Always Be on the Lookout for Vacant Properties

Finally, in addition to using all five of the property search methods that I have outlined in this chapter, always be on the lookout for vacant properties while driving around town. How do you go about spotting vacant properties with profit potential It is really not that hard to do once you know exactly what to look for. Probably the easiest and quickest way is to simply look for properties exhibiting any of the following telltale signs of blatant neglect. Look for properties that have 8....

Why You Must Be Able to Think Outside Your Local Real Estate Market

The key to consistently making money with this strategy and every other option strategy that I have outlined in this book is to be able to think outside your own local real estate market. I say this because in my professional opinion, the number one reason that most vacant commercial and industrial properties usually remain vacant for long periods of time is simply that no one in that particular real estate market has been able to come up with a profitable use for the property. And I attribute...

Maintain a Separate Checking Account for Your Real Estate Investment Business

For record keeping and tax purposes, you must maintain a separate checking account for your real estate investment business that you can deposit checks into and pay expenses out of. One of the criteria that the IRS uses to determine whether a business is legitimate and not a sham is bank accounts. A business that claims expenses, losses, and depreciation on federal tax returns but does not maintain a bank checking account is going to be suspect and have a very hard time trying to document...

Real Estate Options Are Not for Dummies

As I alluded to in the introduction to this chapter, real estate options are definitely not for dummies. To make it as a profitable option investor, you need to possess an imaginative, analytical, and creative mind. First, you must have the imagination to be able to visualize various types of properties being put to a myriad of different uses. And then you must be able to put an option deal together from scratch that makes financial sense to all of the parties involved in the transaction....

The Most Profitable Types of Properties to Buy Real Estate Options On

I ou need to know right from the get-go that, as a real estate option investor, you are not going to have option property deals served up to you on a silver platter by eager sellers and real estate brokers. In this business, the most profitable option deals are usually the ones that investors create from scratch by identifying an unfulfilled need in their local real estate market and putting a property under option, which best fills the need, and then reselling the option to a buyer, who has a...

Savvy Investors Can Use Real Estate Options to Provide Justin Time Property

Last, one of the things that I like most about real estate options is that I can use them to provide just-in-time (JIT) property. Just-in-time inventory management refers to the practice of ordering an inventory of parts or raw materials on an as-needed basis, versus maintaining a large on-hand inventory. The automotive industry in the United States has used JIT inventory management for over a decade. Today, savvy real estate investors can apply the same JIT inventory management principles when...

Why You Should Add Real Estate Options to Your Repertoire of Strategies

Typically, many real estate options are bought more on speculation than on anything else. However, buying real estate options on speculation is not what this book is about. If you follow the advice contained in this book, all you should be doing is changing your name from buyer to real estate optionee. When used properly on the right types of undervalued properties, real estate options provide an excellent low-cost, low-risk, high-profit potential property control technique, which...

The Legal Status of Real Estate Options Varies from State to State

Unfortunately, there's no Uniform Commercial Code equivalent for real estate options. The legal status of real estate options varies from state to state. In most states, the legal status of real estate options has evolved over the years from a combination of common and case law. The case law that regulates estate options in most states is the result of various lawsuits involving legal disputes between optionees and optionors over the use of real estate options. To know the legal status of real...

What You Need to Know about Real Estate Options

Real estate options are a little known and seldom used investment strategy probably because the only time that most people ever read or hear anything about real estate options is when they are bandied about, willy-nilly, on real estate web site message boards or discussed at real estate investment club meetings by people whose collective knowledge of the subject would not fill a thimble. However, when fully understood, properly prepared, and used correctly, real estate options are an excellent...

Learning about Real Estate Options

When I first got interested in using real estate options in 1985, there were no publications available like this book. The scant amount of information that I was about to scrounge up about real estate options told me just enough to be dangerous, but not enough so that I really knew what I was doing. This lack of solid information meant that I did not have the luxury of learning from someone else's mistakes. I had no choice but to go it alone. So, how did I become my own real estate option...

How to Recruit Bird Dogs into Your Network of Paid Informants

The best way to find bird dogs to join your network of paid informants is to tell everyone that you come into frequent contact with that you are looking to buy real estate and that you are willing to pay a finder's fee when you buy an option on a property that they told you about. Here is a listing of the types of people you want to recruit into your network as bird dogs

How to Use Bird Dogs to Find Potential Option Properties That Are Not Advertised

A bird dog is someone who comes into frequent contact with problem property owners within a specific neighborhood or area and is in a position to learn about non-advertised potential option properties that are for sale there. These types of hidden properties are never formally advertised as being for sale their availability is made known only by word-of-mouth. A neighbor, a relative, or an acquaintance may be the only one who knows of a property owner's willingness or need to sell. Once you...

What You Should Check for When Looking Over an Obsolescent Property

When I come across a vacant property with all of the telltale signs of obsolescence that appears to be a potential option property, I always do a quick visual inspection of the outside I use an inspection checklist like the following sample to try FORM 4.1 Sample Vacant Property Checklist 1. Has the electrical meter been removed from the property ( ) Yes ( ) No 2. Is there an electrical power line connected to the property ( ) Yes ( ) No 3. Has the property been cited for code violations ( )...

How Income from the Sale of Real Estate Options is Treated for Tax Purposes

Income earned from the sale of real estate options is taxed at the same rate as ordinary earned income. And for tax purposes, the IRS will consider you to be a real estate dealer versus an investor because you are buying options with the intent to resell and not as an investment. Real estate options are covered in Section 1234 of the Internal Revenue Code, which is provided for your convenience Internal Revenue Code, Section 1234, Options to Buy or Sell 1234(a)(1) GENERAL RULE. Gain or loss...

Real Estate Options What They Are How They Work and Why You Should Use Them

I first want to thank you for investing your money in a copy of How to Make Money with Real Estate Options. This one-of-a-kind book was written for serious, rational, reasonable, intelligent, reality-based, goal-driven, and action-oriented adults who are willing to take calculated risks in order to profit from the many money-making opportunities that real estate options provide today. I am a firm believer that a real how-to book should tell its readers precisely what to do while providing...