Friday, January 11, 2008
A Good Mix of Fun & Financial Benefits
By Theresa Souers, president South Tahoe Association of Realtors
Lake Tahoe is perfectly situated just a few hours drive from the sophistication of San Francisco and just over the mountains from the sparkle of Reno, Nevada. Nestled in amongst spectacular mountains with breathtaking panoramic views and crystal clear fresh water lakes, the Lake Tahoe area is rich in both natural beauty and solid investment opportunities.
Over two million visitors a year come to Lake Tahoe to enjoy snow and sun alike. During the ski season people from all over the world, flock to the slopes for some of the best skiing in the United States. First class resorts such as Heavenly, Squaw, and Kirkwood are a popular draw for the recreation minded. And, the hot tourist market doesn't cool down when the snow melts. Summer brings a whole different crowd—one looking for warm, sunny days full of boating, biking, hiking, camping, and of course, golf. There are nineteen golf courses in and around the Lake Tahoe area including the two world-renowned courses at Incline Village framed by a stunning mountain backdrop.
Gambling Attractions Add Attractiveness
As if these attractions weren't enough, for those who prefer their entertainment indoors, Lake Tahoe's casinos add to its reputation as an all-season, world-class vacation destination. Popular events such as the Summer Outdoor Concert Series, the Shakespeare Festival and the Renaissance Fair do their share to draw in visitors. After all, half of Lake Tahoe is in Nevada, and South Lake Tahoe is centered about Stateline (the California-Nevada state border) where the area's largest casinos are located.
The question is, what do all these visitors have in common? The answer: they all need somewhere to stay when they come to play.
Getting Investment Returns from Rental Properties
Throughout the decades, the value of Lake Tahoe rental properties have consistently grown at a rate higher than the state and national averages. Every indication is that Lake Tahoe real estate values will continue to climb in the coming years. One reason is what's known in the real estate business as the "rolling boom"—one of the strongest indicators of a particular area's investment potential. This is when an area grows due to its affordability as compared with its more pricey neighbors. In the case of Lake Tahoe, it sits squarely centered among major real estate hot spots predicted to have solid growth. Consider these statistics:
The population of Nevada is growing four times faster than that of the United States and is predicted to double by the year 2023.
Reno , Nevada is currently rated toward the top of the Metro Growth list.
The San Francisco Bay Area has developed affordability challenges where the average price of a home exceeds the average homebuyers' budget.
Other economic factors indicate that rental properties may make a solid investment. The following have a direct affect on the real estate market: the U.S. gross domestic product, unemployment, consumer price indexes and interest rates. According to the National Association of Realtors, the U.S. gross domestic product should increase from 3.7% in 2005 to 4.1 % in 2006. The Consumer Price Index is projected to rise 2.9% and inflation-adjusted disposable personal income is forecast to increase 4.5% in 2006. And finally, despite recent modest increases, interest rates remain at record lows.
With the recent "pause" in rapid price increases, this may well be the best time to enter the revenue producing rental home market. In fact, the second/vacation home market is the fastest growing segment of real estate investments today. Lake Tahoe—as an international recreation destination with a bright demographic future—is one of the top recommended investment areas. When considering Lake Tahoe vacation properties for income purposes, an investor has two options, both of which can produce great results: a vacation or a full time rental.
Vacation Rentals vs Full Time Rental Properties
The advantage of a full time rental lies in the consistent income the owner collects, while the tenant pays most of the utility bills. Currently, there is a shortage of full time rentals in the South Lake Tahoe area resulting in a vacancy factor of almost zero, with the average rental bringing in close to $400 - $500 per bedroom.
While the income from a vacation rental may not be as consistent, the potential for income can be much greater and has the added benefit of allowing personal use for the investor. In fact, there are very few opportunities today that offer rental properties that "Pay for Play." With Lake Tahoe real estate, baby boomers can spend their vacations at their own rental property and have the confidence and security that they have also made a wise investment. For example, if a home with a purchase price of $500,000 were to increase an average of 7% in value annually—not the 20 - 30% seen in the past two years—an investor could still see the following:
$35,000 in equity appreciation per year
A potential of $25,000 in rental income per year
Significant tax benefits
A whole lot of fun in the snow, under the sun and/or at the casinos
There is no one right strategy.
Real Estate Investment Strategies
The important questions to consider in choosing a real estate investment strategy include:
Can I afford to carry the mortgage, property taxes and other real estate expenses in the months when the property may not rent or rents lightly?
What is the likelihood that my family will use the property enough to add significant value to this investment?
Which is more important to me at this time, the certainty of a full time renter or the pleasure of a vacation home?
Nevada Real Estate vs. California Real Estate
Lastly, there is always the California or Nevada question to be decided when purchasing real estate in the Lake Tahoe area. Is it better to buy on the California or the Nevada side of the state line? Both offer distinct advantages. Bottom line, full time residents of Nevada enjoy the benefit of living in a state with no personal income taxes. On the other hand, real estate located on the California side is as much as 50% less expensive between the South Lake Tahoe shore in California and the North Shore of Nevada.
Whichever way an investor chooses to go, California or Nevada, full time or vacation rental, Lake Tahoe offers many kinds of attractions as well as investment attractiveness. From my own personal experience, Lake Tahoe real estate is a great investment opportunity whether your investment goals are income, equity growth, tax leverage, or just plain old vacation fun.
About Theresa Souers
With her husband and partner, Don Souers, Theresa Souers has built one of the most successful Lake Tahoe real estate teams. Among their many accomplishments and affiliations, her team has been one of the top five Century 21 Sierra Nevada sales teams for the last seven years. Ms. Souers is currently president of the South Lake Tahoe Association of Realtors and a member of the board of directors of the California Association of Realtors. For more information, please visit http://www.homeintahoe.com.
Andie Hockett chooses IDX/MLS Search Application for Prudential California Realty Website
Eugene based IDX, Inc. today announced the addition of Prudential California Realty's Andie Hockett to its suite of real estate based search applications online. Hockett now uses the latest version of IDX Broker to display and completely integrate Multiple Listing Service (MLS) listings on her personal website. This allows her to retain leads generated from direct traffic, rather than losing out to the listing broker through the use of traditional framed MLS search tools.
The IDX Broker application provides agents, brokers and other real estate professionals with the tools needed to create a competitive advantage in a growing real estate market.
The objective in developing a website with an integrated MLS data feed is to generate new leads at a low cost for the client. With automatic email announcements, custom client home views, and advanced admin and integration controls, Hockett's clients now have access to the entire MLS listing database on her website.
Additional benefits of using IDX Broker Pro is the ability to automatically create featured listing pages, check the status of new MLS listings and generate automatic emails 24/7.
About Andie Hockett
Andie Hockett dedicates 100% of her time and energy to delivering superior real estate service to her customers. Andie strives to eliminate frustration, stress and worry by offering the best service and ensuring customer satisfaction in every real estate endeavor.
About IDX, Inc.
IDX, Inc. creates solutions to promote and connect sellers with buyers using innovative server-side technology. Headquartered in Eugene, Oregon, IDX, Inc. specializes in advanced web-based application development for industries and businesses worldwide. IDX Broker, the primary application developed by IDX, Inc., helps inventory and real estate professionals generate more new leads at a low cost to the client. For more information please visit the IDX, Inc. website.
How Much Will College Cost, Really?
This specific article is the result of many life exprience mix with important data from different sources. The sole purpose of writing this article is to answer one of many questions about sutdent and education loan. I hope anyone who read this article will find it useful and truly enjoys it.
How much money is too much to borrow for college? Experts disagree. Both lenders and government suffer from a surprising lack of information about how we borrowers really manage during the years after we start paying our loans. Most of us don't default. But how much effort that costs us, how it gets in the way of our buying other things like cars and houses, nobody really knows. Frankly, until now, few people have asked.
We all agree on one thing, though: when you look at your loans in total, that number doesn't give you the real feeling of what you own. In order to understand what you're really considering, it helps to look at your loans by breaking them down into monthly payments. Then, you get a sense of how much money you will need to make if you want to pay your loans off comfortably.
Most estimates I have encountered place the average college debt at close to $11,000. Remember this is for undergraduate school; the dept of graduate school is going to be even higher. According to a study done by USA Group Loan Services/USA Group, you will be comfortable if you can keep your student loan payments at or below eight percent of your monthly income. Here's an example: if you borrowed what they list as the average amount, $10,146, your monthly payment would be about $123. That's definitely manageable. You have to make more than $18,500 a year to keep it under eight percent of your monthly income, but you can probably do that.
A quick question or wondering-ment. Is this information really helpful and important to me? The answer is yeas. I do not represent everyone who read this article. But for me, I really learn something new today. This is a really quality article that is very hard to find now days. So I decide to keep reading it. Not forever, but just for now.
You can see that a lot of cases, we really have just one practical option. We can consolidate our loans, which means we will now be paying for up to thirty years instead of ten. It also means that because of added interest, the loan is thousands of dollars bigger than we started our with. Our payments will still be in the $200 range, high enough to be irritation, if not a major pain. And we will have them every month for almost the rest of our lives.
What does it really mean, $200 a month? Try thinking of it this way. A typical car payment is $200 to $300 a month. If our salary is in the $30,000 range, that's about how much extra money most of us can afford to spend after we finish paying our other bills, such as housing, and I don't mean $200 worth of credit card bills every month.
If you buy the car and put off the loan, the loan gets bigger. If you pay the loan and don't buy the car, you are riding bus, or continue asking your parents for money. None of these options is a real solution. Also we are not talking about a real life-threatening problem. But in a real life, it is a pain to deal with. It's an everyday presence in your life, and even if it's over in ten years, because then years is a very long time. If you are a high school senior now, ten years you were in the second grade. It is shocking.
Here is the truth about paying for your education with student loans. It is not easy. It is a big deal. If you borrowed more than about $30,000, you will probably still be writing those checks when you are the age your parents are now. So before you sign those dotted lines, make sure that you know what you are getting into, and make sure you are getting a deal you want.
Now, you are pretty much finished with the article. If you think these information are helpful and important. I want you to keep up with the good work, in another word, keep reading more articles regarding the issues you have. I can promise you that within a short period of time, you can find all the information you need right here. Thank you for reading.
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