The real estate industry experienced some big changes last month when the Consumer Financial Protection Bureau implemented new rules significantly changing the forms and procedures used in most mortgage loan transactions.

Last week, TAR’s Housing Initiatives Committee hosted a webinar featuring Tamara Tapman of SWBC Mortgage, who reviewed the new requirements. Here are six important takeaways from her presentation:

1. The changes don’t apply to all loans. Certain transactions aren’t covered by the new rules. These exemptions include commercial loans, reverse mortgages, and home equity lines of credit.
2. Your clients are getting two documents: a Loan Estimate, which borrowers must receive no later than the third business day after the lender receives the borrower’s loan application, and the Closing Disclosure, which borrowers must receive at least three business days before consummation.
3. Certain info comprises a loan application. A lender is required to provide the Loan Estimate after receiving six pieces of information from the consumer: his name, Social Security number, and income; the property address; an estimate of the property value; and the amount of the mortgage loan the consumer wants.
4. Saturdays count, too. For the Closing Disclosure, “business days” means all calendar days except Sundays and legal public holidays.
5. Sellers don’t have a three-day requirement. There is no three-business-day waiting period for the seller’s Closing Disclosure. This can be delivered the day of consummation.
6. Your client may have to extend closing. A lender must provide a corrected Closing Disclosure and ensure the borrower receives it no later than three business days from consummation  in three situations: The annual percentage rate (APR) increases by more than an eighth of a percent; the loan product changes; or a prepayment penalty is added.

Original article: https://www.texasrealestate.com/advice-for-texas-realtors/article/6-things-you-may-not-know-about-new-closing-rules

By MIKE SIMONSEN

For a while this summer it seemed like everyone expected mortgage rates to climb. However, since a peak in early July, rates have been drifting lower and are back under 4% – less than half their long-term average.

With mortgage rates down from 4.5% a year ago, homebuyers can actually afford 8% more home than a year ago, according to our friends at themortgagereports.com.

Mortgage interest rates, 30-year fixed loan, across the Altos 20-City Composite, year-to-date 2015.

It may be hard to believe, but the US housing market is now well into its fifth year of recovery. Home prices across the US are up another 7% over the past year, raising concerns about affordability for cash-strapped home buyers. If rates rise, that concern gets amplified. If mortgage rates fall however, that would provide another cycle of boost for housing demand.

Long-time readers of this blog will be aware of the striking shortage of homes for sale around the country. The low-supply conditions have lead to consistent price gains as demand has gradually increased since January 2011. Today is no different. Rates under 4% add to affordability and marginally add to housing demand.

To be clear, there isn’t a lot of evidence that small changes in mortgage rates change housing demand profoundly. So the last few months of mortgage rate drop are merely adding a check in the bull-market column for US home prices into 2016.

What does this all mean for home buyers? It might cost you more to buy a home, but with low interest rates, you may actually be able to afford it.

Original article: http://blog.altosresearch.com/low-mortgage-rates-supporting-home-price-growth-into-2016/

By Ali Anari

Texas had a sharp fall in home sales in the 2007–09 Great Recession (GR). Since 2011, the recovery of the state’s economy from the GR has boosted the number of homes sold in Texas.

Researchers at the Real Estate Center at Texas A&M University studied the contributions of Texas’ regions to the state’s home sales recovery. They found that the Houston and Dallas metro areas made the largest contributions to Texas’ total home sales recovery in 2012 and 2013 followed by Austin, San Antonio and smaller metro areas. The research also found that after two years of exceptionally strong home sales expansion in 2012 and 2013, the state’s home sales market recorded much slower and more moderate growth rate in 2014.

Regional Housing Markets

The Texas housing market comprises regional housing markets in 26 metropolitan areas and 43 micropolitan areas. Not surprisingly, the state’s housing market is concentrated in the five major metro areas of Austin, Dallas, Fort Worth, Houston, and San Antonio. The market share of homes sold in Texas accounted for by these major metros increased from 57.8 percent in 1979 to more than 70 percent in 1997, and since then has remained relatively stable at around 73 percent (Figure 1).

Houston is the largest regional housing market in Texas with a relatively stable share of around 27 percent of total Texas homes sold since 1997 (Figure 2). Dallas’ share of Texas homes sold has trended downward since hitting an all-time high of 24.1 percent in 2000. It was the second largest housing market in the state, accounting for 21.1 percent of homes sold in 2014 (Figure 3).

Austin’s share of homes sold has trended upward from 5.8 percent in 1979 to 10.8 percent in 2014, making it the state’s third largest housing market (Figure 4). San Antonio is the fourth largest, with its share of homes sold trending upward since 1997 and reaching 9 percent in 2014 (Figure 5). Fort Worth’s share has slowly trended upward from 3.2 percent in 1998 to 4.2 percent in 2014 (Figure 6).

The expansion of housing market shares of the state’s larger metro areas has been at the expense of the smaller regional housing markets. The percentage of Texas homes sold accounted for by the state’s smaller metro areas has trended downward from 44.1 percent in 1980 to 25.8 percent in 2014 (Figure 7).

Housing in the Great Recession

Texas did not experience a home price bubble during the GR because of flexibility in the supply side of the state’s housing markets and abundant lands for new home construction. In the early 2000s, the state’s housing market responded to increased low-cost mortgage lending by building more housing units, unlike California’s and New York’s housing markets in which more credit availability coupled with limited supply led to higher home prices. When the housing bubble burst in the GR, the other states’ housing markets suffered both in the number of homes sold and prices.

Because they account for more than 70 percent of Texas home sales, the five major metro areas bore the brunt of the housing crisis in the GR. Total number of homes sold in Texas fell from a pre-GR peak of 292,805 units in 2006 to 203,637 units in the trough year of 2010, a decline rate of 30.4 percent spread over four years (Table 1 and Figure 8). The home sales decline rates from 2006 to 2010 for Houston, Dallas, Austin, and San Antonio were 29.9 percent, 34 percent, 34.4 percent, and 29.5 percent respectively (Table 1 and Figures 9 to 12). Fort Worth suffered five years of home sales declines from 11,977 units in 2006 to 8,124 units in 2011, a decline rate of 32.2 percent (Table 1 and Figure 13).

The state’s smaller metro areas collectively did slightly better than major metros. The number of homes sold in those areas fell from 79,155 units in 2006 to 56,436 units in 2011, a decline rate of 28.7 percent (Table 1 and Figure 14).

After four years of declines, Texas home sales began a weak recovery in 2011 (Figure 15). The regional housing markets of Houston, Dallas, Austin, and San Antonio began recovering in 2011 while in Fort Worth and the state’s smaller metro areas, recovery started in 2012 (Figures 16 to 21).

The home sales recovery in 2011 was not strong in the state’s major regional housing markets. The growth rates of number of homes sold in Houston, Dallas, Austin, and San Antonio were 3.6 percent, 0.6 percent, 6.7 percent and 0.3 percent, respectively. The state’s local housing markets had stronger home sales recoveries in 2012 and 2013, reflected in double-digit growth rates (Figures 16 to 21).

After two years of strong growth rates in home sales, housing markets weakened at the end of 2013. As of the end of 2014, only Houston and Austin had recovered their pre-GR levels in number of homes sold, but the latest data for 2015 show the state and all its local markets are expected to recover their pre-GR levels of home sales when the 2015 year-end tally is taken.

Regional Contributions to Total Home Sales

Growth rates of Texas homes sold in any designated period is the weighted average of the growth rates of number of homes sold in the state’s local housing markets. Weights are the shares of homes sold in local markets. Each region’s contribution to the statewide growth rates of homes sold is equal to the growth rate of homes sold in the region multiplied by that region’s share of homes sold in Texas.

Houston and Dallas made the largest contributions to the growth rate of number of homes sold in Texas in 2012 and 2013, followed by smaller metro areas and Austin, San Antonio, and Fort Worth (Table 2). The state’s housing markets recovered lost ground but are currently cooling. The growth rate of number of homes sold in 2014 has fallen to a moderate rate of 3.32 percent because of smaller contributions from the state’s major metro areas.

Houston’s economy was a major driver of the state’s economic recovery from the GR but is beginning to show the impact of lower oil prices and drilling activity. Consequently, Houston is expected to make a somewhat smaller contribution to the state’s total home sales for 2015 and especially in 2016. The growth rate of Texas home sales in the next couple of years will depend more on the contributions of Dallas, Austin, and San Antonio.

Original article: https://www.recenter.tamu.edu/articles/tierra-grande/regional-contributions-Texas’-home-sales-recovery

BY MICHAEL BLANK

By the time I got started with multifamily investing, I had flipped about three dozen houses and started several businesses. I thought my flipping career would serve as a useful stepping stone to the big leagues.

I was wrong.

First, I got woefully little credit for my prior real estate experience.

I was surprised that the vast majority of my single family house (SFH) investors did NOT want to invest with me in apartment buildings. They either didn’t have the capital or didn’t like their money tied up for a longer period of time. Whatever the case, only very few investors made the transition with me.

Not only that, but when I “bragged” to commercial real estate brokers, sellers, and lenders about my track record as a house flipper, they yawned. Despite my best efforts, they viewed me as a multifamily (MF) newbie and treated me as such.

I was essentially starting over from scratch.

Maybe the SFH investing thing was not a stepping stone at all. In fact, maybe it was actually a distraction.

I’ve come to the conclusion that SFH investing is not necessary to get into multifamily investing. If you want to get into apartment buildings, then do it. Don’t get into a “temporary” other strategy.

Most newbies get into SFH investing for the wrong reasons. They believe that they need to cut their teeth with SFH investing before getting into multifamily properties.

Related: Thinking About Buying a Multifamily? STOP! Wait Until You Read This!

They are wrong.

If you closely examine WHY newbies say they should get started with SFH, the real reason they think they should do it is to get comfortable enough to get into multifamily investing. In other words, they want to expand their comfort zone with SFH investing.

I’m all for expanding your comfort zone. But you don’t need to “waste” several years of your life pursuing a distraction only to expand your comfort zone.

There are other, more efficient ways to achieve the same thing.

How to Expand Your Comfort Zone WITHOUT Investing in SFHs First

I’ve advised my students to expand their comfort zones by focusing like a laser on their first apartment building deal.

The first step is to create a “Sample Deal Package,” which is a deal overview for potential investors. Everything is real, including the photos, financials, projections, etc., except that you don’t have it under contract. You use it as a tool to speak with potential investors and build credibility with other professionals.

Read more about a Sample Deal Package here.

Creating a Sample Deal Package does several important things to expand your comfort zone:

• You become skilled at analyzing deals, which increases your confidence.
• You become very familiar with this one deal. You’ve analyzed the numbers, you’ve spoken to the broker, maybe you spoke to other professionals like lenders and property managers. Perhaps you even toured the property.
• As you use the Sample Deal Package to speak to potential investors, you let your excitement shine through. People sense your excitement and want to be part of it.

In other words, you’re behaving as if it’s real — as if you actually have it under contract and are doing due diligence. You become so familiar with this deal that you, too, start to believe it’s real.

And your comfort zone expanded far beyond what it was just a few short weeks before.

I remember when I bought my first 12-unit building, I was completely overwhelmed. Yes, I had flipped a bunch of houses and owned restaurants, but for some reason I was anxious about this. With shaky hands I signed the contract and started down my due diligence checklist.

Then a funny thing happened.

I was so engrossed in the due diligence process, spending hours reviewing documents, making phone calls, and visiting the process that after about 10 days, my angst about buying this building had completely vanished.

Not only that, I suddenly wished the property was bigger. Buying a property is a lot of work, and I realized that buying a building TWICE this size would have been about the same amount of work.

What an odd phenomenon. And it only happened in a couple of weeks.

The same thing happened with one of my students, whose goal was to buy a small 10-unit apartment building before going bigger. He managed to get agreement on a 51-unit building and brought the deal to me. I put it under contract, and he stayed involved. After 14 days of due diligence, this is what he told me: “Michael, I don’t know what I was thinking looking at these small apartment buildings. From now on, I’m looking at nothing less than 50 units.”

Again, comfort zone explosion in just 14 days.

Related: What Newbie Investors Should Be Prepared to Do to Land That First Multifamily Deal

Conclusion

If you know apartment building investing is the strategy to help you achieve your financial goals, then don’t make the mistake of going the SFH route first. It won’t actually serve you in the way you think, and it will in fact delay your goal of financial independence.

Please don’t misunderstand me. There is nothing wrong with SFH investing, and I’m not saying you shouldn’t invest in SFHs. I know a very accomplished investor whose strategy is specifically to build up a portfolio of SFHs. I’m just saying, do it INTENTIONALLY. Don’t do it for the wrong reasons.

And if you’re primary reason is to “get comfortable” enough to get into apartment building investing, then maybe you should examine your plan.

You absolutely have to expand your comfort zone to play the game at a higher level with multifamily. But do it in the way I described in this article: Don’t waste several years pursuing a strategy that won’t directly get you to your goal.

Instead, exercise your mind muscles by believing, visualizing and acting as if you already have your first deal. You’ll find that this will expand your comfort zone much faster and will bring you a HUGE step closer to your goals, whatever they may be.

Original article: http://www.biggerpockets.com/renewsblog/2015/11/02/gain-experience-multifamily-investing/

By Mark Ferguson

Why isn’t financing as risky as you may think?

Society tells us debt is bad and we should do anything we can to get rid of it. However, the biggest companies in the world and riches people in the world almost all used debt and a lot of it to get where they are. Debt is an awesome tool if used correctly, but it can be dangerous if it is not used correctly.

If you use debt to live a lifestyle you cannot afford then obviously that is a dangerous situation and could cause serous problems. If you use debt to fund real estate deals that make you much more money than the debt costs you then debt can be an awesome tool. There are a few guidelines to remember:

• Don’t extend yourself too far with debt when you have no reserves or extra cash
• Don’t buy the most expensive house you can afford as a personal residence
• Don’t over burden yourself with car debt if you don’t need too
• Invest for cash flow with rentals and the cash flow will more than cover the debt payments and then some.

How can debt increase your returns on rental properties?

Whether you are flipping or buying rentals debt can increase your returns. At the same time it can also reduce your risk! Yes, reduce your risk as opposed to using cash. When you use a loan on rental properties you are able to buy three rentals for every rental you could buy with cash. You may make $800 in cash flow with a house that is bought with cash and only $400 a month on a house bought with a loan. However, you can buy three more houses with a loan, which would equal $1,200 a month in cash flow total versus only $800 paying cash.

Cash flow is not the only advantage to using a loan. While you own three houses you have more tax advantages, your paying loans down every month, you have more possible appreciation and the biggest advantage is more equity gained through buying below market value.

When I buy flips or rentals I always buy houses below market value. I get great deals by purchasing REOs, short sales, estate sales or auction properties. In some cases I will even usedirect marketing. For every rental property I buy I usually gain at least $20,000 in equity because I get it less than market value. If I buy one house with cash I would gain $20,000 in equity, but if I can buy three houses with a loan I can gain $60,000 in equity.

How can debt increase your returns on fix and flips?

When you flip houses it is tough to get financing. Some portfolio lenders will finance flips as well as hard money lenders. Financing on flips can be expensive, especially if you use a hard money lender. I may have to pay $8,000 in financing costs on a $150,000 house I own for 6 months. Some people may look at that figure and want to pay cash to save the $8,000. But what are you giving up when you pay cash? If I can finance just part of a fix and flip I can buy at least one other flip or possibly two with the same cash I needed to buy one. I average about $30,000 in profit on each of my flips. While $8,000 will cut into my profit, I would much rather have three flips going that make $22,000 each than one flip making $30,000.

Why isn’t using debt riskier than using cash?

The biggest reason using debt is not as risky as using cash is diversification. I would rather have three rentals in different locations, instead of one rental. Plus if something happens to a rental I am better off the more I have.

• With three rentals if one goes vacant I am not out all my rental income because the other two rentals will still be producing income.
• With three rentals if one needs maintenance the rent from the other rentals will help pay for that maintenance.
• With more cash flow coming in I can build up my cash reserves faster.
• If one neighborhood goes down hill and prices drop, I am better off having other properties in other neighborhoods that might not drop in value as much.

Why does using cash limit your options for future purchases?

Using  cash seems like the safe bet when buying properties, but what if you need that cash later? You can refinance properties, but it is not always easy to do even when you have no loans. Lenders like to look at debt to income ratios and if you are retired or living off rental income you may not make enough to get a new loan. You might buy properties when you are working and making good money. You paid cash then thinking it was a wise decision, but then decided to retire want to access that cash. But if you aren’t making any money you might not be able to refinance and access that cash without selling the house.

Conclusion

Using leverage to buy flips or rentals is a great way to increase returns and even reduce risk if you buy the right properties. If you buy houses that don’t cash flow then it makes no sense to use leverage to increase negative returns! Be sure to listen to the podcast for much more information or check out the transcript below.

Original article: http://investfourmore.com/2015/10/podcast-21-why-using-financing-will-increase-your-returns-on-real-estate/

We’re looking forward to a spooky night of fun this Halloween, but unfortunately for property owners, it could also be the stuff of true nightmares. Halloween has the highest number of vandalism claims from property owners than any other day of the year, according to the Property Casualty Insurers Association of America.

“November 1st is a busy day for insurance adjusters given that more vandalism claims are filed on Halloween than any other day of the year” said Christopher Hackett, PCI director of personal lines policy. “Halloween 2015 comes on a Saturday night so there will be more festivities, more cars and more little zombies dodging cars on dark streets. The fun of Halloween also brings more risk of auto and homeowner claims.”

Rental property investors will want to keep their tenants and property safe from hazards while also protecting themselves from unnecessary legal liabilities. Here are a few tricks to make Halloween safe and enjoyable for all:

1. Light up the night. Install motion-activated floodlights on the corners of your rental homes and garages so vandals have nowhere to hide. Install them near stairwells and walkways at multi-families. This is an essential home safety step for every day of the year, not just on Halloween night.
2. Send out a safety tip sheet to tenants. Advise tenants to keep all pets securely in the house when trick-or-treaters arrive, and to keep their cars parked in the garage or at least in a well-lit area. Encourage tenants to use battery-operated candles in their decorations, and to make sure walkways are clear of obstacles and any wet, slippery leaves. Also use this as an opportunity to let your tenants know of any city and community-sponsored Halloween events.
3. Secure rickety railings. Young children, and the adults who often accompany them, will need the security and support of railings while climbing steps to get to your rental’s front door. Also ensure walkways are clear and accessible.
4. Check the fire alarm. With candles setting a spooky mood and so much electricity used to fire up decorations, you’ll want to be sure the smoke alarms are working correctly, just in case!

Some simple preparations like those mentioned above can make this a holiday your tenants will enjoy while keeping themselves and your property investment safe.

Original article: http://www.b2rfinance.com/blog/is-your-rental-property-safe-from-ghouls-and-goblins-this-halloween/

What were more than half a million people doing in Texas last year? Finding new homes.

According to the 2015 Texas Relocation Report released today by the Texas Association of REALTORS®, more than 538,000 people moved to Texas from out of state in 2014. This made Texas the No. 2 state for population gains from out-of-state residents.

Download the full report to see more statewide statistics and data from your county, and click here to view an infographic with highlights from the report.

Original article: https://www.texasrealestate.com/advice-for-texas-realtors/article/what-thousands-of-people-want-from-texas

Holding real estate in a qualified retirement account offers tax advantages not found with traditional property purchases. This guide is aimed at helping investors learn how an Individual Retirement Account (IRA) can hold real estate investments, including:

• Prohibited transactions that can result in a loss of tax advantages
• Types of property investments and purchase methods that are permitted
• What investors should expect from the account’s custodian

Click Here to download

Original article: https://www.rentometer.com/articles/pensco-trust-company-an-investors-guide-tax-advantaged-real-estate-investing

You’re probably already familiar with the power of commercial real estate. For example, if you’re able to increase rents by $50 and decrease expenses by $50 per unit per month and you have a 24-unit apartment building, you’ve increased the income of the property by $28,800 per year.

Not that much, you say? It doesn’t seem like much. But if you assume that the capitalization rate is 8.5% for buildings like this in this area, then your tiny increase in income increased the value of the property by $338,824.

Sound a little better?

“Yes,” you say, “but how do I create this value?”

Here are 8 ways you can increase the income of your asset and increase the value to maximize your profits with apartment buildings.

8 Simple Ways Maximize Your Apartment Building Profits

Tip #1: Reduce your water bill.

In many cases, you (the owner) is paying for your tenant’s water bill. The biggest reason the building’s water bill is high is because there are leaks and drips. The best way to catch these is to encourage your tenants to report them, to look for water issues whenever the property manager enters the unit and to do regular unit inspections. Another way you can drastically reduce your water bill is to install low-flow toilets, faucets and shower heads. There will be a capital expense to do so, but the break-even is several months, not years.

Tip #2: Reduce your heating bill.

If you’re paying for heat, then your heating bill will be a challenge to control. That’s because your tenants will have the heat turned to full blast in the middle of winter with the windows wide open. This is why you should try to stay away from buildings where you have to pay for the heat.

A good option if you are paying for heat is a programmable thermostat. Even though the tenant could override the programming, most will not do so because it’s too complicated to figure out. If set to EPA standards, programmable thermostats can save a significant amount of energy and costs.

Tip #3: Reduce your electrical bill.

Another way you can reduce your electrical bill is to replace all lighting with energy-saving bulbs.

Tip #4: Challenge your property tax assessment.

If you are buying a property substantially below its tax assessed value, you should appeal the tax assessment. The process may take several months, but it is worth it.

One of my buildings was assessed at $650,000 and had a $5,100 per year property tax bill. I purchased it for $475,000, appealed the tax assessment and got it reduced to $525,000, which reduced my taxes to $3,800.

Tip #5: Price shop your vendor contracts annually.

Each year, price shop your insurance, trash, landscaping, janitorial and other vendor contracts to see if you can improve over the previous year.

Tip #6: Increase rents.

The most obvious way to increase income is to increase rents. This is sometimes easier said than done for a variety of reasons. However, you and your property manager should always be on the look-out for ways to increase rents.

If the rents in your building are below average in the area, ask yourself why that is. Perhaps the other apartment buildings are in better condition or offer better amenities.

Before you buy a building, be very clear what your business plan is to increase rents. You may decide that the exterior of the building needs work to look more appealing and more comparable to the competition. This may require the installation of awnings, a new sign, painted shutters and improved landscaping. Sometimes even minor cosmetic improvements like this improve the curb appeal substantially and make the property more desirable.

The size of the units affect the rent. If your units are below the average size for the area, it will be tough for you to get the average market rent. If the competition has a laundry area and you don’t, then this will put downward pressure on the rents as well. However, if your product at least matches that of your competition and your rents are below market, then it’s time to increase rents.

If your building is in a rent-controlled area, then you can’t arbitrarily increase rents as you please. Rent control laws regulate exactly how much you can increase rents. Therefore, increasing rents in a rent-controlled building can take a long time, unless you rent to Section 8/subsidized housing voucher tenants, who are exempt from rent control. The local housing authority who runs the voucher program typically pays above-market rents for their tenants, and so this is a GREAT way to increase income and reduce delinquencies.

If your building is not in a rent-controlled area, then you can send a rent increase notice as soon as the leases of each tenants expire. You have to consider the impact of a rent increase on turn-over expenses and vacancies, but essentially you can ask whatever you want.

Make sure you increase the rents by something each year so that the tenants get used to an annual rent increase, even if it’s only very little.

Tip # 7: Install laundry facilities or vending machines.

Do not underestimate the income from laundry or vending machines. Let’s do some quick math on a washer and dryer.

Let’s assume each unit does two loads of laundry per week. Let’s assume one washer load costs $1.25 and the dryer also costs $1.25. That’s $5 per week or $260 per year. At a 10-cap, you just added $2,600 of value per year. If you have 10 units, then you just increased the value of your building by $26,000 just by adding laundry facilities.

In addition to increasing the income, you also added an amenity to the building, which may allow you to ask a little more in rent.

Tip #8: Pass on utility expenses with the RUBS system.

RUBS stands for “Ratio Utility Billing Systems” and may be appropriate for situations where the constraints of space and/or construction do not allow a property to be submetered (i.e. to have separate gas, water or electrical meters installed for each unit). RUBS can be done for almost all utilities, including water, wastewater, electric, gas and trash.

Often, implementing a RUBS system requires no upfront capital investment. RUBS uses pre-calculated formulas based on industry-wide usage statistics. Once the RUBS system is in place, each tenant receives their own utility bill, which they must pay.

While it may be technically feasible to use the RUBS system and pass your utility expenses to the tenants, you must first determine whether the market allows you to do so. If you’re the only owner passing along the utility expenses to your tenants and everyone else pays for water and heat, then you may have trouble filling your units or getting market-level rent!

RUBS is most appropriate when it’s customary for tenants to pay for utilities, but the building you purchased is not separately metered. If the market allows for it, RUBS is an excellent way to increase your income!

Conclusion

Making money with apartment buildings is all about creating value. What I like about apartment buildings is that even a LITTLE value can have a huge impact on PROFITS. Increasing rents a little bit here, adding laundry machines there, re-evaluating your contracts and watching your utilities — all contribute a little bit to the bottom line. Multiply that little bit by the number of units for the entire year and divide it by the capitalization rate, and the result of your little improvements can mean BIG profits.

Original article: https://www.rentometer.com/articles/8-awesomely-simple-ways-to-maximize-your-apartment-building-profits