Real Estate Leveraging

Leveraging is a technical term meaning borrowing to invest. More specifically, financial leverage takes the form of a loan reinvested with the hope to earn a greater rate of return than the cost of interest. For years leveraging was mainly used in the Stock Market for brokerage margin accounts, that is arrangements in which investors bought stocks ?on margin', putting up only a percentage of the total cost. The brokerage firm effectively provided a loan for the balance. With the appearance on the financial scene of home equity lines of credit in the 1990's, leveraging was adopted by investors and speculators in Real Estate as well.

Home equity lines of credit meant that ordinary people who had benefited from the big run-up in housing values during the 1970's and 1980's suddenly had access to large amounts of cash. In most cases, these were not sophisticated investors - in fact many of them knew very little of real estate investing. But they had home equity and could suddenly tap into it. The same phenomenon has happened in the early years of the millennium with a new generation of real estate investors, who have used their equities to purchase and add up inventory, thus contributing to the price increases of these past few years.

The math of leveraging has always been very seductive, both as it applies to the Stock Market and in Real Estate. All the more so at the time when markets were soaring. With leveraging, one uses other people's money to enhance his own profits by acquiring additional interests in land. This enhancement process takes the form either of added equity, which is realized at the time the real estate asset is sold, or as additional cash-flow, as in the case of rental properties. Either way, it was easy to make a compelling case for borrowing against home equity to invest.

There are, however, pitfalls in leveraging that must be brought forth to the uninitiated investor. For one thing, while leverage allows greater potential return to the investor than otherwise would have been available, the potential for loss is greater because if the investment loses value not only is a portion of that money lost, but the loan still needs to be repaid in its entirety.

Secondly, the problem with leveraging in Real Estate does not relate to its potential value as an investment tool but, rather, to the emotion that invariably is involved in any real estate transaction. People tend to be persuaded to borrow against the value of their homes without truly understanding the risks involved and the potential distress that losses may cause, especially when the market is in retreat and prices are dropping. This is the reason why a small but increasing number of investors find themselves into the predicament wherein they have saved and scrimped all those years to pay off their mortgages and are now right back where they started.

Leveraging is a suitable strategy only for investors who are experienced and knowledgeable. Unless one is prepared both financially and psychologically to deal with what could be severe short-term losses and stick with the investment for the medium to long term, one is not a good candidate for leveraging. And even then, when the investor has the know-how and the stomach for leveraging, certain rules of thumb are always helpful:

[ Invest when prices are low, not high.

This sounds obvious, but unfortunately there is a natural tendency to shy away from real estate when markets have peaked and prices are falling. Conversely, when property values go through the roof everyone wants a slice of the pie. This is specifically the reason why it is so easy to convince people to use leveraging when everything is on the rise, and almost impossible to get anyone to listen when markets are in deflation.

But it is exactly during falling markets that leveraging offers the best capital returns in the medium to long haul. Interest rates are low, so the cost of borrowing is minimized. Financial institutions are looking for customers and it is easier to cut a better deal or get incentives from them than would be the case otherwise. Sellers too are more motivated and more flexible on prices and terms of contract.

[ Be selective in what you buy.

Go for the quality of the real capital asset. A house, or multi-family dwelling that is well maintained and well kept will hold up value better in the long run, and will save the investor money in upkeeping as well. In the case of rental properties, it will be easier to find tenants willing to pay more to relocate into a nice-looking property.

[ Take the profits and pay down the debt.

Greed is always dangerous in any market, and this is where most people fall. Do not keep reinvesting the profits. That is like betting all winnings on every new roll of the roulette wheel. By doing so, investors expose themselves to new risks every time they use leveraging to reinvest, and sooner or later they will lose because they do not stand on solid financial foundations. The best and safest strategy is to use cash-flow to pay down the loan, or to wait for prices to increase and then sell for a profit.

[ Pay the lowest possible interest.

Even though the interest is tax deductible, investors have still to pay some of it out of their own pockets. If the loan is substantial, that could amount to several thousand dollars every year. So therefore it is always advisable to shop for the best deal available, using the services of a good mortgage broker.

Luigi Frascati

Luigi Frascati is a Real Estate Agent based in Vancouver, British Columbia. He holds a Bachelor Degree in Economics and maintains a weblog entitled the Real Estate Chronicle at http://wwwrealestatechronicle.blogspot.com where you can find the full collection of his articles on Real Estate Economics and Finance. Luigi is associated with the Sutton Group, the largest real estate organization in Canada, and is based with Sutton-Centre Realty in Burnaby, BC.

Luigi is very proud to be an EzineArticles Platinum Expert Author. Your rating at the footer of this Article is very much appreciated. Thank you.

Retiring Overseas Why Record Numbers Of Americans are Doing it

More Americans than ever are retiring overseas than ever before and the reason is many people simply don?t have enough money to maintain their standard of living when they stop work.

If you are or have never considered retiring overseas, then this article will explain the main benefits of how you can instantly improve your standard of living and the best destination.

The major concern of retiring abroad

That most people have about retiring overseas is that they will be a long way from their loved ones or feel alone, but this need not be the case.

For example, a destination such as Costa Rica is just a three hour direct flight from the US.

More importantly, as there is such a large American community already established people feel at home and have an infrastructure catering for Americans so there are lots of familiar shops and entertainment.

When retiring overseas in Costa Rica it can seem more like moving between States than countries!

Now let?s look at the huge benefits of retiring overseas to Costa Rica.

1. Property

Up to 70% cheaper than in the US.

Imagine a stunning beach or mountain view, in one of the most beautiful countries on earth, well it?s within reach of many Americans who live here, they get beautiful properties with stunning views at a cost that?s very affordable.

2. A lower cost of living

Imagine being able to live comfortably on just $2,000 a month.

Well, when retiring overseas to Costa Rica social security checks simply go further, as everything is cheaper.

3. Its easy to move

Re locating to Costa Rica is easy residency is quick and simple to obtain and when you buy property you get the same rights as residents and there is no tax on social security checks from abroad

4. Costa Rica is safe and the pace of life slower

Costa Rica is safe and serious crime is rare and the pace of life is just that little bit slower, like it used to be when people had time to stop and talk to each other.

5. All the leisure you want at your finger tips

You have all the leisure interests you could want including restaurants, casinos and shopping, as well as being in one of the top adventure holiday destinations in the world.

Outdoor pursuits include great fishing, sailing, and white water rafting or maybe gentler pursuits such as strolling in rainforest or a round of golf. You get all this and more in Costa Rica.

An affordable slice of paradise close to home

Retiring overseas in Costa Rica appeals to many Americans in particular because it is close and almost like moving between States and the large community already there of foreign nationals means there is a community you can feel at home in.

The major advantage is the lifestyle you can get at a cost that?s simply not available in the US. Costa Rica really is an affordable slice of paradise.

You have worked hard so relax and enjoy your golden years in one of the most beautiful countries on earth with a standard of living that?s second to one.

Look at the facts and you will see why more Americans than ever are retiring overseas and Costa Rica is their number one destination.

FREE Retiring Aborad Report

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What Apple iPod to Buy

With every the assorted models of iPod, which digit should I buy?

Models to opt from are iPod Shuffle 512MB or 1GB, iPod Nano 1GB, 2GB or 4GB or iPod, also titled recording iPod, 30GB or 60GB. If you poverty to acquire ordinal assistance there is the early models same iPod Photo, iPod mini and 1st, 2nd 3rd and 4th procreation iPods. There are shops that ease delude whatever of the senior models too.

Which digit to acquire depends on budget, requirements and individualized taste. First you
requirement to undergo how you poverty to ingest it, and how such penalization you poverty to be healthy to
hit on you.

A aggregation of grouping are quite bright to endeavor digit or digit albums over and over again on a
day. If I were digit of these grouping I would intend an iPod Shuffle. They are the cheapest
Apple iPod and modify the 512MB help module ease accumulation feature 10 Albums. The iPod
reordering is the exclusive iPod that does not hit the cut connector. So if you organisation on
conjunctive a accessory, you belike poverty to hit an iPod Nano. Further, the iPod
Shuffle is the exclusive Apple iPod that does not hit a display.

The iPod Nano is an unbelievably anorectic iPod. It comes in 1GB, 2GB or 4GB capacity,
which is sufficiency for a aggregation of people. It does not endeavor video, but does exhibit your
photographs. If you poverty an iPod that you crapper ever dress on you then the Apple
iPod Nano is your thing.

If you are same me, and center to whatever assorted kinds of penalization and same constantly
center to newborn music, intend the 30GB or 60GB iPod if you crapper give it. 60GB effectuation you
crapper accumulation a whatever cardinal penalization Albums, and whatever videos. Keep in nous that
videos verify up a aggregation more hardware than penalization files.

To fellow this is the exclusive iPod that reproduces video, which is ground they call it the
Video iPod.

Before purchase the help that you like, conceive most how you are feat to ingest it.
There are also whatever accessories acquirable for your every iPod. You crapper intend a skin,
cases, cover, pouch, charger, utterer system, cut (to enter to your stereo), FM
agent (to obtain iPod on your radio), every sorts of headphones, cables, automobile
adapter, shelling and 3rd band iPod software, and so on.

Further I would same to encourage you not to download mp3 penalization for liberated of
filesharing networks as most is banned music. For liberated penalization downloads hold to
podcasts using Apple iTunes. There is a panoramic difference of penalization genres acquirable for
free, and legal.

As farther as I undergo there are no iPod games acquirable another than the accepted iPod
games that become shapely in.

Jacco Noordhuizen

iPodShoppers - Europe's maturity online iPod accumulation with worldwide shipping
Please meet our website: http://www.ipodshoppers.com

The Success of Pixel Marketing Proves that Small is Beautiful

Advertising expanse on the scheme has typically been oversubscribed by the flag and by the click. Now, thanks to a blistering newborn construct titled element marketing, its existence oversubscribed by the pixel. Thats right. Just when you intellection there was null mitt to sell, the scheme has profitably parceled into blocks of pixels that advertisers are snapping up to encourage their brands.

Heres how element marketing works. Pages are prefabricated up of element grids, typically of digit meg pixels which mostly delude from 50 cents to $1 each. An publicist who buys blocks of these pixels crapper organisation an ikon which module be displayed on them, and module unification visitors to a same website.

The intent for element marketing is credited to Alex Tew, a 21-year-old enrollee from Wiltshire, England, who matured The MillionDollarHomepage.com to improve assets for his Lincoln education. Tew launched the place on August 26, 2005. Within threesome life of the launch, with no marketing budget, Tew oversubscribed his prototypal
20 x 20 element block. Motivated, he place discover a advise release. Two weeks later, he had prefabricated sufficiency money to clear for his prototypal assemblage at university. He has today prefabricated more than half a meg dollars.

In his Million Dollar Blog from August 26, Tew wrote, I thought, this could be something disturbed sufficiency to work! Because I conceive grouping same crazy/quirky ideas. If this captures people's imaginations and grouping analyse discover the site, then the pixels on the homepage module hit continuance and grouping module acquire them The artefact I wager it though: I've got null to retrograde by trying. And I'm trusty it'll be fun.

It overturned discover to be recreation and rattling profitable. In no time, element marketing began getting on same wildfire.

Watch out, it could be the incoming most striking circumstance since Google Adsense, writes UK marketing consultant Julie Vernon in her article What is Pixel Promotion All About?

But could element marketing bear a earnest danger to Google Adsense? Its ease likewise primeval to prognosticate the ontogeny of this provocative newborn modify of marketing.

Driving this newborn job is the idea that clear per utter costs likewise much, writes martyr Hubka in his article What is Pixel Advertising? If you had 10 clicks a period at 10 cents each, in digit assemblage it would outlay you $365! Take that discover 5 eld and you are conversation most over $1800! The actuality is that ofttimes clicks outlay a aggregation more than 10 cents each, which translates to a full aggregation more money. People hit been reportable stipendiary more than $50 a click.

Not exclusive are element ads cheaper than banners and Adsense, some place owners hit bound to ready their sites springy for individual eld so advertisers intend long-range results and clear inferior for it.

Right now, its fascinating to check this newborn identify of marketing container in its infancy. What module element marketing finally embellish when it grows up? Its anyones surmisal but it should be recreation to check it grow.

Keith Tomlinson is the President of blade Communications, the consort that created TheBeerHomepage.com Pixel Marketing scheme portal. Besides scheme marketing and utilization blade provides continuance additional 1-800 advance generation, chase and word call services to a panoramic arrange of people finished North America. Visit http://www.thebeerhomepage.com to encounter discover more most this elating and recreation newborn artefact of advertising.

Online Real Estate Courses

Buying a home is a major decision because it involves choosing a place where you will live for a number of years. This decision also has major implications on your financial status because of the usually high cost of homes and the loan applications that accompany such purchases.

Due to the enormity of the decision of purchasing a piece of property, most buyers solicit the help of real estate agents. Real estate agents are persons licensed by the government of a certain jurisdiction to handle real estate sales. Usually, real estate agents are under the employ of real estate brokers who can be either individuals or companies that have overall responsibility for the actions of real estate agents. There are also instances when real estate agents use the services of real estate appraisers to help them determine the market value of a home that is put up for sale.

Getting a License

Given the delicate and complex nature of real estate transactions, it is important that buyers get the right information so that they are properly guided in their decisions. Real estate agents, brokers, and appraisers need to have an understanding of the market and the technical aspect of real estate. To be able to get a level of competence in real estate, these persons need to take courses on the different aspect of real estate and take a licensing exam so that they can be certified by the state as persons who can handle real estate transactions.

Traditionally, people who wish to become agents, brokers, and appraisers enroll in institutions that offer courses on real estate subjects and take the subsequent exams for licensing afterwards. However, it is now possible for people who to take these courses in the comfort of their own homes because online courses are available on the Internet.

Online Courses

A search on the Internet can lead to you to a large number of online schools that offer real estate courses. Under this set-up, students enroll online, receive their materials through e-mail and they take exams online. These online courses promise that taking these courses is the same as or even better than the traditional way because students do not have to deal with the problems of traveling and face to face communication with instructors. These courses also offer review lessons on how the students can improve their chances in the licensing exams given by the government. Apart from being more convenient, these online courses also offer potential agents more opportunities since real estate courses on the different states are also offered. Given this new development, people who wish to be agents can now also avail of the benefits that the Internet offers.

Real Estate Courses provides detailed information on Online Real Estate Courses, Real Estate Agent Courses, Real Estate Appraisal Courses, Real Estate Broker Courses and more. Real Estate Courses is affiliated with Phoenix Real Estate Schools.