Good Time to Invest in Rental Property

If you have been considering investing in a rental property, now would be the time to act. Low home prices in San Diego, combined with low interest rates from local lenders, makes this the perfect time to become a real estate investor. For first time investors it is important to consider your options and develop a strategy for your future. Consider whether you want to become a landlord, flipper, or developer. From there you will have a better idea of what you are looking to make your investment. In the current real estate market the most sensible option for first time investors may be residential homes, because commercial and development real estate are still facing challenging times.

Once you have weighed the options you need to find an agent. It is important to look for a real estate agent that is experienced in investment properties in San Diego County. While searching for your investment, different features will be important to you compared to the typical buyer. You will be looking for something that can provide you value and return on your investment as opposed to certain other amenities buyers look for. In San Diego County, rental rates have been increasing modestly over the past six months and vacancy has decreased, making it a good time to buy a rental property. Recently Premiere Homes found a condo for client A at $112,000 near the San Diego State University campus. After putting about $8,000 into the property for repairs and updating it is now rented for $1450 per month.

Another option is to form a partnership with an experienced real estate investor. During these difficult economic times they may be willing to assist you with their experience and knowledge in exchange for your added capital. Even if you decide not to collaborate with another investor, find out what you are getting yourself into. Talk to the experienced investors to find out what you can expect to encounter on your new venture.

When the search for promising properties begins take into account what a renter will want in a property. For most, location is a key element in how much they will be willing to pay monthly. High rent, highly populated areas are ideal. Pick homes in close proximity to malls, grocery stores, schools, and neighborhoods with low crime rates. It is important to plan for the unexpected and have capital saved up. As a landlord you will be responsible for repairs and must be prepared to pay the mortgage during vacancy periods if any. You may want to see a financial advisor to make sure you have enough assets to cover the ups and downs that come with real estate investments. Being prepared will better ensure your success.

      Nick Alameddin

     Broker

    C 760.802.4166

    F 858.455.0100

http://www.PremiereSD.com

    DRE License #01426515

If you know anyone looking to sell or buy a home, please e-mail me their name & phone number. I will gladly get them a great deal and provide them bar none service. 

Posted via email from Nick Alameddin's

Median Home Prices Continue to Increase

As reported on Monday by MDA Data Quick, San Diego County’s median home price has increase from 6.9% a year ago to 15.8% this March. Of the six Southern California Counties, San Diego had the most significant increase, followed by Ventura County at 15%. Economist say these numbers can be considered indicators that housing plunge is mostly over, but because of rising interests rates and slow job growth, the general upturn is not likely soon. When the figures are examined more closely it becomes evident that the increase reflects a change in the types of properties being sold. Sales were up for the 21^st consecutive month, as transactions involving higher-priced properties broadened the market beyond low-cost starter homes.

Over all, the Southern California area experienced a 14% increase from last March to a median of $285,000, further evidence of the region’s real estate market stabilizing. Some economists attribute the rapid increase to the federal government stimulus policies and tax credits, which seem to have been successful. The problem is the policies are coming to an end, and when they do, there is a fear of another plunge in the market. Even if the economy improves, housing will not necessarily improve with it. While individual property values are not changing, there is a general feeling that since there is no longer deterioration in home prices, things are looking up.

Sales across the region totaled 20,476 up 5% from last year, but still below the 23 year average of 24,936. With 3,227 of those regional sales from San Diego and 6,747 from Los Angeles, it is obvious that demand for housing is not rising consistently throughout the region. Although, San Diego’s median home prices are rising at a more rapid rate than Los Angeles, and there is more of a trend of high priced homes being sold in San Diego. According to John Walsh, President of DataQuick, more sales activity will not take place until lending patterns normalize.

While median home prices and sales have seen improvement in the Southern California Region, and more specifically San Diego, homeowners and buyers are beginning to become more optimistic about the future of the housing market. However, economists warn to not let the current trend fool you into believing your individual home has increased in value. Despite the fact that indicators seem to show stabilization in the real estate market, after two years of sales increase we are still below the sales average, which is a reflection of just how bad things were. After such a deep plunge, full recovery is far from near. 

Thinking of selling? Call me today.

      Nick Alameddin

     Broker

    C 760.802.4166

    F 858.455.0100

http://www.PremiereSD.com

    DRE License #01426515

If you know anyone looking to sell or buy a home, please e-mail me their name & phone number. I will gladly get them a great deal and provide them bar none service. 

Posted via email from Nick Alameddin's

Rental Tax Measure for Del Mar Homeowners

Del Mar is a popular vacation destination for visitors attracted by the beautiful beaches and Fairgrounds. With the summer season approaching the City Council is bringing a new measure to the ballot that will surely affect these vacationers.

The Del Mar City Council voted unanimously to put the rental tax measure before voters on the June ballot. The new tax would require hundreds of Del Mar homeowners to obtain a permit from the city for short term rentals of their vacation homes. Currently the transient-occupancy tax applies to stays of 30days or less at hotels, lodging houses, apartments, and condominiums, but doesn’t include houses or duplexes. Nearby cities like San Diego and Encinitas have already extended the city’s hotel tax of 11.5% onto vacation rentals and duplexes, paving the way for the city of Del Mar. The measure would raise about $175,000 a year to help pay for beach and park maintenance, fire safety and law enforcement.

The San Diego Taxpayers Association opposes the rental tax, and has raised concerns that it will burden homeowners that already pay property taxes, as well as issuing a loss of property rights. Supporters of the rental tax measure respond by pointing out that the tax will not be applied to the homeowner, but will be include in the cost for the vacationer. This way there is no double taxation for the homeowner, only the responsibility to retrieve the permit from the city. Besides causing a bureaucratic inconvenience for homeowners, other opponents to the tax add that it is a bad time to raise taxes while most are struggling. Some do not see the need to purpose the tax now, since the city of Del Mar is not in a deficit with its revenues exceed costs over the past few years. Del Mar Mayor, Richard Earnest counters this in saying that the tax is a strategy to avoid future deficit instead of reacting to a crisis.

Given that all visitors and current residents benefit from the maintenance of the beaches and parks, and fire safety and law enforcement, it is only fair that the people renting vacation homes pay the same tax as those who stay in hotels. This summer is bound to be a busy time in tourism in Del Mar, and whether or not the tax is approved and implemented will be up to the voters this June. 

If you are thinking about selling or buying a home, please call Nick at 760-802-4166

Or you can e-mail me at Nick@mypfgroup.com

 

      Nick Alameddin

     Broker

    C 760.802.4166

    F 858.455.0100

http://www.PremiereSD.com

    DRE License #01426515

Posted via email from Nick Alameddin's

Homebuyer Tips to Get the Tax Credit

Time is running out to get the tax credit put in place by the government to encourage homebuyers to act fast. If you are serious about buying a home in San Diego, you need to be proactive in order to meet the deadline. The tax credit is worth 10% of the home’s sale price, up to $8,000 for buyers who have not owned a home in the past three years. Up to $6,500 for buyers who have owned and occupied a principal residence for at least five consecutive years during the eight year period that ends on the day the new home is purchased. With the current time constraint on homebuyers, there are a few guidelines to keep in mind to move the process along, and ensure the benefits of the tax credit on your purchase.

The buyer must enter into a binding contract to purchase the home on or before April 30^th of 2010. Since the term “binding contract” is not specified in the tax credit law, it may be open to interpretation. Therefore, there may be some flexibility as to whether the buyer qualifies depending on the terms of a signed agreement between both parties. The deposit check must also be in escrow.

Also, the purchase must close within 60 days after the binding contract deadline, so by June 30^th. Certain U.S. military, foreign service and intelligence service personnel are entitled to an extra year to receive the tax credit. This gives until April 30^th, 2011 and close by June 30^th, 2011.

It is important to be clear with your Realtor what your “must haves” are on the home you are looking for. There is no time to be wasted, and you want the best pick of houses and options to choose from when the time comes. Some buyers have expressed concern about the length of the current housing market process. Circumstances such as the sale of the buyer’s current home, inspections, and financing can be covered with contract contingencies to allow for more time to tie loose ends, but should not be the reason for delay once the deal is pending. The homebuyer may want to include a contingency in the contract to ensure it will close before the deadline, and you still qualify for the tax credit.

Lastly, don’t leave anything until the last minute. Something unexpected may arise, and you want to have cushion room in that case. Make sure the homebuyer is pre-approved for a mortgage, have homeowner insurance lined up, and allow extra time incase there needs to be a second appraisal. Keep in mind that short sales often take longer because they require lender approval, and if you don’t have an answer by a certain date, you may want to look at another home.

Disclaimer: We are not experts on the homebuyer’s tax credit and recommend you consult a tax professional before beginning the process. This is strictly my opinion and not professional advice.

      Nick Alameddin

     Broker

    C 760.802.4166

    F 858.455.0100

http://www.PremiereSD.com

    DRE License #01426515

If you know anyone looking to sell or buy a home, please e-mail me their name & phone number. I will gladly get them a great deal and provide them bar none service. 

Posted via email from Nick Alameddin's

San Diego and LA Counties Only Areas to Show Price Increase

According to the Standard & Poor’s report that was released on Tuesday, San Diego and LA Counties were the only two of all the metropolitan cities to have price increase on their homes over the past year. The Standard & Poor’s Case-Shiller Home Price Indices tracks residential real estate costs in 20 major housing markets, including San Diego and Los Angeles, at a baseline of 100 set in January 2000, and without listing an actual average housing price.

 

The national figures covering the 20 major metropolitan areas were a monthly drop of 0.4%, a yearly decline of 0.7% and a 10 year appreciation of 45%.The monthly increase in San Diego was 0.4%, and from January 2009 to January 2010 the prices jumped 5.9%. San Diego’s pricing index of 156.95 is a reflection of the appreciation in value of nearly 57% in the past 10 years. In Los Angeles the monthly jump was 0.9%, and the annual increase was 3.9%. The Los Angeles pricing index is currently at 172.92, showing an appreciation of 73% over the past 10 years.

While things are looking up for San Diego and LA Counties, there is still concern for the housing market. From year to year homes continue to appreciate in value for all 20 major metropolitan cities, but the rebound in housing prices is not happening as quickly as one may hope. The number in home sales shows that the real estate market is still difficult, and there continues to be worry about the amount of current foreclosures as well as possibility of future ones.

      Nick Alameddin

     Broker

    C 760.802.4166

    F 858.455.0100

http://www.PremiereSD.com

    DRE License #01426515

If you know anyone looking to sell or buy a home, please e-mail me their name & phone number. I will gladly get them a great deal and provide them bar none service. 

 

Posted via email from Nick Alameddin's