ImClever Consulting

Unlock the power of real estate investment with our expert consulting services! We specialize in helping people acquire out of state rental income opportunities and fix and flip properties. With years of experience and a proven track record of success, we’ll guide you every step of the way in finding and securing the perfect investment properties. Whether you’re looking to diversify your portfolio or start building your wealth through real estate, we’ve got you covered. With our comprehensive services, you’ll have access to market insights, acquisition strategies, and a network of trusted professionals to ensure your investment is a success. Let us help you achieve your real estate investment goals. Contact us today for a consultation!

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  • Check in from Dayton Ohio

    Speaker 1: Hey everybody, I just wanted you to see, I’m over here at the, don’t know if you can see it, the Dayton International Airport. Over here to go do an inspection on some of the properties that I bought here. So just to take you through a little bit of the process, I didn’t come out here, although I will today, or tomorrow, go look through some properties out here in Dayton from California. But I actually bought the property that I’m looking at right now. I’ve already bought it, had it renovated, and I’m just going to go through a walkthrough and Prospect other property, and I’ll follow up more on this in the properties that I’m actually looking at. I just wanted to reach out and show everybody. This is how you do it. You can do it on site or remotely. Either way, leverage is way better out here than California, so let’s go look at some properties.

  • Steps to buying an out of state property

    Buying an out-of-state property that needs repairs, getting it repaired, renting it out, and then refinancing it can be a complex process. Here are the basic steps to guide you through this real estate investment journey:

    1. Set Clear Investment Goals:
      • Define your financial goals, including the expected return on investment (ROI) and the desired rental income. Determine your budget and financing options.
    2. Research and Location Selection:
      • Research out-of-state markets and choose a location that aligns with your investment goals. Consider factors like job growth, rental demand, and property prices.
    3. Financial Preparations:
      • Secure financing through a mortgage lender or other funding sources. Ensure you have the necessary funds for the down payment, closing costs, and initial repairs.
    4. Find a Real Estate Agent:
      • Hire a local real estate agent or property manager who is familiar with the out-of-state market. They can help you find suitable properties and navigate the local regulations.
    5. Property Search:
      • Search for properties that fit your investment criteria. Focus on distressed or undervalued properties that require renovation.
    6. Due Diligence:
      • Conduct a thorough property inspection and assess repair costs. Get quotes from contractors and factor in any hidden repair expenses.
    7. Purchase the Property:
      • Make an offer, negotiate the price, and finalize the purchase through a real estate attorney or closing agent. Complete all necessary paperwork.
    8. Property Repairs:
      • Hire contractors to carry out the necessary repairs and renovations. Ensure the work is done efficiently and within your budget.
    9. Tenant Screening and Leasing:
      • Find suitable tenants through background checks and screening processes. Execute a legally binding lease agreement to protect your interests.
    10. Property Management:
      • Decide whether to manage the property yourself or hire a property management company to handle tenant relations, maintenance, and rent collection.
    11. Build Equity and Cash Flow:
      • As you collect rental income and pay down the mortgage, your property should appreciate in value, and your equity will grow over time.
    12. Refinancing:
      • After a period of property appreciation and rental income, explore refinancing options to access your property’s equity. This can help you lower your interest rate, increase cash flow, or access capital for other investments.
    13. Repeat the Process:
      • Consider repeating the process with additional properties to diversify your real estate portfolio and maximize your returns.
    14. Compliance and Taxes:
      • Stay compliant with local regulations, including property taxes and landlord-tenant laws. Consult with a tax advisor to optimize your tax strategy.
    15. Continuous Monitoring:
      • Continuously monitor the property’s performance, keep up with maintenance, and adjust your investment strategy as needed.

    Remember that investing in out-of-state properties involves risks and challenges, so it’s essential to conduct thorough research, build a support network, and be prepared for unexpected expenses or issues that may arise during the investment process. Additionally, consulting with real estate professionals and financial advisors can provide valuable guidance throughout the journey.

  • Surprisingly awesome benefits to long distance Investing
  • What Is The BRRRR?
  • REITs: Defined and Explained
    Updated: Oct. 26, 2021, 11:20 a.m. A REIT (pronounced REET), or real estate investment trust, is an entity that holds a portfolio of commercial real estate or real estate loans. Congress created REITs in 1960 to provide all investors, especially small investors, with access to income-producing commercial real estate. REITs combine the best features of real estate and stock investment. This guide will walk you through everything you need to know about real estate investing through REITs, including the types of REITs, REIT pros and cons, how to invest in REITs, and what qualifies a company as a REIT.

    Types of REITs

    There are several types of REITs. Let’s start with classifying REITs by access:
    • Publicly traded REITs trade on major stock exchanges such as the NYSE and the Nasdaq Exchange. Anyone with a brokerage account can invest in a publicly traded REIT. Publicly traded REITs must register with the U.S. Securities and Exchange Commission and provide audited financial reports.
    • Public non-traded REITs are also open to all investors but don’t trade on stock exchanges. Investors can purchase public non-traded REITs through their financial advisor or on online portals known as real estate crowdfunding platforms. Public non-traded REITs also must register with the SEC and provide audited financial information.
    • Private non-traded REITs aren’t available to the public. They’re usually only open to high-income earners or high-net-worth individuals. Private non-traded REITs are exempt from SEC registration.
    Within those REIT types are three subcategories by asset type:
    • Equity REITs own and operate income-producing real estate.
    • Mortgage REITs, or mREITs, provide financing for real estate by purchasing or originating mortgages and mortgage-backed securities and earning income from the interest on these investments.
    • Hybrid REITs invest in a combination of income-producing real estate and real estate-backed loans.
    Real estate agent showing customer a commercial property Source: Getty Images Finally, we’ll look at the dozen equity REIT types by sector or property type:
    • Office REITs own and manage office real estate such as skyscrapers and office parks. Many office REITs focus on a specific region (New York City or the West Coast) or a type of tenant (technology companies, government agencies, or biotech).
    • Industrial REITs own and manage industrial facilities such as warehouses, distribution centers, light manufacturing, or cold storage. Many of these properties are crucial for e-commerce. Most industrial REITs focus on a specific industrial property type or region.
    • Retail REITs own and manage retail real estate such as regional malls, shopping centers, or freestanding retail buildings. Most retail REITs will focus on a specific property type such as grocery-anchored shopping centers or free-standing retail properties triple net leased to essential retailers like convenience stores and pharmacies.
    • Lodging/resort REITs own hotels and resorts, usually managed by a third-party hotel brand. They rent space in these properties to guests on a nightly or weekly basis.
    • Residential REITs own and manage residential real estate such as apartment communities, single-family homes, and manufactured home parks that they rent out to residents. Residential REITs focus on a specific property type.
    • Timberland REITs own and manage timberland. They specialize in harvesting and selling timber. Some timberland REITs also own wood products manufacturing facilities and sell portions of their real estate for higher and better uses like a housing development.
    • Healthcare REITs own and manage healthcare-related real estate such as senior living facilities, hospitals, medical office buildings, and skilled nursing facilities.
    • Self-storage REITs own and manage self-storage facilities that they rent to individuals and businesses.
    • Infrastructure REITs own and manage infrastructure such as fiber cables, telecommunications towers, and energy pipelines. They lease capacity on this infrastructure to mobile carriers or energy companies.
    • Data center REITs own and manage data storage facilities. They lease space in these facilities to technology companies to house servers and other equipment. These REITs also provide an uninterruptable power supply, a regulated temperature, and physical security.
    • Diversified REITs own and manage a diversified portfolio of commercial real estate. For example, they might have a portfolio of office properties and industrial real estate. Some diversified REITs focus on specific markets, owning a mix of residential, retail, and office properties in one city.
    • Specialty REITs own and manage unique properties such as movie theaters, casinos, farmland, outdoor advertising, or ground leases.

    Related investing topics

    Investing in Construction Stocks The construction industry encompasses infrastructure, industrial and buildings investment opportunities. Investing in Lumber Stocks Lumber is one type of commodity stock within the construction industry. Investing in Electric Utility Stocks Electric utility stocks are publicly traded companies regulated by government agencies. Investing in Housing Stocks Housing stocks give you exposure to the industry without having to own a home.

    REIT pros and cons

    Investing in REITs has several benefits, including:
    • They usually pay above-average dividend yields compared to other stocks.
    • They offer diversification from the stock market.
    • REITs don’t pay federal corporate income tax, shielding investors from “double taxation.”
    • They offer attractive total return potential, e.g., stock price appreciation plus dividend income.
    • Publicly traded REITs offer greater liquidity compared to owning real estate outright.
    • Public REITs are highly transparent, including providing audited financial statements.
    • Lower cost compared to buying commercial real estate outright.
    However, REITs also have some drawbacks, including:
    • Higher tax liabilities because REITs pay nonqualified dividends. Because of that, REITs are often best held in a tax-advantaged account such as an IRA.
    • Sensitivity to changes in interest rates.
    • Property-specific risks such as tenant move-outs, industry headwinds, and technological disruption.
    • The risks of using too much debt.

    How to invest in REITs

    Investors have many ways to invest in REITs. They can buy shares of publicly traded REITs through their brokerage account. An investor could purchase a diversified REIT or invest in several different REITs to build a diversified portfolio. Another way to invest broadly across the REIT sector is to buy a mutual fund or exchange-traded fund ( ETF ) focused on REITs. Finally, you can invest in public non-traded REITs through a financial advisor or a real estate crowdfunding portal.

    How does a company qualify as a REIT ?

    Companies must meet specific criteria to qualify as a REIT, which receive special tax treatment so they don’t pay corporate income tax. These qualifications include:
    • REITs must pay out at least 90% of their taxable income to shareholders as dividends each year. Many REITs will pay out more than 100% of their taxable income because their cash flow, measured by funds from operation ( FFO ), is often higher than income due to depreciation.
    • Be an entity that would be taxable as a corporation.
    • A board of directors or trustees must manage them.
    • They must have fully transferable shares.
    • Have a minimum of 100 shareholders after its first year as a REIT.
    • Have no more than 50% of its shares held by five or fewer people during the last half of its taxable year.
    • They must invest at least 75% of total assets in real estate assets or cash.
    • Get at least 75% of its gross income from real estate-related sources, including rents from real property, interest on mortgages, financing real property, and the sales of real estate.
    • A REIT must get at least 95% of its overall gross income from those real estate sources and dividends or interest from any source. In other words, 75% of its gross income must come from real estate, and only 5% can come from sources other than real estate, dividends, and interest income.
    • Have no more than 25% of its assets in non-qualifying securities or stock in a taxable REIT subsidiary.

    REITs often make great passive income investments

    Congress created REITs so that anyone could own income-producing real estate. Because of that, they’ve become a great way to earn dividend income. Add in their diversification benefits and historical returns, and REITs can be an excellent investment option.

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