Statistics show that in 2006 the average sales prices for one-bedroom, two-bedroom, three-bedroom, and four-bedroom residential properties were, respectively: $396,095; $453,897; $521,490; and $653,329.  The average price per square foot in California during that year for these properties was, again respectively: $699; $399; $341; and $312.  All these numbers are derived from sales of 839 one-bedroom units; 5,005 two-bedroom units; 8,526 three-bedroom units; and 3,966 four-bedroom units, as based on data from assessor and title deeds for the year.  Over this decade, Californian housing sales peaked between the latter half of 2006 and the first three quarters of 2007, with a precipitous decline during 2008, right back to turn of the century levels!  Residential sales have picked up rather markedly this year, right through the summer, probably buoyed by the low prices created by excess inventory.  Overall, and perhaps not surprisingly, four-bedroom units have been by far the best-sellers statewide.  There was an interesting spike in the selling price of one-bedroom units for the middle of summer 2001.  Prices rose dramatically just before August, and fell right back shortly after August.

According to census reports, the median value of owner-occupied housing in California was $211,500, while the national average was only $119,600.  Median asking price for housing in the state was $151,900 against the national average of just $89,600.  All this takes place against the backdrop of moderate median household, family, and per capita incomes, respectively: $47,493 compared with the national average of $41,994; $53,025 compared with the national average of $50,046; and $22,711 compared with $21,587.

The content of this article has been posted strictly for informational and human interest purposes only, not for advisory purposes, and should not be relied upon in any way by any person or institution.  The reader should not rely on the validity of any of the information contained herein.  The reader is urged to consult a variety of professionals when making business or any other significant decision, including accountants, lawyers, investment advisors, insurance companies and the like.  Again, this article has been posted merely for human interest and informational purposes, not for advisory purposes.

Job, high interest rates, tight credit and a depressed real estate market all conspire in aggravating the situation. It is essential for everyone to be on their toes and anticipate all possible real estate options to avoid the misfortune of being subjected to foreclosure proceedings.

Best Real Estate Options to Avoid Foreclosure

Beyond these best real estate options to avoid foreclosures, one should start with the proper mind-set. It is important that you objectively face the idea of foreclosure. Most would tend to struggle and deny that this is a possibility. These real estate options will only be effective if you begin to accept your situation.

Secondly, begin your work by approaching your mortgage lender and lay all your cards on the table. You should always remember that you and your mortgage lender share a common interest on this particular issue. Your mortgage lender would also like to explore the best real estate options to avoid foreclosure as such an event would also mean a financial loss for them.

Try to work out a new repayment plan based on your present financial circumstances. Your situation may provide you with the much needed relief in terms of temporary suspension or cutback in your monthly mortgage payments. There are certain conditions that should be considered for you to qualify for this relief and you need to provide some documentation to support your request.

One of the best real estate options that you can explore is to negotiate for a refinancing or term extension for your mortgage loan. The immediate beneficial effect of this option is that you may be able to cutback on the amount of your monthly payments to a level that could be covered sufficiently by your present financial condition.

Another one of the best real estate options involves the application for a loan with HUD which has no interest to cover the unpaid monthly mortgage requirements. This would immediately put your mortgage status to current. The proceeds of the HUD loan shall be used to pay your mortgage company.

You will be required to sign a promissory note for the loan and a lien is applied on the property. The loan will only be due when you decide to leave, sell the property, or when your mortgage loan reaches maturity.
The following real estate options will be explored if the previous real estate options don’t work out for your situation. You may consider giving up the property by selling it before any foreclosure proceeding is undertaken. This option may be used only if:

• The appraised “as is” value of the property is at least 70% of the mortgage amount and the price tag is at least 95% of the real market value of the property.
• The mortgage loan should be at least two months overdue before the pre-foreclosure sale
• The sale of the property must be completed within 3 to 5 months.

Finally, the last of the best real estate options to avoid foreclosure is to give up the property in favor of your mortgage company. This should be your last option after you have exhausted all the other real estate options.

You will lose the house when you take on this option but you are able to protect your credit record. This will be a great help in getting another mortgage loan in the future.

Discover more about Otto’s techniques and claim your FREE video webinar right now.

What people do not realize is that the lockbox is an extremely powerful tool in obtaining showings for a property. Exposure to the maximum number of buyers increases one’s chances of selling a home. Think about it, you have a property in Tucson. A buyer who is relocating from New York is on a short weekend trip to look at properties. She needs to see as many properties as possible in a short period of time. Sunday she will return to New York and does not plan on coming back for awhile. Her buyer’s agent wants to allow her to view 10 properties per day, but doesn’t know the exact times they will be at each property, only a range. The agent is also aware that his client may decide in the car that she does not want to view a particular property for whatever reason. It is a dynamic situation and while the agent is comfortable providing a range of times he might be at a particular property, he would like the flexibility to view properties and cancel or move up showings based on his client. As a property owner, having a lockbox can provide an advantage in cases such as these.

There are two types of lockboxes used in real estate: mechanical lockboxes and electronic lockboxes. Mechanical lockboxes can be accessed by anyone that knows the combination or code, whether they are a real estate agent or not. They are frequently used by property management companies and general contractors that have a lot of different types of people that need to obtain access to the property. Electronic lockboxes can be accessed by a member or affiliate (e.g. an appraiser) of the local Realtor association. They are sometimes called Realtor lockboxes or e-lockboxes. There are only 2-3 major manufacturers of the electronic boxes, so they are somewhat expensive, but most people agree that the benefits outweigh the costs.

Besides increasing showings, users of an electronic lockbox also benefit from the fact that the box functions as an advanced tracking device. You can typically find the name, brokerage name, and phone number of any Realtor that has entered the property as well as the time of the showing. You can see if a particular Realtor has returned to the property on multiple occasions. Additionally, if the lockbox is ever lost or stolen, it can be disabled. Finally, most electronic lockboxes come with a feature that allows them only to open between selected hours, such as 8am to 8pm. The main negative surrounding lockboxes are the potential that someone could enter your home in a malicious fashion, such as to steal property or commit a crime. While these incidents are very rare, you should still be mindful of them and decide what is best for you. You also need to weigh the pros and cons of whether you would be better off meeting someone at the property who had similar intentions.

Next time, you list a property for sale, you should strongly consider using a lockbox. They have greatly increased the ability to show properties and feature many other benefits.

Donald Plunkett is a real estate broker with Congress Realty, a flat fee listing company which serves Alaska, Arizona, California, Colorado, Hawaii, Idaho, Montana, Nevada, New Mexico, Texas and Washington. He has received the top ranking in MLS listings sold from the Phoenix Business Journal. Donald is a Certified Residential Specialist® and has been licensed since 1994.

A number of listed brokers have instilled some type of flat fee pricing. The range is all over the map. One broker might charge three hundred dollars, another might charge three thousand dollars. The services one receives may be the same or different. In some cases there may be different levels of fees, such as a bronze, silver or gold package that would include increasing prices that were nonetheless not based on a percentage of the eventual sales price of the home. Others charge a flat fee plus a smaller commission based on a percentage of sales price that includes additional components such as negotiation or advisory services. A few others actually have two flat fees with a break point coming at a particular sales price. So regardless of the fee structure selected, it is important for the homeowner to examine exactly what is being offered for a particular price and whether the flat fee price includes everything they need or if they need to pay extra for additional services.

It is important to note that while many listing brokers have taken on a flat fee structure, most buyer’s agents are still compensated on a percentage amount that varies with the sales price of the home. It is not uncommon to see three percent of the sales price being offered to a buyer’s agent. Sellers often are not as concerned that the buyer’s agent commission is not a flat fee but instead percentage-based, because of the fact that they want their property to offer competitive compensation compared to other homes and because they generally perceive that buyer’s agents provide an extremely valuable service in delivering qualified buyers to a home seller. Flat fees to buyers’ agents may gain traction in the future, however, today they are somewhat uncommon. During certain periods of an extremely hot seller’s market, some homeowners and builders have moved to the flat fee structure for buyers’ agents, however, the trend generally has not lasted long. As the Internet and other dis-intermediation continues, however, it would not be a surprise for even more flat fee real estate to take place with all sorts of brokers.

Donald Plunkett is the President of Congress Realty, a $299 flat fee real estate company offering its MLS listing services in Alaska, Arizona, California, Colorado, Hawaii, Idaho, Montana, Nevada, New Mexico, Texas and Washington.

How to Make Money Investing in Real Estate Today

Buy smart. Research your market so you know how to find a bargain investment property. It’s difficult to understand your investment location if it’s too far from home, so choose an area that you enjoy visiting or one near your work or home. Study the area, watch the trends, and learn as much as possible about your location.

Finance smart. Check your credit and put yourself in position to qualify for the best interest rates, lowest mortgage costs, and avoid pre-payment penalties. You can buy investment property with poor credit, but you will pay much more for the financing.

Rent smart. Many investors purchased homes in other states believing that the property would pay for itself. You must understand local rental markets or be in the position to pay any negative monthly expense. Can you afford the difference between the mortgage payment and the rental income? What about vacancies? Don’t put yourself in financial jeopardy to purchase investment property.

Improve your property. Raise your profit potential by making improvements. You can raise the rent or sell for top dollar when tenants and home buyers fall in love with your unique offer. Learn about the latest interior design ideas that pay you a higher profit.

Sell smart. Home staging methods can increase your profit potential. Create a buyer’s dream with interior design strategies. Use new Marketing Psychology to sell your property. Sell the benefits to the buyer (just like Internet marketing). Avoid common pitfalls in the sale of your property, such as appraisals that don’t measure up to the sales price. Understand the sales process and watch over your pending sale.

You can profit in any real estate market, bubble or not, when you do your research, understand your location, buy smart, improve the property, and sell for top dollar.

© 2005 Jeanette J. Fisher. All rights reserved.

Jeanette Fisher, Design Psychology and real estate investing instructor, is the author of Sell Your Home for Top Dollar–FAST! Design Psychology for Redesign and Home Staging and other books. Free ebook report “Design Psychology for Selling Houses.” Visit http://www.sellfast.info.

Step 1 is always to determine the fair market value(FMV). As a real estate investor, you can always buy properties at the FMV. My question is why would anybody want to do that? Through careful selection, you can always find properties that are priced below FMV, regardless if they are existing or if they are a preconstruction project. The best way to determine FMV is to work with someone already familiar with the area or determine yourself through local websites showing recent sales histories.

Step 2 is to then determine the market trend for the area for which there are two critical pieces: 1) is the average price increasing AND 2) is the volume of sales increasing. If both are moving in your favor, then you have the comfort of knowing that the right trend is in place to keep prices moving forward. In stock market investing, there is the saying that the trend is your friend and traders frequently observe price and volume data to confirm the trend. If a hotly priced real estate market shows signs of dropping in volume, be very careful.

Step 3 is to learn about supply, especially in the preconstruction marketplace. In some areas, there are very few projects on the books and in others, there are 15,000+ units expected to emerge within 1 zipcode, in 1 year. Same is true for investing in houses. In you are competing with a bunch of new houses that are coming on-line, then rapid price escalation may be limited. For most savvy investors, they like to see lots of demand with very little supply which is nothing more than common sense.

Step 4 is to make your OWN opinions of the macro conditions of the local and regional marketplace. So, for example, if you are a strong believer that real estate is overvalued in the target area, why would you ever consider investing? On the other hand, if you believe that market forces will continue to escalate in the market, then why would you not be actively looking? As an example, some people believe that the graying of America is just now starting to drive people to warm, more attractive climates. Even though property values are high in these areas right now, are we going to see 20+ years of additional migration to them? You have to decide for yourself because we won’t know the answer for another 20 years!

Step 5 is one of the most important risk management tools available to the investor in real estate. Each property has typically an inherent rate at which it can be rented, even if that is not your intent. By looking at rental rates, relative to the amount of principle, interest, taxes, and insurance (PITI) that you will have to pay, then you can understand the amount of cashflow that may be required to support the property. If your objective is to produce cashflow, then you need to be cashflow positive very quickly. If your objective is capital gains and the cashflow is negative, then you now understand what you may have to support on a monthly basis if things don’t work out.

Deferred maintenance then becomes our Step 6. For an existing property, how much maintenance has the previous owner neglected that you will need to catch up? Be careful here since this can be one of the major places to get nasty surprises.

And now I saved the best for last: Step 7 is to determine your own personal risk tolerance. Some new investors look at a deal and only see the positive. This is a huge mistake. EVERY REAL INVESTOR I KNOW HAS LOST MONEY IN A DEAL but they gladly will do more. Why? They understand their risk’s going in, they understand how to limit their downside, and the gains are much larger than the risks they are taking. If you were standing beside them and saw what they saw, you would gladly take the risk as well and rapidly ignore any small losses that you experience.

Hopefully this has given you a good start at learning how to analyze a potential opportunity. Obviously each of these steps requires additional work or training but they are what separate the new investor from the seasoned, battle tested veterans.

Chris Anderson is a leading authority on preconstruction real estate investing. Get his 4 day e-mail course and a 33 minute video free today! Visit http://www.GetPreconstructionProfits.com & http://www.GetPreconstructionDeals.com. In addition, Dr. Anderson is the on-line training coordinator at the Van Tharp Institute, a group that provides world class training for investors and traders.

This simply isn’t true.

First, banks let you finance as many mortgages as you can pay for. Some banks limit the number of loans made to one person. Experienced real estate investors just move on to another lending institution.

I know one investor who owns more than one hundred single family homes. All have mortgages. He constantly refinances one rental for the down payment to buy the next. Besides living off the cash flow from his rentals, he also refinances a rental occasionally to take his family on a first-class vacation.

Another investor, my friend who owns the carpet company we use for our fixers, owns more than fifty rentals. None were purchased “subject to” the existing loan. Many were purchased “all cash” for quick closings, with mortgages added later.

For beginning real estate investors, looking for an owner willing to sell their property “subject to” the existing loan adds a frustrating component to the search for a profitable property. Today’s savvy home sellers just won’t sell to a buyer who can’t cash them out.

Of course, some investors offer “subject to” and lease-option purchases. But, properties with most of the equity stripped out come with payments too high for rental income to support. These properties make better candidates for owner-occupant home buyers with poor credit who don’t mind paying more for a house.

Beware of “subject to” seminars, books, and promotions. This real estate investing method worked last century.

Jeanette Fisher teaches real estate investing and credit college courses. Jeanette is the author of “Doghouse to Dollhouse for Dollars” and other books. For a free report, “Design Psychology for Selling Houses,” visit http://doghousetodollhouse.com.

How property taxes are used. Each locale uses the revenue earned from property taxes for different purposes. It can be anything from road repairs and utility upkeep to firefighter salaries and emergency response. Most areas, however, use the money received from property taxes for school districts. Taxes are levied and then distributed to schools in a district according to the amount of money received from property taxes. This often puts homeowners in a bind, as most of them want quality education for children, but are reluctant to vote to pass measures that will result in a property tax increase.

How property taxes are determined. Before buying a home, it is important for real estate beginners to understand how the amount you pay in property taxes is decided upon. Everyone pays a different amount, depending upon how much a home is worth. The tax rate for an area is the same throughout that area, but due to varying home values, the property tax you pay may be a little higher or lower than your neighbors.

If the property tax rate in your area is 9 percent, and your home is assessed at 250,000 dollars, your yearly property tax would be 22,500 dollars. If your neighbor’s home were only assessed at 235,000 dollars, he or she would pay 21,150 dollars in taxes per year. Many areas have specified periods of time required for a new assessment. Most places require a new assessment every five to seven years. This means that your taxes could go up or down as your property value changes.

What goes into a property assessment? There are some guidelines assessors use when determining the value of your home. By being acquainted with these, you will be more likely to understand why your home has been given a certain value. Here are the most common benchmarks taken into consideration when determining a home’s value.

• Sale price of similar properties in the area: the assessor will know how much other homes in your immediate area are selling for, and will assess your house to reflect the value of the neighborhood.

• Property’s historical value: records of the property’s value through the years will help the assessor determine whether the home’s value keeps with current trends, and whether the home increases in value over time as a general rule.

• Cost of replacing the property: it is possible to determine how much the materials to replace the property, or to add improvements to increase value, would cost. This can figure into the value of the property.

• Potential value of the property if it is used to make money: many people use their property as income through rental or sale, and this value can be used to help the assessor decide how much he or she should value your property for.

Disputing an assessment. Because home values are subjective, it is possible to dispute a value. You can speak with neighbors and realtors to discover what homes in the area are valued at. Recent home buyers and sellers can give you a good idea of what others are paying in property taxes. Visit your tax board or the local tax assessment office to find out what the procedures are for dispute an assessment you feel is unfair.

Paying your property taxes. As a real estate beginner, you want to be sure that you are paying the taxes on your property. There are a number of ways to do this, including paying to the tax commission quarterly or yearly. However, the simplest way to pay your taxes is to have them integrated into your home loan. They can be added to your monthly mortgage payment, making it a relatively hassle-free way to make sure everything is taken care of.

With a little savvy, even a real estate beginner can have a good handle on what it takes to get a fair value assessment and know the ins and outs of paying property taxes.

Nicole Soltau is the President and Founder of CreditUnionRate.com. The Leading Credit Union Directory. Search, Find, Join.http://CreditUnionRate.com.

Using social media for your real estate business is a great idea because it creates a personal feel for your website. When people can see you talking then they almost feel as if they know you personally. If you offer the ability for people to chat live with you then it is even better because they get to meet you in person. Social media is a smarter approach because discussing real estate with people through email is not very personal. People are vulnerable when they are looking for a home because it is usually one of the biggest decisions people make in their lives. That is why the entire process should be made personal.

Another benefit to using social media for your real estate business is that you can give people the opportunity to see a home over the computer. If you have cameras setup then you can offer virtual tours and have them online. This allows people to decide if they like a home or not. This means you will waste less time showing homes to people who are not interested. Each time you go to a home then the people are more serious about the buy. When you don’t use social media and offer an opportunity for people to see a home for sale then they might absolutely love the outside of the home and have to get inside. Once they get inside the home they hate everything about it. This has probably happened to you a million times in the past, but you can really minimize situations like this by using social media for your real estate business.

Social media is also another way people are marketing their businesses today and you can too. It is proving to be true that people online are more interested in social media sites than those with plain text. If you offer something interactive for the user then they are more apt to pay attention. Creativity is important. However, you should be sure to provide useful information that the viewers can benefit from with your business. Social media is also used to generate larger traffic to a business website and it really works.

There are many ways for using social media for your real estate business. You can create a more personal and up close feel for your business while prospects are about to make one of the biggest decisions of their lives. You can also give potential buyers the opportunity to view homes in advance so you and the buyers save time. In addition, social media can help improve your website and generate more traffic which could lead to more sales.

David Ledoux is an author, speaker, trainer and mentor to entrepreneurs. His newest report The Small Business Death Sentence can be downloaded for free at http://bigmoneyfreetime.com.