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Real estate investing is a field in which millionaires are made and lost on an almost daily basis. Most of the wealthiest investors in the world will agree that real estate is by far one of the most profitable fields in which you could invest. It also carries some of the biggest risks when it comes to investing at the same time. Real estate investments are large investments for the most part so when you loose on an investment such as this the losses tend to be much greater than when you loose in other investment avenues.

When it comes to flipping houses there are several risks that you should consider before diving in headfirst. While most of the risks are not something you can anticipate or plan for they are risks that you should be aware of and carefully consider before investing in a risky venture such as a property flip.

1) Fickle market. The real estate market is a fickle business. There are countless things that can greatly impact the likelihood that your investment will sell quickly or sit on the market for months on end and most of them are beyond your control Tornadoes strike nearby, crime happens nearby, a big company goes out of business, or a new company moves into the neighborhood. For better or worse all of these things have a profound impact on the real estate values nearby.
2) Neighborhood knowledge. It is very important that you take the time to get to know the neighborhood before you invest in a house you are planning to flip. You want to make sure that your vision for the home fits with the reality of the neighborhood and that the average income of the people in the neighborhood will be able to purchase the home you are creating.
3) Bursting bubbles. I’m sure you’ve heard all kinds of talk about the real estate bubble and how it seams to be bursting. While I’m not sure I put much stock in that I do know that heavy taxes in an area, new taxes in an area, and the encroachment of crime in an area can give you a sudden stream of competition for low prices while also making it more difficult in general for the property to sell.
4) Underestimating your own limitations. This is a big deal when it comes to risks in the business of flipping houses. You need to have realistic expectations before getting in of the time frame for completion, budget, and what you can do yourself and what you will need to hire professionals to handle. If you don’t you can seriously impair your budget and the impact of the work you do as a whole.
5) Underestimating prices. This is another big deal because you need to have realistic expectations when it comes to the price of supplies, tools, labor, and equipment that will be required in order to complete your house flip. Failing to have a reasonable grasp of current prices can have a devastating impact on your budget and how much you can actually accomplish during the course of your house flip.
6) Great profits. While some do not necessarily consider this a risk, excessive profits do work to impair your ability to pull out your wallet at the bank or anywhere else along the way. While we could be all so lucky as to call that a risk it is a very possible outcome of your house flipping attempt as long as you spend at least as much time in planning your flip as you do in executing it.

You should understand that there is no such thing as a no risk flip or a no risk real estate investment. You cannot eliminate the risk all together for the types of rewards that stand to be made through real estate investing and flipping houses. Tread softly, plan wisely, and work diligently in order to make your financial dreams a reality through real estate investing.

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About Morocco

Call it Tangier, Marrakesh or Casablanca but for all the people who love long and idyllic beaches under the sun, there is no place like morocco to suit their needs. The charm of living or holidaying in morocco is in its multiplicity as its offers attractions for every type of visitor. For people who love to bathe in the sun, there are miles of beaches; while inland lies Berber country where, among the snow-capped Atlas Mountains, the energetic can walk or trek and for the more adventurous there’s Sahara desert. It is only recently that investors are putting all of these factors together to come up with an ideal investment option in Morocco property.

Due to its proximity from Western Europe, Morocco of late has become the ideal African starting point for the traveller. Throughout morocco one can open-air markets selling rugs, woodwork, jewellery and leather – said to be the softest in the world.

After gaining independence from France in 1956, the Morocco of today is an exquisite amalgamation of the exotic magic of the Islamic, Arabic, African world – the world of medinas and minarets, desert and mountain; yet it almost touches Western Europe and, for all the differences, retains a European gloss, the legacy of the French Protectorate.

Morocco is located at the westernmost tip of North Africa, bordering Algeria to the east and Mauritania to the south and southeast, the Atlantic Ocean to the west and the Mediterranean to the north. Running through the middle of the country is the Atlas mountain range, which leads to the fertile plains and sandy beaches of the Atlantic coast.

With the opening of tourism and Moroccan governments’ initiative into tourism and infrastructure building many outsiders are finding it a wealthy proposition to own a piece of the booming market.

The Property Market in Morocco

The last few years have seen a dramatic increase in the numbers of overseas investors buying apartments, homes, villas – amongst the other properties in morocco. Morocco with its combination of great weather, exotic location, and good food, Morocco property is becoming the most sought-after location for better-off overseas as well as not so well of overseas investors. Which place in the world can provide you the opportunity to rub shoulders with Fashion designers Yves Saint Laurent and Jean Paul Gaultier both have Morocco property and keep houses in Marrakesh and prices reflect strong European interest. Small, traditional houses start at just £40,000, although there will be substantial restoration costs to pay.

If you are considering buying a property in Morocco for investment, now is the time to make your move. Moroccan interest rates are low and property prices are rising steadily.

Compared to Spain in Morocco properties are available at approximately one third of the price for comparable property located in Spain. The major cities of Morocco have recorded capital growth of over 30% in the last 3 years.

The cities in Morocco which has been witnessing higher capital growths are Casablanca, Fes, Marrakech and Tangier. The Areas along the Mediterranean coast are expected to be the next booming areas in morocco – current prices are very low.

In addition, King Mohammed 6th has liberalised the political and tax system – rental income is now exempt from tax for 5 years and no capital gains are paid if the property is sold after 10 years

For buying property in Morocco, built in mortgages are available for investors and they can borrow upto 70% of the value of the Moroccan property for upto 15 years from a Moroccan bank. The interest rate as of Feb 06 was 5.5%.

The Moroccan property market can effectively be divided into three sectors namely “riad” built around a central garden with a fountain, and a “dar” a similar house without the central garden. Both are found in the oldest part of the city, medina. The third sector is the new properties being build.

Why Invest in Morocco

With its unique location and being very near to Western Europe and its all the year round weather, it’s uniquely suited to investors needs. The reasons for investing in Morocco is not just confined to its location or weather but there many more things which makes investing in a Moroccan property a profitable business investment. At this stage the property prices in Morocco are relatively low compared to other destinations and is an emerging market coupled with is the sense of making a secure investment. The tourism sector is booming in Morocco and people have reported 85% occupancy rate for rented properties during high season. These reasons alone make Morocco a safe investment destination.

If you are still little bit skeptical about purchasing property in Morocco this piece of news will certainly make you think and take notice, the Moroccan King Mohammed VI and the UAE have allocated huge investment into drastically increasing tourism further to a goal of 10m per year by 2010 apart from this investment into developing infrastructure is also poring in from United States. This investment along with several tax advantages also helps investors in feeling comfortable in investing in property in Morocco.

The main points why one should invest into Moroccan property are given below.

Luxury lifestyle for very little

Great value property

10 year building guarantee (similar to nhbc)

Rental yields 6% plus

Strong emerging property market all set for very strong capital growth

0% Tax on rental income

0% Capital gains tax under £40k or after ten years

0% Inheritance tax when passed onto family

100% repatriation of funds

Government vision for 2010 tourism strategy

Major investment in infrastructure, airports and ports

There are very few locations in the World that investors can look to invest at excellent prices and expect an immediate rental return with such high capital appreciation prospects.

Outlook

Morocco is already creating waves as the newest hot spot in the international property market. The properties which are being constructed in properties be it hotels, residential apartments, villas, luxury houses etc are comparable to the best in the world and available for a fraction of price compared to similar properties around the world. The outlook for the Morocco property market is bound to go higher as it is fast becoming the playground for the rich and famous going by media reports that say that large number of the worlds wealthy, including film stars and sports heros. Richard Branson, the Rolling Stones, Malcom Forbes, and even David Beckham are believed to have purchased property in Morocco. With considerable investment going into developing the infrastructure like roads, ports, bridges, airports and when completed it can be said with conviction that the prices of Moroccan property will be far higher than investors can purchase at present. Also the resorts which are being developed are expected to attract vast numbers of tourists on short term holidays generating excellent rental yields for the investors who own these properties.

As far as the growth rate in property prices is concerned there are many different views, but in these entire different views one thing is common that is the prices are bound to rise. Homes overseas Magazine has quoted a capital growth of 30% but on a conservative note 15% is deemed as being very achievable.

Also the outlook for the rental income from Morocco based property is set to increase over a period of time as good rental yields are achievable from property in the new luxury resorts being constructed. With people reporting 85% rental occupancy during the high season and the number of tourists set to grow faster than the number of available accommodation this figure is expected to grow meaning larger occupancy levels for investors and potential growth in rental income as demand grows.

Parag Sheth
http://www.articlesbase.com/advertising-articles/buying-property-in-morocco-79308.html

We all want high return low risk investments, but can you really get low risk and high returns? – The answer is yes!

We all know that property can be a high return low risk investment but you need the right location and an affordable entry level.

That’s just what you get with this high return low risk investment. So what is it?

More Americans and foreign investors are purchasing property investments in Costa Rica than ever before, not only is it affordable but it has given great growth rates and little drawdown and you can get on board with just $30 – 60,000

Consider these facts!

You will realize why this is such an attractive low risk high reward investment:

• Average growth rates of 300% in the last 10 years

• The above is an average and many investors have doubled or tripled their money in just 2 or 3 years

• Property is easy to buy and costs 70% less than similar properties in on the US south coast

• If you buy you enjoy the comfort of knowing that you have the same rights as Costa Rican residents

But this high return low risk investment gets even better!

Not only can you buy an appreciating asset that’s cheap, but you can enjoy it to!

Use it as a holiday home if you wish and if you are not there simply get an extra rental income on top.

You cant enjoy stocks, hedge funds or unit trsuts in the same way, so this represents a nice diversifcation.

This high return low risk investment gives you the chance for great capital growth, extra rental income and the chance to enjoy it!

You get better returns than your mutual fund or asset manager can provide and you can get some fun along the way.

Will prices continue to increase?

The answer is yes

Demand is booming with prices 70% less than in the US Southern states more people are looking to this affordable slice of paradise.

Americans and foreign investment generally is at record levels.

Costa Rica is beautiful, real estate is cheap, the country is safe, the cost of living is cheap, there is low crime, great education, a more relaxed pace of life, low cost medical care, tax advantages and a great climate!

And all this is just a 3 hour direct flight from the US south coast.

How to I get on board?

You can buy and arrange this high return low risk investment yourself, but its best to get some local advice and look at some locations.

How to make a killing and some big returns

When looking at locations look at the infrastructure and you could make a killing — by buying near the new facilities ahead of the crowd and take advantage when they arrive.

Here are three projects to look at:

1. The new freeway linking the major cities of the Pacific and Atlantic

2. A new international airport is being built

3. The biggest marina in the country will be completed soon.

If you can buy in the right location, this high return low risk investment could out perform the average and give you great capital gains.

Costa Rica real estate represents a solid long term investment and if you get on board ahead of the crowd big capital gains could be yours.

More and more investors are seeing Costa Rica as an affordable slice of paradise and that’s why it’s becoming so popular.

This could be a high return low risk investment that will help you accumulate wealth with low risk you have been looking for.

Finally

Unlike mutual funds, hedge funds or stocks, you can enjoy this investment to by visiting it which is much more fun than seeing your asset manager!

Sacha Tarkovsky
http://www.articlesbase.com/investing-articles/high-return-low-risk-investments-a-great-investment-you-can-enjoy-58560.html

WEIGH YOUR RISKS CAREFULLY

When you decide to embark on a commercial real estate investment program, how do you get your start? We know that there is no such thing as 100% financing for commercial property, so where do you get your initial capital for that first purchase? One method which I have discussed before is to use Other People’s Money as your initial “stake.” Perhaps having partners is not the path you wish to follow in your investment program. That makes the other option using your own funds. Before you dip into your resources, however, consider some of the risks you face.

First, you are embarking on an investment program about which you have little practical experience. You may have read every book on commercial real estate investing ever printed and gone to every seminar ever produced in a hotel for a year, but you have no experience in the business. Do you really know what can go wrong? Do you realize what additional reserves you might need in case things don’t go as planned?

Second, consider the source of your equity. For most people who have done some real estate investing, they have probably focused on residential investment properties. Residential properties usually enjoy a large number of comparables to easily estimate value, financing programs for residential properties allow potential buyers to facilitate sales with little equity investment, and residential properties are usually less expensive, and therefore more accessible, to most people. If you are such an investor, then you probably have a pretty good pool of equity to tap. But how do you access it? Sell them outright and pay your capital gains? Sell them in a 1031 Exchange? Refinance them? Each option has its advantages and disadvantages.

Third, if you are like most people, your biggest chunk of equity is sitting in your home. There may be a great temptation to go get yourself an equity line, suck out the equity, and go buy a commercial property somewhere. Before you do, make sure to consider how the increased debt service of the equity line will affect your finances. Can you truly afford the payments if something doesn’t work out with your commercial investment? Yes, your commercial property will be producing income. However, the majority of that income will be used to pay its operating expenses and paying off the loan you arranged to acquire it. That doesn’t leave a lot left over for you in the initial years of the investment to pay down the equity line, which will most likely have a rate somewhere above the Prime rate (8.25% today).

The point is to consider your investment goals, your tolerance for risk, and your ability to live without the funds you are using for your commercial investment. Over time, your commercial portfolio should provide you with significant current income, a hedge against inflation, and net appreciation. You need to pay careful attention to how you structure your commercial real estate financing to minimize unforeseen risks and increase your chances of success. In your quest to achieve your commercial investment goals you need to carefully asses the impact of the financing decisions you make.

Craig Higdon
http://www.articlesbase.com/real-estate-articles/commercial-real-estate-investment-decisions-126005.html

Image by Getty Images via @daylife

If you have the heart and soul of a gambler or love extreme sports and activities such as skydiving or bungee jumping then you may be the ideal candidate for pre-construction real estate investing. Pre-construction profits are often among the highest in the industry. At the same time so are the risks. You will find the greatest highs and lows that can be found in the field of real estate investing lie beneath the umbrella of pre-construction profits and many of the big names we know so well in the real estate investing field have made much of their fortunes through speculation and pre-construction sales.

Before I go any further, one word of caution should be spoken. While the potential for profits in this particular corner of the real estate market are unconventionally high the risks are also abundant. This is speculative real estate at its very best and as we have all learned in the past, when the bubble bursts in a specific market those who have the most invested are the ones who often loose most heavily.

As far as what pre-construction real estate is there are a few interpretations. The first is also the most obvious. You are buying real estate at some point before construction is complete. In hot markets you will often need to purchase the units before ground has broken on the project in order to get the lowest price for your investment and highest potential pay off for your pockets. Once you’ve purchased the unit or units you plan to sell you then begin seeking buyers for those units. In markets that are on fire like some Vegas suburbs and big retirement and vacation cities along the Florida coastline the same property is not exactly uncommon for a property to change hands and have several owners before the unit is complete. Each one will take a little something home from the table for their efforts with those who get in earliest often taking the largest piece of the pie home with them.

You may be wondering why this occurs and the answer really is simple. When the contractors attempt to get funding for their buildings in these large complexes they often need to have a certain percentage of the units "pre sold" in order to convince the banks that there is an adequate market and to garner some of the revenue that is needed to get the venture up and running, so to speak. So real estate investors buy these units at rock bottom prices because essentially they are paying for the idea of the unit (which hasn’t at this time been built and isn’t yet approved to be built in many cases) rather than a brick and mortar property. As the project draws closer to completion, particularly in markets where real estate is in high demand, the value of the property rises dramatically ending in ridiculous profits for those who have managed to hang on.

The risks however are many. There are any number of things that can go wrong on a project such as this not the least of which is that the demand for housing will be met before the unit is actually built. This has happened and continues to happen. Also recessions, business closings, economies collapsing, and tragedies in the vicinity can occur before the property is complete leaving everyone who has invested heavily in the project holding a little bit of the bag and loosing their profits and, quite possibly, their investment. These projects generally take a great deal of time to complete which makes the risks that much greater and the anticipation of these events a little more difficult to map out ahead of time. If you can manage to make it through however many investors see more than a one hundred per cent return on their investment making it a popular type of investment among many despite the rather large risks involved.

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Real Estate among other investments provides superior returns because of its multiple income streams. The investor can create source of income that would last over time. The following are the rated top profits which made real estate investing an attractive investment to investors and clients alike:

Property Value Appreciation

Normally property value appreciates overtime, benefiting the investor by providing better chances of reinvesting on properties with higher value. This is influenced by inflation which increases value on sales and an equity line for credit that can be utilized in another form of investment. Appreciation wouldn’t only escalate the value of an investment but it also generates additional investment to earn from.  

Mortgage and Stocks

Not everyone engaging in real estate investing is an active investor. Some would engage passively. In cases like these the investor would most likely place his or her investments in the hands of the stock market forming equities of many huge homebuilders. On the other hand, these investors can choose discounted notes for conversion of mortgage.

Inflation of Prices

The general economy has the most unpredictable status. It tends to go up really high but seldom goes down really low. Nowadays, inflation has become a continuous process and a majority of the consumers would consider to be a nightmare. But inflation is an investor’s best friend. When prices go up, it is then assumed that the price of the investment properties goes up with it. Even if there are certain areas not technically affected by the appreciation, values can increase significantly through time just by the terms of inflation. During times of inflation, if the cost of construction materials and labor for building a structure rises, results will affect identical properties big time. Therefore due to recreation costs, the value of a property increases tremendously.

Market Value Depreciation

For several reasons, there would be properties that are sold due to immediate needs of the seller to gain the equity of their property. Due to pressure, some would agree to a price significantly lower than its original market value. There are properties that are in foreclosure wherein the lenders will concur with a market rate so as to clear any history in their books and avoid further expense in marketing. When you have found properties like these, take it as an opportunity. Immediately enter the equity position which serves as your profit within the given transaction.

Have the Right to Increase

Owning a property that has lesser or zero disadvantage and having more advantage reserves the owner the right to increase its value. One typical example is when the property is located in an accessible and profitable area. You can increase the price of this property type most especially if it is a commercially good location. Another site gaining much appreciation is the one located in areas where the views and environment are welcoming, calming and can provide some sort of relaxing enjoyment.

To further improve the site, one can renovate the structure through the removal of hindrances or bad aspects of the environment. Add a deck and patio facing the view or add bigger windows; a few ways to add to the total appearance and rate of the property.

Property Conversion

One of the best examples of property conversion connected with real estate investing is purchasing an apartment having a low selling price, remodeling majority of the structure, and conveniently converting it into condominiums. 

Technorati Tags: real estate investment, remodeling