While today’s real estate world might resemble yesterday’s on the surface, there are monumental uprisings lurking beneath, threatening to tip the balance of power from traditional buy a home and hold it forever to the income property model. As an agent, ignoring this reality could hit your pocketbook hard. The old real estate designations are no longer completely adequate to prepare you to reach the level of success you’ve dreamed about.
A 2004 study by Wholesale Access Mortgage Research & Consulting revealed there 53,000 mortgage brokerage companies in the United States and that these companies originate a full 68% of all residential loans in this country. Every state differs in the level of license and certification required of its mortgage professionals but the task of turning your mortgage broker education into something that equates to commissions in the pocket is a tricky prospect.
Now why the heck would local realtors be advised to talk to customers about the stock market? Well, obviously we at AIPIS are not suggesting you trumpet stocks from the hilltops as a sterling investment opportunity but the reality is that many people have a chunk of investment change sunk into Wall Street assets. One thing you should mention to potential real estate investors is the reality of tax code changes coming this year, which are set to see the top capital gains rate rise from 15% to 20%.
One of the first characteristics of income property investing you should convey to your customers is that all properties are not created equal. Knowing and understanding the difference between single-family, multi-family, and commercial income property can be the difference between success and failure as an investor. And trust us, there is much success to be found through this type of real estate investing but there is also a resounding crash waiting for you if you don’t understand what you’re getting into before you pull the trigger on that first deal.