Ever wonder how much your house is worth, but is overwhelmed by the process? Don’t worry, you’re not alone.

I’ve gotten the exact question so many times, that I’ve decided to answer the question as thoroughly and completely as possible.

The easiest way to figure out the value is to check the “comps” — or comparable properties that have sold recently. That is- how much have similar (comparable) homes sold for recently?

One great resource is Zillow.Com- it’s a great site to check what homes have sold recently, and Zillow.Com will even give you their own “guess” as to what the property is worth, even show you an aerial picture.

But be careful- DON’T TRUST ZILLOW’S VALUE! Just use them to tell you what other homes have sold for recently. If there are plenty of sales, all within a particular price range, then apply this little formula:

Comps Formula

1. Houses that have sold within 1 year
2. Houses that are within 20% of the same square footage

Now simply average the remaining sales, and voila- you have your comparable value! Now, without actually seeing the “comparable” houses, you don’t know if it’s actually comparable- you’ll have to go look to be absolutely sure, but this is a simple “guideline” price.

If you have a property where the comps vary in value by a LOT, you have to do one additional step. Here’s the breakdown of how to determine the value of a property with values all over the map (like the one you’re dealing with).

First, get a list of recent sales within 1 mile of the subject property. Here’s one I pulled from zillow for a student’s property. It might be a little over a mile, I had to guess from looking at a map):

The result:

XXX Leeward Ln 3 2.0 1,386, 1969 SF 09/01/1992
968 Leeward Ln $32,752, 3 2.0 1,386 — 1981 SF 10/05/2006
9393 Windy Ct $110,700, 3 2.0 1,922 — 1976 SF 12/28/2006
9396 Ridgewood Ter $120,000, 3 2.0 1,640 — 1986 SF 09/21/2006
767 Four Winds Ln $114,600, 3 2.0 750 — 2000 SF 01/12/2007
9429 Citrus Ct $102,000, 3 2.0 1,515 — 1985 SF 01/30/2007
9479 Bywood Ct $86,000, 3 2.0 1,484 — 1986 SF 12/14/2006

Ok, so now, you have to eliminate anything more than 20% bigger or smaller than the subject property. That means, for this 1386sf example, 1,108 – 1,663 square feet are the comps.

So that leaves:

The result:

XXX Leeward Ln 3 2.0 1,386 — 1969 SF 09/01/1992
968 Leeward Ln $32,752, 3 2.0 1,386 — 1981 SF 10/05/2006
9396 Ridgewood Ter $120,000, 3 2.0 1,640 — 1986 SF 09/21/2006
9429 Citrus Ct $102,000, 3 2.0 1,515 — 1985 SF 01/30/2007
9479 Bywood Ct $86,000, 3 2.0 1,484 — 1986 SF 12/14/2006
9530 Autumn Ct $105,900, 3 2.0 1,536 — 1986 SF 02/05/2007
9274 Brown Rd $235,975, 3 1.0 1,414 766,656 1953 SF 02/21/2007

From 21 properties, now we’re down to eleven. Now, take the highest and the lowest sales price, and eliminate them. That means the $32,752 sale and the $235,975 sale are gone, so we’re left with:

The result:

XXX Leeward Ln 3 2.0 1,386 — 1969 SF 09/01/1992
9396 Ridgewood Ter $120,000, 3 2.0 1,640 — 1986 SF 09/21/2006
9429 Citrus Ct $102,000, 3 2.0 1,515 — 1985 SF 01/30/2007
9479 Bywood Ct $86,000, 3 2.0 1,484 — 1986 SF 12/14/2006
9530 Autumn Ct $105,900, 3 2.0 1,536 — 1986 SF 02/05/2007
9583 Briar Creek Ln $132,000, 3 2.0 1,408 — 1983 SF 01/26/2007
9581 Washington Cir $161,600, 4 2.5 1,140 — 1999 SF 02/05/2007

Now, two things need to happen. First, average all of these, and you’ll have a pretty good estimate of value. In fact, this is just about how an appraiser would start.

Average Sales Price: $126,500

Second thing that needs to happen now, is you would need to go look at the so-called comps, and see if they are actually comparable. That’s what an appraiser would do.

Now, for purposes of knowing whether or not to follow up on a deal, you don’t have to do that. Just run the comps, + or – 20%, knock off the highest and the lowest, and average them.

But, once you decide to do a particular deal, AFTER you sign up the deal with the seller, while you’re still in the neighborhood, go look at those addresses and decide which are true comps.

So, let’s imagine that Sedgwick Dr, Castlebrook Dr and Washington Cir are NOT comparable because they are much newer, built in the last 8 years instead of 1969 like the subject property.

Then the average value of the older homes, once those three are removed, would be:

The result:

XXX Leeward Ln 3 2.0 1,386 — 1969 SF 09/01/1992
9396 Ridgewood Ter $120,000, 3 2.0 1,640 — 1986 SF 09/21/2006
9429 Citrus Ct $102,000, 3 2.0 1,515 — 1985 SF 01/30/2007
9479 Bywood Ct $86,000, 3 2.0 1,484 — 1986 SF 12/14/2006
9530 Autumn Ct $105,900, 3 2.0 1,536 — 1986 SF 02/05/2007
9583 Briar Creek Ln $132,000, 3 2.0 1,408 — 1983 SF 01/26/2007
823 Four Winds Ln $120,000, 3 2.0 1,594 — 1984 SF 01/03/2007

Average Value (Eliminating Newer Homes): $110,983

Of course, that last example is a hypothetical, you won’t know until you go and look, but you can do just the true “comps search” FIRST, just to see if there’s any reason to even get involved.

Jason Loucks, following conventional wisdom, built up a significant portfolio of rental properties, and very quickly mastered the art and science of retailing properties for Cash NOW through his 7 Day Sale Guy system.

-http://www.7daysaleguy.com

Investment property comes in all shapes and sizes, but what happens when it comes within an HOA community? HOA communities are neighborhoods regulated by a Home Owners Association. The organization is run by members of the community who enforce the neighborhoods rules.

The nice thing about HOAs is they serve as a watchdog for the community and thus your property. They make sure lawns are mowed and trash cans aren’t left on the curb. But with the pros come the cons, such as laws that may be more restrictive then you as an investor care to worry about. Here is a quick breakdown of some reasons why HOAs are nice to be involved with.

Pros
1)HOAs provide an additional way to monitor your investment property.
2)Neighbors to your investment property are also monitored. You won’t have to worry about cars on blocks and trash piles popping up around the neighborhood thus driving down the equity of your investment.
3)The majority of HOAs have regulations regarding home elevations and changing them. This makes it harder for other homeowners in the community to change the exterior of their house to a distasteful color.
4)Some HOA communities come with amenities such as pools, ponds, walking paths, parks, club houses, fitness centers, and other attractions.
5)HOAs can foster a sense of community which you can use to your advantage when finding that perfect tenant to fill your investment property.

Of course, HOAs are like a double-edged sword. They come with rules for both your tenant and the neighbors to follow. When you have an investment property in an HOA community, you have to worry about your tenant complying with these rules.

Cons
1)Large recreational items, like portable basketball hoops, can’t be left out at night.
2)Trash cans are required to be put up in a timely manner after trash pickup for the week.
3)Landscaping and lawn care needs maintained per HOA guidelines.
4)HOAs have been known for developing rules that make the city’s laws look meek in comparison.
5)Some HOA restrict the amount and type of animals community members can own. This could limit your potential renter list.
6)HOAs can regulate the amount of investment property within a community and even make it near impossible for you to lease a home.

Because HOA rules differ based on the community, it is hard to determine if investing within a regulated neighborhood is right for you. If you are thinking about investing in a piece of real estate, find out if it is part of an HOA. If it is, inquire about the HOAs rules. Are they investor friendly? What are the rules? How often are they enforced? What happens if your tenant breaks the rules?

Omar Johnson is a successful Real Estate Investor and author of the home study course The Real Estate Investor’s Guide To Finding The Motivated Seller for more info http://www.findingthemotivatedsellers.com

There are numerous ways to invest in real estate. A common investing trend is landlording. Landlords are investors who purchase real estate and instead of selling it for a profit, retain the property and lease it to a tenant.

Landlording for profit makes economic sense. To begin, there will always be a high demand for homes and land. As supply and demand goes, it is reasonable to venture that a landlord could make a lot of money off individuals who, for whatever reason, don’t have a place of their own to call home. Even better, renting is a growing trend. As that trend grows, so does the potential of successfully leasing a home.

When done correctly, leasing property can pay big dividends for the investor. The lessee essentially pays for the property while the landlord retains the equity. Landlords who charge more then the property’s mortgage can either gain a profit off the excess rent or put it on the mortgage for a faster payoff. Eventually the investment will be paid off and can serve as a residual income for years to come.

As an added bonus, landlords qualify for some big tax advantages. Investors who rent their property can receive liberal tax breaks. Landlords can deduct real estate taxes and mortgage interest on their rental properties. Investors can also write off their operating expenses such as yard care, maintenance, utilities, HOA fees and insurance. Finally, residential buildings can be depreciated during a 27.5 year span, even if the property increases in value.

There are some downfalls to being a landlord. If you decide to manage your investment properties on your own, it can be very time consuming and stressful. When renters have issues with the home or property, they come to the landlord for assistance. When something breaks, the landlord is usually responsible for fixing it. For a fee, the would-be landlord can pay a management company to oversee the proprietor duties and handle troubles when they occur. Along those same lines, landlords sometimes face tough situations when their tenants don’t pay on time. This can put the investor in a bad cash flow position.

Landlords are also responsible for their tenant’s safety. There are laws regulating these responsibilities and it is important for the investor to know and understand them.

Because rental real estate usually has a mortgage attached to it, the property can tie up the investor’s personal wealth. Investment property of this nature pays off more so in the long run, after it has been paid for and continues to generate a monthly payment. Depending on the investor, landlording may not be an ideal way to pursue capital gain.

Whether or not becoming a property-owner is right for you as an investor depends on your goals. In the long run, landlording can pay off. Like all things in life, however, there are pros and cons to being a landlord. It may be that you don’t want to bother with rental properties. Either way, it is definitely something to consider.

Omar Johnson is a successful Real Estate Investor and author of the home study course The Real Estate Investor’s Guide To Finding The Motivated Seller for more info http://www.findingthemotivatedsellers.com

When you are in the commercial real estate market, particularly in apartment investing, one way to reduce your financial risk is by investing in duplexes. You will cut your risk by half with duplexes and cut it by even more with quadplexes. This is because the more units you have under one roof the easier it is to absorb tenant turnover. It is generally rare to have all the apartment units empty at the same time, unless the building is being remodeled and the vacancies are planned. With these properties there is generally enough tenants that if one unit is empty, it’s not going to affect the profit from the investment. Nor will there come a time when you will need to place any of your income into this property, as there will always be enough tenant-generated income. Apartment
building investing is considered a wise investment because as long as there are tenants, enough income is coming in to pay the loan and cover the taxes and other money needed to maintain the property.

When a commercial real estate property is bought properly, other people pay your loan amount. The tenants pay your mortgage and expenses, and most importantly, they pay you. Because this is true, the more units you have under one roof, such as the number of tenants in a duplex or quadplex, the more your initial investment will pay off.

Another advantage of investing in commercial real estate is forced appreciation. This concept can be so profitable it can be compared to legally printing your own money. To take advantage of this, look for apartment buildings with some fixable structural or cosmetic problems and fix them. These properties may be ones that other commercial real estate investors are passing up rather than fix the existing problems. If it just needs simple updates to make it more profitable, it may be an excellent investment opportunity. Any commercial real estate property once repaired, modernized or even just painted, will instantly be worth more. In some cases, this may entail something as simple as creating new parking spaces for the tenants or laying new carpet. There is an initial cost with any improvements you make, but it can be regained quickly by either renting at a higher price or reselling the property. Apartment building investing is not just about owning the property for yourself and making the money back through rent. Apartment investing is often about buying a property as inexpensively a possible, making necessary repairs and then selling it for a tidy profit.

David Jackson is a real estate investor and author who has found a niche in apartment
investing. Find out how you can buy apartments while being broke and with no money of your own. You can also register for his newsletter claim a free CD here.

How much auto coverage to buy is the most common question most car owners ask when it comes to buying an insurance policy. The simple answer to this question is buying as much as you can afford and as much as your car really requires. But of course, the amounts will differ significantly between those who have brand new mid class cars, and those who drive old vehicles or buy their first insurance policy.

Drivers who have older vehicles or low cost cars are very likely to overpay for their insurance coverage. That is because most policies carry average amounts of comprehensive coverage, which are suitable for new mid range cars and are linked to the purchase value of the car. But as time go by and the value of your car decreases the amount of comprehensive coverage tends to be higher the actual amount you need. The same applies for low cost vehicles, which initially have a lower value than the average car.

Regardless of your legal or financial situation you are legally required to carry minimum amount of coverage with your policy as indicated by your local state regulations. The minimum amounts differ from one state to another, but in general they represent the minimum amount of money that would be required to pay for the damage or injury you have delivered to a third party while driving your vehicle.

However, most insurance experts advocate that you buy more than your state requires in order to assure you with enough coverage for a serious accident. The best way to learn the approximate coverage amount you would want to have with your policy is to analyze your local medical and repair costs. This will give you a good idea of how much coverage to include.

If your car costs a lot or you have financed it through a loan, you might want to purchase additional comprehensive and collision coverage in order to pay for things like theft, storm, fire, natural calamities and other circumstances. In most cases your lender will require you to buy additional types and amounts of coverage, so read your loan contract carefully before looking for cheap car insurance.

In case you live in a place where autos are frequently stolen or vandalized, having comprehensive auto coverage is a must. Of course, you will get higher car insurance quotes living in such a place, but the cost will still be lower than the damage you will have to deal with if your car gets vandalized and you don’t have the insurance to cover it.

Regardless the fact that auto coverage is legally required to operate a vehicle, there are a lot of drivers out there who don’t have any coverage at all. Having an accident with such a driver means that your injuries and damage won’t be covered as there is no policy paying for the other party’s liability. That is where uninsured/underinsured motorist coverage turns out to be really helpful. If you have some additional money to spend, make sure you have this type of coverage as it will be really useful when having an accident with such an irresponsible driver.

If your aim is cheap car insurance but you still want to have reasonable coverage amounts, raise your deductibles and you will get very good rates. Just make sure you always have the amount of money you specify as a deductible as you will need it to pay for the costs before the policy kicks in.