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Archive for the 'Real Estate investment' Category
Are Colorado Springs short sale disclosed?
Colorado Spring Short Sales are now disclosed
Search for Short sales in Colorado Springs
- Buying a short sale vs. a foreclosure, what’s the difference?
- Tips to buying a short sale
- 8 reasons NOT to buy a short sale
- 12 questions to ask before writing a contract on a short sale
Every MLS around the US, and in Colorado, has their own policy about short sale and how these are disclosed in the local Multiple Listing Service. The MLS that serves the Colorado Springs area, (PPAR) recently made a change in their rules to reflect a change in their policy regarding short sales. In the past, it was an optional disclosure in the Pikes Peak area. As of January 1, PPAR now requires that Listing Agents disclose if a property is a short sale and if the seller has signed the Short Sale Addendum, which is required by Colorado Real Estate Law.
The following policy was adopted by the RSC Board of Directors on November 17, 2011: “The listing broker shall, on each listing filed with the PPMLS, disclose to other Participants whether a Colorado Real Estate Commission Short Sale Addendum has been signed by the seller. Such disclosure shall be made upon submission of the listing to the PPMLS. If a Short Sale Addendum is signed after the listing is submitted to the PPMLS then disclosure must be made within 72 hours of the time the seller has signed the Short Sale Addendum and for the purposes of enforcement this disclosure shall also be treated as a status change pursuant to Section 1.6 of the RSC Rules and Regulations.”
Since this change has been made, there is now a new field that is required in the PPAR database when listings are being entered, “ShortSale Addendum Signed by Seller. This is a sortable field, both by Realtors and the public. As I’ve written before, short sales are not the right fit for every buyer, for many buyers and investors, they may be the perfect option.
One important thing to note: One of the many challenges about Listing Properties, is that if the property is priced at a certain price it is not a short sale. But if an offer comes in on the property that is 10% less than the original Listing price, this could change the status of the property from a “Normal Listing” to a Short Sale. Hence, in this case mentioned above, a property wouldn’t be listed as a Short Sale, since when it was listed at the current price, it was not a short sale. Sound confusing? It is!
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To find out more information about buying a home or Short Sale Home in Colorado Springs area, call ….
Kathy (719-287-1049) KTorline@msn.com
Build a good team
Colorado Springs Real Estate Investors need a good team
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Since I’m a real estate investor, as well as many of clients are also investors, I’ve continued to realized how important it is to have a team of people to help you when you are an investor.
Henry Ford was famous for saying he did not know all the answers, but knew where to find them. An investment team is no different. You don’t have to know all the real estate answers, just know where to find them.
Here’s a quick list of some of the professionals you may want to have on your team:
- Real Estate lawyer
- Tenant issues, leases, evictions, etc.
- Ownership of the property. LLC, Corporate, etc.
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Home Inspector
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CPA/Accountant
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Insurance Agent
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Make sure you know what your policy covers and does not cover. Also, not all insurance policies will cover a property when it is going thru substantial renovation and is vacant
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Also, it’s good to have a name you can refer renters to; as you want any renters to have renter’s insurance
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Contractors
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Overall handyman/carpenter
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Painter
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Flooring installation and purchase
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Flooring refinishing for wood floors
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Cabinetry, including countertops
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Landscaping
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House Cleaner
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Plumber
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HVAC
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Roofer Pest Control
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To find out more information about buying a home or an investment property in Colorado Springs area, call ….
Kathy (719-287-1049) KTorline@msn.com
3 reasons to get building permits
3 reasons to get a Building Permit in Colorado Springs
Related articles:
- 5 reasons lack of building permits cause big problems
- Colorado Springs Building Codes and Permits – Part I
- Colorado Springs Building Permits – Part II
- Colorado Springs Building Permits – Part III
- Colorado Springs Building Permits — Part IV
- Colorado Springs Building Permits — Part V
- Why do you care about building permits?
Some people complain about getting a building permit from the local code enforcement office for changing something in their house, erecting a deck, adding a garage or making any other improvement to their property. I think it’s very important to get permits.
Before you start your next home improvement project, here’s 3 reasons to get a building permit:
- It might be a law that if you make enhancements of a certain nature to your property you must get a building permit to begin the work.
- The permit keeps everyone honest. There won’t be any shortcuts by the contractor that might affect your investment or safety. If there have been shortcuts that affect
safety, the code enforcement officer would typically find it. - You get free inspections of the work the contractor does. The code enforcement officer typically comes out to check the work and to ensure the work is up to code. Wouldn’t you prefer to know about problems on your your remodeling project? Especially before you make the final payment to your contractor.
As an example, we’re currently getting the electric panel upgraded on a Colorado Springs rental house that my husband and I own. Even though we’ve done our homework on the contractor we’ve hired, we won’t know if the work is “up to code”, as we’re not trained electricians. Pikes Peak Regional Building will come out and inspect the work to make sure it meets code requirements. It certainly gives me peace of mind.
According to information on the Pikes Peak Regional Building web site, “The main goal of the Department is to safeguard life and limb, health, property and public welfare by regulating and controlling the design, construction, quality of materials, use and occupancy, location and maintenance of all buildings and structures within all zoned areas of El Paso County through the enforcement of minimum building code standards.”
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To find out more information about buying a home in Colorado Springs or Manitou Springs, call ….
Rents keep rising
Colorado Springs rents are on the rise
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The Apartment Association of Southern Colorado put out a quarterly document about Apartment rents and vacancies on a quarterly basis. It’s a great document, any for anyone interest in buying Investment Properties in Colorado Springs, it’s well worth reading. Here’s some of the highlights of the report:
- Median rent was $ 740.15 for the second quarter of 2011 compared to $714.14 for the first quarter of 2011.
- The Colorado Springs vacancy rate is the lowest in the Southwest and the highest in the Security/Widefield/Fountain area.
- The highest average rent is in the Northwest and the lowest average rent is in Security/Widefield Fountain Area.
- The average rent for an efficiency apartment is $568 vs. the average rent for a two bedroom/two bath apartment is $945.38
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To find out more information about buying a home or an investment property in Colorado Springs area, call ….
Kathy (719-287-1049) KTorline@msn.com
144 Potential amazing deals
You can Buy a home under $100,000 in Colorado Springs
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There are (174) active listings of single family detached homes available for sale in the Colorado Springs area that are priced under $100,000! Even though 34 of these are short sales, that still leaves 14
0 homes on the market that are less than $100,000. I don’t have exact numbers, but several years ago, there were very few livable homes on the market that were priced under $100,000.
These homes range in price from $27,000 to $100,000, and from 480 square feet to 2600 total square feet. Most have 2 to 3 bedrooms, and some also include garages.
Some of these active listings do qualify for FHA & VA financing, and some only offer Cash or Conventional financing. Here are some of the areas where there are homes under $100,000:
- 33 Homes in Central Colorado Springs
- 12 Homes in Southwest Colorado Springs
- 4 Homes in East Colorado Springs
- 22 Homes in Southeast Colorado Springs
- 19 Homes in Fountain Valley (close to Fort Carson)
- 9 Homes in Powers area (close to Peterson Air Force Base)
- 9 Homes in Old Colorado City area of Colorado Springs
- 12 Homes in Southwest Colorado Springs (close to Fort Carson)
Whether you are buying your first home, or your first investment property, some of these homes are amazing deals.
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To find out more information about buying a home or an investment property in Colorado Springs area, call ….
Kathy (719-287-1049) KTorline@msn.com
The Perfect Storm, it’s time to buy Investment Property
Colorado Springs named as one of the 10 best cities to buy rental properties
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MSN recently published an online article naming the 10 best cities to buy rental property, and Colorado Springs was included on the list. According to the article, the vacancy rate is 5.3%; but in actually I think it is closer to 2-3%. Combine higher rents with low cost properties, seems like the perfect time to invest.
Just for fun, I thought I’d analyze fourplexes and duplexes, that have sold in 2011. Since I’m a Real Estate Investor, as well as I work with a variety of buyers who are Real Estate Investors, I’m a firm believer that the more knowledge I have about the market, the better. Knowledge is power; and statistics about the market place definitely provide more knowledge.
As with all housing statistics, it’s important to remember that price varies vastly, depending on the area of Colorado Springs, Fourplexes by Fort Carson and Fourplexes by Peterson AFB sell for a much different price than a historic property built in the early 1900’s by Colorado College or in Historic Old Colorado City. A duplex in the southwest part of Colorado Springs located close to the Broadmoor will sell for a much different price than a duplex located near the Olympic Training Center. When buying investment properties, it’s still all about location; but it’s also about the return on your investment.
There are currently 53 fourplexes Read the rest of this entry »
How accurate are real estate listings on the Internet?
It’s on the Internet, it must be correct
Search for Colorado Springs Homes
Related Articles
- 9 reasons to use a buyer’s agent to help you find a house
- 6 things to add to your budget when buying a house
- 10 questions to ask the Neighbors
As a Buyer’s Agent in Colorado Springs, I work with many buyers from all parts of the world looking to relocate to Colorado Springs. The Internet is a wonderful tool for buyers, as they can find out so much information about the Colorado Springs area as well as check for 
potential homes. BUT, not every home listing they find on the Internet is correct.
Each Realtor is typically responsible for inputting their home listings in the local MLS system, which is called PPAR in the Colorado Springs area. Many Realtors have office administrators or assistants that input the data for them; but the Realtor is ultimately responsible for the the information. Even though most Realtors strive to have the information correct, it’s extremely easy to get something wrong. I’m guessing that the average listing has 100 to 150 fields of data that need to be filled in; which leaves alot of room for error.
But even more important than the initial input of all of the data about a home, is all of the places the information gets distributed to line. Every web site has a different way they get their information and different ways their information gets updated. As an example, as a member of PPAR, my listings get distributed to Zillow and Trulia and Realtor.com. But there are many, many other web sites out there; and some of them get updated more often than others. According to a recent quote in the Wall Street Journal, “21% of the data agents individually submit for posting on real estate websites isn’t updated when changes are made to the price or when the property is sold, according to a report released last month by listing web sites, Trulia.com”
Remember, just because it is online doesn’t make it accurate
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To find out more information about buying a home or an investment property in Colorado Springs area, call ….
Kathy (719-287-1049) KTorline@msn.com
5 key things Real Estate Investors needs to know about deductions
Attention Colorado Springs Real Estate Investors — It’s important to know about your deductions
As more and more people are looking into purchasing their first Colorado Springs rental property, I thought a quick post about the tax implications on owning a property would be good to share.
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1. It’s important to have some type of system to keep track of expenses and income. This doesn’t have to be complicated, but you need a way to keep track of income and expenses, as well as copies of any receipts for the expenses and income.
2. Maintenance, repairs and improvements are typically a write-off for landlords. Deductible expenses can include advertising, cleaning and maintenance, mortgage interest, insurance premiums, legal fees, utilities, property taxes.
The IRS also allows landlords to claim depreciation on their properties and on capital improvements Their is an explanation in Publication 946, “How to Depreciate Property.” You’ll also want to look at IRS Publication 527 on Residential Rental Property.
3. Landlords also can deduct the costs of traveling to their properties to collect rent. According to the IRS Publication “You can deduct the ordinary and necessary expenses of traveling away from home if the primary purpose of the trip is to collect rental income or to manage, conserve, or maintain your rental property. You must properly allocate your expenses between rental and nonrental activities. You cannot deduct the cost of traveling away from home if the primary purpose of the trip is to improve the property. The cost of improvements is recovered by taking depreciation. For information on travel expenses, see chapter 1 of Publication 463. “
4. Landlords need to know the difference between maintenance and improvements. When it comes time to sell the rental property, it’s important to know the cost of the improvements which can include the costs of replacing the roof, windows or furnace. These costs can be deducted from the basis of your interest in the property and help reduce the capital gains on the sale.
According to the IRS Publication “Caution. Work you do (or have done) on your home that does not add much to either the value or the life of the property, but rather keeps the property in good condition, is considered a repair, not an improvement.”
5. Have a tax professional that you can consult with in order to get the full benefit from rental property deductions, etc.
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Kathy (719-287-1049) KTorline@msn.com
Location, Location, Location for Real Estate Investment Property
How important is the location for Real Estate Investment Property in Colorado Springs?
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I work with a variety of real estate investors in Colorado Springs; and I often get asked the question on how important location is when buying investment property. There
is no easy answer to this question, as it depends on the goals of the investor. Some investors are purely looking at the return on their money, some are looking at future appreciation of the property; some are looking at properties that are close to where they live; some want a historic property, some want properties close to the military bases or close to one of the colleges.
In Colorado Springs (like most cities), pricing for residential and income producing properties can vary vastly depending on the part of town. A Fourplex in Fountain close to Fort Carson, may sell for around $150000 to 200,000 and each 2 bedroom 1 bath unit may rent for $550.00 each. The monthly income if it’s fully rented would be $2200.00 a month.
The same style of fourplex in the Northwest part of town may rent for closer to $650,00 a month and may sell for closer to $250,000 to $275,000. The monthly income if it’s fully rented would be $2600.00 a month.
A Historic property in downtown Colorado Springs with 4 units could sell for anywhere between $200,000 to $400,000; all depending on the size of the units and the total square footage of the property. Rents will vary vastly depending on the size of the units.
Some investors say it’s all about the location. I say it’s all about the return on capital AND the location.
Give me a call if you would like to receive a list of duplex, triplex and fourplex units available in Colorado Springs
Kathy Torline 719-287-1049
HUD Homes are almost perfect for Investors
Colorado Springs HUD homes and investors
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In my opinion, some of the best properties currently available for sale for Colorado Springs Real Estate Investors, are Colorado Springs HUD Homes. They are listed two different places, both in the Local MLS and in the HUD web site, www.hudhomestore.com. There are many reasons to buy HUD properties, including that they require low down payments.
Earnest Money Policy
BUT, it’s very important for real estate investors to know that once your bid gets accepted and you don’t close on the property, there is a very good chance you are going to loose your Earnest Money. On most home purchases, investors as well as homeowners, assume they can inspect a property and if the property has additional inspection items that the buyer didn’t except, they can cancel the contract and get their Earnest Money back. Not so, on HUD properties. According to the Forfeiture and Extension Policy for Investors, unless you have a special circumstance, you will forfeit your Earnest Money. Special circumstances includes death, loss of a job, serious illness. Essentially the policy says nothing about inspections.
The form also goes onto say that if acceptable documentation is not provided, or provided in a timely manner, 100% of your Earnest Money will be forfeited.
To find out more information about Colorado Springs Foreclosures and Colorado Springs HUD Homes, Call ……
Kathy (719-287-1049) KTorline@msn.com
How do I analyze Colorado Springs Investment Property?
How do I analyze a Colorado Springs investment property?
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The Colorado Springs Real Estate Market is seeing more and more investors enter the market. Every investor has their own reason for purchasing rental properties, some are looking to 
generate income, some are looking to build wealth, and some are looking for long term appreciation. Regardless of the reason, it’s important to understand how to analyze the purchase and there are many different ways to compare properties, including comparing the Gross Rent Multiplier, Cash Flow Analysis, and Cash on Cash. We’re going to focus on Cash Flow analysis.
Let’s first start with some basics…………. what is Net Operating Income and Cash Flow
It’s one of the most important numbers in investment analysis, and it’s used by appraisers to determine value, as well as it’s used by lenders to help determine the amount they will lend on a property An easy definition is that Net Operating Income is the amount of money available to pay the mortgage; and determine whether a property has a negative or positive cash flow.
Here’s a quick example of Cash Flow for a Read the rest of this entry »
Financing matters!
If you are getting ready to sell a home, it’s important to know what kind of financing buyers use to purchase a home in Colorado Springs
Are you asking why I would say this? Essentially, financing matters.
If you would like information about selling your Colorado Springs Home, call Kathy Torline at 719-287-1049
Related Articles:
- Smells don’t sell
- How long should it last?
- Why didn’t my house sell? Top 6 list of reasons
- Why didn’t my house sell? Part II
- hat are polybutylene pipes? Colorado Springs homeowners beware!
- Why didn’t my home sell?
- Make every showing count
- 134 questions for sellers to disclose
Different financing options effect home sellers in different ways
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Buyers who use FHA and VA financing have certain closing costs they cannot pay for, hence the seller ends up paying for these costs. Over 50% of Colorado Springs buyers are currently using VA or FHA loans.
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Both FHA and VA buyers typically take about 45 days to close.
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Conventional loans can typically close even faster than FHA and VA loans, maybe within 30 days.
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If a home needs substantial repairs, a great option is to market it to be financed with a FHA 203K loan.
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Both VA and FHA appraisals can come back with appraisal conditions that can be required home repair items to be fixed before the loan can be processed. As an example, FHA requires the home to meet minimum living conditions which could cost the seller money; including repainting areas on the exterior of the property where paint is flaking and peeling.
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Both VA and FHA loans limit how much a seller can contribute towards the buyer’s closing costs and down payment
Here’s a chart that shows the financing for homes sold in Colorado Springs for the first two months of 2011.
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Kathy (719-287-1049) KTorline@msn.com
FHA loans and fourplexes in Colorado Springs
Fouplexes and Colorado Springs investment properties
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I recently received a question from a Colorado Springs home buyer and thought that many of you may have the same question. The question was:
“Can I use an FHA mortgage to purchase a Colorado Springs investment property, such as a duplex, triplex or fourplex in Colorado Springs?”
The answer is yes
FHA loans are currently one of the best financing options available for most Colorado Springs home buyers right now and represent the majority of new loan applications. It requires you to only put 3 1/2% down at closing as a down payment and can also be used to purchase a duplex 
triplex or fourplex. It’s important to note that the home owner must live in one of the units.
Also, with an FHA loan you can use the expected income from the other units to help you qualify for the loan. This allowance may allow you to purchase a multi unit dwelling and rent out the additional units. The financing does not apply to a property that has more then four units. By law, a building with 5 or more units is a commercial property and requires entirely different financing and FHA rules no longer apply.
Your appraisal requirements are different
You need to have an appraisal for 2-4 unit properties, which will probably cost you considerably more than a standard appraisal on a single family home. In addition, your appraiser will complete a schedule of rents, researching market rents in the area and projecting the probable income of the property. When a property is purchased as an income producer, the income it produces influences the appraised value. In addition, if you need the rental income to qualify for the purchase, the appraiser will have to estimate what that income will be.
The rental income of the property may also be determined by current rents (if it’s already rented) The FHA underwriters allow you to count 75% of that income in your qualifying ratios. As an example if you were to buy a four-plex that rents for $500 per month per unit, you’d get credit for 75% of the income for three units, or $1,500.
Your reserve requirements may also be higher
For triplex and fourplex units, you may be required to have at least three to six month months of PITI in liquid funds after closing. These funds typically cannot be a gift.
Give me a call if you would like to receive a list of duplex, triplex and fourplex units available in Colorado Springs
Kathy Torline 719-287-1049
6 tips for purchasing Colorado Springs Investment Property
Do you want to invest in a Colorado Springs Investment Property?
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If you listen to late evening TV commercials, they talk about how rich you can get overnight by investing in real estate. This is certainly not correct, but with the right guidance by a experienced Realtor, professional investing can be profitable. (It just doesn’t happen overnight.)
I specialize in helping Real Estate Investors in Colorado Springs, and I’m also an active real estate investor. Below are some of my top tips for investing in Colorado Springs real estate to make a profit.
- Location, Location, Location
- This is just as important when investing as when buying your own personal residence. It’s the number one thing that should drive the decision to purchase.
- Do not become emotionally involved in purchasing an investment property.
- A successful real estate investor should learn to make their decisions based on real estate investing criteria and metrics. As an example, if you are buying a duplex or a fourplex, your criteria may include a certain amount of return on your capital investment. If the numbers don’t work, don’t purchase the property.
- Buy for the right price
- Most investors will say that how you make money in real estate is by buying right; not by selling right.
- Update the property correctly to maximize profit. Read the rest of this entry »
Analyzing real estate investments
Don’t forget about Carrying costs
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Colorado Springs Real Estate Investors who are buying properties to fix and flip need to do their homework when analyzing the 
costs of properties. Some investors forget about the carrying costs of the transaction, they just look at just the purchase price and resale price. They deduct the cost to fix it, but they overlook other expenses.
Ax an example, if an investor bought a home for $100000, put $25,000 into it, and sold it for $150000, it seems like they are making a profit of $25,000. But what about the carrying costs? The costs to purchase the property? The cost to sell a property?
Here’s a list of some of the costs that investors forget about
- Closing costs to purchase the property including title insurance, property tax allocation, HOA reserves, water bills, survey, inspection costs, etc.
- Mortgage Interest payments
- Real estate property taxes
- Hazard insurance
- HOA’s
- Utilities
- Miscellaneous supplies
- Real Estate broker commission when the investor sales it
- Closing costs when selling the property, including Buyer’s closing costs (it’s typical in today’s market for the buyer’s to ask for a portion or all of their closing costs to be paid by the seller)
- Additional costs incurred during the Buyer’s inspection
- Resale closing costs
My suggestions is to make up an Excel worksheet to include all of the potential expenses. Then fill in the blanks including 6 months of carrying costs. Subtract these costs as well as your fix up costs from the initial purchase price. Does the purchase still make sense? Is it still a good deal.
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To find out more information about buying a home or an investment property in Colorado Springs area, call ….
Kathy (719-287-1049) KTorline@msn.com
How do you confirm a Colorado Springs realtor has a license?
Do you want to know how long the Colorado Springs Real Agent you are working with has been licensed in Colorado?
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If so, the following link will take you to the Colorado Department of Real Estate Licensee ‘Look up”.
Related Article:
- Real Estate Agent or Realtor? What’s the difference?
You can search by First name and Last Name, License #, of company name. As an example, if you search by Kathy, it will bring up 13 pages of people by the first name of Kathy. You can then look at each person and it will then tell you if their license is active, inactive, expired, deceased, relinquished, or revoked.
It will also tell you if the Licensee has been subject to any disciplinary action.
To find out more information about Colorado Springs real estate, Call ……
Kathy (719-287-1049) KTorline@msn.com
Is Investing in Colorado Springs Real Estate for you?
Is investing in Colorado Springs real estate for you?
There are many different Colorado Springs real estate investment options, here’s a quick summary of the most popular ones:
- Buy and holding real estate in Colorado Springs involves purchasing property and holding on to it for a long time while the value of the property appreciates in value. This involves someone who has the patience to hold on to their investments for a long
period of time. They can eventually provide a nice retirement for the right investor. - Purchasing Colorado Springs rental properties are another excellent way to make money for those who are willing to deal with a long-term property investment. In this type of investment, money is made each month to pay the mortgage or provide income. Also, it’s important to understand that even if the property is paid for, there will continue to be some expenses involved in keeping properties up to date and well maintained. The investor can manage the rental property or hire a property manager to do it.
- Fix and flipping in Colorado Springs is another type of real estate investment that is receiving a large amount of press these days. This involves purchasing a property below its value, repairing or rehabbing the property, and then reselling the property for a profit. This is one of the few short-term types of real estate investments that can be profitable when it comes to real estate investing.
There are many other options for real estate investing, including wholesaling, purchasing land, purchasing mobile home parks, purchasing large apartment complexes, as well as joint ventures with other investors.
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To find out more information about buying a home in Colorado Springs area, call ….
Kathy (719-287-1049) KTorline@msn.com
