Are you thinking about buying your first home but aren’t sure where to start? Don’t worry, you’re not alone. Every homeowner goes through the same feelings you’re likely going through now at some point in the process. Buying your first home can be a mentally and emotionally exhausting task, so I’m here to share some tips for first time home buyers.
Get your debt under control
A big factor of buying a home is making sure your debt is under control. Debt is a very common denominator among home buyers, especially first-timers who may only be a few years out of school. While you may not be able to get rid of all of your debt before thinking about purchasing a home, it’s a good idea to at least get it under control and make sure that you can manage to continue paying that debt, as well as any expenses that come with purchasing a home.
Save for a down payment
By saving up enough for a down payment, you can ensure that you’ll be able to secure a good mortgage rate while hopefully avoiding things such as private mortgage insurance (PMI). If you can afford to make a down payment of at least 20% or more, that would be best. Anything lower than 20% will usually involve you having to pay PMI, which tends to cost around 1% of the entire loan and is added to your monthly payment. There are plenty of mortgage do’s and don’ts when it comes to buying a house, so finding the right one for you is crucial to the process. With a well thought out down payment, you can easily get a manageable mortgage that you’ll be able to pay off sooner rather than later.
Research potential neighborhoods
One of the worst thing that can happen is you find what you believe to be your dream home, but when you move in you learn that you have extremely disruptive neighbors, or the internet in your area is poor. Since these types of preferences vary from buyer to buyer, neighborhood to neighborhood, it’s important to do a little research before you make your purchase in case you end up not being happy with your decision later down the line. You may also want to think about things such as what your work commute may look like, or if the area is child-friendly. Some quick real estate statistics show that 78% of buyers care more about the quality of the neighborhood they’d be living in over the size of their home, while 57% would rather have a shorter commute than worry about having a big yard.
First time home buyers often have a lot to think about before making their final decision. While there is certainly more to buying your first home than what I’ve mentioned here, these are three tips I believe to be of the utmost importance.
Investing in real estate doesn’t have to be a dirty job. Here are three strategies to help hands-off investors make money from real estate.
Real Estate Notes
A real estate note is a type of promissory note such as a mortgage or deed of trust, which is secured by a real estate asset like a house. The borrower promises to repay the lender a certain portion of the debt at regularly scheduled intervals. While the original lender may be an individual note investor, usually the first lender is an institution such as a bank. Individual note investors also can purchase existing notes from banks, hedge funds, or other individual investors.
One way investors make money from real estate notes is to collect the debt payments with interest. Existing real estate notes are classified as performing or nonperforming. A performing note means the borrower is current on the note payments. With a nonperforming note, the borrower usually is at least 90 days behind in payments. A hands-off investor who is buying an existing note should purchase a performing note. Nonperforming notes are labor-intensive.
Publicly Traded Real Estate Investment Trusts
Investors in real estate investment trusts, often called REITs, buy shares of commercial real estate portfolios. Some REITs specialize in a particular class of real estate assets like multi-family apartments or office buildings while others have diverse property holdings. Publicly traded REITs sell shares to individual investors via a national securities exchange. In addition, there are legal mandates that publicly traded REITs must follow to maintain their status as a REIT.
REITs have several advantages for the hands-off investor. REITs give shareholders real estate ownership without the stress of being a landlord. Unlike traditional real estate ownership, publicly traded REITs are liquid. They are bought and sold in the same manner as stocks. Finally, REITs are a source of cash flow for their shareholders. To legally qualify as a REIT, it must pay out a minimum of 90 percent of its annual income as dividends to shareholders.
Hiring a property manager is another way a hands-off real estate investor can own real estate assets such as a house or apartment building without being a hands-on landlord. The property manager’s role is to take care of typical landlord duties like collecting rents, screening tenants, and handling maintenance. A property owner should expect to pay 8% to 12% of the monthly rental income as the property manager’s fee.
About Jason Cohen Pittsburgh
Jason Cohen is a real estate investor in Pittsburgh, Pennsylvania. He created Jason Cohen Pittsburgh, a group of real estate enthusiasts committed to helping others invest in real estate, and he has thrived in the area since 2002.
As Jason’s career has grown and flourished, so has Pittsburgh itself — transforming from an industrial “rust belt” city into a major cultural center abundant with high-end multi-family rental properties. Jason has seamlessly handled the dynamic nature of Pittsburgh and of the real estate industry in general. A research-driven professional, he consistently enables smart and profitable investments in the area, helping to transform modest properties into high-end rentals in Pittsburgh’s hottest neighborhoods.
Jason Cohen first entered the world of real estate shortly after his graduation from college. He started out by investing in distressed properties in Pennsylvania. After some experience working full-time for a real estate company, he decided to pave his own path in the industry. He has worked as an independent real estate agent and developed the Jason Cohen Pittsburgh team ever since. The team consists of highly qualified investors, property managers, leasing agents, and contractors.
Over the course of his career Jason has become highly proficient in acquisitions, joint ventures and partnerships, multifamily real estate investments, asset repositioning, real estate management, real estate brokerage, and new construction. He has excelled in high-level investment strategies, but is also no stranger to “ground work” when it comes to the industry. He is well-versed in each step of Jason Cohen Pittsburgh’s unique system: researching local areas and investing in properties, performing renovations to transform these properties from dilapidated eyesores into high-end units, and ultimately repositioning the properties for maximum profit in renting and selling.
Jason Cohen Pittsburgh is the group of choice for anyone who needs advice, analysis and due diligence, and general expertise in matters of investing, whether they are short-term or long-term. Jason Cohen Pittsburgh has dealt with properties in a variety of neighborhoods throughout parts of Pittsburgh, including the South Side, Oakland, Shadyside, Squirrel Hill, Mt. Lebanon, and Regent Square. Each and every one of these locations, paired with Jason’s overall knowledge of real estate investing, has allowed him to play a part in restoring Pittsburgh’s place as one of the most popular cities in the United States.
This blog will share news, updates, and insights regarding Pittsburgh and its real estate market from the perspective of Jason Cohen Pittsburgh. Stay tuned!