It has been a long time coming . . .

We just launched a MAJOR FACELIFT to BiggerPockets!

For years, people have been using our site to do everything from finding tools and resources, to discussing real estate, to making deals, to selling property, etc. We’ve just made it easier to do several of these things.

Here are a few of the highlights:

• Created a New BiggerPockets Front Page — some of the great things you’ll find on the new front page of BiggerPockets.com include highlighted property listings, random member profiles, assorted public gallery photos, tags from our property listings, the latest forum and blog posts, and more!

  

• Re-launched our Property Directory to make it “2.0″ — it is now fully integrated into the social profiles of our members, and is easy to use and interactive! Members can save a property as a favorite, email it to their colleagues, subscribe to our main listing RSS feed, or customize their own feeds for individual State or even more specific listings, and much more!

  

  Of course, adding a listing is free and easy. Members (agents, investors, FSBOs, etc) can add investment properties, land, a primary residence, commercial properties, or even make a deal post on the property directory by going to the property section of their Dashboard or adding directly through the Property Directory page. Of course the listings are integrated with mapping, and are connected directly to the listing poster’s profile.

• Established a Property Notification “Matching” System — members can select criteria that interests them, and once a listing is added to the site that matches that set of criteria, the user will be notified in their Dashboard — if they elect to do so, they will also be sent an email letting them know that a match to their requirements has been made. The user can then remove individual notifications if they are no longer interested in seeing them, and disable or deactivate all notifications.

  

• Built a Community Gallery Page – members who elect to share photos by creating a public gallery will see their property photos in our gallery page.

  

• Cleaned up several areas of the site, and made many other changes to improve the user experience.

Stop by and see how BiggerPockets has stepped up the game!

Next up . . . . stay tuned! (did you really think we’d share all of our secrets?)

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This Post is from the BiggerPockets Real Estate Blog. Copyright © 2008 BiggerPockets, Inc. All Rights Reserved.

BiggerPockets.com Undergoes a Major Facelift Complete with New Property Directory!

The Investor Buying Process

1. Build your TEAM
If there was one thing that will make a difference between a good experience/deal or a bad experience/deal…it is your team. Your team could consist of a Real Estate Agent, Mortgage Broker, Title/Escrow Agent, Insurance agent, Home Inspector, General Contractor, Real Estate Attorney, and the list can go on. We are going to start with the most important…and that is your Real Estate Agent and Mortgage Broker.

So how do you know the difference between a good team member and a bad one…we recommend the book Rich Dad’s Real Estate Advantages …in chapter 5 it covers some of the questions to ask and what to look out for. We have listed a few of these questions for you….

2. Your Exit STRATEGY (& Credit) = Loan Options

You need to start with your exit first. If we break down your exit strategies, they will fall into 2 categories…cash flow or capital gains. What is the difference? My parents have a ranch and they raise cattle for beef. They raise the cattle and sell it for a profit (hopefully) and get that profit only once. Had they chosen to be a diary farmer, the cattle would continually produce milk which equals a profit. Real Estate is the same way, I can sell it for a 1 time gain (or loss) or I can us it for a monthly income. All of the real estate investing strategies fall into 1 of those 2 categories…cash flow or capital gains.

Most mortgage brokers focus on your credit as the key factor in placing you into a certain type of loan. While your credit is important…It is your intended exit of the property that will define your loan options. If you are looking to hold this property for the long term then you may be looking for a 30 year fixed loan that is paid off within the 30 years or sooner. If you intend to only keep this home a few years, then an interest only loan may make the most sense. Why, because it will keep your monthly payment low.

No matter what your exit is, there is a loan program for everyone. The problem, most people look for the ‘best deal’ instead of the loan program that is the ‘best fit’.
Team Members Needed - Mortgage Broker, Credit Repair specialist
Tools - Mortgage Calculators , Online Mortgage Application

3. FIND a Property

So here comes the step of going out and finding a property. One of the most important parts of this process is managing your emotions. Yes, the purchase of a property can be an emotional decision…lets just be aware of that. To give you a different perspective though, it is important to understand the difference between a consumer and investor. Consumers make decisions based on emotions while an investor makes decisions solely by the numbers.

My recommendation is be both a consumer and an investor, get what you want (emotions) yet make sure it makes financial sense. So how do we make sure that a deal makes financial sense? Well that is entirely based on your exit strategy that we discussed in step #2. But lets talk about the 2 different tracks that you may look at…Cash flow vs. Capital Gain. If you want cash flow you will need to evaluate the income of the property…if you want capital gains you want to evaluate the future value of the property. Lets break these 2 elements down. Cash flow is a relatively easy formula…

income – expenses = cash flow

So why do so many people end up with negative cash flow? Simple answer…they don’t use the formula. They so often mistake different numbers for different things or don’t use the formula at all. An example of this…your real estate agents tells you the Cash Flow is $800 on a 3/2 single family home. The problem is, this number didn’t include the largest expense…your mortgage. So you got a great deal, unfortunately your mortgage turned out to be $1000 a month so you are losing $200 a month. The other problem is that so called investors are using the wrong formula…they use the formula for capital gains to evaluate cash flow. I will hear from people that the property is 20% below market value…problem is it is still over priced from a cash flow perspective. Capital Gains. How do you predict the future value of a property?

Do you have a crystal ball?

I don’t…but if you do let me know as I will pay you a lot of money to use it. So lets get real, to invest in capital gains you are not going to use a crystal ball and predict where the market is going, you have to base your decisions on where the market is today. The key with capital gains is to build in your profit before you buy. So how does this look, another simple formula of addition and subtractions.
ARV – Expenses – Profit = Your Highest Offer

1. ARV = the appraised value after repairs made or what you think you can sell the property for. In a down market you may consider lowering the price to sell.
2. Possible Expenses (repairs, money costs, closing costs when you buy and sell, real estate agent commissions when you sell, carrying costs – HOA, utilities, insurance.)
3. Profit