We have decided to relocate our blog. We hope that you will still be interested in following our real estate market as you look to invest in Utah. Please check out the new home of
Utah Real Estate Investor blog at http://khayyamjones.com/blog
Saturday, September 12, 2009
We're Moving Our Blog
Saturday, August 22, 2009
For Rent: 199 S 1680 W, Provo, UT $685/mo
I have an apartment for rent in Provo, UT for only $685/mo. This apartment is in a side x side duplex with a nice, large back yard. It also has central A/C, double paned windows and was just repainted. The apartment is available immediately and starts with a 1 year contract (through July 31). Please contract me if you would be interested in renting this apartment.
Thursday, August 20, 2009
Evaluating a Lot Split Property in American Fork
In this video I walk through a brief property analysis to evaluate the potential of a property in American Fork, UT for subdivision (lot split) possibility. This property has been on the market for about 1 year because the asking price does not justify what the property can become.
This property needs 150 feet of frontage to subdivide into 2 lots. Many people have approached the neighbors about buying the missing land but the neighbors do not want to sell. Using Highest & Best Real Estate Investing techniques we uncover another option.
This video goes through the steps of the initial property analysis to determine if there is enough potential to pursue this property (and move to the next step in the evaluation process).
Tuesday, August 18, 2009
Free Housing for 1 Year
The average renter in Provo, UT is paying $685/mo to live in a 2 bedroom apartment. That means that over the next 12 months this renter will spend over $8,200 just for housing. But what if there was a way to save that $8,200, would that make a difference in your life. What could you do with an extra $8,000?
Right now there is an opportunity for this renter to qualify for a special program that is currently being offered by the government. In order to help stimulate the economy the Obama administration has passed what is commonly known as the Obama Tax Credit for first time home owners. The tax credit is available to people who have not owned a home in the past 3 years and buy (and close) on their home before December 1, 2009.*
Imagine that you are currently looking to rent a 2 bedroom duplex apartment for $685/mo but instead you buy that same duplex for $200,000. Using the current FHA loan program you could buy the duplex with 3.5% down payment ($7,000; which is a little more than first and last month's rent and a security deposit). You would then have a loan at 5.5% interest for 30 years (fixed rate) which would give you a principle and interest payment of $1,095.83. Now here is how you live here for free for the 1st year...
A duplex will have a renter in the other unit which is paying the same $685/mo that you were willing to pay. So after you receive your rent payment your $1095.83 payment becomes $410.83! Right there is you save about $275/mo just by buying the duplex you were going to rent. But there are more benefits!
Next, as a first time home owner you receive the Obama $8,000 tax credit which is money that is refunded back to you as soon as you file you 2009 taxes. $8,000 averaged over 12 months is like getting $666.67/mo. So your $410.83/mo is effectively reduced to -$256.84/mo (which means that you are being paid $256.84 a month to live in the duplex apartment that you were originally going to rent). But wait, there's more...
As a home owner you also receive a tax deduction for the mortgage interest that you are paying on the duplex. Over the next 12 months you would expect to pay about $10,500 in mortgage interest. This $10,500 is subtracted from your income before you pay taxes which could eliminate up to an additional $3,000 from your taxes! That $3,000 tax saving is effectively another $250/mo paid to you. Now you are effectively receiving $256.84 + $250 = $506.84/mo because you are buying the duplex instead of renting it.
So the average renter could effectively be paid $506.84/mo to live in their duplex OR the can pay $685/mo simply to rent it. Not only does the renter become a home owner, they receive the monetary benefit of home ownership AND they will also receive the equity from the property appreciation. The best part is that this renter now owns a cash flowing property that will continue to pay them as long as they want the income!
*Some restrictions apply.
Monday, August 17, 2009
Sunday, August 16, 2009
Home For Sale: 236 W 800 N, Spanish Fork UT
This lovely period home has been updated and remodeled multiple times. The recent remodel updated the bathroom, new carpet & paint, heating & A/C, electrical upgrades, and wiring through out the home (with CAT-5 internet wiring to each bedroom).
The home is conveniently located close to the new retail development project (coming soon) in Spanish Fork. It also has easy access to I-15 and Main St. And this home is close to schools.
The list price on this home is $164,900. The seller is open to a convention purchase or various seller financing options. This home is available for immediate occupancy. A first time home buyer could purchase this property with an FHA loan. The buyer would need 3 1/2% down payment ($5,775) and could obtain a 30-year fixed rate loan at 5.5% for a principle and interest payment of $908.75/mo. Plus the first time home buyer can get an $8,000 tax credit if they buy before November 30, 2009.
An investor could buy this home with 20% down payment ($33,000) and get a 30-year fixed rate loan at 6.5% for a principle and interest payment of 749.48/mo. We had previously rented the home for $1,250/mo but at a conservative $1,100/mo the investor would have at least $300/mo in positive cash flow ($3,600/year) which gives more than 10% ROI!
Friday, August 14, 2009
Approved Short Sale: 20 E Maple Lane, Pleasant Grove, UT
I have listed a home in Pleasant Grove, UT that is an approved short sale. The home owners originally bought this home for about $175,000. According to the lender's BPO the property is now only worth $150,000. However, the lender has already indicated that they are willing to sell the property for $135,500! A buyer on this property would start of with nearly $15,000 in instant equity. That is absolutely fantastic in this market.
The home has 3 bedrooms, 1 bathroom, 2 family rooms, 1,210 square feet and central A/C. This home is conveniently located with easy access to Main St (Geneva Road), State Street and I-15 (at the new Pleasant Grove exit). It is also located near shopping (including Wal-Mart) and schools.
The lender has approved a price of $135,500. A buyer (who would live there) could get an FHA loan with 3 1/2% down payment ($4,750) and have a 30-year fixed rate loan at 5.5% giving a principal and interest (PI) payment of $742.38. Not only that, as a first time home owner this buyer would also get $8,000 tax credit (refund) next year; that would make the first year's payments effectively only $75.71/mo!
An investor could buy this property with a 20% down payment ($27,100) and get a 30-year fixed rate loan of 6.5% with a PI payment of $685.16. A 3 bedroom home average rent in Pleasant Grove is $1,000/mo. This gives the home at least $200/mo positive cash flow ($2,400/year) or a 9% ROI on the invested money, not including tax benefits.
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