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Condotel or Apart-Hotel Suites Make an Excellent Rental Property Investment

Many people are aware of the strategy of developer extended loans to purchase rental real estate says Beth Collingz, Overseas Sales Director of PLC International, lead marketing partners for Pacific Concord Properties Inc’s Lancaster Brand of Condotels in the Philippines. You make a very small down payment with the majority of the purchase price payable over as long a period the developer extends at zero interest.

In Apart-Hotels or Condotels, the rental income goes a long way to cover the cost of servicing and managing the unit and in the long term after paying off the purchase price, can give a ROI through rentals of up to 16% per annum. Regardless of the possible bumps on the road to greater wealth, condotel investments are at least an easily-understood investment tool that most of us can handle added Collingz

Collingz expects rental income to rise 15 percent in the coming 12 months after gains of as much as 30 percent since January 2006, when Pacific Concord Properties Inc are set to launch Condo Hotel operations of their flagship Lancaster Suites located in the Ortigas business district in Metro Manila.

UK Private equity units of banks and investment clubs, driven in part by the current strength of the Pound Sterling in international trading, are being attracted by returns in the Philippines as much as double those in the United States and Europe, are purchasing significant blocks of real estate for investment trusts for Asian commercial property. There are large amounts of capital now chasing increasingly limited investment-grade real-estate opportunities in Asia, said Collingz. We are currently in the closing stages of packaging the investment of some $20M in private-equity real estate funds for new Lancaster Brand Apart-Hotel or Condotel developments in Metro Manila and Cebu, on the strength of expected rental returns which will continue to grow at a rapid pace. With funds raised for commercial property deals in Asia having doubled in each of the past five years, Collingz see the market value of Condotel investments in the Philippines reaching new heights in 2007/8 as more developments come on line.

Rising demand for homes, hotels, short and medium term rental accommodation, offices and shopping malls in the Philippines, home to a population of almost 80 million and with a significant number of the more than 10 million returning overseas Filipino Baby Boomers, is fueling rents. Residential rents in Metro Manila rose 26 percent in the three months to March 2007, their highest quarter-on-quarter increase in more than a decade, as more and more IT companies set up shop in the Philippines. Companies like Texas Instruments are investing $1B in expanded operations in the Philippines. High-end rents rose some 13 percent from a year earlier, said Collingz.

Collingz projects that Rents in the region are set to effectively jump up by at least 8.7 percent per annum over the next five years, compared with 3.3 percent in the United States and 3.7 percent in Europe. Yields from 8 percent to as high as 14-16 percent ROI on rental income property contrast with the 4 percent to 5 percent that private equity firms get in the United States and Europe.

People are in general looking to shift fund flows relatively towards Asia,” Collingz said. It already has had a profound impact in markets where there’s a lot of this money chasing the same assets. In Singapore, the region’s second- biggest market after Japan, investments by private real estate funds accounted for seven of the 19 office blocks, worth 6.7 billion dollars, sold since September 2005. REITs bought six. A Goldman Sachs fund paid 690 million dollars for two buildings last November that house the headquarters of DBS Group Holdings. In Hong Kong, property funds of Morgan Stanley and Macquarie Bank paid a total of 7.9 billion Hong Kong dollars, or $1.02 billion, for four office blocks from March to May, according a recent article published by CB Richard Ellis.

As the Singapore, Japan and Hong Kong markets become saturated, the Philippines will be the next real estate market to attract substantial overseas investments. Lower prices and retirees spending money are also directing foreign attention to residential condominium hotels in the Philippines, which in turn is driving up more construction. A lot of this interest is being driven by the relatively cheap market prices here compared to Europe especially UK housing prices and the easy payment options available for condominium hotel developments Collingz said. The buyers gain rental incomes that on todays purchase prices give a projected ROI of some 8 percent to 14-16 percent depending on the mode of payment for the unit she said.

Beth Collingz
PLC International Marketing Networks

We all know that buying real estate but especially in hot markets like Miami, is one of the biggest personal investments you can make. When you are buying in a competitive market, like the Miami real estate market, it’s important not to allow yourself to be pushed or cajoled into making a fast decision. The “fear of loss” factor is used very effectively by many real estate agents and is a popular ploy in the hotter markets.

The first thing you need to do is to understand that the market is cyclical. That is, it won’t keep going in any one direction permanently. OK, so over a long term of 5, 10 or more years, there will be a definite trend but don’t expect a year over year equity increase.

This fact free you from another popular real estate agent strategy… the “buy now because the price is going up” plan. Honest agents will show you market profiles that justify the asking price of any property. These profiles should include not only the asking the selling price also. There are agents that make statement like; “the market will go up 10% this year,” or “that you will make your investment up in 2-3 years.” Now unless they have a crystal ball or can see into the future, these are fluff statements that should raise a red flag in you mind.

Never buy real estate and base the purchase on something happening in the future. If it’s a “good deal” it’s a good deal NOW not in 10 years. A lot can happen during this waiting period.

This doesn’t mean that the market doesn’t get red hot or that if you don’t jump onto something immediately, it ends up sold. These things do happen. But it’s important to remember that there are other factors at work in any real estate market but especially evident in a robust or seller market.

These include the GREED FACTOR. People look back several years and then use that information to decide that the market will continue to go up in the future. “Previous returns are not indicative of future results” is a popular statement on many investments but some people don’t seem to believe it when it comes to real estate.

Next up is the GREATER FOOL THEORY. This is one that even bankers use to justify lending to some people who can barely qualify. The theory is that once the property is sold and the loan closed, the increase in appreciation will give the bank – or owner better protection. The idea is that the owner can sell it for more money to the next person willing to pay to get into the market. The problem is that once again, is assumes a continued positive appreciation in property values.

People seem to forget that it wasn’t that many years ago that property in much of Florida was sold off very inexpensively. There was little to no appreciation in many real estate markets throughout the country for years. A normal market will return sooner or later.

By buying into the hurry up and purchase strategy, you run the risk of buying at the top of any real estate market. This is especially true however when talking about a hot market like Miami Real Estate.

Purchase wisely as a good investment continues to be a good investment no matter what the market.

Bad Credit and Unsecured Credit Cards: Two terms that dont often go together.

If you are a consumer that is suffering from a poor credit history you are likely to be aware of how hard it is to get an unsecured credit card. A good majority of consumers are enjoying the conveniences of being able to shop with a credit card carrying and unsecured credit limit. While it is extremely nice to be able to apply for and actually qualify for a credit card you do not have to put money down to get you will quickly see that an unsecured credit card is usually the type of credit card that someone with bad credit is not very likely to obtain.

Since an unsecured credit card isnt very likely if you are having issues with your credit the best plan of action is to look into a secured credit card for the time being. There are many different types of secured credit cards out on the market for people with bad credit all with different options so be sure to shop around so do some comparison shopping so you locate the card that is going to best meet your needs.

Now while there is no rule set in stone about the exact time that you would be able to apply for and actually qualify for a credit card with an unsecured limit there are some factors that will determine what types of cards that you will qualify for. For instance your debit to credit ratio plays a big factor in whether or not you could get an unsecured credit card.

So while it is not unheard of for someone with a bad credit history to obtain an unsecured credit card the route that is easiest for most consumers is to obtain a secured credit card build up their credit and then apply for the unsecured credit card if they so choose.

How much does the average person know about investing?

According to American Century Investments’ “On Plan I.Q. Quiz,” a 10-question test taken by more than 800 investors, knowledge of some of the most basic investment concepts is poor. On average, participants selected about half of the correct responses on the multiple-choice test, which was given to individuals who have investments outside of a company retirement plan.

“While the trend over the last few decades has been for Americans to assume more ownership of their financial futures, many still don’t grasp some of the most essential investment concepts, leaving them ill-equipped to achieve their financial goals,” said Doug Lockwood, vice president of investor guidance at American Century Investments.

According to the survey, portfolio rebalancing is the concept that confuses investors the most. When presented with three statements about rebalancing, only 13 percent selected the correct response.

While the largest proportion of respondents recognized that rebalancing returns the portfolio back “to its ideal asset allocation mix,” participants failed to grasp other aspects. Test takers appeared most confused by the notion that rebalancing often entails selling some of the investments that have performed best and buying more of those that have lagged.

Though the test participants also struggled with definitions of other common investment terms and concepts, investors scored better on questions related to basic investment practices. For example, 71 percent understood that a “well-diversified portfolio will experience less volatility.”

Regardless of their investing knowledge, investors are about evenly split between those who are confident they’ll reach their long-term savings plan and those who are not.

“Financial empowerment begins with quality financial education and guidance,” said Lockwood.

Sun, sand, nice beaches, palm tree-lined beach fronts, classy homes, glitzy fashion districts. People have plenty of reasons for moving to Miami, particularly Miami beach, including the sunny skies and diverse cultures. Since Miami is know to be a truly a diverse city, there is a wide array of available Miami Beach real estate choices. A potential home-buyers options would include locations from the ocean to the bay, and varying structures from small apartments to sprawling mansions.

Currently, the real estate scene in Miami Beach has greatly improved from the old, conventional low-rise Miami Beach properties to spectacular high-rise condos, with prices ranging from the $300,000 price range to over the $5 million mark. Miami Beach real estate properties on South Beach are usually in the extravagant Art Deco District, which encompasses 16 city blocks.

The varying types of real estate in this area are surrounded by more than 800 unique buildings of distinct style, consisting of hotels and apartment buildings, which have inspired the renaissance of this neighborhood, and further entrenched the places color and lifestyle. The Art Deco District attracts showbiz celebrities and socialites who savor the trendy night-life and its countless outdoor cafes along Ocean Drive, as well as for single folks and young families who enjoy the urban lifestyle, and indulge in the pleasure of doing convenient walks to the local beaches, stores, clubs and restaurants.

The distinct advantages of owning real estate property in Miami Beach include the nine miles of sandy, palm-fringed 300-foot wide beach fronts, as well as an abundance of places to swim, sunbathe, jet-ski, and fish and do parasailing and other water sports. Another convenient spot for both ardent and casual walkers and joggers is the boardwalk located along the northern part of the beach.

Aside from the wonderful beachfront, the citys arts, production and entertainment communities also add to the attractiveness of owning real estate in Miami Beach. On the cultural and artistic front, the Bass Museum of Art exhibits exquisite art, and the Miami Beach Garden Center and Conservatory contains exotic flowers and flora. The district also boasts of world-famous nightclubs and bars, as well as restaurants and cafes.

One of the more popular areas of Miami Beach is South Beach, also known as SoBe, or The Beach. Topless sunbathing is tolerated on some designated areas of the beach. The TV show Miami Vice helped make the area popular as well. Today, South Beach is considered one of the richest commercial areas in the area. Miami Beach, specifically Ocean Drive of what is now the Art Deco District, was also featured prominently in the movie Scarface, further adding to its glitzy status.

At present, the South Beach section of Miami Beach is a major entertainment center with hundreds of nightclubs, restaurants and oceanfront hotels. The district is famous with both American and international tourists, with German being the third most spoken language after English and Spanish. The hefty influx of European tourists explains South Beach’s tolerance of topless sunbathing, despite it being a public beach. Another unique aesthetic fixture of South Beach is the presence of several colorful and unique lifeguard stands, which are still used today by South Beach’s lifeguards.

Most people dream of making a lot of money. The question is, what does that mean?

The truth is that money is highly subjective. Certainly, a billion dollars is a lot of money; there are only a handful of billionaires in the world. Is a million dollars a lot? In terms of total wealth, no; a significant minority of the population has a million dollars or more in total assets to leave to their heirs, largely due to the appreciation of real estate. Were one to make a million dollars a year, however, that person would be among the most highly paid in the world.

Personal perception has a significant role in determining the amount of money that a person can expect to make. The reason for this is that the two factors that most influence earnings–level of demonstrable skill, and payment requested from an employer–are very dependent upon the individual. Moreover, while skill is partially based on individual confidence and partially dependent upon innate ability, the amount of money that a person asks an employer to provide is solely based on the individual.

Of course, the two are related. One cannot have a minimal skillset and expect to receive a high salary. However, many people have excellent skillsets yet are paid comparatively little versus their peers. Why?

The truth is, they probably didn’t ask–or if they did, they didn’t ask in a way that conveyed they really thought that they deserved what they wanted. In many cases, the boss knows the most that he or she can pay, but will be pleased to pay less if an employee will accept it.

Of course, the boss will not tell the employee what he or she can actually afford to pay. But dealing with that is comparatively easy in the Information Age: there are salary guidelines for given locales and positions available on the Internet. The real challenge is not asking a high level of compensation, but feeling that you deserve the high level of compensation for which you are asking.

To do that, one must understand the relative value of money. We have established that being a billionaire is truly remarkable, and that accumulating a million dollars over a lifetime is not but that making a million dollars per year is. What about lower income levels–the sort that we tend to see in everyday life?

How much is a lot?

The U.S. Department of Health and Human Services Federal Poverty Guideline for a family of four in 2006 is $20,000. A family that makes this amount or less is, by definition, poor.

The median income reported for a family of four in 2006, however, ranged from a low of $45,867 in New Mexico to a high of $87,412 in New Jersey. These figures include single- and multi-earner households.

Consider a candidate in New Jersey who holds a degree in a moderate-demand field. Will he or she accept a salary of $20,000? Probably not. Expecting a salary of $87,412 may seem excessive, though, because he or she would, as a single earner, be requesting the average income of a family of four.

But is it excessive? Actually, no; if $87,412 is the median salary–meaning there are an equal number of earners above and below that mark–the candidate could, in fact, confidently request $90,000 or more. The reaction from a hiring manager would depend in part on the industry and also in part of the applicant’s specific skillset. Another candidate, in another job, however, could ask for it and get it. The trick is to have the audacity to ask.

A real-life story

Shortly after I finished college, someone I knew earned $40,000 a year. His stated goal was to reach a salary of $50,000. He worked hard to apply himself to education and professional development, and volunteered for special projects to expand his skillset.

His next job offer caught him off-guard: $73,000. He took it, of course, astonished at how much he now made. Within a few months, though, he realized that others in the field made considerably more. He stayed active in professional development and worked hard to master new skills.

A year into the job, he requested an increase in salary, providing his employer with salary survey data and other information. He received a raise to $89,000 and was offered an incentive plan based on performance.

After three years, he decided to leave. He interviewed at a number of top companies that were excited to meet him. He had an offer from one for $110,000 and then got an offer from another for $115,000. Deciding that he prefered the first company, he asked if they would increase their offer. Knowing that this would require approval, however, he offered to take an initial salary of $100,000 until he finished his probationary period. They accepted.

Four years ago, he aspired to someday make $50,000. Today, he makes $115,000–and considers $200,000 to be easily within reach given a few more years. And why?

Because he asked.

Many people dream of owning a vacation home. But often concerns about maintaining it, renting it out in the off-season, or even justifying the expense when its only to be used for a couple weeks of the year keep them from making the dream a reality. Now condo hotels, an innovative type of vacation home ownership, provide a welcome solution to all these problems.

Also known as condotels or aparthotels, condo hotels have been growing in popularity as an approach to owning a luxurious second home.

Condo hotel buyers purchase an actual condominium unit in an upscale hotel or resort. The property functions as a full-service hotel, and owners have access to all facilities, amenities and services just like hotel guests.

They receive a deed to their unit and can use their vacation home when they want. When not in residence, they can place their unit into the hotels rental program and share in the revenue it generates. Like most real estate investments, the owner can also sell his condo hotel unit at any time and may make a profit on its appreciated value.

Young professionals, baby boomers and seniors alike are just beginning to discover the benefits of owning a condo hotel unit. They appreciate the hassle-free nature of condo hotels as a second home in which a professional management company handles everything from property maintenance to finding hotel guests to rent the units. They also consider condo hotels a means to diversify their investments.

Condo Hotels Are Not Your Parents Timeshare

As hybrid properties, condo hotels differ from timeshares in a number of ways. With timeshares, buyers pay only for the right to use the property for a set amount of time each year, usually a single week. They dont own the title to the property, and they do not receive any rent revenue for the weeks theyre not in residence.

Condo hotel owners can use their condos when they want throughout the year, within the guidelines of the individual development. They receive a percentage of any revenue their unit generates when theyre not there and the unit is rented out to hotel guests.

Timeshares traditionally diminish in value over time, rather than appreciate. While the history of condo hotel resales is rather limited, they are seen as an appreciating asset.

Condo Hotels Offer Facilities

How do condo hotels differ from owning a traditional single family house or condominium? Consumers who purchase a traditional condominium pay property taxes, insurance and maintenance fees, but typically dont have access to hotel-type amenities.

Condo hotels, on the other hand, are not your standard second home. They are suites in a hotel designed condominium.

The properties often feature four- or five-star amenities, ranging from full-service spas and fitness centers to fully-equipped business centers and fine-dining restaurants. They also come with exceptional hotel services like concierge, valet and room service.

With condo hotels, owners reap the rewards of condo ownership while enjoying the privileges of a full-service hotel.

Condo hotel units range from studios and full-size apartments to luxurious penthouses and villas. Prices for these homes range from $250,000 to over one million for top properties.

Condo Hotels Generate Revenue to Cover Their Costs

What makes the condo hotel concept so appealing? When owners are not using their condo hotel unit, they have the option of placing it into the hotel’s rental program. They receive 60% of the revenue their unit generates with the balance going to the hotel operator. The revenue generated helps offset the costs of owning a holiday home.

While many hotel operators dont guarantee the rental of the condo, by capitalizing on the hotel’s brand name, strong sales and marketing capabilities, centralized reservation system and management expertise, owners typically receive a higher level of rental income than they would from a traditional vacation home.

More importantly, ownership is 100 percent hassle-free, as the hotel operator takes care of finding hotel guests and maintaining the unit as well as managing the propertys many facilities.

Condo Hotel Expenses Are Shared

How are the ownership expenses split? As part of the rental agreement, the hotel pays for most operating expenses such as housekeeping, administration, sales and marketing. The condo hotel owner typically pays for real estate taxes, insurance and capital improvements. The rental revenue that owners receive helps defray these expenses and, in some cases, provides additional income.

Condo Hotels as Investment Tools

While developers primarily sell their condo hotel units as a lifestyle and vacation home alternative, many buyers see merit in the condo hotel concept as an investment tool. They say it gives them the best of both worlds. They can enjoy all of the benefits of vacationing in a first-class hotel while they own a property that has potential to appreciate.

For further information about Philippine condo hotels please do not hesitate to contact us:

Beth Collingz
PLC International Marketing Networks

Low down payments, no credit check and guaranteed approval. This is the convenience for many investment property buyers who choose to shop online. With the internet being responsible for dramatically changing the way people do business, it is also responsible for revolutionizing the way people shop for investment property.

A conventional loan for investment property would entail an application, credit review and complete disclosure of the applicants financial situation. However, an increasing number of real estate developers, owners and brokers are offering investment property with the convenience of owner financing. A low down payment, which is followed by regular monthly payments, may result in a prime piece of investment property. Most commonly used for purchases of land, owner financing is extremely popular for investors, first-time home builders with no credit or even individuals who have past credit problems and would not otherwise qualify for a conventional loan.

With very low down payments, which are often lower than $1,000.00, many investment property sellers provide competitive interest rates and low monthly payments with absolutely no qualifying, credit check or income verification. As long as consumers continue to make their minimum required monthly payment, they will be approved.

No matter when, where or how investment property is purchased, the buyer must perform due diligence prior to signing on the dotted line. The buyer will want to make sure that he/she will receive a warranty deed on any investment property, which means it will be free and clear of any liens, and that the current owner has the full right to sell the property. In addition, it may be a good idea for the potential buyer to contact the local tax office and inquire about the most recent assessment of the investment property. This will give the buyer a good idea as to whether or not he/she is getting a bargain. If the investment property is located in another state, the buyer should request photos and even consider hiring a video professional to make a recording of the immediate area and the land for visual purposes.

When agreeing to purchase investment property with owner financing, a signed contract is a must. This is simply a contract that is drawn and signed by both parties, which will indicate the down payment required, full purchase price, monthly payments, number of payments required until payoff, a listing of pre-payment penalties (if applicable), the location of the investment property and the size and details of the same.

A valid investment property contract will confirm that the seller agrees to finance the property at a certain amount of interest and will sell the described property after a predetermined number of payments. In return, the buyer agrees to pay a certain amount each month on a specified day each month. The contract should outline the exact location, street address, size of the lot and parcel number. In addition, it must include terms regarding late or missed payments, late fees and cancellation options (if any). The contract must be signed and dated by both parties in order for it to be valid.

Massive Potential to Profit from Real Estate Investment in Romania

According to a recent report released in the UK about which European property markets have the greatest potential for growth and profit over the coming decade, Romania topped the lot.

Romania, located in southeastern Europe, is a nation poised on the brink of full European Union membership and one benefiting from substantial foreign direct investment and economic advancement as a result. According to the report these facts mean that over the coming decade the housing market in Romania will likely go from strength to strength and anyone who invests before EU membership is cemented could net up to 400% profit on their investment in the next ten years.

The report was based on an economic assessment and overview of each country in Europe and included analysis of the room for growth within each countrys real estate sector. Because property prices in Romania start from as little as twenty thousand US dollars, the room for property price expansion is clear. The low starting prices for real estate in Romania also mean that its property sector is already attracting substantial international real estate investor interest.

Investors from all backgrounds are attracted to Romania those with a small sum of money to invest are looking to make immediate gains from buying apartments in Bucharest pre-construction which can be purchased by stage payment and profited from upon completion when investors are flipping the real estate right back into the market. Those with more substantial sums of money to invest are generally drawn to either the commercial property sector in Bucharest or Romanias burgeoning tourism market.

Opportunities in Romanias tourism market exist along the countrys stunning and as yet undeveloped 225km of Black Sea coastline and also in Romanias quality but as yet little known winter sport resorts. Accommodation in these locations is required to let out to tourists and a growing number of British, Russian and eastern European citizens are also seeking second homes in these areas of Romania as well, with most preferring to purchase established but well renovated properties.

Other opportunities exist in the form of fairytale properties for sale in Transylvania with castles, medieval houses and entire farms available for sale to overseas investors looking to diversify their property portfolios and buy real estate in one of the most stunningly beautiful, romantic and ancient European countries.

If the real estate and economic expert analysis of Romanias property market potential is correct, those who buy in Romania today could be looking at the realization of 400% profit within the next ten years this means that someone who invests as little as twenty thousand dollars today could potentially reap sixty thousand dollars profit within ten yearsnow thats what I call potential!

Low income housing providers get a bad rap. Be ready to be called a slumlord if you invest in it. Much of what people call slumlording though, is simply providing reasonable housing for those with low incomes. It is of benefit to the renter AND the landlord.

Why Do People Rent Ugly Homes?

Not-so-nice places are rented because they are affordable. When a house needs paint, has old rusty hinges on the doors, and a dirt driveway, it costs less to buy, and therefore can be profitably rented for less. In fact, anything major that the landlord does to improve it will result in higher rents, and possibly drive the renter away.

This often happens due to local regulation. When my own town enacted its first rental regulations, the fifteen pages of new rules required many landlords to spend money to upgrade their apartments and other rental properties. They included many non-safety-related requirements, like a minimum of windows, to allow natural lighting, bedroom square-footage requirements, and no peeling paint or cracked plaster.

Regulations like these are done in the name of low income renters, but the result is always the same: higher rent. Combined with the regulations against mobiles homes, these laws force low income families to move further away from town and jobs. I mention all this to let you know that if you offer an ugly, but safe and affordable rental, you are providing a real service.

Why Low Income Housing Investments?

When an average two bedroom house in a small town costs $130,000 and rents for $800, an old mobile home on a lot will probably cost $45,000 or less and rent for $500. The house costs almost three times as much, but the rent you get isn’t even doubled. In other words, the mobile gives you MORE CASH FLOW. That is why old houses, run-down apartments, and mobile homes (on land) are such good investments.

Maybe you think you’ll have more risk and management problems with low income housing. Well, you’re right. Small repairs come up more often, and rent will be late more often, on average. But this is why you deserve a higher rate of return. I wouldn’t recommend investing in low income housing if you didn’t get a higher rate of return.

Let them call you a slumlord. Just treat your renters well, and make your places safe. Do these things, and you can enjoy a good return on your investment in low income housing.