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Frequently Asked Questions

Select one of the frequently asked questions below to learn more about buying and selling real estate. Also, begin to think about important things to consider when diving into your real estate search.

Question About Selling

It’s best to sell a house when there are more buyers than houses available. This encourages bidding wars on houses, and can substantially increase the selling price for your home. Some of the best indicators of a good time to sell a home include:
• When the economy is doing well and people’s outlook for the future is positive
• When interest rates are low – this allows people to borrow money more cheaply
• When people are more likely to move – traditionally many more houses are sold during the spring than during the winter

Before you sell a house, you should probably hire a professional home inspector because eventual buyers certainly will, and it pays to know what they will find first. A professional home inspection can:
• Allow you to address problems and complete repairs before you sell a home
• Help you set the price on your home
• Ensure that the sale process won’t be held up by unseen issues
• Reduce your liability by relying on professional documentation in your disclosure statement

Assessed value is different than market value or appraised value. There are many properties that could be sold for significantly more than an assessed value and others that maybe sold for significantly less. The assessed value of a home is used for the purpose of taxes in your local municipality. The assessed value of a home is multiplied by the local tax rate to determine what your yearly taxes are. The assessed value has no impact on how much your home is worth to a potential buyer in the marketplace.

The list price is the price a property is currently listed for sale at. The sale price is the price a property is sold at. A top agent should be able to suggest a list price that ends up being very close to the final sale price.

Question About Investing

One of real estate’s most renowned benefits is its capability to diversify a portfolio. But not all diversification is equal. Make sure you understand exactly how the addition of a new investment will impact the overall risk and earning potential of your investment situation. For example, whether an investment is in the public or private market can play a huge role in its power to diversify.

“Profit!” might seem like the obvious answer, but responses can differ as much as people themselves. For some, an adrenaline-pumping fix-and-flip is their first choice real estate scenario, while others want to stay as far away from hands-on work as possible. Knowing what matters most to you in an investment will help you determine a clear view of what success in this investment can look like. The world of real estate investing, in general, is profitable because it offers many financial benefits only to property investors.

One example of the tax benefits is that the cash flow that your rental property generates is tax-free. In addition, when property investors decide to sell investment properties and reinvest the profits, they are not required to pay the capital gains tax.
As for tax deductions, owning a rental property enables property investors to deduct almost all expenses related to their investment such as real estate property taxes, mortgage interests, insurance, and operation expenses. Being able to deduct from these expenses ultimately increases the real estate investor’s profits and overall return on investment. Exactly how much you can deduct depends on your rental income and local real estate laws in the housing market in which you’re investing.

Yes, they are. As a real estate investor seeking answers to are rental properties profitable, you should know that there are many factors that determine how profitable rental properties are. The 2 main factors are: appreciation and tax benefits and deductions. Thus, to understand when are rental properties profitable, a real estate investor has to perform a real estate market analysis to determine which rental strategy is optimal and generates a higher return on investment.

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