http://www.vancouversun.com/business/story.html?id=8397869

Which came first, the chicken or the egg? Well, there is a similar conundrum in real estate investing. Which one is more important: finding the deal or finding the money?

Some investors will say that the deal is more important and others will say that the money is more important. Many investors feel that in order to be successful, they have to possess the skills to do both—the deal and the money—really well. Luckily for them, that is a myth and not the truth. In order to be successful in real estate investing, they only have to do one of two things really well. They either need to be really good at:

1. Finding the deal or
2. Finding the money

If you have a great deal, you can find people that have money because they will be attracted to the opportunity. If you can find money, then you can also use the money to get the deals coming to you. If people know that you have the means to put together a deal, they will bring opportunities to you, so it works both ways. If you have either the deal or the money, the other half of what is needed will be attracted like a moth to a flame.

Let’s review each of these aspects.

Finding the Deal

To be successful at finding the deal, you will want to put several strategies at work simultaneously to help you consistently locate great investment properties.

First of all, find a real estate agent that can supply you with potential opportunities. Let the agent know what kinds of investments you are looking for (rental properties, rehab properties, commercial, etc.) so they know what types of deals to bring to you. If you have a deal that is profitable, the money will come to the deal because it is an opportunity for another investor to make a profit.

When you are working with an agent, you will likely submit many offers or letters of intent to secure a deal. You need to know that it is part of the process so that you can set the right expectation with the agent.

Another way to get consistent deals is through advertising. Motivated sellers are always looking for a way to sell their property. If they see a sign, a billboard, a flyer in the mail, a letter, or are referred by someone, you can solve their problem and score a great deal in the process.

One of the keys to successful advertising is to be consistent. Many sellers do not respond the first time they see an ad because it is a timing issue. If a seller is losing a home due to foreclosure, they may be in denial for quite some time before they realize that they need help. There are similar circumstances with probate properties, job transfers, divorces and so on. The important part is that you never know when the timing is right. In order to get the best results, it is important to plan on having an advertising budget each month and stick to it.

Monitor the results of your advertising. When people call you, ask them how they found out about you. This is one of the easiest ways to gauge what is working and what is not. That also helps you identify where you should spend your money in the future as you advertise.

If you have the money but need the deal, another option is to work with wholesalers in the area. A wholesaler will constantly find deals and assign the contracts to other investors because they do not have the money to put the entire deal together. If you find a good wholesaler, this can be a constant source of potential deals and they are doing all of the leg work for you.

Let the wholesaler know what you are looking for in a deal and what you have the ability to fund. With that kind of information, they can use their resources to find the right scenario for you and it takes a lot of the burden off of you. This is another case of how people who have money set the rules and people do their best to match those rules.

With this combination of strategies, finding potential investments will be much easier and it will give you a place to put the money that you have located.

Finding the Money

What happens if you find great deals but you do not have the money? Well, use these strategies to help you with the other half of the puzzle.

If you cannot find the money, the simplest solution is to assign the contract as a wholesaler. This means that you sell your contract to another buyer (usually another investor) and they step in and use their resources to fund the deal. You would make an assignment fee for putting the deal together, and you are free to move on to the next deal.

Wholesaling is a common way for many investors to get started as it is a way for them to begin investing without having the capital resources to do it.

Another common method is for people to use creative financing as an option for putting the deal together. This includes lease options, seller financing, and many other options. The whole point here is that you can structure an alternate method for the deal to work where the money needed will be little or nothing at all. With these strategies, you can potentially bypass the need for having funding.

You can also use partners for funding a deal. The whole point is that you put up the deal, they put up the money, and you split the profits. Now, there are specific rules you must comply with when it comes to raising capital from others and they are too detailed to include within this article. However, the principle is that you can always raise the money. No one said that the money had to come from your bank account.

When you privately fund deals like this using other people’s money, you remove a lot of the barriers and limitations that many investors feel that they have. There are many people that have money that would like a better return than what they can find through traditional sources. If you can provide them with an opportunity that they cannot get elsewhere and they believe in your ability to deliver, then this can be a viable opportunity.

Summary

The purpose of this article is to show you that there are many roads that lead to success as a real estate investor. The training offered by Rich Dad Education will show you how to use each of these various methods to achieve success. If there is a specific path that interests you, enroll in the appropriate class and get all of the necessary information.

You can use your personality, your skill set, and your talents to be successful as a real estate investor. Get really good at finding either the deal or finding the money. When you have one half of the puzzle solved, the other half tends to work itself out.

The summer of 2012 drew to a close in September with home sale activity well below historical averages in the Greater Vancouver housing market.

The Real Estate Board of Greater Vancouver (REBGV) reports that residential property sales of detached, attached and apartment properties reached 1,516 in September, a 32.5 per cent decline compared to the 2,246 sales in September 2011 and an 8.1 per cent decline compared to the 1,649 sales in August 2012.

September sales were 41.6 per cent below the 10-year September sales average of 2,597.

“There’s been a clear reduction in buyer demand in the three months since the federal government eliminated the availability of a 30-year amortization on government-insured mortgages,” Eugen Klein, REBGV president said. “This makes homes less affordable for the people of the region.”

New listings for detached, attached and apartment properties in Greater Vancouver totalled 5,321 in September. This represents a 6.3 per cent decline compared to September 2011 when 5,680 properties were listed for sale on the MLS® and a 31.6 per cent increase compared to the 4,044 new listings in August 2012.

At 18,350, the total number of residential property listings on the MLS® increased 14.1 per cent from this time last year and increased 4.5 per cent compared to August 2012.

“Today, our sales-to-active-listings ratio sits at 8 per cent, which puts us in a buyer’s market. This ratio has been declining in our market since March when it was 19 per cent,” Klein said.

The MLS HPI® composite benchmark price for all residential properties in Greater Vancouver is $606,100. This represents a decline of 0.8 per cent compared to this time last year and a decline of 2.3 per cent over last three months.

“Prices in the region remain relatively stable overall, although we do see some reductions in the areas that have had some of the largest price increases over the last year or two,” Klein said.

Sales of detached properties on the MLS® in September 2012 reached 594, a decrease of 37.9 per cent from the 957 detached sales recorded in September 2011, and a 31.4 per cent decrease from the 866 units sold in September 2010. The benchmark price for detached properties decreased 0.5 per cent from September 2011 to $935,600.

Sales of apartment properties reached 676 in September 2012, a 26.7 per cent decrease compared to the 922 sales in September 2011, and a decrease of 30.4 per cent compared to the 971 sales in September 2010. The benchmark price of an apartment property decreased 0.7 per cent from September 2011 to $368,600.

Attached property sales in September 2012 totalled 246, a 33 per cent decrease compared to the 367 sales in September 2011, and a 35.8 per cent decrease from the 383 attached properties sold in September 2010. The benchmark price of an attached unit decreased 2.7 per cent between September 2011 and 2012 to $458,600.

Download the complete stats package by clicking here.

The number of residential property sales hit a 10-year low in Greater Vancouver for June, while prices remained relatively stable.

The Real Estate Board of Greater Vancouver (REBGV) reports that residential property sales of detached, attached and apartment properties reached 2,362 in June, a 27.6 per cent decline compared to the 3,262 sales in June 2011 and a 17.2 per cent decline compared to the 2,853 sales in May 2012.

June sales were the lowest total for the month in the region since 2000 and 32.2 per cent below the 10-year June sales average of 3,484.

“Overall conditions have trended in favour of buyers in our marketplace in recent months,” Eugen Klein, REBGV president said. “This means buyers are facing less competition and have more selection to choose from compared to earlier in the year.”

New listings for detached, attached and apartment properties in Greater Vancouver totalled 5,617 in June. This represents a 3 per cent decline compared to June 2011 when 5,793 properties were listed for sale on the MLS® and an 18.9 per cent decline compared to the 6,927 new listings reported in May 2012.

At 18,493, the total number of residential property listings on the MLS® increased 22 per cent from this time last year and increased 3.7 per cent compared to May 2012.

“Today, our sales-to-active-listings ratio sits at 13 per cent, which puts us in the lower end of a balanced market. This ratio has been declining in our market since March when it was 19 per cent,” Klein said.

The MLSLink® Housing Price Index (HPI) composite benchmark price for all residential properties in Greater Vancouver over the last 12 months has increased 1.7% and declined 0.7% compared to last month.

Sales of detached properties on the MLS® in June 2012 reached 921, a decrease of 37.4 per cent from the 1,471 detached sales recorded in June 2011, and a 19.1 per cent decrease from the 1,139 units sold in June 2010. The benchmark price for detached properties increased 3.3 per cent from June 2011 to $961,600.

Sales of apartment properties reached 1,026 in June 2012, a 19 per cent decrease compared to the 1,266 sales in June 2011, and a decrease of 18.4 per cent compared to the 1,258 sales in June 2010. The benchmark price of an apartment property increased 0.3 per cent from June 2011 to $376,200.

Attached property sales in June 2012 totalled 415, a 21 per cent decrease compared to the 525 sales in June 2011, and a 27.8 per cent decrease from the 575 attached properties sold in June 2010. The benchmark price of an attached unit decreased 0.1 per cent between June 2011 and 2012 to $468,400.

Download the complete stats package by clicking here.

High Ratio mortgage rules are changing July 9th.

If your clients do not have 20% down payment this will effect them! Use this rule change to contact your data base and let them know what it means to them. It really is a now or never situation for a lot of borrowers. If your clients have an accepted offer and we secure financing prior to July 16th the old rules will apply.

Max amortization reduced to 25 years from 30 years

Max debt servicing ratio reduced to 39% from 44%

Max purchase price of $1,000,000

Clients with less than 20% down payment will no longer be able to purchase a house over $1,000,000.

Here's a few examples of what the rule change will do:

With the current rules it takes around $67,000 to qualify for a $500,000 purchase with 5% down payment. After July 16th the same client will need to earn $82,000 to qualify for the same puchase plus their payments will be $250 more per month.

With the current rules a client can purchase a $1,000,000 plus property with 5% down payment after July 16th this same client will need 20% down payment. On a $1,000,000 purchase that's an extra $150,000.

If interest rates increase these scenarios will only be amplified. For example if interest rates went to 4% and using the new rules the client who could purchase a $500,000 house right now with $67,000 income would need to have an income of $90,000.

Please feel free to call me to discuss this further.

Real Estate Market Reflects Canadian’s Love of Home Ownership

The record-setting pace of the Canadian housing market will continue into 2012, according to a Re/Max’s housing market outlook. The report reinforces Canadians’ trust in home ownership despite gloomy global economic conditions, and highlights immigration and Gen X+Y purchasers as extensions of the home-ownership cycle. Re/Max anticipates an estimated 460,000 homes will be sold by the end of 2011, up 3% from 2010. Prices too, are going up. The average Canadian home cost $363,000 this year – that’s 7% more than in 2010. Re/Max forecasts an appreciation of 2%, bring the average housing price to $371,000 in 2012.

“What 2011 proves is that real estate continues to have momentum,” says Elton Ash, regional executive vice-president, Re/Max of Western Canada. “The economic underpinnings support ongoing demand, particularly as job creation efforts continue and unemployment rates edge down further. Nationally, we remain on an upward track, and the confidence consumers have demonstrated in housing over the past decade will rove well founded once again next year. The rising belief in home ownership is key, especially among Generation X and Y, some of whom are making their moves sooner. Boomers and retirees are changing, too. They’re healthier and more active, with longer life expectancy. Overall, we’re seeing an extension of the home ownership cycle, and it’s great news for housing going forward.”

6 Things You Must Know Before You Buy

"Subtle changes in the way you approach mortgage shopping, and even small differences in the way you structure your mortgage, can literally cost or save you thousands of dollars and years of expense."

Mortgage Regulations Have Changed . . .
Mortgage regulations have changed significantly over the last few years making your options wider than ever. Subtle changes in the way you approach mortgage shopping and even the small differences in the way you structure your mortgage can literally cost or save you thousands of dollars and years of expense.

Get the Right Information
Whether you are about to buy your first home, or are planning to make a move to your next home, it is critical that you inform yourself about the factors involved. Industry research has revealed 6 common mistakes that most homebuyers make when mortgage shopping and they can have a significant impact on the outcome of this critical negotiation. If handled correctly, these issues could result in a mortgage that will cost you less over a shorter period of time.

6 Things You Must Know Before Obtaining a Mortgage
Before you commit your hard earned dollars to monthly mortgage payments, consider these 6 issues. Effective consideration of these important areas can make your payments work much harder for you.

1. You can, and should, get pre-approved for a mortgage before you go looking for a home:
Pre-approval is easy, and can give you complete peace-of-mind when shopping for your home. Your local lending institution can provide you with written pre-approval for you at no cost and no obligation, and be done quite easily over-the-phone. More than just a verbal approval from your lending institution, a written pre-approval is as good as money in the bank. It entails a completed credit application and a certificate, which guarantees you a mortgage to the specified level when you find the home you’re looking for.

2. Know what monthly dollar amount you feel comfortable committing to:
When you discuss mortgage pre-approval with your lending institution, find out what level you qualify for and also pre-assess for yourself what monthly dollar amount you feel comfortable committing to. Your situation may give you a pre-approval amount that is higher (or lower) than the amount of money you would want to pay out each month. By working back and forth with your lending institution to determine what this monthly amount is, and what value of home this translates into at today’s rates, you won’t waste time looking at homes that are not in your price range.

3. You should be thinking about your long term goals and expected situation, to determine the type of mortgage that will best suit your needs:
There are a number of questions you should be asking yourself before you commit to a certain type of mortgage; How long do you think you will own this home? What direction are interest rates going in and how quickly? Is your income expected to change (up or down) in the near term, impacting how much money you can afford to pay to your mortgage? The answers to these and other questions will help you determine the most appropriate mortgage you should be seeking.

4. Make sure you understand what prepayment privileges and payment frequency options are available to you:
More frequent payments (for example weekly or biweekly) can literally shave years off your mortgage. By simply structuring your payments so that they come out more frequently, it will significantly lessen the amount of interest that you will be charged over the term.
For the same reason, authorized pre-payment of a certain percentage of your mortgage, or an increase in the amount you pay monthly, will have a major impact on the number of years you will have to pay and could shorten your payment term considerably.
These two payment options can cut years off your mortgage, and save you thousands of dollars in interest. However, not every mortgage has these pre-payment privileges built in, so make sure you ask the proper questions.

5. Ask if your mortgage is both portable and/or assumable:
A portable mortgage, where available, is one that you can carry with you when you buy your next home and avoid paying any discharge penalties. This means that you will not have to go through the entire mortgage process again unless you are making a move up to a much more expensive home.
An assumable mortgage is one that the buyer for your home can take over when you move to your next home. This can be a very powerful tool at the negotiating table, making it much easier and more desirable for a buyer to buy your home, and again saves you any discharge penalties.

6. You should seriously consider dealing with a Mortgage Expert:
Consider dealing only with a professional who specializes in mortgages. Enlisting their services can make a significant difference in the cost and effectiveness of the mortgage you obtain. For example they can make the process faster thereby avoiding costly delays. Typically there is no cost or obligation to inquire.

Enjoy these holiday qoutes:

Christmas gift suggestions: To your enemy, forgiveness. To an opponent, tolerance. To a friend, your heart. To a customer, service. To all, charity. To every child, a good example. To yourself, respect.
-- Oren Arnold

As we struggle with shopping lists and invitations, compounded by December's bad weather, it is good to be reminded that there are people in our lives who are worth this aggravation, and people to whom we are worth the same.
-- Donald E. Westlake

Are you willing to believe that love is the strongest thing in the world - stronger than hate, stronger than evil, stronger than death - and that the blessed life which began in Bethlehem nineteen hundred years ago is the image and brightness of the Eternal Love? Then you can keep Christmas.
-- Henry Van Dyke

Love the giver more than the gift.
-- Brigham Young

The best and most beautiful things in the world cannot be seen or even touched. They must be felt with the heart. Wishing you happiness.
-- Helen Keller

When the clock strikes twelve on December 31st, people all over the world cheer and wish each other a very Happy New Year. For some, this event is no more than a change of a calendar. For others, the New Year symbolizes the beginning of a better tomorrow. So, if you look forward to a good year ahead, spread happiness and it will be a good year for everyone.

This is not the first New Year. Nor is it the last! Then why do we celebrate New Years as if the world is about to end? Do New Years justify a celebration? For a cynic, a New Year is just another day. But for an optimist, New Years herald the birth of hope. So fill your heart with joy, and spread love to everyone.

May peace and joy be yours during this wonderful season and the coming New Year - Saleem Dhalla

With a sales-to-active property listings ratio of 15 per cent, the Greater Vancouver housing market continues to hover at the lower end of a balanced market and has been trending in that direction over the past five months.

The Real Estate Board of Greater Vancouver (REBGV) reports that residential property sales of detached, attached and apartment properties on the region’s Multiple Listing Service® (MLS®) system reached 2,317 in October, a 1 per cent decrease compared to the 2,337 sales in October 2010 and a 3.2 per cent increase compared to the previous month. Those sales rank as the second lowest total for October over the last 10 years.

“Right now, prospective home buyers have a good selection of properties to choose from and more time to make decisions,” Rosario Setticasi, REBGV president said. “Home sellers should be mindful of local market conditions to ensure they are pricing their properties competitively.”

New listings for detached, attached and apartment properties in Greater Vancouver totalled 4,374 in October, which is on par with the 10-year average. This represents an 18.3 per cent increase compared to October 2010, when 3,698 properties were listed for sale on the MLS®, and a 23 per cent decrease compared to the 5,680 new listings reported in September 2011.

The total number of properties listed for sale on the Greater Vancouver MLS® system currently sits at 15,377, which is 9.3 per cent higher than the 14,075 properties listed for sale during the same period last year. October was the first month that the total number of property listings showed a decrease this year.

The MLSLink® Housing Price Index (HPI) benchmark price for all residential properties in Greater Vancouver over the last 12 months has increased 7.5 per cent to $622,955 in October 2011 from $579,349 in October 2010. However, since reaching a peak in June of $630,921, the benchmark price for all residential properties in the region has declined 1.3 per cent.

Sales of detached properties in October reached 974, which represents virtually no change from the 976 detached sales recorded in October 2010, and a 34.5 per cent decrease from the 1,487 units sold in October 2009. The benchmark price for detached properties increased 11 per cent from October 2010 to $884,778, but decreased 1.3 per cent compared to the previous month.

Sales of apartment properties reached 958 in October, a 2.6 per cent decrease compared to the 984 sales in October 2010, and a decrease of 40.4 per cent compared to the 1,607 sales in October 2009. The benchmark price of an apartment property increased 3.2 per cent from October 2010 to $402,702, but decreased 0.7 per cent compared to the previous month.

Attached property sales in October totalled 382, a 1.3 per cent increase compared to the 377 sales in October 2010, and a 37.4 per cent decrease from the 610 attached properties sold in October 2009. The benchmark price of an attached unit increased 6.5 per cent between October 2010 and 2011 to $519,455, and increased half a per cent compared to the previous month.

Download the complete stats package by clicking here.

Housing Forecast Points to Market Stability in 2012

BCREA November 2011 - Fourth Quarter Housing Forecast BC Multiple Listing Service® (MLS®) residential sales are forecast to rise 3.2 per cent from 74,640 units in 2010 to 77,000 units this year, increasing a further 3.9 per cent to 80,000 units in 2012.

“Low mortgage interest rates are expected to persist through 2012 keeping affordability on an even keel,” said Cameron Muir, BCREA Chief Economist. “However, headwinds on the economic front will constrain consumer demand over the next year to below the ten-year average of 87,600 units.” A record 106,300 MLS® residential sales were recorded in 2005.

“Moderate consumer demand combined with larger inventories of homes for sale means BC housing markets will experience little upward pressure on home prices through 2012,” added Muir. The average MLS® residential price in the province is estimated to rise 11.8 per cent to $564,600 this year, and is forecast to decline 2.5 per cent to $550,500 in 2012.

Consistent increases in property listings and fewer home sales over the summer months has helped move the Greater Vancouver housing market into the upper end of a buyers’ market.

The Real Estate Board of Greater Vancouver (REBGV) reports that residential property sales of detached, attached and apartment properties on the region’s Multiple Listing Service® (MLS®) reached 2,246 in September, a 1.2 per cent increase compared to the 2,220 sales in September 2010. Those sales also rank as the third lowest total for September over the last 10 years.

“There's more competition amongst home sellers in today's market, providing more options for prospective buyers," Rosario Setticasi, REBGV president said."Buyers now have more properties to choose from and more time to make decisions compared to the spring season.”

New listings for detached, attached and apartment properties in Greater Vancouver totalled 5,680 in September, the third highest volume for September in 17 years. This represents a 20.1 per cent increase compared to September 2010 when 4,731 properties were listed for sale on the MLS® and a 21.2 per cent increase compared to the 4,685 new listings reported in August 2011.

The number of properties listed for sale on the Greater Vancouver MLS® system has increased each month since the beginning of the year. At 16,085, the total number of residential property listings on the MLS® increased 4.6 per cent in September compared to August 2011 and rose 4.4 per cent compared to this time last year.

“Our sales-to-active-listing ratio currently sits at 14 per cent, which is the lowest it’s been this year. Generally analysts say that a buyer’s market takes shape when the ratio dips to about 12 to 14%, or lower, for a sustained period of time,” Setticasi said.

The MLSLink® Housing Price Index (HPI) benchmark price for all residential properties in Greater Vancouver over the last 12 months has increased 8.8 per cent to $627,994 in September 2011 from $577,174 in September 2010.

Since reaching a peak in June of $630,921, the benchmark price for all residential properties in the region has declined 0.5 per cent.

Sales of detached properties on the MLS® in September 2011 reached 957, an increase of 10.5 per cent from the 866 detached sales recorded in September 2010, and a 32.8 per cent decrease from the 1,423 units sold in September 2009. The benchmark price for detached properties increased 13.4 per cent from September 2010 to $896,701.

Sales of apartment properties reached 922 in September 2011, a 5 per cent decrease compared to the 971 sales in September 2010, and a decrease of 38.1 per cent compared to the 1,489 sales in September 2009. The benchmark price of an apartment property increased 4.4 per cent from September 2010 to $405,569.

Attached property sales in September 2011 totalled 367, a 4.2 per cent decrease compared to the 383 sales in September 2010, and a 43.3 per cent decrease from the 647 attached properties sold in September 2009. The benchmark price of an attached unit increased 5.4 per cent between September 2010 and 2011 to $516,697.

Download the complete stats package by clicking here.

Slumping economy will put interest rates on hold, or moving lower, until at least until 2013

A big Canadian bank predicts the slumping economy will put interest rates on hold, or moving lower, until at least until 2013. In an interest rate outlook released Tuesday, the Bank of Montreal said it does not expect interest rates to rise again until the early part of 2013. That's about six months later than earlier forecasts that rates would stay flat until the fall of 2012 as the Bank of Canada tries to boost the sagging economy.

In the bank's report, BMO Capital Markets senior economist Michael Gregory said the weaker global economy has squeezed commodities, the Canadian dollar and undermined growth in Canada. That has kept inflation in check and made it more likely the Bank of Canada will hold the line on rates.

In fact, Gregory said, there is a good chance the central bank will cut rates over the next six months — by close to half a point.

That's good news for homeowners with variable-rate mortgages and consumers financing loans and lines of credit tied to the prime rate. However, even rock-bottom rates may not be enough to spur consumers to spend if job loss fears grow and incomes sag.

In the United States, the Federal Reserve Board has already said it will keep rates low for another two years or so in the hopes of injecting consumer confidence back into the troubled economy.

"As global economic risks have escalated, casting commodity prices and the Canadian dollar much weaker, the Bank of Canada's diminishing tightening bias has probably diminished further," said Gregory.

"We now judge that the resumption of rate hikes will be an early-2013 affair."

The report noted that with recession risks building on both sides of the Canada-U.S. border, and the next six months being particularly critical, the odds of Bank of Canada cutting rates are also growing.

"The market is currently pricing in a little less than two (quarter point) rate cuts by April 2012," Gregory said.
"However, with core CPI inflation not far below its two per cent target, the loonie, now more than six cents weaker than where the bank had assumed in its projections, and a continued well-functioning domestic bank credit creation process, we judge the policy easing bar remains high. Short of signs of imminent recession, the bank should remain on hold."

The BMO report also projected the loonie will settle at around 93 cents U.S. next year.
"During the second half of 2012, with global economic and commodity price prospects improving, the currency's fortunes should shift with a flight plan back to parity by January 2013."