Posted by: dagmarsands | November 30, 2016

Buying Real Estate Through Auctions

I felt that this article written By Cynthia Badiey, Editor, Auction.com Blog was very
helpful to many of my past clients so I wanted to share it on my blog because as you
know, REAL ESTATE INVESTING is the most lucrative business you can be in.  You can
always drive by your investment property, you can rent or lease it,  you can enjoy it
for a while and then resell it.  www.Auction.com also has lots of information about
Auctions and if I can be of help walking you through the process I’ll be happy to
assist you.  Dagmar Sands – The International Real Estate Agent 

buying-investment-real-estate-auctions

By Cynthia Badiey, Editor, Auction.com Blog

If you’re interested in buying real estate as an investment, the local multiple listing service isn’t your only option. Real estate auctions are growing in popularity, especially for people looking for a bargain. Experienced investors often buy property this way, but technology has simplified the process and has made it less intimidating to new investors—as long as you do your homework.

What Types of Properties are Sold at Auction?

While virtually any type of property or asset can be sold at auction, most home auctions—and the type you’ve probably heard the most about, thanks to the housing crisis—are foreclosures. Depending on the state, a trustee assigned by the lender or an officer of the court conducts a foreclosure sale to recover the balance of a loan from a borrower who’s defaulted on their mortgage payments. According to RealtyTrac, as of March 2015, there were close to 850,000 homes in some stage of foreclosure in the United States. Nearly 42% of them were up for auction.

But “distressed” property isn’t the only type of asset you can buy at auction. More and more non-distressed properties are being sold at auction today, including luxury homes and commercial assets such as office buildings, hotels and apartment buildings. Some developers are even conducting auctions for newly built homes.

There are two types of real estate auctions: live (in-person) and online. The latter is becoming more and more prevalent as people grow more comfortable with making major purchases online.

No matter which route you choose, remember that buying real estate can be complicated. Companies like Auction.com are making the process more efficient and transparent, but in most cases there are still long contracts, escrow, disclosure documents and other paperwork required by law.

Buying Foreclosure Properties at Live Auctions

The phrase “real estate auction” often brings to mind the stereotypical image of a small group of investors, huddled around an auctioneer on the county courthouse steps. And in fact, almost all foreclosure auctions are conducted live in front of (or in a room inside of) county courthouses. Many states only require a publicly accessible space, like a hotel ballrooms or room in a convention center. In some of these larger venues, hundreds of foreclosure properties might be auctioned on a single day.

Some of the larger counties in Florida now conduct foreclosure sales online; Wayne County Mich., the county in which Detroit is located, conducts online tax lien sales (where the government seizes a home due to unpaid taxes). The laws vary widely from state to state, so be sure to check out the specific rules governing your state.

Live foreclosure auctions are free to attend and open to the public to ensure that a home being foreclosed upon receives the highest possible recovery for the bank or lender and the smallest deficiency for the borrower. Anyone can attend; however, if you want to bid, you’ll need to register. In almost all cases, you’ll have to show that you’re in possession of sufficient funds to pay for the property in full. (There are a few states that allow an auction day deposit and payment in full the following day).

Here are the basic steps for participating in a live foreclosure auction:

Find and track foreclosure auctions. Consult an online resource like RealtyTrac or Auction.com to find foreclosure auctions in the area or areas in which you want to buy. Foreclosure sales data is usually available from the specific county either online or at the county courthouse, or from the third-party foreclosure sales agent, often called a “trustee.” You can also work with a local real estate agent or broker to identify these properties, but you should know in advance that, by law, there is no agent commission on these sales.

Do your research. Be sure you read and understand all due diligence documents and transaction details prior to the auction. It wouldn’t be a bad idea to seek independent advice from a real estate attorney or a knowledgeable real estate agent.

Research the estimated market value of the property, how much the borrower owes on the mortgage, and whether there are any liens against the property. This last point is especially important. If you’re the winning bidder, you may have to pay off these liens. It’s worth hiring a title company or real estate attorney to run title searches on properties you’re interested in bidding on.

Drive by the property, if possible. This will let you see the home’s condition—from the outside. Homes in the foreclosure process are usually occupied by the owner who’s being foreclosed upon or a renter. Do not trespass or disturb the occupant! Doing so is a criminal offense.

When you bid on a foreclosure, you’re bidding on the property “as-is.” You won’t know what condition you’ll find inside once you take possession. Extra, unexpected repairs could cost you thousands of dollars, so take that into account when figuring out how much you can comfortably bid. There’s a saying among investors that’s a pretty good rule of thumb: “How it looks on the outside is what it’s going to look like on the inside.” In other words, an unkempt exterior indicates an unkempt interior, while a home with great curb appeal will probably look similar inside!

Get your financing in order. Most foreclosure auctions accept cash, bank money order or cashier’s checks for payment. In nearly every state, you’ll have to pay in full immediately following the auction of the property; a few states allow you to pay a percentage at auction and the rest within a certain timeframe.

County foreclosure auctions often require advance deposits. The deposit amount varies across municipalities, but generally runs from 5% to 10% of the expected final bid amount of the property.

Confirm all auction details, even on the day of the auction. It’s very common for foreclosure auctions to be postponed or even cancelled. Sometimes an auction is cancelled because the borrower comes up with the money to pay the lender the amount they owed, obtains a loan modification or sells the property as a short sale. Auctions might be postponed for a myriad of reasons; for example, the bank or lender might not be able to compile the proper documentation in time, or the owner might request more time to complete a short sale.

Attend the auction and bid! Check in at least one hour before the auction’s start. Get an Auction Bidder Card and raise it when the auctioneer announces a price that you’re prepared to accept as your winning bid.

If you win the auction, your payment is due immediately or the following business day (dependent on state). Once you’ve paid in full, you’ll complete a certificate of sale or an execution of sale receipt, deed upon sale and IRS Form 8300, subject to state-specific laws.

Wait for your certificate of title. While you’ll get your certificate of sale immediately, the actual certificate of title may take as much as 10 days to complete. During that time, the original owner may file an objection to the sale and pay the amount owed in full to retain their rights to the property. Don’t do any work on the property until you receive the certificate of title.

Buying Property in an Online Auction

In an online auction, you won’t find yourself standing on the steps of the county courthouse or packed into a hotel ballroom. You could be anywhere when you bid—at home, the office, even an airport—as long as you have an Internet connection. Bidding can occur 24 hours a day over the course of days or weeks, instead of on a single day.

Online auctions also broaden the types of properties you can bid on: short sales, non-distressed, bank-owned homes (known as REOs), and commercial property and notes.

The steps for bidding in an online auction are similar to a live auction.

Find a property you love. With online auctions, you can search for and bid on properties all over the country. You can even bid on multiple properties at once.

Do your due diligence. Many online auction sites provide a wealth of information on the property page, including maps, estimated market value and any liens. Be sure you read it all! It’s also a good idea to conduct your own due diligence, including a title search, and seek independent advice from a real estate agent or broker, a real estate attorney, or another experienced investor. Unlike live foreclosure sales, most homes sold in online auctions do have an agent commission (called “broker co-op” in the business), which allows a real estate agent to get paid for their services.

As with foreclosures, visit the property if you’re local. The real estate agent may even offer open houses; if so, bring your contractor with you to help you assess what repairs might be needed.

Register for the auction. Most online auctions require you to register and submit a refundable deposit in the form of a credit card authorization. This simple process ensures that all bidders are serious and motivated. (Don’t worry—you’ll get the deposit back if you’re not the winning bidder.)

Prepare your financing. To expedite the close if you win, start gathering the following documents before the auction:

  • Proof of funds or financing information. Although most online auction sites don’t provide financing, Auction.com has a large—and growing—number of homes with financing available.
  • Entity documents if you’re bidding under a company name or entity such as an LLC, trust or limited partnership.
  • An earnest money deposit, which is usually 5% of the total purchase price and due one business day after the auction ends.

And if you’re the winner? Be ready for things to move fast. With Auction.com, for example, the contracting department will contact you within two hours and walk you through the online purchase and sale agreement, which shows the total purchase price and the timeline for submitting documents and payments. Make sure that escrow receives your documents and payments on time; otherwise, you could lose your earnest money deposit.

Look closely at the property page for each property you are planning to bid on. Many properties have what’s called a “buyer’s premium,” which is the fee charged by the auction company for conducting the sale, from marketing through the closing. The amount can vary, but it’s usually 5% of the winning bid amount. Many properties don’t have a buyer’s premium because the bank or seller has arranged to pay this fee out of their proceeds from the sale.

Title insurance. It’s a good idea to purchase title insurance. Here’s why: The properties in an online auction often have quit claim or special warranty deeds that will transfer the bank’s interest in the property to you at closing. The problem is that any undiscovered liens will transfer to you as well! Title insurance protects you from these risks. For some homes, you can buy title insurance through escrow; for others, you can buy it after closing.

Occasionally, you’ll receive clear and marketable title to the property at closing. It depends on where the home is in the foreclosure process. This is another reason why a knowledgeable real estate agent or attorney can provide a valuable service to you.

Buying real estate at auction can be a lucrative—and fun—way to start or enhance your investing career. It can also mean years of heartache for the uninformed, so take advantage of all the resources available to make sure you know what you’re getting into.

Posted by: dagmarsands | September 21, 2016

The Importance of Cash Flow

Per Manta Tip of the Day:

Positive or negative cash flow can be the difference between success and failure as a small business owner. After all, it doesn’t matter if you’re close to getting a big payment from a customer if you need the money now. But a little bit of planning can help you avoid these panicked moments.

First, recognize that certain times will be slower than others for your small business. “Despite all of your marketing efforts, your cash flow will still be slower in some seasons,” said Lisa Chu, owner of Black n Bianco Kids Apparel in El Monte, California. “Learning your market and industry will help you maintain a healthy cash flow during the slow seasons.”

Next, Chu recommends that you start saving. Set aside at least two to three months’ worth of operating expenses as soon as you can. Much like a personal emergency fund, that money will help your small business survive any unforeseen financial challenges.

Lastly, don’t ever “set and forget” your budget. Things change often, “so it’s wise to regularly revisit your budget on a monthly basis,” Chu said.

Dagmar Sands, President Real Estate International
dagmar@dagmarsands.com
http://www.worldclassrealestateabroker.com

 

 

 

Posted by: dagmarsands | August 22, 2016

How Much is Your Business Worth?

Per Manta Tip of the Day –

As a small business owner, it’s easy to fall into the trap of thinking that a business valuation simply isn’t necessary, at least not yet. After all, you’re busy trying to grow your business. You can worry about what your business is worth down the road, when it’s time to sell or think about retirement, right?

As it turns out, though, you shouldn’t wait for a business valuation. There are several reasons why it’s important to know how much your business is worth right now.

  • Planning for the future: A business valuation provides a current market value that you can use to assess the strength of your business and determine where improvement is needed—before you retire, sell or pass the reins to another family member. Once you know how much the business is worth, you’ll be able to plan for these events with confidence.
  • Purchasing adequate insurance coverage: Small businesses often use a life insurance policy to protect against the death of a key employee. In this case, a business valuation can help determine how much insurance coverage is necessary.
  • Expanding the business: When it’s time to grow your business, an accurate and up-to-date business valuation makes it easier to approach lenders and raise capital. It provides potential lenders with a snapshot of the health of your business, which in turn facilitates the decision-making process.
  • Establishing a buy-sell agreement: This agreement typically outlines what happens to a business in the event of death, disability, divorce or retirement. If one of these events triggers a sale, you’ll need to know the value of an owner’s or partner’s share of the business.
  • Helping with tax and estate planning: If a business owner passes away, the family or estate may be required to pay taxes based on the value of the business. Without a certified business valuation, determining how much your business is worth will probably fall into the hands of the IRS.

Dagmar Sands
Real Estate Broker
International Real Estate Broker
http://www.worldclassrealestatebroker.com

In the past 3 weeks I’ve had 8 offers on one of my listings in Johns Creek, GA
and 90% of them were Asian Buyers.  When I asked them why Johns Creek, GA
they said they wanted to be close to their community.  Having #1 Schools is their
primary reason, having more of their Culture and Restaurants they said was
another and having Super H Mart close was also very important to them.
I’ve sold and closed properties with clients from 59 different countries that
relocated to metro Atlanta, GA area.  Japanese, Chinese, Philippines, Korean
are all very much interested in Johns Creek, GA.  I think it is wonderful that
they want to live close to each other, communicate, gather and help each other.
Now we are working with Chinese investors and Indian investors who are
interested in purchasing land here.

Being Bi-Lingual myself and understand what sense of community means,
I totally understand being close to people that speak your own language
and having children communicate and continue speaking their native language.
That is why I am also very interested helping Czech & Slovak Community.
I was born and raised in the former Czechlovakia and came to the United States as a teenager so I understand the cultural differences, language issues and even food
differences.  It may seem silly to some people, but if you have never eaten
“Sloppy Joe Sandwich” and you are from Europe where everyone eats with fork
and knife and then you see kids at school eating their sandwich with their hands,
it will be surprising to someone coming here.  The cutest story I have heard
from a Czech friend is that when he arrived in New York and went to Starbucks
and the lady behind the counter waiting on him asked him for his first name.
In shock he thought “WOW… she must really like me, I just came in for a cup
of coffee and she wants to know my name”.  Little did he know until later
that is the first thing they ask you at Starbucks.

For information about Foreign Investments, Buyers & Sellers of Foreign Properties,
International questions, feel free to contact us at 404-313-3456 or email us at :  dagmar@WorldClassRealEstateBroker.com

Posted by: dagmarsands | August 17, 2016

International Invasion of Georgia Real Estate

international invasionBy Bruce Kellogg, MAI, FRICS, Managing Director- MG Valuation

Foreign Direct Investment (FDI) is a large part of the U.S. economy, and recent investment has been dominated by China. Over the past fifteen years, Chinese firms have spent approximately $46 billion on acquisitions in the U.S., most of it in the last two to three years.[1] While high-profile Mergers & Acquisitions (M&A) transactions get much of this publicity, the investment in real estate is equally large. Favoring trophy acquisitions, such as the 2014 Anbang Insurance purchase of the Waldorf Astoria Hotel in New York City for $1.95 billion, this investment in U.S. real estate is driven by both the private sector and high-net worth individuals through U.S. government programs, such as the Employment Base (EB)-5 program. EB-5 accelerates the Visa process for foreigners through investments in U.S. real estate. As the Chinese economy slows, particularly the domestic real estate markets, Chinese firms and investors are looking for safer havens to place their money.

Chinese investors typically prefer larger coastal communities, such as New York, San Francisco and Los Angeles, but these investments are becoming increasingly sought-after by state and local governments and trade offices. Georgia is actively pursuing these investments through trade delegations and the efforts are starting to pay off, with approximately 50 U.S. subsidiaries of China-owned firms in Georgia.

The local real estate markets are also active with this investment. MG Valuation is currently working with an international private sector firm focused on investments in the Southeast, including a mixed-use project in a major Southern city. The EB-5 program, which is approximately twenty years old, is also very active. While created as a vehicle to attract foreign investment in U.S. real estate, it has been characterized as one dominated by Chinese investors. Of the 10,000 Visas granted through this program in 2014, more than 9,100 went to Chinese individuals. The program requires a minimum investment of $500,000 in certain Targeted Employment Areas (TEAs). Regional centers have emerged as vehicles for these EB-5 investments, often pooling the minimal investments into larger, multi-billion dollar projects. There are several Atlanta-based regional centers, listing current EB-5 projects, including a Marriott hotel at the Gwinnett Center and Arena, a Hyatt Place hotel in Athens, a senior retirement village in Stockbridge and student housing at local universities.

There are issues associated with these programs, including the requirement that they create a minimum of ten full-time jobs for the minimum investment.  It’s not clear if the definition of ten full-time jobs refers to permanent employment, such as workers at hotels or construction workers building these projects. The program came under Congressional review last fall for renewal. However, rather than address these issues, Congress renewed the EB-5 program for another twelve months, leaving resolution for another day. Organizations, such as the Asian Real Estate Association of America (AREAA), are highly active and aware of these investments in the local real estate markets. Meanwhile, Chinese investors will continue these investments, with increasing frequency in the greater Atlanta and Southeastern markets.

Bruce Kellogg is a Managing Director with MG Valuation, an independent multi-disciplinary valuation firm serving clients in eleven countries in the Americas, Asia/Pacific and Europe, including China, and responsible for client relations and business development. He is a CREW member, Past President of the Appraisal Institute, Past Chair of RICS Americas Professional Valuation Group, and a member of the Atlanta chapter of AREAA. 

[1] New Neighbors: Chinese Investment in the United States by Congressional District, National Committee on U.S.-China Relations and Rhodium Group, May 2015

International Invasion in Georgia Real Estate

International Real Estate Agent, Dagmar Sands, World Class Real Estate Broker,
Dagmar Sells Churches, Dagmar Sells Commercial, Dagmar Sells Atlanta

Posted by: dagmarsands | May 24, 2016

Your Business’ Succession in Case of an Emergency

Per Manta Tip of the Day –

Planning for accidental death or disability is an uncomfortable prospect for anyone, but it’s especially important for small business owners.

Preparing for the worst can help protect you, your family and your business, so don’t wait to seek out professional guidance on issues such as insurance and inheritance. In addition, you may want to consider drafting an emergency succession plan.

“If the owner gets hit by a car, who takes over?” said tax attorney and CPA Andrew Goldberg. “Is there a short term and long terms plan? Almost no one has this in place because entrepreneurs feel invincible.”

But Goldberg stressed the importance of having an emergency plan, in addition to a long-term vision for passing on the company, as unexpected disruptions in leadership can destabilize your business.

“Your succession plan might look different if something were to happen tomorrow versus five or 10 years from now,” Goldberg said. This is especially true in cases where the owner intends to transfer the business to a younger family member or employee who needs years of training and experience before they’re ready to take the helm.

Posted by: dagmarsands | May 9, 2016

SEO – Local Google Rankings

Per Manta Tip of the Day –

The competition to rank within Google’s local listings is stiffer than ever. The search giant slashed the number of local listings it displays on search results pages from seven down to three. Google has also removed exact business addresses and phone numbers in favor of more prominent business hours, website links and directions.

With these changes in mind, here are three ways you can focus your search engine optimization efforts and improve your rank in Google’s “three pack” of local search listings.

  1. Local backlinks. Build a consistent presence on online business directories like Manta, YP.com, Whitepages, and Google. Pay special attention to name, address and hours of operation when updating your info, and make sure your business listing is correct wherever it appears.
  2. Customer reviews. It’s impossible to overstate how much emphasis Google places on customer reviews. Make it a habit to solicit reviews immediately following every customer interaction. Include a request for reviews in every email newsletter and at the end of every customer phone call. And, put a request for reviews and a link on your invoices.
  3. Website optimization. A mobile-friendly website is key to winning with Google and customers who are searching on-the-go. Embed a Google map with your business marker on your “contact” or “location” page. Then add local keywords, such as city and state, to relevant pages of your website.

    Dagmar Sands
    Broker – Real Estate International
    International Real Estate Broker
    http://www.worldclassrealestatebroker.com

Posted by: dagmarsands | April 1, 2016

How Much is Free Publicity Really Worth?

Per Manta Tip of the Day –

Getting your name in the news is as good as gold. In fact, when your business is mentioned in the media, you can put a value on it—and compare what this free publicity would have cost in advertising. For example, a mention of your business by Yahoo! Finance has an ad value of approximately $100,000, based on the site’s audience size.

According to Manta’s Academy course on Public Relations, reporters and editors are pitched story ideas dozens of times per day. So how do you cut through all that noise to get your name in the news? Have the reporter come to you.

Reporters are often looking for experts in a certain field or opinions from local community members, and they’re frequently working on tight deadlines. If you can answer their questions on short notice, you might just get quoted in a story—and earn free publicity for your business.

There are a number of resources reporters use to find sources, but our favorite is Help a Reporter Out (known as HARO). You can sign up with the website to be an expert source for your particular field. Reporters submit questions or interview requests on a wide variety of topics; when a reporter’s question matches your area of expertise, you’ll get an email request straight to your inbox. Plus, if you establish a rapport with a reporter, they are more likely to come directly to you in the future. Get quoted today.

Dagmar Sands, Real Estate International
International Real Estate Broker

Posted by: dagmarsands | March 9, 2016

Why do Homeowners Remodel?

Homeowners primarily remodel their home for one of two reasons: to increase the value of their home when putting it on the market, or to reap personal enjoyment from the renovations.

According to NAR, the interior renovations that attract potential buyers are kitchen upgrades, complete kitchen renovations, bathroom upgrades, and new wood flooring. Other exterior improvements include new roof, new vinyl windows, and new garage doors. Projects that recoup the largest percentage of their cost when selling the house include new wood flooring, insulation upgrades, and converting a basement to a living area.

Many families choose to upgrade their current home rather than move because they like the neighborhood and schools, and the home is a sanctuary where memories are made. Upgrading one or more areas in your home can give your space new life, and allow you to see and enjoy your home in a whole new light. Remember, the grass isn’t always greener on the other side of the street, or in a different home!

Posted by: dagmarsands | January 14, 2016

Hiring: Cultural Fit Matters as Much as Skill Set

Manta Tip of the Day –

According to Manta’s Wellness Index survey, 83% of small business owners feel positive about business prospects in 2016, but one hurdle is still looming: 16% of small business owners found that the inability to hire and retain good employees hindered business performance in 2015.

So, with 39% of you planning to hire in the first half of 2016, what’s the best way to get great people for your company?

“A great way to hire employees who are a good fit is to have a referral program that encourages and rewards current employees for recommending good people,” suggested Rasheen Carbin, cofounder and CMO of nspHire. “The most common pitfall in hiring is looking for someone who exactly fits your job description. Don’t be a slave to a job description. After all, it’s only a wish list. Don’t pass on someone who is a great cultural fit because they don’t have the exact skills you wanted, especially if those skills can be easily taught.”

Needless to say, focusing on the wrong qualifications usually results in hiring the wrong candidate.

“Our own research echoes what we’ve seen in other studies—about half of hires result in people with insufficient or wrong skills taking the job,” said Magda Walczak, CMO of Search Party. “That means the new employee won’t be productive when they start and they won’t last long in the job. This is especially detrimental in a small business or startup where the team is small. Other team members end up having to pick up the work caused by a wrong hire, which decreases productivity all around.”

So, as you put your hiring plans for in motion, be selective, listen to your employees and customers—they might just have the perfect person ready and waiting for the job.

Dagmar Sands, Real Estate Broker
International Real Estate Broker
http://www.worldclassrealestatebroker.com

 

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