BUYERS – QUESTIONS AND ANSWERS
How do I choose a good farming area to meet and greet the neighborhood and send out monthly fliers and sponsor community picnics?
Locate properties near your home. (You don’t want to drive clear across town all the time.)
To choose a particular subdivision, your goal is a low sales price, yet high rental price.
Using MRIS: Choose some neighborhoods in the mid level area of around $400k-$500k to compare. Townhomes are best for farming.
Now for some examples:
Search the MLS: Let’s say Fox Croft Subdivision had 5 homes sold last year.
Search Tax Record for Fox Croft and hit count. That will tell you the total number of homes in the community. Maybe 100
5 divided by 100 = 5% turnover ratio for Fox Croft
Do this on two other subdivisions to compare.
This is called turnover ratio comparison. The highest percentage = the best place to market. Except:
Now compare listing agents. Make sure you choose a subdivision where one agent already dominates. By pulling up the listing agents on each subdivision, you pick the one where one agent is not dominating it. Eventually you will be the agent dominating it.
Do I have to deposit the earnest money on a Short Sale after seller and buyer sign or after the 3rd party bank approves it?
On the Short Sale purchase:
On the Short Sale Contingency (page 2 under number 6) it will ask when is the contract considered ratified? Do not check the boxes that state “when ratified.” Instead you check the boxes, “it is considered ratified when the 3rd party bank approves it. “
This is why:
If you check ratified when seller and buyer sign, then escrow must be deposited.
If you check ratified when 3rd party approves, then escrow is not deposited until bank approves.
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I am listing a town house for rent. In a rental property who pays the HOA fee?
Any Condo or HOA fees etc. are paid by landlord. Tenant only pays for rent and utilities as outlined in their lease.
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How do I handle an Investor Purchaser looking for a good value in purchasing a Rental home?
The idea is to find a low sales price with high rentals in a particular community. The price range should not be too high nor too low. The area of choice should be close to the home of the buyer, because he will have to service it over the years. Now compare the subdivisions: Compare Sales prices to the rented prices.
If it Sells for $200,000 and rents for $800. per month. You have one study.
Now go to another subdivision and do the same.
If it sells for $200,000 but rents for $1500. per month. You have another study. And in fact you found the best investment subdivision.
Next: In those same neighborhood studies, you want to compare appreciation of sold prices from one neighborhood to the other.