What You Need To Know For Buying Real Estate In Knoxville

Real estate is one of those few investments that have rarely shown a negative growth, despite the volatility across Knoxville real estate markets. Some of the countries that have shown the highest percentage change in real estate investments, since 1980, include Spain with 15.4%, followed by Ireland at 14% and Australia at 11.2%. Of course, buying real estate might not be the easiest of tasks but it can be made easy if you know where and how to’s of investment. There are certain important factors that you will need to consider before you decide to make a residential or commercial real estate investment in Knoxville.

Six Important Points To Consider While Buying Real Estate in Knoxville

Investing in a home is perhaps one of the biggest investments you will make in your life. Therefore, it’s vital that you understand the nuances involved in the process of purchasing real estate.

1. Your affordability: This is one of the most important factors and you need to take into consideration the down payment, loan amount, loan interest, your monthly salary, and monthly expenses. The golden rule for buying real estate is: never buy a property that you can’t pay for! In fact, before you make a decision, take advice from a housing counselor or a financial advisor.

2. Buyer rights: A real estate buyer has certain rights as the US Department of Housing and Urban Development’s fair housing scheme. This scheme offers people in the US equal access to homeownership as well as rental opportunities.

3. Real estate agent: While buying real estate you can take the help of Knoxville real estate agents or you can go solo. If you are buying foreclosure homes then you will not require the help of real estate agents as these homes are sold through public auctions. But if you are buying a new real estate property then you will need to look for a reliable and licensed agent who can help you in finding the right property, negotiating the price and guide you through the entire process.

4. Loans: The crucial part of buying real estate is finding the right loan. Off late, there has been a high rate of foreclosures in the US and the primary reason is the Adjustable rate mortgages. The interest rates in ARM have been moving upwards and as a result, more and more people are finding it difficult to make their monthly payments. This should not happen to you! You can choose from government loans like FHA & VA loan to conforming loans by Fannie Mae and Freddie Mac, Fixed rate mortgages, Jumbo Loans, two-step mortgage, fixed period ARM, Graduated payment mortgages, Convertible ARM, and interest only loans.

5. Looking for a home: You can take help from a real estate agent or go the classified advertisement way. These days Knoxville real estate properties are also advertised online and you can get all important details like size, image, number of rooms, locality etc. Once you have shortlisted a couple of homes, you need to go and visit the homes to check if the homes are worth the price mentioned.

6. Paperwork: For buying real estate certain documentation like pay stubs for last two months, wage and tax statement, Federal tax return, bank & asset statements, and a copy of driver’s license are required.

Finally, do your own homework. Research the internet, ask your friends and colleagues for advice and gain from their experience and prevent yourself from making the mistakes they might have made.

Research The Market Before Selling Your Home In Knoxville

There are basically two ways to sell a home in Knoxville – with the help of real estate agents or by you. The second process is called FSBO or For Sale By Owner. In the second process, there will be no agents acting as an intermediary and you will be the decision maker. It is not going to be easy and you will need to first understand how the process works. If you have opted for FSBO then you will need to do a lot of homework, which is something that is taken care of by a real estate agent.

First things first, if you are in a hurry to sell your home, you may want to consider contacting a house buying company.  They are often seen advertising “We buy houses in Knoxville” or “Sell your house fast in Knoxville, TN”. These companies have ample resources to provide you with an offer within a few days and can have you out of your home shortly after. You can choose FSBO if you have ample time on your hands and are not in a hurry to sell your home. Now let’s take up the job of demystifying the entire FSBO process. There are several aspects that you will need to consider in an FSBO situation as the more you understand the process, the easier it will be for you to sell your home.

So where do you start? You will need to first identify a list of professionals who will help you sell your home. You will need the services of a home inspector, real estate lawyer, and appraisers. One of the good things about the entire process is that due to the reach of the internet, you will be able to advertise and find 80% of your buyers online. So the next step would research the Knoxville real estate market. Research is of primary importance because if you are unable to understand how the real estate market behaves then you might not be able to achieve success. You might end up selling the home before the market reaches its zenith or after it falls. Here are some steps that you can follow:

1. You can start with the real estate section in your local daily and understand the current real estate market conditions. You need to identify when the market is hot and when it is cold. Read about expert opinions and what real estate agents predict regarding the market.

2. If there are several other sellers in your neighborhood then talk to them and find out how they are handling the entire process. Find out more about their experience and get an overall feel of the process.

3. You can even speak with real estate agents in your area. Just because you have chosen to go solo doesn’t mean that you can’t get information from the agents. It always helps to dangle a carrot and get the required information regarding the current market trends, the sale price of homes similar to your home. You can also be upfront and tell them that you are planning to go FSBO and need guidance. A reputed real estate agent in Knoxville will be able to provide you with the guidance. Some agencies might even charge a small fee.

4. Browse through property listings in Knoxville or locality to understand how sellers have advertised their property. This will help you later on.

If your research is thorough then it will put you in an advantageous position!

Real Estate Referred to As Handyman Specials

If you’re considering profiting by investing in handyman special properties, know that this is a good decision with the right amount of renovation. Some people believe that handyman specials mean that with a little paint and carpeting the house will resell quickly. This is not often the case.

In order to make money from these properties, you must be willing to renovate them. However, with the appropriate renovations, you’ll have a large profit potential with each property you take on.

When you see a property listed as a “handyman special” be sure to see the property before deciding on investing. It’s easy to invest in a property and then later find that it’s going to require more investment than you’ll get in return. Buying a handyman’s special will result in you making money if done carefully. There are certain steps that you’ll want to follow when investing in handyman special properties:

Step 1: Review the property carefully.

Be sure that you’re going to get a good return on your investment. If a property has to be completely renovated complete with plumbing, electric, etc. You may not get back what you put into it. Don’t be afraid to invest, but be sure the investment is worth it.

Step 2:

Once purchased, take the time to do the job right. When work is done haphazardly, it’s very obvious to potential buyers. When they see that something has been thrown together, they will feel that the entire property has been taken care of that way and will be less likely to purchase it. Take the time to make sure it’s done right.

Step 3:

Be sure to price the property right. Talk to others that are selling and find out what other properties are selling for. Don’t just look into what they are asking for properties, but what those properties are sold for. If you overprice the property you’ll sit on the property for a long time. If you under price the property you’ll cheat yourself of profits. Be sure to find out what other properties are priced for and price your property just below the others.

Step 4:

Take care of property well when it’s on the market. Renovating the property is not complete until it has been sold. Be sure that even though the property inside is done; the outdoors will need constant care. Be sure to mow the lawn, pull weeds, and plant flowers if necessary to increase curb appeal. Don’t let too much time go by between mowing. If the weather’s been cool and sunny you can be sure that the grass is growing quickly. Cut the grass at least once a week. If the lawn is starting to brown due to heat, water the grass a few times a week to regain the green.

The above steps will ensure that your property will sell quickly. You will maximize your profits by choosing your properties wisely. You will take your handyman’s specials and turn them into cash.

Buying a Fixer Upper – 3 Traps To Avoid

Whilst savvy investors regularly make big profits with fixer uppers, there can be many hidden risks when buying a fixer upper. Learn the traps to avoid when investing in a fixer upper to increase your profits and stay away from those properties that will cause you more stress and costs than anything else.

If you can’t make a profit off of a property because of the expenses you have to pay into it you will not be making a profit at all. To stay in this business you need to make a profit on all of your investments. Getting stuck with a property that has a huge problem where you will have to shell out more money than you can make off of it is stressful, aggravating, and especially a waste of time and money.

Three Traps In Buying a Fixer Upper to Avoid

These traps often inflict the new and beginners in the field of real estate investing, but they can also hit the most experienced and skilled of investors. Everyone should be on the lookout for these three main traps and if found – stay away from them.

1. Toxic Mold: When you are looking at a newly built property you should not have to worry about toxic mold. However, since you are looking for fixer-uppers you will be mostly looking at older homes. These older homes have a risk of containing toxic mold. Many more buyers today are requesting an environmental inspection, which can reveal toxic mold if it is present in the home. Watch out for damp basements, unfinished basements, and any other wet problem.

Moisture is where toxic mold loves to grow. Before you invest in a property ask for an environmental inspection to ensure that there is no toxic mold.

2. Major Structural Repairs: Major structural repairs could be roof problems, foundation problems, old beams, and rotting wood. All of these problems could be extremely costly and could cause you to spend more money than you will make. Always make sure that you get an inspection done by a constructional professional and a home inspector to detect these problems.

3. Major Electrical Faults: Since all of the electricity is run inside a home’s walls, if there is a problem it will most likely be very costly. Major electrical faults can also be very dangerous and can come back to haunt you. You should make sure that you get a thorough and professional electrical inspection on an investment before you put any money into it.

You do not want to invest in any property that could have any one of these three problem traps. Stay away and stay safe in your investments. You can make profits in buying fixer uppers, and you can keep your business running smoothly by avoiding the risks involved in investing in these fixer uppers.

Finding The Right Property In Knoxville to Invest In

If you’re starting out in real estate investing, the first thing you’ll need to do is know your market.

Where Are You Investing?

You need to know the market to know if you’re getting a deal or not. Is the area seeing a lot of sales, or are the properties lingering on the market for a long time? Even in a soft market, you can make a profit. This is because there are always sellers.

The idea is to find the motivated sellers that will really be looking to unload their house. A profit can be made in any kind of market. You just need to be prepared and know what you’re getting into from the get-go.

What Features Sell?

As I said, regardless of the market, people will be selling and buying houses. As you investigate the market, find out what features sold the property. In the case of finding the fixer-uppers, you’ll want to know about the cosmetic things, nothing structural. Making structural repairs can drastically cut into your profit. But pay attention to the types of things that attract buyers and see about incorporating them into your strategy.

Enhancements like replacing walls, plumbing, structural beams, sub-flooring, and electrical systems can certainly be done – and have been done – by investors such as you. However, the successful ones are only successful after many years of investing; it should not be done by anyone brand-new to real estate.

The bottom line: an ugly house could be your cash cow

Fixer-uppers are that way because they need work. Maybe the yard is overgrown and in disarray. Cosmetic repairs can be simple enough to do. You should embrace the garbage-filled houses, stained carpets, and nasty odors. These are all things that you can fix – and see a profit on when complete.

Real estate isn’t rocket science. The trick is to really understand the market that you operate in. Especially in today’s market where you can become unstuck very quickly. Let’s face it, anyone can make money when the market goes up. The real magic is making it when things aren’t so hot.

Which is why research is the biggest risk-minimization method you can adopt. And I ain’t talking “lazy” research either. I’m talking about getting off your butt and inspecting real houses. If you aren’t prepared to do the hard yards… don’t expect to make easy money!