Archive for October, 2009
Launching Your Bandit Sign Campaign
Have you ever noticed how a lot of small signs on wire H frames pop up all over town on the weekends? Then just as quickly as they appeared the signs are gone come Monday morning? No there aren’t sign fairies fluttering around town on the weekend placing and removing signage. Instead these signs are part of someone’s marketing campaign. The small signs also known as bandit signs are a common form of marketing generally utilized by homebuilders across the nation. Now here is the good news you can do it to!
Bandit signs are used as a weekend marketing campaign. The signs are about 3 feet tall by 3 feet wide. They are usually made of plastic and can be inserted onto wire H frame stands that set in the ground. The term “bandit” refers to the illegality of the sign itself. Most cities have an ordinance against bandit signs but chances are they don’t enforce that ordinance which is why you often see them out.
The campaign concept is to place as many bandit signs at hightraffic intersections and other areas of interest. The signs are put out Friday evening and removed Sunday evening as to not irritate city officials. Quite often you will see several bandit signs on a corner. Most likely the same person put all those signs out for several different businesses or individuals.
You can launch your own bandit sign campaign quite easily. First contact a local sign provider if you don’t already have one and request a quote for some bandit signs. You can probably get a better deal if you buy your signs in bulk. And you might want to consider buying in bulk because bandit signs have a way of disappearing. Make your signs generic so you can reuse them once the property you are marketing sells. If you really want to get creative have signs made up with directional arrows to help push traffic in your direction.
Once you have your signs in hand you can launch your bandit campaign. This is something you can do on your own or by using a service that places signs. If you want to go the service route ask you sign provider if they know of anyone who assists with bandit sign placement. If you want to handle the campaign yourself scope out the area near your investment property. Identify hightraffic areas where your bandit sign will get the most exposure. Then Friday evening the best time is after rush hour take your signs out and place them in these spots. You may want to keep a map with you so you can pinpoint the location of all your signs. Don’t forget to place bandit signs in the yard of your investment property. When Sunday evening rolls around go back out and pick up your bandit signs. Make sure you retrieve all of your signs. You don’t want to leave them out during the week. It may spark complaints that could put the city hot on your trail.
Bandit signs are a great way to drive traffic to your investment property. They are a proven method of successfully marketing in the real estate industry. For a small investment and some minor effort you too can put a campaign to work for you.
About the writer: Omar Johnson is a successful Real Estate Investor and author of the home study course The Real Estate Investor’s Guide To Finding The Motivated Seller for more info http://www.findingthemotivatedsellers.com
Infrastructure Based Real Estate Investing
Capital Investment in Infrastructure is an interesting component affecting Real Estate investment. It can be one of the most positive influencing factors in property appreciation. Hence it can never be taken for granted. Frequently an investor will discover during the examination period of a poential investment that infrastructure improvements are planned. These improvements may be water and sewer expansion adjacent the property or new road to be constructed. In many of these instances and without a great deal of consideration the investor aquires as much of the surrounding property without regard to the timing of the purchase.
The focus of this article is how best to determine the timing of the acquisition of an investment property impacted by infrastructure improvement. To do this I have found it beneficial to first differentiate the type of infrastructure change. Begin by separating the properties under consideration into Direct and Indirect Impact Investments. Properties that are immediately impacted by the announcement of an infrastructure project are considered a Direct Impact Investment. Indirect impact investments are those not immediately affected by the or the early stages of the improvement however its value wwill be improved significantly by the project completion.
Take the example of two properties located outside of Raleigh North Carolina the home of North Carolinas Research Triangle Park. The first property direct impact property is located contiguous I85 at an intersection with a secondary road. The second property is approximately onehalf mile away from the intersection and has frontage on the secondary road leading to the I85 intersection.
This area is considered a bedroom community for the Raleigh metropolitian area. The are is growing at a faster rate than either Durham or Raleigh. The Interstate 85 corridor had been experiencing sustainable growth substantially prior to the NC Department of Transportation announcing highway reconstruction of from Raleigh north to the Virginia State Line approximately 40 miles of construction. The project would ultimately take eight years to complete create major delays reroute traffic and have a substantial impact on the local economy and expansion of the entire corridor.
The first response of most investors was to move out of the area and invest in other locations. However for those who analyzed the potential and adjusted the price timing and selection of properties in this area turned out to be a very profitable investment. Let me explain.
Direct Impact Sample Analysis
The first property is adjacent Interstate 85 in a very active market and priced around 100000 per acre prior to the highway reconstruction announcement. Property value was tied directly to business activity generated by its access to Interstate 85. Property value was evaluated as a Direct Impact Investment over the 8 year life of the infrastructure project. The duration was determined based on project length from announcement through completion
Upon announcement of the project the value of the property dropped from 100000 per acre to about 70000 per acre and remained at that level for the first three years of the investment.. In the fourth year of the project life the property began to gain in value at about the same rate as other properties not aligned with the highway still there was no positive influence caused by the highway project. The primary growth in value came toward the end of the highway project eighteen to twentyfour months from its completion.
Indirect Impact Sample Analysis
The second property is well off the Interstate and has little or no value related to the interstate driven commerce. Its initial value was 12000 per acre and continued to grow at a rate consistent with value driven by noninterstate factors. However during the last two years of the highway project the value grew substantially and was in fact pulled by the Interstates commerce generating capability. The transition from no impact to high impact was created by the general maturing of the area and the much increased commerce generating capacity of the improved infrastructure.
It is key to notice that the quality of the investment is higher for the land investor if the investment is made in the Indirect Impact Parcel and the timing of the investment can make a massive difference in the rate of return. In comparing indirect impact to direct impact properties the compounded rate of value growth with respect to the year invested through to the end of the project showed substantially higher returns for the indirect impact property.
The really interesting thing about these results is that for the indirect impact property years four and five were outstanding however year six fell off to the lowest level during the project life. This is primarily due to the limits of I85 to continue to drive value. As a rule most of the growth in value was related to the investment in the highway capital improvement. The investment in I85 over the long haul created a gain in revenue generating capability which forced the property value upward. It is important to note that the growth in the interstate traffic after the completion of the project is slow and its ability to create additional value would also be slow.
These properties will not see really strong growth until a commerce center is established at this intersection. With capital investment in a commerce center there will be value growth similar to the growth we saw with the highway but it will occur in a shorter cycle time. I would therefore argue that the risk component would be higher and the timing would be more crucial.
Summary
In summary for an investor to successfully select a high yielding land investment with changing infrastructure certain conditions are in play:
1. The announcement of the change must not directly impact the target property in a negative way. .
2. The investment property will increase in value at the local not project driven rate in the early years of the project.
3. There must be more than twentyfour months remaining life in the project.
4. Due to its higher yield the Indirect Impact Investment will create less risk for the life of the project.
5. Investment timing is of utmost importance.
6. Direct Impact Investments offer a lower yield and higher risk during the project life.
I have been able to employ this thinking over the last five years and have found the concept applies to any long term capital project.
About the writer: Wayne Machon is a graduate of Rollins College in Management and Economics. He is responsible for developing investment grade opportunities for the clients of Hallmark Real Estate in the central North Carolina real estate marketplace.
How To Protect Yourself From Predatory Home Mortgage Lenders
Home mortgage lenders are for the most part the ordinary American’s stepping stone towards realizing the American dream. To many buying and owning a home is the American dream. Because of the prohibitive costs of houses however very few have the resources to pay for the house of their dreams right there and then.
Still buying a house remains a much wiser option than renting an apartment. When you rent you are paying off someone else’s mortgage and are helping them acquire equity. When you buy a house however you not only acquire equity on your own you will eventually own the home.
While on the lookout for home mortgage lenders do not get blinded and sidetracked by fabulous offers of immediate assistance. You must remember that the home mortgage industry is an industry that rakes in billions of dollars per annum. It is literally a mother lode that attracts all sorts of miners and gold diggers.
To protect yourself and your hardearned money be cautious of the following:
1. Unheard of home mortgage lenders
Before dealing with specific home mortgage lenders be sure you know everything there is to know about them. Ask for identification cards. Ask for licenses. Better yet direct inquiries to the Better Business Bureau or the office of the State Attorney General. Another option is your town or city’s local association of home mortgage lenders. Should such a group exist in your neighborhood it will be easy for you to ask them for a list of their members in good standing.
2. Astonishingly high or low rates and fees
Always shop for home mortgage lenders before focusing on one. This way you can compare different loan providers and then pick the one offering the best deal. In your dealings with home mortgage lenders however be sure to watch for abnormally high mortgage rates and charges. Have them explain the credits calculation. Your many talks with different lenders will help you anticipate the average rates that different home mortgage lenders are willing to give you. Also be sure to inquire about hidden charges. Unscrupulous lenders gloss over this in their presentation and hide this in small print in your contract.
3. Abetting of unscrupulous practice
If your lender asks you to provide false data on your application form be very wary. If there’s one thing legitimate home mortgage lenders advise you to do it is to be painfully honest in filling out your application form. A predatory lender on the other hand will request that you state down a higher income than is factual or overstate the span of your employment. He will try to convince you that everyone does this. Do not believe him. People may be sent to prison for falsification of documents.
4. Insistent requests for signatures on blank documents
Signing blank documents is a sure recipe for disaster. You don’t have to be a lawyer to figure this out. Should your lender shove a blank document in your face and ask you to sign firmly and politely refuse to do so. This is not industry practice. It never will be. After all with a blank document you will never know what you are signing away.
Vigilance is the key to protecting yourself and your future home from embezzlers. Never do anything rash where taking out a mortgage is concerned. Remember what an old proverb says about doing things without taking the time to examine them first. What you do in haste you will eventually repent in leisure.
About the writer: Alex Peterson writes for ZipRealty Inc. ZipRealty provides home buyers and sellers with an innovative real estate solution. By using the efficiencies of the Internet ZipRealty has streamlined the real estate process and is able to pass significant savings on to home buyers and sellers.
