Marketing Your Rental Income Properties Effectively

Anyone who has been engaging in real estate investing for any amount of time has surely tried to sell an investment property at one time or another.

It’s called marketing. Over my thirty-year real estate career, I certainly did my share. And though my attempts didn’t always produce a successful outcome, the experience taught me a few things about marketing rental income property I would like to pass along.

Most are common sense, but mentioned as a reminder because there are realtors and sellers out there who need to hear it. The remaining tips are more subjective, but included to help you consider what might be a more effective marketing approach than you’re using.

Foremost, never make your marketing packages too vague. When you omit important financial data, it makes it very difficult for a buyer to adequately determine whether or not it presents a good investment opportunity. And this will typically lead to a further exchange of data with a buyer or agent that, at the very least, will be time-consuming, and at the worst, could cause a buyer to lose interest in the deal altogether.

Secondly, resist the temptation to skew the property’s financial data to appear overly optimistic. Perhaps rents can get raised, for instance, and you want to reveal that. But if you over-inflate what you deem could be future rents, you risk losing your credibility with the buyer, or may end up wasting your time in a deal that never has a chance anyway, once it’s subjected to the buyer’s due diligence. Keep your estimated assumptions realistic.

Thirdly, and this is a bit more subjective, don’t present marketing packages that contain everything but the proverbial kitchen sink-at least not in your initial presentation. In my opinion, distributing more than a three-page property report at your local investment club meeting or in response to a telephone inquiry, is overkill. Remember, you’re just trying to generate a response from credible investors with a valid interest; a more comprehensive set of reports can always get presented during subsequent exchanges.

Okay, now let me show you the essentials that worked for me. For simplicity, I’ve organized them by category: the numbers, and the reports.

The Numbers

Aside from sale price (which is a given), you’ll want to provide an itemized break down for the property’s annual cash flow, and computations for at least two rates of return.

  • Cash Flow

Cash flow is crucial because it’s essentially what the real estate investor is purchasing in the rental property. So compute it for at least the first year of ownership by focusing on the following three financial elements:

  • Gross Rental Income
  • Operating Expenses
  • Debt Service

Rates of Return

The rates of return (at least the two listed below) are important for the investor to determine whether or not his or her yields get met as well as providing a good way to compare the property’s financial performance and value to other similar-type rental properties in the market area.

  • Cap Rate
  • Cash-on-Cash

The Reports

Here are two reports I commonly used for initial inquiries. Both clearly show the rental property’s cash flow, and each include the cap rate and cash-on-cash rates of return. So they are informative, easy to read and understand, and straight to the point. Consider them as examples.

  • Marketing flyer

This announces the listing to the community-at-large (i.e., investment meetings, call-ins, and inquiries from colleagues). (Sample available on my site).

  • APOD

This enables you to show your own investor-customers a likely scenario during the first year of ownership. (Sample available on my site).

In a Nutshell

An effective way to market rental income property is to consider the process in two stages: the initial presentation, and the subsequent follow-up. Keep the initial presentation concise; even one report with enough data to reveal the property’s description, estimated cash flow, and investor’s rate of return should be adequate to garner interest from credible buyers when they exist. And reserve all the other reports (e.g., acquisition funds, proforma income statement, rent roll) to the subsequent follow-up exchanges.

Lending Private Money on Real Estate

Lending to real estate investors offers the Private Lender many benefits not otherwise enjoyed through other means. Before we get into the benefits, let us briefly explore what Private Money Lending is. In the real estate financing industry, private money lending refers to the money an individual, not a bank, lends to a real estate investor in exchange for a primary determined rate of return or other consideration.

Why private loans? Banks do not typically lend to investors on properties that require improvement to attain market value, or ‘after repair value’ (ARV). Savvy people with available cash in a broker account or self-directed IRA, realize that they can fill the void left by the banks and attain a greater return than they may be currently getting in CD’s, bonds, savings and money market accounts, or even the stock market. So a market was born, and it has become essential to real estate investors.

Private Money Lending would not have become popular unless Lenders saw a tremendous value in it. Let us review key advantages to becoming a Private Money Lender.

Terms are negotiable

The Lender can negotiate interest rate and possible profit share with the borrower. Additionally, interest and principle payments can also be negotiated. Whatever agreement that suits both parties to a private loan is allowable.

Return on Investment

Current interest rates charged on private money loans are generally between 7% – 12%. These rates, as of April 2018, are currently greater than returns from CD’s, savings and money market accounts. They also outperform the 4.7% the stock market has produced, inflation adjusted, since 1/1/2000. That is over 18 years.

Collateral provided

Real Estate property serves as collateral for the loan. Most real estate investors acquire their properties at a significant discount to the market. This discount provides the lender with quality collateral should the borrower default.

Choice

The Private Money Lender gets to choose who to lend to, or what project to lend on. They can get detailed information on the project, the investors experience, and the kind of profits normally made.

No Effort

The Lender only worries about the loan. The Investor takes all the other risks and does the work to find, purchase, fix and sell the property. The Lender just collects the interest.

Stability

Real Estate does have ups and downs. But its volatility is nowhere as pronounced as the stock market. Additionally, when purchased at a proper discount, the property provides a cushion against the ups and downs.

Tax Free/Tax Deferred

A Private Money Lender can lend on real estate from a self-directed IRA. The gains achieved can grow either tax-free or tax deferred helping to build the retirement nest egg faster than ever.

Diversification

Lending on real, tangible, brick and mortar assets provides additional diversification to a Lenders portfolio to provide protection in the event of a down period.

If you have the desire to invest in real estate, but don’t want to take on all the associated risk, or get your hands dirty, private lending could provide a wide range of opportunities and benefits in growing your wealth and providing for your retirement.

Global Business on a Budget

Businesses today need to look beyond geographical borders in order to expand. There is a whole world of consumers, customers and clients out there waiting to buy your service or product. Opportunities aplenty await the astute businessman willing to take the risk and go global.

“Going Global” does not need to be expensive. It’s relatively straightforward and cost-effective to target foreign markets if you are astute enough and cost conscious enough. Neil Payne set up his business on a laptop in a studio flat in 2018. He now oversees a company with offices in the UK, USA, Argentina, South Africa, Germany and the UAE. Here are some tips on how he did it.

  • Marketing

“Marketing doesn’t need to be expensive anymore,” explains Neil. You don’t need a massive budget to get customers. A simple website, fully-optimized for the search engines and in the local language is probably one of the most effective means of entering a market at very little cost. If worse comes to worse you may lose a few hundred dollars.

  • Phone Bills

Using Skype, Google Chat or any other VOIP system dramatically reduces phone bills. With Skype you can call internationally for as little as £0.02 per minute which, compared to landlines, is peanuts. “Skype has helped us in many ways”, adds Neil. “Not only can all offices conference call for pennies, but in emergencies we can even have calls forwarded via Skype to one of the other offices ensuring we never let clients down.”

  • Virtual Working

If you fancy having a go at a market it’s not always necessary to actually have staff on the ground there. “When we first started our operations in Germany we actually had a German speaker in the UK office handling calls and emails. We still had a German number and appeared to be in Berlin through using a virtual office,” comments Neil. “Once we knew the German market was for us, we only then invested in people there.”

  • Get Funding

Governments generally want to see businesses doing well abroad. It’s good for everyone. As a result there are usually pots of funding available for companies wanting to trade abroad. UK Trade & Investment (in the UK) offer numerous incentives including Market Research, Aid-Funding and one-to-one business advice. Check what other grants may be available through local governments, enterprise incentives and the like.

  • Watch Exchange Rates

Many a decent business as been caught out by exchange rate fluctuations. “I remember many years ago when the Euro suddenly shot up against the Pound. We were losing money hand over first to our Europe based suppliers, ” states Neil. “In the end we decided we had to fix rates against the Pound so that we were always paying the same amount regardless of exchange rates.”

  • Money Transfers

Working internationally inevitably means you have to pay people in foreign locations. Avoid paying money via wire transfers. Banks charge extortionate rates. There are plenty of alternatives now on the market such as Moneybookers, Paypal, Payoneer and the like. “We used to be charged £25 per international transaction by our bank. Now we use Moneybookers and literally get charged around a £1 per payment,” states Neil.

  • Minimize Business Trips

Travel costs time and money. In the age of conference calls, emails, the internet and online demonstrations travel is no longer a necessity. You save thousands in using technology to address problems, meet with employees or sell to customers. “But,” adds Neil, “always bear in mind cultural differences. Some cultures will only ever really want to do real business with someone face-to-face. Doing so online may actually alienate them.”

  • Book Flights in Advance

If you are prepared enough you can block out a few weeks well in advance and use this time to visit a location. You will then be able to tell suppliers, customers and staff to also set aside those times to meet with you. This then allows you to book flights well in advance and save serious money.

  • Centralize Functions

If it’s possible to do so, have one of your offices deal with a certain function. For example, you may do all your invoicing from one location, all quoting from one location or all marketing from one location. This saves time and money and decreases the burden on the different locations.

  • Look for Local Partners

“My strategy for all our offices has always been that I want to find someone like me in that country; someone with entrepreneurial skills and plenty of passion. If you find the right person they can take on your business and make it their own at a fraction of the cost of immediately employing a manager for example,” says Neil. If you do not want to go through the burden of managing an office or staff, then look to franchise or partnership agreements.

Apartment Accommodation in Argentina

If you are planning a trip to Buenos Aires, one of the most important things to take into consideration is your lodging during your stay in the city. Today Buenos Aires has a wide selection of accommodation and furnished apartment rentals have become a popular choice.

While international known hotels have similar average rates in all big cities of the world, apartments rental rates in Buenos Aires offer great amenities with domestic rates, which makes it very attractive for the independent traveler.They find it more convenient and considerably less expensive, specially for long stays.

Renting an apartment is the most cost effective way of lodging, giving the traveler more independence in terms of time and of course much more privacy. In an apartment you can cook your own meals in a proper fully equipped kitchen, while enjoying homely comfort.

When traveling with the family there is no doubt that this is the best way to continue with the home routine, having lots space for each member, and more than one room if required. Many students also lower their accommodation costs sharing an apartment during their stay. Executives, tired of hotel rooms and restaurant meals prefer renting an apartment in a high quality building.

There is a wide selection of apartments in every neighborhood of Buenos Aires. All of the apartments are thought and design by their owners to provide the best facilities for the guests whichever their budget is. They are fully equipped and furnished, and include all the linen, crockery or anything you might need during your stay. They all come with cable TV, fridge, microwave oven and now many of them offer a weekly cleaning service and Internet connection.

There are also exclusive luxury apartments, with attractive design interiors, stylish furniture, and the latest entertainment equipment, many of them offer amenities such as swimming pool, tennis court, gym, sauna and maid service. Located in the best neighborhoods of Buenos Aires, such as Puerto Madero, Downtown , Recoleta, Palermo and Las Cañitas, they have nothing to envy a five star hotel suite.

Fortunately, today you can search for a short term rental apartment online before arriving to Buenos Aires. These sites will show you pictures of the apartments, have a complete property description, check the equipment and the availability calendar, locate it in a map and learn about its surroundings.

Weekly rates start at around USD 250 and the monthly rates at USD 550! All included.

Usually studios are for 2 guests and bigger apartments with one or two bedrooms are for 3 or more guests. Some apartments have lovely patios or terraces with barbecues where you can grill your own Argentine “asado”. This is definitely the best way to take better contact with the Buenos Aires way of life.

Every apartment is strategically located, close to commercial areas, touristic points, and universities, so if you come to Buenos Aires as a tourist, a student or a business executive there is surely a furnished apartment that will suit you best.

Land and Property Investing in a Rising Market

Argentina is one of the most varied and interesting places to be found on the globe. A melting pot of nationalities populated the country in the 19th century and they have left indelible marks on the country from the English Cricket Club at Buenos Aires, the Welsh in Patagonia, the Italian Chic and Parisian construction of the Capital city and the organizational structure taken from the Spanish.

As many people know, Argentina defaulted on its foreign debt in 2001 and one of the effects was that the banks were closed and people could not get access to their money. It was finally decided that the old order had to go, the politicians that had taken Argentina to this point and for once it wasn’t the military who took the action. New President Kirchner has steadied the ship despite the forced devaluation of the peso which previously traded at 1:1 with the dollar, is now at 3:1. Therefore life became a lot more expensive for Argentinians who earn in Pesos as everything from real estate through to cars became triple their previous price. Things that are priced in pesos remained the same apart from the relatively high inflation rate which is now being dealt with.

Investors therefore had and are having a field day. Suddenly there was a fire sale of properties because people couldn’t get their money from the banks and prime real estate was being sold off at bargain basement prices. Those who came in taking both the long and medium term view are currently enjoying increases in their investments of over 200% compared with the prices in 2001-2.

Buenos Aires real estate is booming with increase reported of up to 37% in the year to October 2006 and the rest of the country is enjoying the boom that the trickle down effect creates from Buenos Aires.

The Mendoza province is the huge wine growing area and is considered a paradise on Earth by some. Patagonia is enjoying a tourist boom to what they describe as a huge Lake District. Argentinians now take their beach holidays in Las Grutas where the warm waters lap up giving it a large advantage over other areas at these latitudes and Argentina shares part of the Iguazu Falls, the most spectacular waterfalls in the World probably which is now being developed for tourism.

The country is fantastic, the culture is a melting pot, part Italian, part Spanish in its majority but there is a part of Patagonia where Welsh is spoken by a whole community, the remnants of a business in cattle and sheep from many years ago (Even the place names are in Welsh)

The economy of the country is basically sound now that the old order and corruption have been eased out of power. It is based on land, lots of it, meat, wines, cash crops, and possibly most importantly oil. The area around Neuquen is a huge oil field meaning that petrol in Argentina is around 30p per litre (if you can afford a car which of course are priced in dollars)

Valencia Property S.L is offering a tract of land by the beach in Las Grutas in Rio Negro province. It is the perfect place to construct holiday villas or small hotels as demand is multiplying in the area year on year and looks to continue that way for the medium term future. This is the area that middle class Argentinians are flocking to in their droves for investment and holidays since they cannot now afford the USA. The plots we are selling are priced at between 12 and 13500 Euros and building on the plots will be relatively inexpensive too with a 100m2 house expected to be built for around 40000 Euros.

Business Cycles – The Stages of Business Growth

Business Cycles – The Stages of Business Growth

  • Initiation

There can be varied reasons for a business start-up but the main values in running the business are of those who are the founders. We can see that company exhibits the main skills of the founder in its spirits, for example, if the founder is an engineer, he will emphasize in production rather than sales and marketing which should not be neglected. Main efforts are centered on the acceptability of the product in the market. If the owner can provide the demands of business i.e. time, energy, and finances, he/she can move to the second stage. Otherwise, he/she will have to wind up their business as there is limited time for the company to stay at one stage. Here the main focus changes to establish the company and earn profits. With this financial push company will need to formalize the system and start record keeping, an unskilled manager can’t handle this all. After this, there will be demand for change in administration’s style because of increased activity in his business.

  • Growth

The moment a company moves forward to the expansion stage it should be able to earn a decent profit, but that profit will not go to the owner. This is because it will be invested in the business in order to assist in the capital demands of the company. It demands time for coordinating functional managerial activities; it demands complicated organizational structure mainly focusing on functional lines. Now research and development will be established in order to increase product range. At the start, it will be on a smaller scale because of lack of capital. If management continues changing its environment, the company can stay at this stage for some time. In many cases, owners sell their business at this stage for substantial benefits. The increase of new markets and product will demand more finances. This stage faces larger competitors who deal the situation by putting stress on emerging firm; this stress can be in the form of very low prices as well. At this stage over trading is the biggest threat if not handled properly it can lead the business to demise. As the company grows it need to extend geographical trading and distribution, so ‘supervised supervision’ will be required at this stage. If new competitors enter the market and the owner wants to maintain his shares, he will have to put more capital by himself or attract some partners.

  • Expansion

This stage demands proper management reports, budget control, and dispersed authority, along with a formal accounting system. Basic adaptation at this stage will be to systemic administrative roles which are keys to survival through this stage. The expansion stage demands stable long term funds which will be important and if there is not plan for partners then this stage must be considered right now. Although retained earnings are major forms of funds but dividends are the special attraction to the investors; at this stage these are inevitable. Now company’s track record will help in gaining long term loans but the company will have to give security in the form of assets.

  • Maturity

At this stage main issues are about expense control, search for growth opportunities and productivity. The direction of authority can be towards functional lines or it is reorganized with production lines. As there is severe price competition, therefore, productions department should be the center of focus and authorities should emphasize on innovative moves towards betterment.

Now basic investments are in sales and marketing struggles and maintenance and plant up gradation. The company grows up to a level that income is sufficient to tackle this but occasionally more long term load prove to be a support. At this level firm may limit its operations or move on, normally acquisition in order to become a large corporation.

Whatever the situation, managers are pressured by shareholders to safeguard the future of the firm. However, the time of great trial falls to the founder. He built his business with great effort and sacrifices, and now he is asked to give it away.

Innovating The Business Product Quality

There are a large number of products available today. The first and foremost thing which comes to our mind, as a customer, is the quality of a product which we would like to purchase. We will be going through some tips which could be implemented as a producer to produce the best quality product in the market.

Keep it Simple – Producer’s creation should be such that it appeals to the customers by its simplicity and ease of use or handling. Customers do not want a product to be complicated or difficult to use. Some products get rejected even after getting shortlisted by the customer. This happens during a trial session.

  • Tryout the product yourself

Think about the situation where you yourself are not satisfied with the product. It is hence, the most important and ignored part that producers should mind while trying to improve the quality of their product. The producer should indeed be pleased with the quality of his produce. Sometimes quality control is not enough.

  • Product needs to be Unique

Everyone craves to be different; similarly, everyone also want their products to be different from others. As a producer your vision should be to provide variety to your customer. Variety can be of colors, shapes, sizes and whatnot!

  • Never Target a particular group

A product can be meant for a particular group of people when produced, but as it comes out in the stores, there can be different types of buyers depending on their personal requirements. People can buy a product for their friends or family, for gifting it to somebody, or simply for any use other than expected!

Focus on the product’s Usefulness

Even if your product is of different use for each customer, but for improving your product quality, you need to focus on how your product can be of a better use for the general customer base. A person by and large buys those products which are more worthwhile.

  • Avoid Comparing your product

Most of the producers compare their product with those of their competitors’. Comparisons mostly lead to producing similar attributes as others. Customer tends to gets confused when he comes across such a situation where he has to choose between two similar products. Especially when he is out to buy a product for the very first time.

Always remember the rule of customer satisfaction and to promptly redress their grievances. Producing good quality product can be a challenging task, but maintaining and improving the quality at regular intervals of time can be even more challenging. As a producer, one needs to have that zeal for delivering a great performing product on a regular basis.

Start-up Restaurant With No Money

For some, owning a restaurant is a dream come true. Though restaurants are tons of work, they can also offer immediate gratification for those that love the work. Starting a restaurant is hard enough if you have the money to open it in the first place. But for those that have no money to back it up, the task at hand can take a little bit of creativity and tons of good hard work.

Start a Restaurant with No Money

Write a business plan. The plan should include the amount of money that you’ll need to make weekly, monthly and yearly. It should include your overhead, or what it costs to run the restaurant. This includes paying staff, rent, utilities, cost of food and advertising.

Apply for a small business loan. Use the information that you gathered from writing the business plan to apply for enough money. Go to a bank with which you have done business in the past. Take time to fill out all the paperwork and include all the information requested. You should already have be knowledgeable of your income in order to fill out the forms.

Approach friends and family who you think might be interested in helping you. Present them with your business plan. Assign an amount of interest that you are willing to pay for the loan.

Approach a wealthy friend to be your partner in the business. Tell him that when the restaurant gets off the ground you’ll pay him a certain amount in order to become a partner in the business.

Advertise cheaply. Once you have established loans to open the restaurant, it’s time to advertise–and the cheapest way to do that is online. Build a website by either enlisting the help of a website-designing friend or by building your own using inexpensive website design software. Start a free blog about the restaurant. Send out specials about your restaurant via email throughout the week. Use Facebook, MySpace and Twitter to advertise your restaurant.

Starting a Costume Rental Business

If you’re looking for a great business idea you may want to start a costume rental shop. This type of business rents costumes to individuals and community groups for special events, performances, holidays and festivals. While you will need a small amount of start-up financing to start a costume rental business, you will find that this type of company can become profitable very quickly. Best of all, this type of business can be fun for the right person, such a one who enjoys working in the entertainment or hospitality industry.

Research what type of costumes are needed in your area. Look to local events calendars and community organizations to see what type of costumes you could provide. For example, if your town hosts an annual Renaissance Fair or Formal Gala, you could market your business to patrons of these events.

Find a location. Most people won’t feel comfortable renting costumes from your house. To make your business look professional, rent a small storefront. Look for an area that can support costume rental fees. Make sure your shop has plenty of foot traffic or access to parking to make it a convenient place for customers to shop.

Purchase a supply of costumes from wholesale manufacturers. Start with the basics, like gorilla suits, clown costumes, Santa Claus outfits and the like. Add more specialized suits as demand becomes apparent.

Consider making some of your own costumes or adding to those you purchase to make them unique. This could save you money and also help your shop stand out. If you can’t sew, find a seamstress who can translate your ideas to cloth.

Add a selection of wigs, shoes and theatrical makeup to your store. Customers will purchase these items outright, adding to your bottom line.

Market your business to theatrical groups, community organizations and the public. Set up booths at area fairs and special events to let those who are most interested in costumes know about your new business.

Food Vendor Business

Have you ever dreamed of starting your own food-selling business? You can accomplish your goal by setting up a food vendor cart or table outdoors or at indoor special events. This way you will save money on overhead while sharing your culinary skills with the people in your community.

Purchase supplies. You can find discounted food items at local wholesale clubs like Costco or BJs, or buy in bulk at meat packing districts in your town. Don’t forget to purchase plenty of condiments, cooking oil, seasonings, drinks and eating supplies for your customers, including forks, knives, spoons, handy wipes, cups and napkins.

Go to your local courthouse or town administration building and apply for a food vending permit. You cannot sell your food out on the street or to the general public without a permit. The only exception is when you are on your own property or at an approved event. If your state has a sales tax, you are required to collect sales tax on your food sales as well, so you will be required to register as a business so the state can collect sales tax from you. This is a very important step—if you’re caught selling food without a permit you may face hefty fines and possibly have your food and equipment confiscated.

Purchase a vending cart or table. Consider how you will transport your cart when you’re making this choice. Buy a food vending cart with wheels and a trailer hookup so you can attach it to your van or truck and haul it away at the end of a selling day. You can also just buy four or more folding tables to set up in a square if you will be vending food at a festival or fair.

Purchase additional equipment that you will need to cook and heat up food, including propane tanks, pots and pans, grills and utensils.

Design a large colorful poster with your business name, logo, phone number and motto, and hang it on your food cart. Use a large banner sign if you’ll be setting up a food table. Create an easy to read price list for your customers that shows all the cooked food you have available for sale. Your price list can be your poster—just include the name of your business at the top.

Enlist help. Hire one or two more people to help you cook food, handle customers and deal with money. It’s almost impossible to take care of all of these duties on your own.

Purchase a cash register and/or a safe to store money received while vending your food. Some food vendors choose to keep cash on their person rather than storing it in a register. Sign up for a merchant account if you want to give customers the option of using a credit card; there are cell phone merchant accounts available that will allow you to process a credit card using your cellular phone.

Pick a location. If outdoors, this will be one of the most difficult steps, because there is usually a lot of competition in high-traffic outdoor vending locations for spots to sell food. Scour popular areas in your town to find ideal locations for your food vending cart or table. Bring your list of locations to your town administration building to ask if the locations are OK for setting up a vending station. Scan the events listings in your towns and call coordinators to ask about vending fees for each event.