Commercial Property Rental and Sales

Real Estate market is cyclic, meaning that it goes up and down in cycles. As we all know from hearing news about tons and tons of for-closures, the market is in a down cycle right now. I don't know whether we have hit the bottom yet or how long before the market starts to improve. However, following the buy low sell high principal, now would be a good time to purchase investment properties.

There are many reason for you to decide whether real estate investment works for you or not. Most importantly, it depends on your particular financial situation and your investment objectives. Comparing to other investment options, real estate investment has some advantages over others:

Cash Flow - Steady source of income to potentially replace your job income.

Appreciation - When the market goes in upswing, your property is likely to worth more than what your purchased it for.

Leverage - You can get started with very little amount of money as your capital. Your monthly cash flow can be used to offset your mortgage payments.

Amortization - Cash flow and leverage working together to reduce your outstanding balance on the property.

Tax Deductions - Mortgage interest, operating expenses, and depreciation are all good sources of tax deductions that save you money to boost up your net operating income (money in your pocket).

Commercial properties are different from residential property in that they are typically used for income-producing businesses whereas residential properties are typically used for dwelling. Commercial properties include Multi-Family, Office, Industrial, Retail, Shopping Center, Hotel/Motel,... etc.

Before jumping into actions, you need to do your own preparations that will help you answer questions such as these:

1. Where is a good area to invest in?
2. How do I evaluate if a particular property is a good rental property?
3. How do I calculate my cash flow and return of investment before buying the property?
4. How do I get qualified for mortgage?
5. How do I deal with property management?

Insider Secrets to Financing Your Real Estate Investments: What Every Real Estate Investor Needs to Know About Finding and Financing Your Next Deal is a highly recommended book that offers a step-by-step guide to buying an investment property. The author, Frank Gallinelli, written this book as Rules of Thumb as well as forms and checklists to show you:

• Selecting the best real estate investments for individual investor needs
• What lenders are really looking for in real estate investors
• Creating winning loan presentations
• Closing statements and what to expect when the deal is sealed

If you want to dig even deeper. Frank's other book: What Every Real Estate Investor Needs to Know about Cash Flow... And 36 Other Key Financial Measures will go into details on the numbers involved in evaluating a property. The book looks at case studies and walks you through calculation for each of the 37 basic formulas that include:

• Discounted cash flow
• Cash-on-cash return
• Net operating income
• Capitalization rate
• Gross rent multiplier
• Net present value
• Payback period
• Mortgage amortization
• And many more

This book is all about the numbers that you need to know about a potential investment property. You don't have to be a rocket scientist to use the formulas in this book. For each formula, Gallinelli clearly explains its significance for real estate investors, walks you through it, and provides examples and sample problems to help you master it. As an added bonus, the book supplies useful forms and spreadsheet templates that you can use to simplify many of the calculations. If you want to become a successful real estate investor, I highly recommend that you get familiarized with these calculations.

Okay, so now that we have done all of the homework, let's get started in looking at some properties. My favorite place is LoopNet.com. You can sign up for a free account and start looking at properties nationwide. Once you locate the property you are interested, contact the seller or agent for additional information and start plugging in your numbers!

Payment Options and Refund Status Information

Check out MyFavDeals.com for more hot deals!