Five Reasons for Real Estate Investors to Consider Mexico

Real Estate prices in the most popular parts of Mexico have been on the increase of late, and the demand for property to retire, holiday and invest in has also been on the up – this has created something of a real estate boom in Mexico but for those still wondering what the fuss is all about here are the five main reasons why an investor should consider Mexican real estate…

1) The government of Mexico has relaxed the rules that once prevented foreign buyers from purchasing on or close to the coast, and nowadays with the simple use of a bank trust structure investors can purchase some of the most beautiful prime beachfront land in Mexico.

This land is ripe for residential and tourism development and because the demand for hotels and luxury beach front property is at its most intense in Mexico right now, this means that an investor who buys beach front real estate in Mexico is probably buying themselves one of the most promising investments possible.

2) The Mexican government is committed to the economic improvement of their country and to this end they are doing everything in their power to attract foreign direct investment particularly into the tourism and real estate sectors. This means that not only is investment welcome but there are certain incentives now in place that make investing in Mexican real estate even more attractive.

3) Mexican real estate is incredibly popular with Northern Americans because it is affordable and easily accessible and also because Mexico itself is a low cost country in which to live. The large American baby boomer generation is nearing retirement and as they do so a surge of interest from this generation into the property market in Mexico is expected. This means that an investor who buys into Mexico now and targets this particular group of people could profit substantially – especially if they consider buying into or developing retirement, gated or exclusive communities.

4) Over 16,000 foreign companies have recently been attracted to Mexico by the government’s commitment to developing policies to make the country more attractive for overseas companies and investors. The companies who have established trading bases in Mexico have also created substantial employment opportunities for the local people and expatriates – as a result, in the main Mexican towns and cities unemployment is down, GDP is up and local Mexicans and expatriate employees of the international firms are in a strong financial position and are looking to rent quality accommodation for which a premium can be charged.

Real estate investors who prefer the buy to let market can buy into the residential rental market in Mexico at a far reduced cost when compared to similar markets in cities or towns in America or Europe for example, and they can profit successfully from the increased purchasing power that is now apparent in Mexico.

5) The tourism market in Mexico is responsible for generating over 8% of the country’s GDP and supplying over 9% of the country’s jobs already, and sustained focus by the government of Mexico on further developing and promoting tourism in Mexico means that the country is growing in popularity annually. The rise in the numbers of visitors to Mexico means that there is increased demand for quality villa and apartment accommodation to let out and a growing number of overseas investors are now buying up single units, buying into entire developments and even purchasing land for the development of properties to meet this rise in demand.

Those who are focusing on this market sector are making some of the greatest returns in the shortest period of time in Mexico today – and if current statistics are anything to go by, the level of overseas interest in both property to let and real estate to buy in Mexico means that the demand for investment properties in Mexico is not abating thus offering real estate investors medium to long term potential for profit and gains.

Breaking into Home Ownership – Finding a Fixer Upper

With the housing market becoming more expensive, buyers must look for the best way to find an affordable home. A fixer upper is a great way to affordably buy your first home in the California housing market. Buying one away from the city is even more affordable since it is not a candidate for a teardown where the land is the most valuable asset.

If you are in the market for a new home, but do not want to spend tons of money or just can’t afford today’s rising home costs, you may want to look into buying a fixer upper. By purchasing a home in less than perfect condition you will be able to save yourself a lot of money. If this sounds like something you are interested in, you are in luck. There are thousands of homes available all over California waiting to be restored to beauty. All you need to know is where to look.

Listed below are the three most common ways that you can find a fixer upper in your area.

1. The most traditional way of finding a fixer home is simply getting in your car and scouring the neighborhoods that interest you. By doing this you may not come across a lot of properties, but you may find the one that really catches your eye. If you do happen to find a fixer upper this way, make sure that you take down the address as well as the name and number of the real estate agent on the sign.

2. Finding a home to restore can also be done by searching the classified ads. This is also a more traditional method of finding a new home. The best thing about searching for a fixer upper this way is that you will be able to search by location and price without ever having to leave home.

3. And of course you can search for a fixer upper online. There are two ways to do this: you can either search a site that offers listings from a variety of different real estate agencies, or you can visit the site of each independent agency. Either way, you will be able to find a lot of details on any lower priced homes that may catch your eye. These sites offer information on pricing, as well as pictures of both the exterior and interior when available. By searching for a fixer upper online, you will ensure yourself of coming across the largest number of properties available in your area, and save yourself some time too!

However, it also pays to use an experienced realtor that can spot major issues, advise you on what extra inspections you might want to consider and also will have a good contact list for reliable contractors and others you may want to consult with.

Overall, finding a fixer upper can be done in a number of different ways. Instead of overlooking this option, why not give it a try? It does not cost anything to look, and you may find out that a fixer upper is your ticket into the housing market or a way to gain a dream home.

In the author box put something like Debra Miller has several years of experience in the real estate market and the web site also allows full MLS access for searching for homes available in the Sacramento area and can help find fixer uppers in the Placerville Real Estate market.

Asset Protection for Real Estate Investors

The first 10 years of my real estate investing I ran my business as a sole proprietor because I really didn’t know any better. Luckily, I survived with only minimal damages, but there comes a point when it is time to assess the best legal structure to use for real estate investing.

If you ask 10 experts you are likely to get 10 different opinions. With that in mind, I’ll share my opinion and experience. Remember: free advice is always worth what you pay for it.

If you are a beginning investor, it’s probably best to not worry about asset protection until you actually have a few assets to protect. Why spend time and money setting up a business entity and creating tax reporting requirements unless you need to? It’s like buying full coverage auto insurance on a beat–up Gremlin…what’s the point?

Once you have assets and something to protect, then it’s time to set up your business structure. Question # 1: what is your net worth? Question # 2: do you have assets that are at risk? If the answer to either of those questions is, “Yes,” then you need to take the next step.

Assuming you want to set up an entity for wholesaling properties, the most popular are an LLC (Limited Liability Corporation) or a C Corporation. There is much debate about which one is better, but I prefer the C Corporation because the first $50,000 is taxed at 15% and you can have a kick-butt employee welfare plan to write off many expenses. With an LLC, the income is passed through. If you start making money, you’ll wish you could pay only 15% on some of it! Trust me on this one.

Why is the tax issue such a big deal?

Here’s a simplified example. If you make $100K personally you are taxed on the full amount (35%) and have $65,000 left. Anything you buy for yourself comes from after-tax dollars. However, with a C Corporation if you could make the same $100K on paper, but have $50K in allowable expenses that you can write off. So you get taxed on that $50K at 15% and only have to pay $7,500 in taxes compared to $35,000 on your personal income.

What type of expenses can you write off in a C Corporation? It depends on how your Company is structured (see your accountant/attorney for details), but you can often write off basic expenses of things like a bed or even a swimming pool. You’re thinking, “No way!” Let me explain how it’s done. If you have an employee welfare plan that covers your medical expenses and your doctor gives you a prescription for aqua therapy, it’s possible to write off the cost of the swimming pool. Yes, it’s crazy, but I don’t make the laws. Another more common example is a prescription for a new bed if you have a bad back. I have a “Sleep Number” bed myself, just like Paul Harvey J.

Cheap Houses For Sale

We found cheap houses for sale all over the country. My wife Ana and I were on a seven-week drive around the country. It was a vacation, but we looked at houses too, and bought one in a great little town in the mountains of western Montana. It cost $17,500, and after $2000 to fix it up, we lived there for several months before selling it for $28,000.

We loved Anaconda. Where else can you fly fish, go to a three-dollar movie in a beautiful old art-deco theatre (the 5th most beautiful in the country, according to the Smithsonian), drop some nickles in a slot machine, eat at a fine restaurant, stop by the bar for a dollar beer, and buy a house for under $30,000 – all within a four block area! There are good schools and churches, a library with fast internet service, and wildlife (including bears) a few hundred yards from downtown.

<B>Why Are There Cheap Houses For Sale?</B>

There are cheap houses in Anaconda, and nearby Butte because there aren’t many good jobs. I easily found jobs in Anaconda – but not good ones. This explains why people left the area in the 80’s, after the mines and smelters closed.

Thirteen percent of the “housing units” in Anaconda are vacant, according to the 2000 U.S. census. This has driven down the home prices dramatically. Since it still has all the basic ammenities, is cleaner now, and is slowly recovering, it’s a great place to retire to or to move to if you have an internet or other non-location-based business.

A poor local economy is the reason you can buy cheap houses in many parts of the country. These are towns that have seen troubled times, but are often recovering, sometimes with good reasons. Anaconda, for example, now has, in addition to it’s beautiful mountain scenery, a ski resort and a Jack Nicholas golf course. Houses cost four times as much an hour in any direction, and those prices are bound to reach Anaconda eventually.

<B>Cheap Houses You Don’t Want To Buy</B>

There are towns like the one in South Dakota where we stopped for lunch one day. A bulletin board had ads for cheap houses for sale by desperate people trying not to be the last to leave town. There was a photo of a beautiful old five-bedroom farmhouse for $11,000. As we ate, we looked up the deserted street and noticed that most of the buildings were boarded-up. This was a dying town, with nothing to help revive it. A free house wouldn’t be a good enough reason to move here.

<B>Cheap House For Sale – Our Criteria</B>

There are many wonderful towns, from Florida to Oregon, where there are cheap houses for sale. After our Montana experience, we started a website about them. What does a town need in order to make our list? The criteria are certainly subjective, but include at least the following:

1. Population of 4,000 to 80,000.
2. Decent library.
3. Good grocery store.
4. Movie theatre.
5. At least six houses for sale under $50,000.
6. The town has a good “feel” to it.

After much research, we found a number of towns that met our criteria, including some with homes for under $30,000. There really are nice towns out there where you can find cheap houses for sale.

Advertising Rental Property

There are many different ways a landlord can advertise his / her rentals property. The kind of advertising that works best depends on numerous factors that include property characteristics, location, landlord’s budget, and whether he / she is in a hurry to rent. There are many combinations of advertising methods landlords and property managers use to achieve the best results, some of which are as under.

1. ‘For Rent’ Signs

The most common method of advertising is the putting up of a ‘For Rent’ sign, either in front of the building, or in one of the windows. A relatively cost-free method, it works best if a lot of foot and motor traffic goes past the building. It also helps if the building is as attractive as the rental unit.

2. Advertising in the Newspapers

As much of a tradition as ‘For Rent’ signs, newspaper ads are also available online, if the paper has an online version. Many potential tenants begin their search for a place to rent by scanning the classified ads in newspapers, while, out-of-towners can log on online to the local paper from wherever they are. Ads should always be placed in papers having many residential listings, as it has been found they work best.

And, they should be targeted to produce the right kind of prospective tenants i.e. if a landlord primarily rents out to college students, the best bet is to advertise in the campus newspaper or put up a ‘For Rent’ sign in the housing office. To play it safe, it is also a good idea to list the rental in a general newspaper, as well.

3. Neighborhood Flyers

As well, a landlord can post ads on neighbor hood public bulletin boards to be found at grocery stores, Laundromats or coffeehouses, complete with tear-off strips listing their phone number. However, if the property is upscale, this is not the best way to advertise for it, though there might be takers at the high-end gym down the street.

4. Listing Online

Online rental services have mushroomed like crazy in recent years, from national in scope, to regional. After finding a residential rental listing for your area, you can add your property to it.

5. Home Or Apartment Finding Services

Home or apartment-finding services are very popular in some areas, with landlords paying to list their properties, though sometimes it is the tenants themselves, who pay the fee when the unit is rented.

6. Spreading the Word

Small-time landlords instead of advertising widely and screening potential tenants, find it easier to market their rentals through word-of-mouth i.e. telling friends, colleagues, neighbours, and current tenants. After all, people already living on your property will invite decent neighbours. So, when a property becomes vacant, simply send a note around to every one, asking them to tell friends or relatives about the available apartment.

7. Real Estate Offices

Many real estate offices handle rentals, but of course, there is a fee involved.

8. Property Management Firms

Going through a property management firm is the easiest way to do it. They handle advertising, showing tenants around, as well as, selecting tenants, collecting rents, and interacting with residents during tenancies (handling repairs, etc. etc.). A paid service, it is for landlords with large rental properties and no time to spare.

Next Steps

Once, the advertising has been done, the next step is to create a rental application and select a tenant. When advertising vacancies and selecting and rejecting applicants, read up on the Fair Housing Act, so as to avoid any inadvertent lawsuits. Evaluate prospective tenants by thoroughly checking out their rental applications, legal residency forms, and tenant consent forms for contacting references, performing credit checks and criminal and background checks.