Will Barnard is a real estate rehabber out of Southern California.

In our interview with Will (5:48 minutes), we learn what ARV or After Repair Value is, and how a house flipper would go about calculating this value. We also learn about finding comps and why ARV is so important.

You can also learn more about Will’s company at Barnard Enterprises

Be sure to read and watch dozens of other real estate interviews from BiggerPockets today!

This Article is Copyright © 2004-2011 BiggerPockets, Inc. All Rights Reserved.

What is ARV or “After Repair Value”?

Chris Clothier is a real estate investor, and co-owner of the turn-key real estate investment firm, Memphis Invest.

In our interview with Chris (45:13 minutes), we discuss a wide-range of topics pertinent to both novice and experienced investors alike, including: how to manage your portfolio, establishing a selection criteria for your properties, the need for capital to invest in rental properties, putting together a strong team, property management philosophies, why you should make major repairs at the time of purchase of your rentals instead of deferring maintenance, and many other topics around the concept of turn-key investments.

You can also learn more about Chris and his company via Twitter at @chrisdclothier or on YouTube at MemphisInvest.

Be sure to read and watch dozens of other real estate interviews from BiggerPockets today!

This Article is Copyright © 2004-2011 BiggerPockets, Inc. All Rights Reserved.

Interview with Chris Clothier of Memphis Invest: Turn-Key Real Estate Investments & Landlording

Joel Owens is a commercial real estate investor, CRE broker, and a long time BiggerPockets member.

In our interview with Joel (34:59 minutes), we discuss land development for commercial projects, owner financing multi-families, how to get started in commercial, triple net lease deals, wealth creation vs. wealth preservation, how to look out for retail deals that result in lower rents due to terminating leases, and using commercial hard money lenders so you can repair your properties, raise rents, and leverage your cash.

You can learn more about Joel via his Company’s site, All World Realty at GACommercialBroker.com

Be sure to read and watch dozens of other real estate interviews from BiggerPockets today!

This Article is Copyright © 2004-2011 BiggerPockets, Inc. All Rights Reserved.

Interview with Commercial Real Estate Investor, Joel Owens on Multifamily & Retail Investments

Boston ranks #1 on the Move.com list of top college towns for real estate investments

Results from one of Move’s earlier studies indicate that in the next two years, real estate investors are expected to outnumber homebuyers in local college markets by three to one. Move takes those findings a step further by listing the ten best college towns for real estate investments. With a guaranteed pool of renters and a perennial need, college towns are a wonderland of supply and demand.

Top 10 College Towns for Real Estate Investing

1. Boston, MA
2. Nashville, TN
3. Chicago, IL
4. Washington, D.C
5. Houston, TX
6. South Bend, IN
7. Atlanta, GA
8. Baltimore, MD
9. St. Louis, MO
10. Syracuse, NY

Here, Jennifer gives us the scoop on their latest survey results, proving that, despite all the trouble we’ve seen, investors are giving it the old college try.

How did your college survey come about?

We did a study back in May about how real estate investors are outnumbering home buyers in the current marketplace. And to further that, we thought we should look at some really good places to invest. We feel that one of those markets is the college town. There is a ready supply of renters. We know that you can cover your mortgage if you invest wisely. You can make your average mortgage payment from renting out your home, and maybe even make a little bit of money depending on the market.

Has investing in college-town property always been a good way to go, even before the current crisis?

Definitely. Investing in college real estate has always pretty much been a safe bet. You get something substantial — especially with the stock market turmoil, where people are not quite sure where it is going. Studies seem to show that if you are associated with a good university, people will always have a need to further their education and that they need a place to live while they are doing that. And a lot of universities don’t have housing of their own. They can’t house their entire student body.

Therefore, given the current market, this type of investment is considered more sound than ever.

It is. Normally when we were in a housing bubble, you had to look to see if prices were going to hold. It was also harder to get properties because they came on the market so quickly. And if you were investing in a town that you didn’t live in, it was harder to have your finger on the pulse of it. You wouldn’t want to get into a bidding war about an investment property. But now that houses are on the market a little bit longer, you have more of an opportunity to choose the right fit.

Is this list in any particular order?

It is based on the median list price, and the year-over-year change in it. And what the average rent is and the average monthly mortgage. We also looked at some of the studies that US News and World Report did, rating the best colleges. So we are looking at where people are attending school.

Where is the hottest spot for this kind of investing?

[Students] will always be going to Boston. There are so many schools, so many universities. The median list price in Boston is a higher list price than the US average, but it’s also in very high demand for rent. It is down from last year, about 2.6%. So the price is a good value right now.

I would imagine that New York, with all of its schools, is not as lucrative a market for the average investor.

New York – that’s a very tough market to get a good deal. Not that there are not great universities. It’s about the price points.

What are some of the common threads you’ve found?

If you notice the median price on all ten cities, the highest one that we have is $375,000 in Washington, DC. Most of them are under $250,000. For a smaller investor, that is more do-able. When you look at the mortgage payments, except for two cities, the average mortgage payment — if you put 20% down — is under $1,000. It’s a great investment without a huge outlay of cash. You’re not looking to be investing $10,000 a month.

What types of investors are most interested in college-town investing?

It can be a mom and pop. It can be [the type of investor who says], ‘hey, my kid is going to this university, so instead of spending $10,000 to the college’s room and board, let me invest that money.’ It does run the gamut. We didn’t do a study on this. It’s more anecdotal from real estate agents that we spoke with.

Most of the real estate agents that we have outreached to had clients who had done this — alumni of the school who rented property while they were there, and saw that it was a good way to make money.

I think most homeowners at some point in their lives had rented something and had always had that thought of ‘why am I giving the money to a landlord when I could be making money myself?’

What are some of the trends you are seeing?

Anecdotally, we are seeing that one of the reasons the market isn’t growing as much is that people aren’t necessarily selling their previous home. People are holding their real estate. We’re noticing at Move.com that our historical listing counts are lower than they have been. There are fewer properties on the market. People hold their property to grow their investment. It’s not the short-term flipper that it used to be. It used to be that people would hold a property for a few weeks or a month or under a year. Now people are expecting property prices to rise and they’re holding for years.
The study that we did back in May says that only 11% of the people who are investing in real estate expect to sell within a year of purchase. And two-thirds said that they are investing for the long term. They are buying real estate to hold.

Any predictions for the next 12-18 months?

There are definitely people sitting on the fence, trying to decide. We’re waiting to see how the government is going to define. There is a lot of housing legislation pending. Just how that gets resolved is too soon to predict. We don’t want to say the worst is over yet. It seems to be trending that way, but it is still fragile, and it is fragile on a market-by-market basis. Some markets are recovering and are trending up. Washington DC certainly seems to be one. Some other markets are stabilizing. We are hopeful, but it’s too soon to say the worst is over.

When you look at the stock market, and they’re saying that we’ve never had four days in a row of this kind of up and down, it does make people nervous. With real estate, if you are in it for the long term, it does seem to trend up.

Photo: David Smith

This Article is Copyright © 2004-2011 BiggerPockets, Inc. All Rights Reserved.

Real Estate Investing in College Towns: Top 10 List Revealed

Kevin Kaczmarek is a real estate investor and expert in land contracts (note investing) who started out wholesaling.

In our interview with Kevin (30:10 minutes), we talk about advanced note investing strategies, tips for getting started in real estate, using self-directed IRAs for real estate investing, and how BiggerPockets has helped his business to grow and thrive.

Kevin can also be found on his Company’s site, Capital Blueprints or on Twitter @sdiraexpert.

Be sure to read and watch dozens of other real estate interviews from BiggerPockets today!

This Article is Copyright © 2004-2011 BiggerPockets, Inc. All Rights Reserved.

Interview with Kevin Kaczmarek on Note Investing, SDIRAs, and Starting Out in Real Estate

Jonathan Rivera aka Real Tech Guy is a real estate investor and expert in marketing through social media for real estate professionals and investors; he is also the creator of Facebook’s hugely popular Real Estate Referral Group.

In our interview (19:35 minutes), we discuss his ventures as a landlord and rehabber, investing in low-income neighborhoods, how to treat tenants, how to use social media for real estate marketing (Twitter, Facebook, Google Plus), how to get leads, what kind of content you should be building to attract these leads, and who you should be listening to for advice for your business.

Jonathan can also be found on his own site: Real-Tech Guy.

Be sure to read and watch dozens of other real estate interviews from BiggerPockets today!

This Article is Copyright © 2004-2011 BiggerPockets, Inc. All Rights Reserved.

Interview with Jonathan Rivera on Real Estate Investing, Social Media & Marketing

Stephan Gietl & Fernando Levy Hara of mckafka Development Group

In a few short years, the partners have built quite a lemonade stand, picking up distressed properties by the bunch and marketing them to investors who still believe in South Florida as a paradise on Earth – and yet can’t believe the low prices!

They offer what they call “effortless investment,” where the properties are managed soup to nuts for buyers. This makes the offer hard to refuse, bust or no bust.

Gietl (from Austria) and Levy Hara (from Argentina) bring an international perspective to a market that is being picked over by an increasingly non-native group of buyers.

Here, Gietl discusses foreign motivations for investment and why South Florida is “it” despite what the naysayers are muttering. He explains his method of buying below replacement cost and why negative land value can be a huge positive for investors. He also predicts the light at the end of the tunnel, and that it will be shining like the Florida sun sooner than you think.

How did you decide to start up your company at the peak of all this economic chaos and doom?

We started in 2009, picking up distressed properties. Everybody was afraid and scared, but this is actually where you usually can make the most money. My partner and I came up with a very simple idea: if you can buy below replacement cost, it means that the land value is negative. In a market-oriented society — in a capitalistic system — land value in the long run can never be negative, but for only one simple exemption: and that’s if demographic data is so bad that people are leaving a place and you have no positive population growth. That’s the only scenario where you can have negative land value.

Can you give an example?

The one good example of this in the United States — and I don’t know a lot of them, honestly — is Detroit. In Detroit, you had a peak in the Seventies, when the population was a boom town, and then people were leaving and the whole real estate market busted. This was ages ago.

However, if you look at South Florida in the last ten years, they had a population growth of almost 20%. And still, people are flocking in from all over the world. We have the snowbirds whether there is a crisis or not a crisis, whether from Chicago or New York or even Canada and Europe. You have a lot of immigration from South America too. Miami is the hub of South America economically, and also for shopping. Argentineans in particular love Miami.

If you look at who is buying in Miami and Fort Lauderdale, you have a lot of people from South America, Canada and from Europe, especially from France and Germany. It’s becoming more and more international.

Orlando doesn’t play into the mix?

Orlando is a little bit different. Orlando is a typical place that is beloved by the British. Don’t ask me why. I don’t understand it. There is a big bulk of investment from the United Kingdom in Orlando. Orlando may actually have a little bit better growth than Miami and Fort Lauderdale. However, the properties there are usually just wooden frame. Due to the hurricane code, I think from 2007, you can only build concrete structure here in Miami. So the buildings do not deteriorate that fast.

So how did you proceed in your market with your master plan?

In total, we bought almost 300 units and we sold out. The last project we did in February, in Fort Lauderdale, was 68 units, and from February until today, we sold 32.

The name of the game in Florida is cash, right?

Most of the transactions are cash. What we see from the banks is an increasing interest in providing loans to foreigners. There is a special loan program called The Foreign National Loan Program, where a bank will not loan to domestic people that much, but will lend to foreigners. [People outside the United States] usually have a stronger equity base. Americans have a rather low savings rate compared to Swedes and Germans, who have tremendously high savings rates. So the banks don’t need to be scared that much [with Europeans], and the leverage is much less. It’s 60%. Domestic financing usually requires a leverage of 80% because people cannot afford the pay down. The foreigners say, “I don’t care if the leverage is 60%. I have the money. And the interest at the moment is low.”

What is the variety of properties you offer?

We offer from one-bedrooms to three-bedrooms in downtown Fort Lauderdale, by the New River. In the Village East, we have one and two bedrooms. We see that the one and two bedrooms are renting very well. Three bedrooms are more difficult.

[Investors] buy it as an investment and we provide full service. We have a property management company and we have the realtor company. We take care so the investors have absolutely no headaches. I have investors from Austria, and they invested in our property because they like it, and they get their reports twice a year. If the a/c breaks, if the tenant needs to be evicted, if it has to be re-rented, we do it. We do the painting, the carpeting, and if necessary, we do the accounting and the taxes for them. They really get the full package with no headache. It’s like being an investor in a vault.

What predictions can you share regarding the near future of your market?

This is what is going to happen within the next 18 months: you will see construction. The last year, we saw more in the low-income housing [sector] and now we strongly believe it will go to regular apartment building [construction]. We just got land under contract in Miami. We will start construction in 9-12 months.

I believe that the remaining inventory will be picked up in the next 18 months, and what’s interesting is that a whole industry is being established around this distressed investment. You have special bridge lenders that provide equity bridge or short-term loans. I assume that in the next 12-18 months, we will see the last really big and significant deals and then we will be ready for construction.

With all this action in South Florida, is it safe to say that you guys are not feeling the pain like the rest of the country?

It depends on how you look at it. If you go west of US 1, it’s more difficult. If you look at some of the buildings that got a mortgage, you understand why this could never work. The good location at the waterfront in Miami was tremendously overbuilt. But also, all the projections of the experts were wrong. They said there was an inventory of ten years and that Miami will be a disaster.

Now here comes the truth: it’s true that it was massively overbuilt, but what happened is that the developers started to rent out those really nice condominiums in downtown Miami, of course at a lower rent. And a lot of yuppies and young families were moving from the outskirts to downtown Miami. There is a very vibrant nightlife in Miami. A lot of restaurants have opened. So the city gained and changed. It’s much more attractive now, even in the nightlife. A few years ago, it was a dead city. It has since become more attractive.

The condominiums have been picked up by a lot of buyers. There is still an inventory, but the inventory is much less than predicted. I think it’s less than one year now. Two years ago, it was predicted that it would last for ten years. And I think this is the difference. We have to look to certain places. It might be true for, let’s say Homestead or Tampa, but as far as Miami, international buyers come because the prices are so low compared to their home country, that it makes sense to buy now.

Can you take this formula and try it somewhere else in the country?

I was looking at California in 2009, but it’s a very regulated market. You have to be there for many, many years to understand all the minor details. I think it’s very easy to fail [in California] because it’s a heavily regulated market. That’s why we like Florida, to be quite frank: if a tenant is not paying, you can evict the tenant in three weeks. Try this in New York. It’s much less headache [in Florida].

What are the challenges you’re facing currently?

The most difficult part, especially in 2009, is to convince people that it’s the right time to buy. 95% of investors that you see are always a little bit behind the cycle. But the markets move massively, like in the stock market. If two or three big players start to fail, everybody fails. It becomes a panic. It’s the same in real estate. Everybody was pessimistic. You had this terrible forecast. But there are a few people who said, “You are right. I am now below replacement cost. The unit is rented. I make a yield of 7%.”

So before any development can start, the pricing of existing inventory has to rise, because otherwise no development is going to happen. And the strongest argument in the United States compared to other developed nations is that you still have significant population growth. And if you look back to the last three to four years in the United States, the inventory increase in multi-family is ridiculous.

We also see one of the lowest construction activity periods in this century. There was only one period lower and it was between 1971 and 1980, where you had lower construction activity. But with the population rising, there will be a demand. A lot of younger people right now are moving in with their parents. This is something that can last for two or three years; but if you get older, you want to have your own home. They will push the demand again in the next two or three years.

What most surprised you about your experience in South Florida so far?

First of all, we were surprised at how fast inventory was absorbed. But the most difficult thing today is to find the good deal. You can find many deals, but you need a good location where you know your investment is going to stay rented over the next year and the building is not going to deteriorate. I think that’s the most difficult part.

From a macroeconomic perspective, we are a little bit surprised by the slow pace of improvement in unemployment. This is one of the key ingredients, especially for residential. The higher the unemployment, the less likely that the housing market is going to recover.

However, having said that, there is one phenomenon, and it’s also something that we were surprised about: even though the unemployment rate is quite high, the rents are currently increasing, especially in Fort Lauderdale.

So all the people who cannot afford their mortgages anymore, they need, of course, to rent. The foreclosure, on the one hand, which is the most serious overall in the economic situation, pushes the rent further because people need to rent. And even with a massive inventory and the banks starting to rent out, and even with this shadow inventory, the rents are increasing. This is one of the biggest surprises. We were not expecting that the rents would increase that much.

What advice can you give investors in the South Florida market?
Wait, because prices will recover in the next two years.

This Article is Copyright © 2004-2011 BiggerPockets, Inc. All Rights Reserved.

Stephan Gietl of the mckafka Development Group on the South Florida Real Estate Market

Jeff Brown aka BawldGuy is a real estate investor and retirement planning specialist. In our interview (34:42 minutes), we talk about his career through the decades, how investing, financing, and the real estate markets have changed over that period, and delve into real estate investing with an eye on retirement.

Jeff is one of the sharpest guys in the real estate investing world and has lots of interesting things to share both in the interview, on his own site, and every Tuesday on the BiggerPockets Blog.

Be sure to read and watch dozens of other real estate interviews from BiggerPockets today!

This Article is Copyright © 2004-2011 BiggerPockets, Inc. All Rights Reserved.

Real Estate Investing Over the Decades: An Interview with Jeff Brown

Loc Rao is a real estate note investor who gives generously of his time to help other investors. In our interview with Loc (26:53 minutes), we cover all the basics of note investing and then some. If you’re looking for alternative investment strategies and have an interest in real estate paper, notes, or mortgages, then sit back and get out your notebook – this primer is for you.

Be sure to read and watch dozens of other real estate interviews from BiggerPockets today!

This Article is Copyright © 2004-2011 BiggerPockets, Inc. All Rights Reserved.

Real Estate Note Investing 101: An Interview with Loc Rao

In our interview with real estate investor, Greg Brister (13:38 minutes), we get into how to deal with your banker in order to get your loan closed. Learn what due diligence you need to do and how to prepare your documents before you walk in the door of the bank. Greg also walks us through all the preparation he goes through to get the bank to say yes and finance his deals. To supplement his interview, you can download his presentation containing all the paperwork discussed above –> Get Your Banker to Say Yes

Be sure to follow Greg on Twitter and visit his website TheChargerProperties.com.

Finally, read and watch dozens of other real estate interviews from BiggerPockets today!

This Article is Copyright © 2004-2011 BiggerPockets, Inc. All Rights Reserved.

Getting the Bank to Say Yes! An Interview with Greg Brister

Ken Corsini is a real estate investor and founder of Georgia Residential Partners, a Turn-Key property investment firm. In our interview with Ken (12:56 minutes), we get into topics including why to get into turn-key properties, who might consider these investments, the benefits and negatives of a turn-key property investment, what to expect with these investments, and how it all works! We also cover what newer investors should do if they don’t want to go this path. If you’re a newer investor and are considering landlording out of state, this is an interview you can’t miss!

Be sure to follow Ken on Twitter.

Finally, read and watch dozens of other real estate interviews from BiggerPockets today!

This Article is Copyright © 2004-2011 BiggerPockets, Inc. All Rights Reserved.

Turn-Key Property Investing: An Interview with Ken Corsini

Tom Tarrant is a real estate rehabber or house flipper, and one of the top real estate investing bloggers out there. In our interview with Tom (30:44 minutes), we get into topics including real estate blogging, building credibility, how your blog can be used to increase dealflow, rehabbing strategies, picking the right house, a unique rehab niche strategy – functional obsolescence, rehabbing criteria, how/why an owner could/should act as their own general contractor, finding a great contractor, numbers and margins, and much more. This interview is chock full of tips for those people interested in flipping houses . . . you don’t want to miss it!

Don’t forget to check Tom’s blog, TomTarrant.com, and be sure to follow him on Twitter.

Finally, read and watch dozens of other real estate interviews from BiggerPockets today!

This Article is Copyright © 2004-2011 BiggerPockets, Inc. All Rights Reserved.

Interview with House Flipper & Real Estate Rehabber: Tom Tarrant