Texas SAE: Real Estate Investment Exam Questions And Answers 100% Verified

Texas SAE: Real Estate Investment Exam Questions And Answers 100% Verified Active real estate investing comes in three "flavors." - answerFix and flip Buy and hold Wholesaling Fix and flip - answerRequirements include: Working capital for the purchase and repairs Priced low enough to cover costs of repairs, holding period, marketing, closing costs, and profit Remodeling skills Eye for needed updates Risks include: Running out of money to finish repairs Inability to sell due to poor market timing Buy and Hold Strategy - answerRequirements include: Capital for purchase Ability to cover debt with rental income during holding period Risks include: Vacancies Cash flow shortages Property value decline Tenant issues Wholesaling - answerRequirements include: Ability to find property at a deep discount Thick skin due to seller reaction to low ball offers Ability to act quickly, perhaps paying cash Ability to resell quickly Risks include: Lack of availability Getting stuck with property (unable to turn property around quickly) Paying too much up front, no profit Passive Investing - answerReal Estate Investment Trusts (REITs) Real estate Limited Partnerships. Mutual funds that sell mortgage-backed securities, and you can invest with online real estate platforms. REITs - answerPassive Investing companies that invest in professionally managed commercial properties such as office buildings, apartments, warehouses, or health care facilities. To invest in an REIT, you purchase publicly traded shares of the company. Limited Partnership - answerPassive Investing private real estate investments in commercial property. The general partner is an experienced property manager or real estate development firm. The investors are the limited partners who provide financing for the real estate project in exchange for a share of ownership. Wholesaling Sid is a wholesaler. He's not interested in buying a property, renovating it, and selling it at a profit, nor is he interested in buying and holding a property as a rental. Sid makes the low-ball bid because a wholesaling investor like himself must buy low and sell fast to make a profit. - answerSid already has a buyer in mind when he makes his embarrassingly low offer for a property with motivated sellers. Real estate investors differ from traditional buyers and sellers. They have different motivations, different mindsets, and distinctly different goals that you'll need to recognize and work with in order to build and maintain investor clients - answerThree Investment Goals Investor clients are more strategic and less emotional. And, while not everyone who invests in real estate has the same goal, most investors are typically focused on one of the following: Earning a profit Generating capital preservation Creating a tax shelter