Ask MetaFilter questions tagged with investment and estate

How do one handle buying property jointly before getting marrried?

Anonymous — Thu, 05 Jul 2012 12:12:42 -0800

How do one handle buying property jointly before getting marrried? (One partner has assets and the other one has income) So I'm thinking of buying an investment property right now, but my situation is a bit different from the typical buying property with your partner pre-marriage. I don't know anyone who's in a similar situation as me right now and would like some inputs from MeFites.

The BACKGROUND: I'm not officially engaged to my boyfriend yet, but we've discussed marriage and are planning to get married sometime next summer. I know my boyfriend is working on a surprise engagement sometime in the next couple of months. Right now I came upon a great investment opportunity. It's a condo in a desirable location (high income neighborhood with shortage of affordable rentals and exorbitant housing prices) with a tenant already in place. I've worked with the agent who's handling the sale before, and I'm confident that a new tenant can be found quickly even if the current tenant leaves. I know what's the general rent is for a comparable condo in the neighborhood and return of rent vs. condo price is very favorable. I own a house that's completely paid off and worth about $300K, the condo is listed at $130K. Assuming the condo is in ok shape, it's hard to pass up on such a great opportunity.

The PROBLEM: I'm trying to start my own business right now. The business is new, so right now I do not have verifiable income. I have a HELOC on the paid-off house worth $50K, but I can't get an increase on the HELOC line due to income issue. My boyfriend has a good paying job and is willing to co-sign the loan, but doesn't have enough savings to put down a downpayment on his own. If my boyfriend co-signs the loan, there's a good chance I'll be approved for an increase in my HELOC line that'll be enough to pay for the condo. The rent should be more than enough to cover the HELOC payments.

Bottom Line: Neither of us can get the property on our own, but together we have a good solid chance to get this property.

The COMPLICATION: I plan to put the paid-off house on the market in Jan/Feb of next year. Due to complicated family reasons that I won't go into detail here, I have to sell the house. Assuming I can sell the house within a reasonable timeframe, I'll use the proceeds from selling the house to pay off the rest of the HELOC loan.

My boyfriend and I live in a community law state. If my boyfriend co-signs the HELOC loan, that means I have to put him on the title for the condo, however, if I use proceeds from selling my pre-marital property to pay off the rest of the loan on a joint property, how do I ensure fairness and equity in the worst case scenario? Should I ask that all rent proceeds go to my account once I paid off the HELOC by selling the house if that happens before we officially get married? And after we get married, then we switch to have the rent proceeds go to a joint account?

Has any MeFites ever been in a similar situation or know someone who did? I don't want to pass on this opportunity, but at the same time, I want to protect myself and not commit any stupid mistakes. If absolutely necessary, I can delay selling the house by couple of months or getting marriage license sooner (keep ceremony around same time), but either one would require explaining to family and while doable, not ideal. Delay selling the house would also possibly involve complicated family drama. What would you do if you were in my shoe? Any input would be highly appreciated. Thank you so much!

CFA worth it for a role in Real Estate Investment?

web74 — Sat, 12 May 2012 04:42:21 -0800

CFA worth it for a role in Real Estate Investment? I was wondering if the CFA will be useful to me if I want to work in Real Estate Investment – starting probably with a Commercial Brokerage firm in their asset management department, which would involve buying and holding investment properties for their income as well as possible capital appreciation. Ultimately perhaps work for some kind of REIT. My background is that I have worked for commercial brokers in their valuation departments as well as in their research & development. This mostly involves writing feasibility reports for developers.

In terms of my education I have a Master of Science in Business Management which covers all the topics of an MBA but in a single year. Also a Masters in construction management and real estate development. The latter involved taking an MBA real estate finance class.

My problem at the moment is that when I apply for jobs, companies very rightfully want to put me in the same kind of research writing roles that I’ve done in the past. It would seem to me that I need to show something extra if I want to start on the more financial orientated roles.

For the valuation I don’t think we are talking hugely complex financial anaylsis. Mostly office or residential buildings laid out on excel where you can see the year-to-year income stream and then it’s a matter of getting the formulas correct and entering the appropriate assumption values.

I’m hoping that, if I can first pass level 1 and start applying for jobs, I will have more luck in getting started in the real estate finance side. Is this a feasible strategy or am I wasting my time? (Assuming I pass level 1, I’m not I’d pursue level 2/3 – I’d have to see how the job situation is going and how relevant the other levels are specifically for real estate).

Ultimately, I’d also like to sharpen my finance analysis skills because I want to be able to evaluate potential business ventures as continue to manage a modest collection of investment properties.

(This is a rather long question, but I thought it would be better to include as much info as possible so I can get some more enlightened responses – thanks for reading and hopefully answering!)

Looking for real estate primers, etc.

5845(f)(1)(D) — Thu, 05 Apr 2012 07:00:07 -0800

I'm considering investing in real estate in a major US city as a landlord. What resources/books/blogs/best practices can you recommend before diving in? As far back as I can remember, I've wanted to own rental property, and at this point, I feel like I'm in a good position to start:

I'm an attorney, and my jurisdiction will allow me to waive into becoming a licensed real estate broker without any other certification requirements

I have a sizeable amount of liquid assets to invest (let's just assume $600K in liquid assets (including $300K cash), plus some other illiquid assets)

handy (and enjoy it) and fit

supportive spouse

some student loan debt, but no other debt, and good credit

My spouse and I are ourselves renters, coincidentally. Right now we're not looking to owner-occupy; we're happy renting. No interest whatsoever in building new property.

We're very much still in the exploratory phase. Can you recommend some resources to help refine our thinking on this? For instance, I'm interested in the rational framework for deciding whether to buy, for instance, a condo in a more affluent area (higher cost, but likely more stability) versus buying a multi unit building in a less affluent area (lower cost, but possibly less stable), and similar questions.

Obviously, one part of this will be educating ourselves about tenants' rights in our jurisdiction, and we'll get a real estate lawyer.

First-time home buyer seeks help making a good investment

mintchip — Fri, 22 May 2009 19:08:57 -0800

First-time home buyer seeks help making a good investment I am interested in purchasing a short sale property. I am a first time home buyer. I'm hoping to buy an undervalued condo, live there for a few years to build equity, and hopefully trade up in a few years if (when?) prices begin to bounce back. The places I've been looking at would cost approximately the same or slightly less than renting the same type of unit...so my hope is that this is a low-risk proposition since I need somewhere to live anyway.

I am just learning about all of this so I have a lot of questions.

1. How can I tell if a property is undervalued? For example, I recently saw one that sold only a few years ago for approximately twice what I could get it for now. Assuming the inspection is clear, can I reasonably conclude that this short-sale property is undervalued?

2. What do I need to know about purchasing a short sale property? If they are a good value, why aren't more people buying them?

3. How much does the "assessed value" tell you? For example, I looked at one property that will sell for $150k less than last year's assessed value versus one that's only $35k less than the assessed value. In other words, if the sale price is close to the assessed value, am I less likely to make a profit upon resale?

4. I have substantial fixed-rate student loan debt. I can lower my monthly payments by consolidating over a longer repayment term (25 years). However, this will cost me more interest in the long run. What would make a bank look upon me more favorably--lower monthly payments or my attempt to pay it off faster?

5. What are the best resources to learn what I need to know?

Profitable Golf Course or Sub development?

CWitt — Tue, 17 Jun 2008 19:08:13 -0800

How profitable is a golf course? I love playing golf and would love to own a golf course. However, with the price of real estate the way it is, I wonder if it is even really profitable? Is it more profitable to buy couple hundred acres and put a course on it or put some homes down? I would think that it would be more profitable to put homes down, because the course would take several years to get out of the red.

Real Estate question

yoyo_nyc — Tue, 14 Aug 2007 16:55:48 -0800

What are the average numbers (purchasing price as a multiple of yearly rental costs/income) for real estate in the US? Let's say a house with several apartments brings in X dollars of rent each year. What is the multiple of X for which the house is sold? In Europe it is, depending on the city and area, 10-25 times X. What are the numbers in the US?

What's life like for someone working in corporate real estate in new york city?

BigBrownBear — Tue, 13 Feb 2007 09:46:57 -0800

What's life like for someone working in corporate real estate in new york city? I am a New Yorker who has been working in corporate real estate consulting/analysis/inverstments in Europe for the past two years (think CB Richard Ellis, Knight Frank, Cushman & Wakefields, etc.)

I am looking to move back to NYC but want to know what the lifestyle, money and hours are like as I start interviewing. Part of the reason I came over here originally is that I was tired of working until 3 in the morning every night (I was a paralegal in a big law firm back then).