Real Estate Investment Tips

You can now use the income on an auxiliary dwelling unit to qualify to purchase or rate and term refinance your home. Well, that is a game-changer, especially for people who have an investor's mindset. How can I optimize the home I'm living in? Can I look at buying a two-unit, a three or four-unit, a single-family, a rentable basement? Well, those auxiliary dwelling units, those separate buildings in the backyard. They were not a legal unit. Now they do have to be permitted right and zoned properly. But those auxiliary dwelling units were just that they were an auxiliary dwelling unit, whether they were apartments above a garage or self-standing buildings in the backyard, but they weren't a legal unit. It's not like it was a duplex. It's a single-family home with an ADU. That ADU income had not been able to be used when qualifying for a purchase price or a loan amount.   Well, that just changed. That literally is a game-changer. Now I can afford more say I'm a first-time home buyer and I'm maxed out at $600,000 purchase price. If there's an ADU in the backyard and the market rents on that are $1,500. Now I'm not maxed out at $600,000 anymore. Now I can qualify for a $711,000 purchase price by putting 10% down. Those kinds of numbers need to be explored, especially given today's market with rising and rising home prices where people know you need to get in. You need to stop paying rent and start building your own equity. And that auxiliary dwelling unit will do two things for you. Now it'll help you qualify for more and put money in your pocket so that you can save for the next one. If you want to know more information, know exactly how much you can qualify for, please call me - 303-214-6393.

With the Denver market up 123%, since its peak in 2006, we have amazing wealth in equity. How do you tap into that wealth of equity, where you can give a gift of equity to your children, or to other family members? We can transfer wealth through real estate using gifts of equity. So what does that mean? And maybe what are some of the limitations with that?  Let's say I want to sell a home for market value. That home is $800,000 and I own that home and maybe I own that home outright, and I want to give it to my kid. I want to give them a head start and I want some money out of that home, but I don't need all $800,000 and I want to give them a head start. Maybe it's a grandchild or a niece or a nephew, and you want to give them the opportunity, maybe an opportunity you never had. You can do that with real estate. You can give them that gift of equity. If the market value of that home is $800,000. I can sell it to them for $800,000, but then give them a gift of equity of whatever you want. 5%, 10%, 20%, a dollar amount, maybe it's $200,000. That means as a receiver, maybe as, as your kid or as your niece or nephew or grandchild, I can get a loan for the $600,000 and not bring any money to the table. Maybe I'm just starting out with my career. I don't have a lot of money saved, but I have a good job. I can qualify for the $600,000. You just gave me such a blessing and such a head start, but I need to know there are some limitations, depending on the loan program I use first off, it has to be a family member. FHA does allow gifts that are either from a close friend or an employer, even, but in this case, a gift of equity, not just a gift of a check, needs to come from a family member. FHA also has another hook. If you have a credit score under 600, you cannot receive a gift of equity as your down payment. You have to still bring your down payment. So that's something that needs to be considered, and certainly may be a reason to get into our free credit optimization program. So let's talk about VA because VA has a benefit that if I can put a little money down. You get a reduced funding fee. Now, if you have any disability, you have no funding fee. So that becomes irrelevant. But if you're not disabled, you have a funding fee. And if you put 5% down or more, that funding fee is reduced. A gift of equity does not go towards that. You will still pay whatever the full funding fee is for your situation. Conventional, conventional has a situation where the borrower typically needs to bring their own minimum funds. A lot of times that's 5% or even 3% for first-time home buyers. The gift of equity needs to be a minimum of 20% down in order for the buyer not to bring any of their own money. FHA and VA don't require that the gift can be just the minimum down, but in the case of conventional, the buyer still has to bring, say 5% down. If the giver of the gift is only giving 10%, but if the gift is more than 20% of the purchase price, the buyer can bring no money of their own. So there are some fantastic opportunities in today's real estate market to continue generational wealth. If you want to know more about gifts of equity, I would love to sit down and talk through a program and a solution with you. We'd love to go to work for you

It's one thing for an expert to tell you what you should do when investing in a home, refinancing, and selling. But when you have an opportunity to hear a real start to finish story from a home buyer to held out for the full must-have list and then successfully purchased a home in the Denver market, you will be riveted. Kara Palffy is Nicole's guest. She's the Business Development Manager at The Rueth Team. Buying her second home, selling the first, and all of the hours required make for the best kind of story. Nicole asks Kara about what she had to do to prep her home, how much they actually got over asking, why they decided to NOT add to their real estate empire and sell their first house instead, and how their goal of staying in this home for many years affected several decisions.

Buy NOW to have options later. Real estate is still the number one hedge against inflation and the potential to build long-term wealth is still there! Although the real estate market is tough right now, you have to get in in order to build long-term wealth, earn appreciation, use the equity you've built for a renovation or a move up and you can always refinance once things calm down.  Your long-term goals can be achieved through owning a home and we want to help you get there. As always, don't hesitate to reach out if you're ready to start or complete your homebuying journey.

This story of using real estate to fund a dream makes me smile each time I think about it. I'm joined by my friend Olivia Kuynevicius, an agent with MilehiModern. It demonstrates the power of real estate and the opportunities owning a home creates. On this episode of Financing The American Dream, I and my dear friend Olivia spotlighted her client Cynthia, who just opened a coffee shop in Denver, Colorado... using the Equity in her Homes! Owning real estate quite literally opens so many doors toward financial well-being, you just have to see it for yourself! Join us for this episode spotlighting Cynthia Diaz, Owner, Tonantzin Casa de Café in Denver.

Chris Gordon loves what he does. He especially loves it when he has no juicy stories to bring home other than, "I worked with a bunch of nice people today that wanted to get their ducks in a row, so we set that up." He wishes younger people would set up their estates to have peace of mind, not just for themselves, but for those who will either care for them in the situation of an illness or accident, or those they leave behind. He has some great tips to add some humor to what can be an uncomfortable part of growing up. Even couples married for decades put this off and then there is no easy way to make transfers and act on behalf of the loved on or children if these pieces aren't in place. You'll gain a lot of comfort and information from this episode of The Double Comma Club. Learn more about the services Chris Gordon offers at Stewart + Gordon.

The table below is taken from Tracey Wilson's presentation at the Agent Ignite session. These are derived from his research. If you have questions, please visit his website. This is the BIG RED button he talks about in this presentation. Here is the PowerPoint from this presentation. Here are a few points covered: 1)American Rescue Plan: $1.9 trillion for COVID Stimulus Package Passed even though $800 billion of the previously passed $2.2 trillion CARES Act (passed 3/20/20) had not been spent yet 2)American Jobs Plan: $2.3 trillion for infrastructure Raise the corporate tax rate to 28% Increase the global minimum tax paid to 15% Impose a corporate minimum tax on book income Eliminate tax benefits for the oil and gas fossil fuels sector Increase corporate tax enforcement 3)American Family Plan: $1.8 trillion for universal pre-K, free community college, SLD $50K forgiveness, paid family leave Raise individual income taxes Raise cap gains tax rate Increase estate tax Limit step-up in basis

Real estate investments are my favorite topic to talk about, but also my favorite type of loan to help a client with why because in an area where loan officer gets to be creative, often purchasing investment isn't cut and dry. It requires strategy and planning. If you've ever joined me from my building investment empire class in the second Thursday of each month.  And you know, I advocate purchasing a home as a primary, living in it for a year and then doing it all over again. Why? Because when you purchase a home as a primary, you can put as little as 3 to 5% down and that frees up cash when you compare it to purchasing it as investment property, which requires 15 to 25% down. 

How do you start in your 20's investing in real estate? You start with the first one. It's the toughest. Let's think of money in terms of buckets.Your checking account feeds short term expenses Long term savings outside investments retirement Consider setting up automatic transfers. 1 month of expenses, then the remainder rainy day fund, build this account up first.50% monthly needs housing food - your short-term expenses for living and entertainment.30% rainy day20% retirement investment bucket. To invest in real estate, consider saving $125/month. By the time you graduate college, you can afford to buy a home.People who invest in real estate are 48x's wealthier than those who rent.

  This episode lumps together 4 episodes from the Real Estate Investing playlist on our YouTube channel. Catch these first four short episodes to get started, first with the logic and then to show how even with a modest income you can still build your retirement through real estate. This 17-minute episode includes: Good Buy, or Goodbye? Creative Investing Long Term Investments - Fact vs. Fiction Turning Rental Income into Retirement Income. Be sure to catch part two publishing next week.