our economy. This was a good thing for homeowners because it meant that rising values in homes worked to offset increases everywhere else.

However, if you were looking for a new home, this presented major challenges, which is true of today’s market.

Dollars in hand disintegrating due to inflationWhat causes Inflation, and How Does It Happen?

Inflation is when the prices of goods and services rise, which decreases the purchasing power of the money you hold in your wallet. Currently, several things are influencing inflation, specifically the government aid during the COVID pandemic.

When the government helped American homeowners and extended financial assistance, this gave consumers more purchasing power. However, the intention of the assistance was to put money back into the economy and various work-related businesses, and this didn’t happen as planned.

These companies had to charge more for goods and services because people were working remotely and didn’t need to spend on things like takeout lunches, commuting, dry cleaning, and other work-related expenses. Sometimes having fewer customers leaves you no other choice.

When the number of transactions drops, business owners are forced to increase prices to stay in the black.

Another large factor contributing to inflation is the supply chain issues occurring in multiple countries. Manufacturing and other services became disrupted because of restrictions, and sickness and lockdowns drastically slowed business. This creates significant problems with the needed goods making it into ports.

When the items did finally arrive, trucking them across the United States became challenging because there were lower numbers of people with CDLs available to drive the big rigs to haul these goods. During times of worker shortage, companies raise wages to fix that, but it also brings subsequent price increases.

When you have a kitchen table that might normally sell for $200, but you have to pay workers and drivers more, the price might rise to $250 or $300 to soften the blow for a company.

How does inflation data specifically affect the real estate industry?

Inflation and Real Estate

There’s no question that strong inflation periods affect the budgets of homebuyers. The great majority of consumers will finance a home they purchase, meaning there’s a need for a down payment, then the application for a mortgage.

Let’s assume they have money for the down payment. In this case, the price of the mortgage payment will be the main influence in determining what they can and can’t afford. Unfortunately, mortgage rates seem to move in tandem with inflation rates, which causes the former to increase.

Back in November, Freddie Mac rates went up to 3.10%, which means that average buyers of a median-priced home will spend an additional $160 more on their mortgage payment. This is far from a slight increase and has a noticeable impact on your budget.

When you’re talking home sellers, the tight market can be the perfect time to net a large profit. However, this is assuming that post-sale, they’re able to find an affordable place to move if they don’t already have one in mind. When the house you bought for $150,000 is now worth $225,000, that’s great.

But if you want to sell and remain in the same area, what has inflation done for your spending power? Did you really get ahead at all in this scenario?

These are important questions you need to ask yourself.

How Long Will Inflation Last?

While inflation steadily eats away at the spending power of homebuyers, many are left wondering: Is there any end in sight?

Most areas will probably continue to see higher prices for housing until the supply chain issues are resolved. Trends in consumption are being untangled from up to 50 years in the past.

Individuals were shifting from spending on goods to instead spending on experiences. They want to go to the gym, eat out, go on a vacation. COVID-19 totally decimated those plans. Who wants to be around a lot of people during a pandemic crisis?

Mortgage rates will play a role as well. 30-year rates could rise as high as 3.7% by the end of this year. Many buyers would no longer be able to qualify for mortgages because of this. They’ll either have to take their spending down a bit or sit on the sidelines for a while until the housing market becomes less expensive.

If things shift and we begin spending more on services, that will help correct supply chain challenges. The demand for goods will be less at the current bottlenecked ports that exist, and things will have an opportunity to level out and return to some form of normalcy.


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5 Reasons Why Real Estate Investors Fail

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Running a business—any kind of business—is difficult. Many businesses fail within their first year or two. It’s no different with real estate investment businesses. There are certain types of issues that you will need to address and problems that you need to sidestep if you want to be successful.

If you are only buying one property to use as a rental, the chance of failure tends to be much lower. However, this would mean that you are more of a hobbyist investor than someone who is running a true real estate investment business with multiple properties. Keep in mind that it is possible to fail even if you have just one property. Below are some of the biggest reasons investors have problems.

Reason 1: You Use Emotion When Investing

This is a major problem when it comes to real estate investment properties. The investor finds a property they fall in love with and they want to buy it, believing that it will be a good investment. However, if you aren’t looking at the numbers, this could end up causing some problems.

For example, you might choose a property because it looks nice or because you think it’s a good deal rather than looking at what it can do for your business. Will the property be easy to rent? Will you be able to get enough in rent for the property?

You might also find that you end up spending too much on the property if you have an emotional attachment. If someone bids against you on the property when trying to buy it, you might end up spending more on the property than you should have. Now, it will take even longer for that property to earn out for you.

Reason 2: They Try to Do Everything on Their Own

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The next reason real estate investors often fail is because they fail to get the help they need with their investment. Instead, they try to do everything alone. This often leads to complications.

Consider all there is to do with the investment. You first have to find properties, buy them and potentially fix them up, market the properties, find the right tenants, maintain the property, deal with tenants, and so much more. It can quickly become overwhelming even if you have just one investment. When you have multiple, it can be a nightmare.

You need to have a quality team working with you. This means you’ll need real estate agents that can help you find the right properties, contractors for those properties that need updating, help with marketing and showing the property to tenants, collecting rent, and more.

Often, investors feel that they can cut their costs down when they simply do it all on their own. While it’s possible to handle some of these tasks yourself, you’ll find that it’s often smarter and more cost-effective to have people that you can bring in at different steps. They don’t need to be full-time employees, of course. Simply have good working relationships with agents, contractors, photographers, marketers, etc. for when you need them to do a job.

Reason 3: Underestimating the Costs

Financial troubles hamper many investors. They buy a property without fully understanding how much it will cost them. Even when they get a good deal on an investment home, they may not realize what the repairs will cost or how much it will cost to maintain and market the home.

Real estate investors, no matter the size of their business, must take the time to understand all of the costs that will go into the purchase of the property, getting the property ready, marketing it, and maintaining it for the long haul.

Keep in mind that it’s always better to err on the side of caution when it comes to cost estimates for the business and your properties.

Reason 4: Not Being Able to Keep Tenants

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As a real estate investor, if you want to make steady money, you need to have tenants. This is true for residential properties and commercial properties you are leasing. If you aren’t able to keep tenants happy, they will move to a different property. This means you’ll be spending months without the property producing income, and you will have to continue marketing the property to bring in new tenants.

Unless you hire a property management company, part of the job of being a real estate investor will be handling landlord tasks.

Reason 5: Not Treating Real Estate Investment as a Business

If you want to have a successful real estate business, you need to treat it like an actual business rather than just a hobby. You need to learn how to manage your time and resources well. Approach everything from the standpoint of a businessperson rather than someone who just wants to get an investment property. Learn how to make it work for you.

You have to put in the effort to learn how to operate the business side of things, not just making the investments. You also have to realize that success doesn’t come overnight. It takes time and you need to persevere if you hope to see results. Know the fundamentals, know how to invest in the right properties in the best locations, and get help with anything that you can’t do on your own.

Find Your Success in Real Estate

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These are just some of the top reasons that many real estate investors end up failing today. There are other potential pitfalls, as well. However, by taking the time to learn more about how to properly invest, how to handle tenants, and how to run the business, it can increase your chance of success.

If you want to do well as a real estate investor, you don’t want to make the common types of mistakes discussed above. You should also strive to continue learning and educating yourself on the business. The more you know and learn the better you will do, just like in any other endeavor.

Self-Managing Rentals vs. Hiring a Third-Party Property Manager

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Owning investment properties can be a fantastic way to earn more money and diversify your investment portfolio. However, with rental properties comes some added work.

The home needs to have someone who can take care of the tenants’ various needs, who can collect rent, handle repairs, maintenance, etc. Landlords should also know the local markets including state, federal, and local laws, demographics, typical rents for the area, how to market the property, and more.

You have a couple of options. You could choose to manage the property yourself, or you could opt to hire a property manager to handle it for you. There are pros and cons to both of these options. Let’s get a closer look.

What Is Self-Management?

This simply means that you will be responsible for everything that happens with the property, not just owning the home. You will be required to market the home and screen potential tenants, set the rent and collect it, and handle repairs, maintenance, and other issues that come up with the property. Essentially, this option means that you will handle everything relating to the property.

Doing it on your own will save you from the cost of working with a property management team. It will also provide you with more experience in how this aspect of the business works. Some investors prefer to have this hands-on approach. However, it doesn’t mean that it’s the right solution for everyone.

When to Consider Self-Management

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If you are working as a real estate investor full-time, and you can dedicate yourself to all of the various tasks associated with being a landlord, then it could work for you. However, you will also want to make sure that you are close to the home or homes that you manage.

Ideally, you will be an hour or less away from the properties. This will make it easier for you to handle tours when looking for new clients and to handle any emergencies that crop up. If you have properties across the state or the country, it will be impossible to handle all of the management duties on your own.

Those who have only a small number of properties will find that it’s possible to take care of local rentals on their own. However, if you plan to increase the number of homes you own and rent out, management will soon become a job that you have to be ready for around the clock. The more properties you have, the greater the time and financial commitments.

Some investors might opt to self-manage one or two units for a while to get a better understanding of everything that it entails. However, they may eventually want to hand off the properties to a third party if they find that it’s too much work for them.

If you are going to manage the property on your own, you must look up and understand all of the laws in your area that apply to landlords and tenants. Failure to know and follow the law could end up landing you in legal trouble.

What Is Third-Party Management?

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Third-party management simply means that you hire a professional property management team to handle your properties for you. If you have no interest in working as a landlord and instead simply want to be an investor, you can find a quality property management company that can handle the work for you. There are plenty of good reasons to take this route.

One of the first reasons is cost-efficiency. Working with a property management team is more affordable than many people realize. Consider all of the work they put into the properties that you no longer have to do. You’ll find that even though there’s the cost of hiring them, it could end up helping you save time and money while eliminating the frustration you would feel if you were doing it on your own.

When you choose a great company, they bring a wealth of experience with them. They have seen and handled just about anything you can imagine. Whether it’s certain types of repairs, problem tenants, etc., they have policies and procedures in place on how to deal with them. They will also have preexisting relationships with contractors, repair companies, and more. They can handle the issues that come up faster and more efficiently than you could on your own.

The experience of the property management company also includes knowledge of the landlord and tenant laws in your area. They can advise you on laws and potential liability. Property management companies also carry legal liability insurance if there are issues that occur during things like showings, maintenance, etc.

When you have a great property management company, you’ll also find that it’s easier to scale your investment business. You can invest in more properties without worrying about how you will manage all of them. As long as you have a quality property manager, they will be able to handle new properties.

However, you’ll want to keep in mind that there may be times when you need to have more than one property management company. For example, if you are buying properties that are outside of your city or your state, the company you are currently using might not have agents in those locations that can provide service. In those cases, you might need to have relationships with several different property management teams.

When to Consider Third-Party Property Management

If you have a large number of properties, it’s going to be hard to manage them on your own. If you have another job, or you simply want to relax and focus more on the investment side of things, it’s in your best interest to work with a property management company.

What’s Right for You?

As you can see, there are benefits to both of these options. The one you choose will ultimately be based on how much time and work you want to put into being a landlord and the number of properties you own.

5 Ways to Save for a Big Purchase

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Trying to save enough money for a large purchase can seem overwhelming when you are first getting started. One of the biggest purchases you will have in your life will likely be your house. No matter what type of large purchase you are trying to make, you will need to start saving for it. Below, you’ll find advice on saving.

Tip #1: Start Small If Needed

One of the reasons that many people struggle when trying to save for a large purchase is because it seems so out of reach for them. Whether you are trying to save $40,000, or even just $10,000, for a down payment or any big purchase, it can seem overwhelming when you have nothing saved.

Instead of looking at it as that gigantic number that you are saving toward, you should break it down into smaller, doable chunks. If you need to save $10,000, for example, you could break this down into 10 chunks of $1,000 each. You could even break it down further if you would like. The point is that you set up smaller, attainable goals that can be reached. This will make you feel better when you have your first $100 and then your first $1,000 saved.

You can start as small as you need. If you are at a point where you can only afford to put in $100 a month, then that’s all you can do right now. No matter how much you are putting away, just commit to it. Add more when you can. Always be realistic with your goals and base how much you can save on the amount you make and your current monthly expenses.

Tip #2: Pay More Attention to What You’re Spending Now

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You might find that one of the main reasons you are having trouble saving is that you are spending more money than you realize each month. You might be spending it on things that you don’t truly need. People often make fun when it’s suggested that those who are trying to save or who are short on cash should refrain from eating out and buying coffee out.

However, those types of expenditures make a major difference in the amount of money you have available. Let’s look at some examples. Let’s say that you are only able to put $100 into your savings toward the big purchase each month.

Examine where you are spending your money. Do you go out to eat for lunch or dinner a lot? Even if you are only going out once a week and you are spending $20 each time, this would be $80 a month that you aren’t able to save. Maybe you are spending just $5 on a coffee from a café once a week. That’s another $20.

When you add the $80 and the $20, you get $100… this is the same amount you were saving each month. Without eating out and getting coffee, you could effectively double the amount you were saving.

Keep in mind that these are conservative estimates. Many people are spending far more money than this on things they don’t need. If you are serious about saving, you could cut back on a few things now and then build up the amount that you have saved. It’s simple, but a lot of people aren’t willing to make those sacrifices.

Tip #3: Don’t Take from Your Emergency Fund

Something else you need to be aware of when you are saving is that you shouldn’t dip into your emergency savings fund to make a large purchase. That fund is there for a reason. It’s for a rainy day and to cover you in the event of an emergency.

If you take from it to pay for a down payment for your house or a car, it means that you won’t have that protection in case something happens. Instead, have your savings for your large purchase separate from your emergency funds.

Tip #4: Get Your Money to Grow

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Where are you putting the money that you are trying to save? While you could keep it in a regular savings account, it’s not doing as much as it could there. Instead, you might want to rethink where the money is going. For example, if you aren’t going to need the money for the purchase for a few years, you could contribute the money you are saving now to a mutual fund.

Alternatively, you could add the money to a high-interest savings account that is specifically for your large purchase. This could help you to earn some interest on the money while it’s being saved. You won’t earn a lot, but it’s better to have your money doing something for you rather than just sitting in an account that isn’t earning interest. 

Tip #5: Add a Temporary Income Stream

One of the tried and true methods of saving more money is to find a way to make more of it. Consider finding a part-time job or finding another way that you might be able to add some more income to your life. There are all manner of “side hustles” that could help.

You might want to look at some of the items you have and don’t use. Selling some of your belongings rather than continuing to store them could be a good option to save some money for your purchase.

It may take some extra work and sacrifice to get the money you need, and not everyone will be willing to do that. Those who are, however, will find that it’s often possible to save much faster.

Let It Build

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Saving takes time. It can feel frustrating when you feel as if you aren’t making enough headway toward that down payment on your home. Every time you put money into the accounts for your big purchase, though, you are getting closer and closer.

If you take a bit longer to save up for your down payment for a house or any other larger purchase, that’s okay. Just make good decisions. Work on getting your credit to be as good as it can be and keep pushing forward. You will reach your goals.

Should You Buy or Rent a House?

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Many people have the dream of buying and owning a home. It’s likely the biggest purchase you will make in your life, and you will have to carry a mortgage with you for decades in most cases. Choosing to buy a home is a huge decision, and it’s one that people don’t take lightly. They want to know whether buying is right for them or if they should continue renting.

You’ll find that there are pros and cons to each of these options, and the answer will be different for everyone. Your personal finances will be one of the major elements you will have to consider, but it isn’t the only one.

Buying a Home

If you feel that buying a home might be the right choice, it’s time to look a little deeper into the pros and cons. This can help you make your decision on whether it’s the right time for you to buy or not.

The Pros

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When you buy a property, you have the feeling that your money is going toward something rather than just being given to the landlord. When you pay your mortgage each month, you are one step closer to fully owning the home.

You will also find that homes tend to increase in value over time. Of course, the market and how well you maintain the home will affect its value. Typically, though, investing in a home is a smart move because the home will be worth more in a few years.

Owning a home also provides some tax advantages. Property taxes, for example, are deductible. Mortgage interest will also be deductible when you are filing your tax returns each year.

When you own the home, you can renovate and decorate it how you like. You don’t have to worry about what the landlord will and will not allow. This includes having pets or painting the interior of the house in colors a landlord might not permit.

Typically, you will find that you also have more privacy when you own your home. Owning a home is the dream for many people, and it could be right for you.

The Cons

Of course, this doesn’t mean that it’s all sunshine and roses when you own a property. There are some potential cons to consider, as well.

If you decide that you no longer like living in the neighborhood for one reason or another, or if you have to move for work, it’s not as easy as just finding a new place to rent. You have to sell your house, which can take months or longer.

You’ll also find that you have to handle quite a few more expenses when you own your home. You have to pay for homeowner’s insurance, property taxes, higher utility bills, and HOA fees if your community has a homeowner’s association. There’s also the maintenance of the property to consider. When you own, it’s your responsibility to handle those issues. You can’t simply call the landlord and let them know.

Renting a Home

Maybe you feel that you would rather continue renting. Many people opt for this, but it’s just as important to look at the pros and cons of renting. Let’s get a closer look at what you can expect as a renter.

The Pros

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When you are renting, there are some benefits. You can move far more easily. As soon as your lease is up, you can move out of the home and find a new place to live. This makes it easier for those who like to move around to different cities or who might have to travel because of work.

Additionally, when you rent, you don’t have to worry about paying maintenance. All of the maintenance will be handled by your landlord. This can reduce expenses and ensure that you never have to worry about things that go wrong with the property.

The Cons

Renting brings with it some cons, as well. For example, the rental rates can and do increase over time. This means you’ll be paying more and still won’t own your place. There aren’t typically any financial incentives to renting. You don’t have the freedom to renovate the property, and you are subject to the rules that the landlord puts into place.

Determining What’s Right for You

Are you truly ready to buy? You have quite a few things that you need to think about. While buying means that you will own the home, not everyone is in a financial position where they can purchase a home. Look at your finances and make sure you can pay for the mortgage, maintenance, insurance, etc.

Make sure that you have good credit, so you can get a better interest rate on your house and get approved for a home loan. You don’t want to have a lot of other debt when you try to take on a mortgage.

You also have to think about how long you want to live in the same area. Is the neighborhood where you are considering buying a place that you could see living for at least five years? Do you prefer being able to move when you choose and don’t necessarily want to be tied to a place if you can’t find a buyer for your home?

In some cases, it might be better to continue improving your credit score and saving for a down payment. This is true even if you find the “perfect property”. It will be a better option than getting a home that you can’t fully afford or that you don’t love.

Of course, you might be paying a substantial amount in rent right now and feel frustrated that all of that money is flowing away into the ether. If you can find a quality property that costs less than your current rent, then buying could be the better choice.

Ultimately, it will be up to your needs and your current financial situation. Never rush into any decision whether it’s to rent or to buy.

Should You Pay Off Your Mortgage Early?

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Having a mortgage is a lot of pressure. You have a substantial amount of debt hanging over your head, often for decades. Most people would like to find a way to reduce that debt and even pay off their mortgage early. They decide to use money from an inheritance, selling a vehicle, or from their savings to pay off their debt early, so they can get out from under the mortgage.

However, is this a good idea or not? It’s always a good idea to take some time to determine whether it’s the best financial choice or not. Even though it might seem like a good option, it doesn’t always mean that it’s the soundest financial decision to make.

What Are the Pros?

First, we’ll be looking at some of the biggest benefits that can come from paying your mortgage off early.

Helpful for Those on a Limited Income

The amount of money you are paying each month on your mortgage might be a substantial portion of your income. If you can pay off your mortgage, this could allow you to free up quite a bit of additional money each month that could be used for other expenses, investing, etc.

Save Money on Interest

How much are you spending on interest on your property? Over the course of the loan, you could be spending many thousands of dollars on interest. When you pay off the mortgage early, you will no longer have to worry about the interest. You won’t be able to use the mortgage interest tax deduction, but you could still end up saving a lot more in the long run.

Tap Into Home Equity Later If Needed

When you have a home that you own, you can still tap into your home’s equity later if you need. With a paid-off property, you can use the home equity to pay for improvements to the home, repairs, debt consolidation, and more. You will simply leverage the equity in the home using the same types of options that someone who still has a mortgage would use.

Peace of Mind

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Of course, one of the biggest benefits of paying off the mortgage early is that it can provide you with peace of mind. Owning your home and not having a monthly mortgage can feel like you’ve lifted the weight of the world off your shoulders.

What Are the Cons?

Of course, even though there are plenty of benefits when it comes to paying off your mortgage, there are some potential cons, as well. It’s important to understand those cons before you make your decision.

Reduced Retirement Savings

Sometimes, people opt to pay down their mortgage while ignoring other uses for their money that could be better for them financially. For example, if you aren’t putting enough money into your retirement accounts, you may find that even though you own your home, you don’t have enough saved for retirement.

Low Cash Reserves

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If you are spending all of the money in your savings to pay off your mortgage, what would happen if you suddenly had an emergency? You don’t want to spend everything you have just to pay off the mortgage. Ideally, you will have enough money saved to cover between three and six months’ worth of expenses in case you have an emergency.

You don’t want to get into a situation where you own the home, but you can’t pay for an emergency that crops up. Only pay off your mortgage when you have plenty of money saved.

Higher-Interest Debt Continues to Accrue

Do you have other debt that has a higher interest rate than the rate for your home? This might be credit cards, for example. If you continue to keep a large balance on your credit cards, you are paying substantial interest rates on them. This is interest that you can’t deduct as you can with mortgage interest.

It’s better to pay off your credit card debt and any other high-interest debt you have before thinking about paying off your mortgage.

Prepayment Penalty

In some cases, a mortgage will have a prepayment penalty. This means that you will have to pay an additional fee if you decide you want to pay off your mortgage early. While this might seem strange, you have to remember that the lender wants to get as much interest as they can. If you pay off early, you are eliminating this interest, so these types of fees are charged.

If you are considering paying off early, check to see what type of prepayment penalty might be involved. You may find that it’s cheaper to keep the mortgage and to continue paying.

In Some Cases, Refinancing Might Be a Better Option

You might find that instead of paying off the mortgage, you could refinance it to get a better interest rate. If you can get a good rate, this can lower the amount that you are paying on the property. Just make sure that you do a full analysis to see whether refinancing is a good option for you or not. If you can get a better rate and a better monthly payment, it could be a good alternative to paying off your mortgage early.

Talk with a Financial Advisor

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If you still aren’t sure whether you should pay off your mortgage early, you might want to speak with a financial professional. They can look at your finances and help to determine the best course of action. For example, depending on the rate, you might find that it would be possible to make money by investing what you were going to use to pay down the mortgage.

Many times, it’s better to invest in places other than your mortgage. However, it might be better to pay off the mortgage for some homeowners. Those who have trouble keeping money in the bank might find that it is a better option for them. The home will act as a savings tool. Everyone’s financial situation is different. If you aren’t sure what to do, get some advice from someone in the know.

Building Wealth Through Real Estate Investment

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Amy Collett of

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For first-time real estate investors, vacation rental properties are a popular choice. You typically have the option of renting to tourists on a part-time basis, or to residents during the off-season, for longer durations. You can also enjoy the space on your own when it’s unoccupied. While the approach may seem tempting, you’re wise to do your research before taking the plunge. An app like Foliolens can help you take away some of the guesswork.


Do Your Research


Before buying any investment property, it’s important to understand the housing market in the vicinity you’re looking to buy. Recognizing vacancy rates and average going rental fees will help you determine what you can afford, based on anticipated return, and what you’ll need to charge in rent to cover your mortgage and your overhead. Buying a rental property is much like a traditional home mortgage, but there are some additional hoops you’ll need to jump through, and you’re likely to incur a higher interest rate for an investment loan. A real estate agent or mortgage lender can help you make informed choices based on your income, credit score, assets, your other credit obligations, and your debt-to-income ratio.


Searching for Property


You’ll want to take several things into consideration when comparing shopping vacation rental properties. In addition to staying in your price range and sticking to desirable neighborhoods close to popular attractions, HSH recommends looking at the age and condition of the property. Older places may be less expensive, but require a higher degree of upkeep and maintenance than newer pricier spaces; on the other hand, newer properties may allow you to command higher rent, require less upkeep, and be more energy-efficient, which can help you save on heating and cooling costs. Compare homes in areas of interest to get a sense of what amenities are in high demand. Also learn whether there are home owner association restrictions, ample parking, and easy access to transportation -according to Holiday Vacation Rentals, these will be important to your tourist market.


Factor in Overhead


In addition to paying the mortgage, property taxes, and insurance, investment properties come with additional overhead. You’ll need to budget for repairs, updates, and both routine and emergency maintenance. The property will need to be advertised, potential tenets screened, rental agreements drafted, and rent collected. You may also need to outfit the space with furniture and home goods. If you don’t plan to do these tasks yourself, you’ll need to hire a property manager or management company, which will cut into your profits. If the property is vacant, you’ll still be incurring all of these costs; also keep in mind that tourists in destination cities may not be as gentle with your property as renters in less popular locations. This could lead to additional cleaning and repair costs, as well as the potential for fielding calls from other full-time neighborhood residents about noise and traffic.


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Operate Like a Business


To protect yourself and your assets from some types of liability and reduce your tax burden and paperwork, you’re wise to establish yourself as a limited liability company, or LLC, as a way to register your rental property as a formal business entity. You can do the legwork yourself, hire a pricey attorney to do the work on your behalf, or your best bet, utilize an online formation company to handle the details. LLC formation laws vary from one state to another, so you’ll want to learn about yours before moving ahead. For example, search, “LLC formation California.” Running your investment property as a business will help you be eligible for various tax write-offs, and you’ll be able to deduct things like the cost of hiring a property manager or maintenance staff.


A vacation investment property can help you start building wealth through real estate investment, but it can be a potential money pit if you don’t conduct your due diligence. A real estate professional who specializes in investment properties can help you make educated decisions.


Foliolens can help you manage your rental property with ease, with features like a portfolio dashboard, document management system, automated reminders, and tax information. Visit the site today to learn more.

Should You Invest in Real Estate Property Management Software?

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Define Real Estate Property Management Software

Before investing in anything, including software, it’s important to understand the basics. Real estate property management software is a program that handles the daily tasks involved in managing real estate property i.e., handling leases, accounting, managing maintenance, communication between stakeholders (tenants, landlords, maintenance workers), etc. 

While there are different kinds of property management software to choose from, the best programs automate the most tedious and/or routine tasks.

Having understood the definition of property management software, the next step is asking yourself if the investment is worth it. Looking at the before and after scenarios is important before you make a final decision. One of the most notable pros of technology is making life easier and cutting costs. Does property management software offer these benefits and more? What are your current property management issues?

1. Do you have accounting issues?

Can you easily tell when rent is due for every tenant and how much they owe? What about reports on all property management-related expenses? Do you have trouble when preparing tax statements for your properties? If you answer “yes” to these and other accounting-related issues while you manage your property, you need real estate property management software.

The best software can handle all property management accounting matters, from rent payments to accounts payable and the general ledger. The best programs today can also generate letters for tenants behind on rent, populate reports real-time on monthly operations and handle any other accounting-related tasks.

2. Do you have tenant communication issues?

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Can potential tenants be able to see available property pictures, videos, descriptions, and other information with ease? Can they also enquire with ease, review property terms, and receive/send maintenance requests once they become tenants? Can tenants also know the status of their accounts and pay rent with ease?

The best real estate management programs address tenant-landlord communication in every aspect, from advertising to communication issues when one becomes a tenant. It’s also possible to advertise the vacant property.

3. Do you have property manager problems?

Do you overly rely on property managers who end up disappointing you? Do you wish to be more involved in the day-to-day management of your property without being overwhelmed? Landlords who are involved in managing their own property stand to benefit the most from using property management programs.

The software eliminates over-reliance on property managers. It also makes property management tasks incredibly easy to the point that a landlord can manage multiple properties with ease. In fact, you don’t need a property manager when you get the best software in the market.

Should you invest in real estate property management software?

Absolutely! If you are a property owner whose answer is yes to the above questions, you need software to help you out. If you can’t communicate effectively with your tenants and other stakeholders (such as property maintenance workers), have accounting problems, and can’t seem to find a reliable property manager, invest in the best property management software you can find.

The success of your real estate business doesn’t need to be pegged on finding a good property manager. Get Early Access Now!

What is Real Estate Automation Software?

What is Real Estate Automation Software?

As the name suggests, real estate automation software is software that automates real estate processes that range from property management to advertising, bookkeeping, property inspections, etc.

The latest (2020) statistics show that the real estate software industry is currently worth $10.45 billion yearly and is projected to reach $21 billion by 2026.

The real estate industry has accepted technological disruption welcoming automation of every single task capable of being automated. What’s more, no one has been left behind. All stakeholders in the real estate industry are benefiting from this automation, (from property owners and real estate agents to tenants, property buyers, property managers, and property maintenance personnel).

To understand real estate automation in-depth, it’s important to explore where the software is applied.

Automating Real Estate Processes‍

Real estate agents fill and submit real estate documents on a daily basis, they also coordinate showings, meetings with developers, open houses, create operation budgets, maintain client databases, send reminders to clients, etc.

These tasks have been handled manually for decades. Real estate automation software automates such repetitive tasks, freeing real estate agent’s time and resources to other more important tasks.

With good software, all repetitive tasks can be handled remotely with a few clicks. Almost every single repetitive task handled by real estate agents can be automated. The same applies to property owners and other stakeholders like tenants.

The best real estate automation programs out there help property owners track occupancy, maintenance, payments, etc., remotely. Tenants can also get maintenance schedules, pay rent and receive updates via the software.

Marketing Automation

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Marketing is a significant part of real estate. New and existing properties must be marketed constantly. The process is tedious if done manually. The best real estate automation software can collect leads, save that information, segment leads, and create targeted marketing ads that increase conversion.

Instead of calling everyone, the software can do everything automatically and let you know which leads are most likely to buy what property. What’s more, the ads are highly personalized, with automatic reminders sent across the most suitable channels. The software can also automatically maintain and increase interest on the property while freeing up time and resources at the same time.

The best applications can do more i.e., distribute leads automatically to the best suited real estate agent, automate agent notifications, capture all interactions with prospective buyers, and more!

Real Estate Finance & Accounting Automation

Property owners, real estate agents, tenants, among other stakeholders, all have financial tasks. Property owners must handle rent, pay for maintenance, pay their staff, and handle tax matters. Real estate agents need to budget for showings, open houses, commissions, facilitate property purchases/sales, etc.

Tenants also need to deposit, pay rent, utilities, etc. Good real estate automation applications automate all these finance and accounting processes. In fact, there’s no need for any paperwork to record transactions and payments. Everything is fully automated as well as notification on transactions.

While real estate automation software is more than what is discussed above, the information captures the essence of the software. The main purpose of real estate automation programs is to make real estate processes easier and better for all stakeholders (from property owners and real estate agents to tenants, property managers, vendors, etc.).

Automation of real estate tasks done across the industry not only frees time for stakeholders but increases transparency, privacy, accountability, and satisfaction for end customers.

Get the best real estate automation software NOW! Sign-up and get early access today!

Do You Need a Property Management Application?

Do You Need a Property Management Application?

Property owners, rental managers, and other real estate professionals need a way to work more efficiently. Property management involves many tasks, the most common being screening and approving tenants, preparing lease agreements, collecting rent, doing property maintenance, etc.

A good property management application offers notable benefits. Do you need property management software? Yes, and here’s why;

You’ll Get Better Tenants at a “Click”

Initially, property owners just want their buildings fully occupied. However, with time, they notice the importance of having quality tenants. A bad tenant will not only increase maintenance costs but also have trouble paying rent on time. They may also be a nuisance to others and make good tenants leave.

Before property management applications, property owners and property managers relied heavily on manual vetting. The best property management software today comes with screening features that allow landlords to automatically generate credit reports, criminal reports, and eviction reports of potential tenants.

You’ll Automate Bookkeeping

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Property management also involves a lot of Bookkeeping, from tracking rent to expenses, maintenance costs, and more. Good property management applications automate the entire process. Tenants can pay rent automatically/online, get receipts, and generate rent reports.

Property owners can also connect the software to their bank accounts to access funds online from anywhere and generate reports that show rental status. It’s even possible to automate payments to property managers among other staff. Automatic recording and dispensing of income and expenses makes property management extremely easy.

You’ll Automate Communication

As a property manager or owner, one of the biggest day-to-day tasks is communication. You need to issue rental reminders, late fee notifications, lease expiry reminders, maintenance schedules, and other communication that tenants and staff need to know. The best property management application can be programmed to send most, if not all communication automatically via email, text, or other media. Tenants can also communicate effectively through the software without needing to call anyone.

You’ll Track Maintenance Easily

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Property maintenance is a big part of property management. Property must be cleaned and maintained periodically. Some tasks are done daily, while others are weekly, monthly, or yearly. In the past, property owners relied heavily on property managers to do their job well. Today, all you need is good software.

As a property owner, you can check the status of every maintenance task as well as feedback from tenants. It’s possible for clients to have portals and send pictures, videos or submit written descriptions of maintenance issues. Tenants can also receive the status of repair work without having to call anyone.

Property managers can track tenant complaints, coordinate and manage maintenance personnel remotely, share maintenance tickets, and do many other tasks remotely from the software’s maintenance portal. Since the best software has portals for maintenance teams, property maintenance becomes a smooth process.

While there’s more why a good property management application is necessary, the above information summarizes the most important factors to consider.

Get the leading property management software in 2021 NOW! And say goodbye to common property management problems.