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A first-time buyer’s guide to becoming a landlord

Photo: James Bombales

Buying a home isn’t always about finding the perfect place to raise a family or host those summer barbecues — for some first-time buyers, owning real estate is the gateway into the realm of landlordship.

Becoming a small-scale landlord can look easy, but there’s more to it than collecting the rental cheques every month. Whether you lease out an individual property or have a self-contained rental unit in your home, such as a basement apartment, buying to become a landlord requires you to be a hands-on business owner.

“I tell my clients upfront [that] you’ve got to think of it as a business,” says Nawar Naji, a Toronto real estate investor and broker at Chestnut Park Real Estate. “It’s not just about, ‘Let’s go buy a condo and rent it out.’ You’ve got to think of it from a business perspective. Think of the operation side of it, taxation aspect of it, and the other part of it — the exit.”

Want to buy your first home?

With television shows like HGTV’s Income Property showcasing the benefits of owning a rental property, like easy income and a boost in property value, renting out your basement looks appealing. Yet, without proper preparation or knowledge of provincial landlord and tenancy laws, the landlord dream can quickly go sour.

“If people have a bad experience in the first year [of landlording], and the first tenancy is problem-ridden, nine times out of 10 I would think they would get out of the business,” says Susan Wankiewicz, executive director of the Landlord’s Self-Help Centre, a non-profit legal clinic for Ontario’s small landlords.

If you do your homework and plan accordingly, becoming a small landlord can be rewarding. As Naji and Wankiewicz tell it, here’s what you can expect if you’re working towards that first investment property.

Put your back into it

Landlording isn’t a passive investment — it requires maintenance, time and experience to nurture into a successful money-maker. As with any business, being present and aware of your investment’s unique needs will start you on the path to being a successful landlord.

“You’ve got to be active in the business,” says Naji. “It’s not just paying the mortgage, getting the rental cheque and calling it a day. There’s more work to be done to it.”

Naji, who has been investing in real estate since 2006, says a new landlord can expect the operation stage of landlording — running the property — to be the longest and most cumbersome. Semi-annual inspections, repairs, collecting rent and regular maintenance are the landlord’s responsibility. You could hire a property management company to take care of this for you for a percentage of your rental earnings, but Naji advises not to within the first year of a new investment property.

Photo: Julien Dumont/ Flickr

“[That way] when you pass it on to a property manager, and they call you [about a house issue], you’ll understand if it makes sense or doesn’t make sense,” he says. “If you haven’t done it by experience, somebody can call you and can come up with explanations that don’t necessarily make sense — it might not need any repairs.”

Naji also recommends building a team of professionals that specialize in residential investments. Your accountant, repair person or real estate agent, he says, should have knowledge of landlording in order to fully understand your needs.

Know it like the back of your hand

Legal jargon may be a dry read, but understanding tenancy laws in-depth before you become a landlord could save you a whole lot of trouble down the road.

“Usually we meet landlords once they’ve rented and they’re in trouble,” says Wankiewicz. “If they were to do the front-end research and understand what they’re getting into before they rent, I think they’d be better off.”

Wankiewicz has seen every kind of problem come through the LSHC office: tenants that default on rent; pets that suddenly appear unannounced; damage to the property; and tenants that decided to move their whole extended family into the unit. Whatever the issue may be, Wankiewicz explains that landlords who familiarize themselves with the provincial landlord and tenancy laws beforehand have a better understanding of what their rights are. For instance, she still encounters landlords who haven’t fully read Ontario’s Residential Tenancies Actand don’t understand that the law equally applies to both high-rise and second suite rentals.

“Landlords are surprised because they think that [because] they’re renting in their home and they’re the king of the castle. That’s not the case. They’re subject to the same legislation as if it were a high rise rental,” she says.

Photo: James Bombales

If a tenancy isn’t working out and an eviction is required, Wankiewicz warns that the process isn’t a quick fix. If a tenant stops paying rent, a landlord will need to give a termination notice and apply for a court hearing to the Landlord and Tenant Board as soon as possible.

“What we are seeing now is that it’s taking anywhere from four to six months for a landlord to terminate the tenancy and recover possession of the rental unit,” she says.

The price is right

Buying a house ain’t cheap, nor is saving for a downpayment, so you’ll want to ensure that you can get a return on your first investment property, and it starts with picking the right rental unit.

Naji says to follow the money — wherever there’s construction for a master-planned community or an injection of government funding into infrastructure, there will be a demand for rental housing. Highlights of a specific neighbourhood — proximity to transit, a family-friendly community, lots of amenities — will entice tenants over more space. As Naji explains, buying the largest rental unit on the market might allow you to charge slightly higher rent, but it will cost you more to purchase.

Photo: James Bombales

“If you’re buying the largest two-bedroom, two-bathroom condo, it’s not necessarily the best idea because the tenants are not going to pay more rent,” explains Naji. “They might pay a little more rent, but not enough to justify the additional cost of acquisition for that larger, or extra large, unit.”

Instead of focusing on big bedrooms and living areas, Naji says to look for smaller spaces with appealing characteristics. Tenants are feature focused; they’ll value better appliances or a shorter commute time over a bigger kitchen. A semi-detached could bring you in the same amount of money as a fully-detached home with the same number of bedrooms, but will cost you less to buy.

“It might be a little bit smaller, but your cost of acquisition is less, and the numbers are going the be in your favour because your rent is going to be pretty much the same with a lower purchase price,” he says.

When pricing your rental unit, Naji says to compare current neighbourhood rental prices with seasonal demand to determine the right price.

Meet and greet

With a tenant living on your property, you’ll get to know all of their quirks very quickly. Some landlords aren’t prepared for the extra smells, sounds and interesting habits on display that go hand in hand with having a tenant.

“Landlords in a smaller situation, were they’re renting part of their home, they become consumed with tenant behaviour, like if the tenant has an overnight guest and, ‘They didn’t tell me’, ‘The tenant’s taking too many showers’, or ‘The tenant’s leaving the lights on’, or ‘They brought in a pet and I didn’t approve a pet’— issues like that, small-living landlords are unprepared for,” says Wankiewicz.

The landlord-tenant relationship can sometimes be a rocky one. Wankiewicz emphasizes that in addition to good communication and responding to issues quickly, landlords need to conduct a comprehensive screening process to find a trustworthy tenant. She advises that going off face-value alone won’t provide enough information about a person. Using a rental application, speaking to references and checking a tenant applicant’s credit score are good methods to finding a quality tenant.

“So many times the small landlord will just make their decision on how their tenant appears, but they need to dig in and check with previous landlords, not just where they’re living now, but where they lived prior to that, because that’s where they’re going to get accurate information about what their behaviour was like,” says Wankiewicz.

Naji likes to take a personal approach to rental applications; he strongly recommends meeting prospective tenants in-person not only to check for that gut-feeling, but to get to know the person.

“At the end of the day, this is a people business. You’re renting your property to a person or a couple. It’s good to meet them, get to know who they are.”

Source: Livabl.com –  

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Renting Versus Buying: A Real Estate Expert Breaks It Down for Us

The renting versus buying dilemma is one my friends have started to face since they’ve begun leaving Manhattan and escaping to the suburbs (I’m still not there yet, but when I think about how much money I “throw away” each year on rent, it’s actually cringe-worthy). But, maybe it’s true when they say the grass is always greener. Buying doesn’t come without its own set of problems, considering both sets of my friends who recently purchased homes faced movers damaging their patio, gas leaks, and even a broken washing machine within the first week. (They’ve confided in me that their bank accounts are still recovering.)

Since we’re no experts on the topics, we decided to tap Scott McGillivray, a real estate/renovation expert and TV host, to get his professional take. “Neither renting or buying is intrinsically right or wrong,” he says. “It basically comes down to your goals and your lifestyle.” That being said, he encourages getting into the real estate market once you feel financially prepared to do so. And what if you’re worried about going all in? McGillivray suggests trying a practice mortgage in which for one year while you’re renting, you put aside the amount you’d have to pay as a homeowner (mortgage, property tax, potential repairs). This gives you a realistic idea of how your lifestyle and budget will be affected if you buy.

“If you can manage, go for it,” the expert says. “And the bonus is that at the end you’ll have some extra cash for a down payment.” Since renting versus buying is no small debate, we asked McGillivray to break down all the pros and cons for each. Keep reading to get the full scoop.

 

 

Source: MyDomaine.com – by 

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Naborly protects landlords’ investments

As every landlord surely knows, running a credit check during the tenant selection process is paramount. However, not every landlord realizes what to do with the information the credit check reveals.

“Every independent landlord knows that to screen a tenant, you have to look at their credit, but a lot of them have no idea how credit relates to a tenant’s ability to pay rent on time,” said Jerome Werniuk, director of sales at Naborly Inc., which runs free credit and background checks. “Ninety-five percent of landlords have tenants show up with their own credit file, meaning they go to Credit Karma or Equifax, but when we hear professional tenant stories, these people come with doctored credit checks.

Doctoring a credit check is as easy as finding a template online and filling it in as one wishes. It’s what Werniuk describes as a huge problem within the industry.
While savvy landlords realize they can obtain credit checks from Equifax or TransUnion, many still don’t know, nor have time, to mine the information therein to decipher a tenant’s capacity for prompt rent payments.

“To get a credit file from either of the credit bureaus, they have to pay for it and a set-up fee for the individual’s report, but there’s a heavy credentialing process to pull somebody’s file,” said Werniuk. “Even when the landlord gets a credit file, they don’t know how to read it. They don’t know exactly what an R9 is or how someone paying a cell phone bill on time impacts their ability to pay rent. So credit is not necessarily a good tool for independent landlords.”

Naborly builds a different type of credit report using critical criteria like contemporary cost of living and verifiable income to determine a potential tenant’s ability to pay rent. It has proven so popular that, when it launched in February 2018, Naborly screened 100 people a week. Now, it screens at least that many people in a day.

“The biggest feedback we’ve received from landlords is our tool is amazing at assessing risk so that they can properly evaluate whether or not to accept the rental application,” said Werniuk. However, there remain risks that are extremely difficult to predict. Landlords have said that many of their previous evictions  were due to circumstances that changed after the tenant moved in, like job loss or some other unforeseen, and expensive, event in their lives. Nobody can predict those things.”

The average cost of eviction in Ontario is $9,000, and that could cripple an investment. In response, Naborly has rolled out Rent Guarantee, which doesn’t just risk assess but also protects the landlord for the full term of the lease. In effect, Naborly cats as the tenant’s co-signor, which shields the landlord’s investment.

“It’s based on the Naborly report and the risk score we give, which directly correlates to a tenant defaulting on rent,” said Werniuk. “We give a quote for how much rent guarantee will cost. They can have Naborly become a guarantor on the lease, meaning if the tenant ever defaults then Naborly steps in and covers the rent for up to six months. Our primary customer for Rent Guarantee is the landlord who only owns one or two units because if they don’t collect rent for two or three months, they’ll have issues paying their mortgages and they could lose the property.”

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Mark Cuban Says the Best Investment Is Paying Off Your Debt — Is He Right?

Mark Cuban Says the Best Investment Is Paying Off Your Debt -- Is He Right?

Image credit: Invision/AP/REX/Shutterstock via GOBankingRates

Billionaire investor and Shark Tank star Mark Cuban said that the safest investment you can make right now is to pay off your debt, according to an interview with Kitco News earlier this year.

 

“The reason for that is whatever interest you have — it might be a student loan with a 7 percent interest rate — if you pay off that loan, you’re making 7 percent,” said Cuban. “And so that’s your immediate return, which is a lot safer than trying to pick a stock, or trying to pick real estate or whatever it may be.”

Cuban is mostly right: More often than not, paying down debt as fast as possible is going to provide the most value in the long run. And perhaps more importantly, it will do so without any real risk that comes with most investing. That said, each person’s financial situation is different, so it is worth a closer look at when it’s better to pay off debt or invest.

Debt is like investing but in reverse.

One important thing to note is that the same principals that make investing so important also make paying off your debt similarly crucial. As Cuban points out, the interest rate on your loan is essentially like the rate of return on your investments but backward. In fact, many investments are simply ways you’re letting your money get loaned out to others in exchange for them paying interest.

As such, it’s important to keep in mind that as satisfying as it might be to watch your money grow in investments, it’s doing just the opposite when you have debt.

Every loan is different.

Although debt chips away at your net worth through interest, it’s important to note that different types of borrowing do so in very different ways. Every loan is different, with some offering terms that are actually quite favorable and others that can be excessively costly.

An overdue payday loan can lay waste to your financial health in no time, but a 30-year fixed-rate mortgage with a competitive rate can be relatively easy to manage with good planning. Borrowers should be sure they understand what kind of debt they have and how it’s affecting their finances.

 

Focus on the interest rate.

The key factor to take note of when considering how to allocate funds is the interest rate — usually expressed as your APR. Debt with a high APR is almost always going to be better to pay down before you focus on any other financial priorities beyond the most basic necessities.

The average APR on credit cards as of August 2018 was 14.38 percent. That’s well in excess of what anyone can reasonably expect to sustain as a return on most investments, so it shouldn’t be hard to see that investing instead of paying down your credit card is almost always going to cost you money in the long run.

Does your interest compound?

Another crucial factor in understanding how your debts and your investments differ is whether or not your interest is compounding. Compounding interest — like that on most credit cards — means that the money you pay in interest is added to the amount due and you’ll then have to pay interest on it in the future. That can lead to debt snowballing and growing exponentially. So, not only do credit cards have high interest rates, but they also make for debt that’s growing faster and faster unless you take action to pay it down.

However, that same principle can work in reverse. Gains on something like stocks will also compound over time, so there’s a similar dynamic at work when comparing your investment returns to fixed interest costs.

Know your risk tolerance.

Another factor that plays a big part in the conversation is your level of risk tolerance. Note that the question Cuban was responding to earlier was about what the “safest” investment was. For most people, erring well on the side of caution when it comes to something like personal finance just makes sense, and in that case, focusing on paying off debt is pretty crucial.

However, others might decide that the long-term payoffs that are possible make it worth rolling the dice on their future. Borrowing money for investments is common despite the risks associated, with everyone from massive investment banks to investors with margin accounts opting to take a calculated risk that their returns will ultimately outpace the cost of borrowing.

 

Costs of debt are set, investment returns often are not.

One important aspect of understanding the risks involved is that the cost of your debt is usually set and predictable, but the returns on your investments are not. It might be easy to look at the historical returns of the S&P 500 at just under 10 percent a year and assume that it’s worth it to put off paying down debt for an S&P 500 ETF or index fund as long as your APR is under 10 percent.

However, that long-term average does not reflect just how chaotic the markets really are. Sure, it might average out to about 10 percent, but some years will be in the negative — sometimes over 30 percent into the red. Even with bonds — where your rate of return is fixed — there is always a chance that the borrower will default and leave you with nothing.

If you have a variable rate loan

Of course, if your loan has variable interest rates, the equation changes yet again. You could see your interest rate rise or fall depending on what the Federal Reserve does, adding another layer of uncertainty to the decision — especially when it’s impossible to say with certainty which direction interest rates are headed in for the long run.

So, although debt will typically have more certainty associated with its costs than investing, that’s not always the case and variable rate loans could change things for some borrowers.

Don’t forget taxes.

You should also remember that the tax code includes a number of provisions that promote investment, and those can boost the value of investing. In particular, contributions to a 401(k) or traditional IRA are made with before-tax income, meaning that you can invest much more of that money than you would have with your after-tax income that would be used to pay down debt.

That’s especially true when you have an employer who matches your 401(k) contributions. If your employer matches, you’re essentially getting a chance to not just avoid paying taxes on that income, but you’re doubling its value the moment you invest — before it’s even started to accrue returns.

 

Some opportunities are unique.

Another important factor to consider is what type of investments you can make. In some very specific cases, you might have access to an investment opportunity that brings with it huge potential returns that could tip the scale. Maybe a specific local real estate investment you’re particularly familiar with or a startup company run by a family member where you can get in on the ground floor.

Opportunities like this usually come with enormous risks, but they can also create transformational shifts in wealth when they pay off. Obviously, you have to gauge each opportunity very carefully and make some hard choices, but if you do feel like it’s a truly unique chance to get the sort of returns that just don’t exist with publicly-traded stocks or bonds, it might be worth putting off paying down debt — especially if those debts have fixed rates and a reasonable APR.

What really matters with debt and investments

At the end of the day, you certainly shouldn’t opt to invest money that could be used to pay down debt unless the expectation for your returns is greater than the interest rate on your debt. If your personal loan has an APR of 15 percent, investing in stocks is probably not going to return enough to make it worthwhile. If that rate is 5 percent, though, you could very well do better with certain investments, especially if that’s a fixed rate that doesn’t compound.

But, even in circumstances where you might have reasonable expectations for returns higher than your APR, you might still want to take the definite benefits of paying down debt instead of the uncertain benefits associated with investments. When a wrong move might mean having to delay retirement or delay buying a home, opting for the sure thing is hard to argue with.

Which decision is right for you?

Unfortunately, there’s no magic bullet for knowing whether your specific circumstances call for you to prioritize paying down debt over everything else. Although paying down debt is typically going to be the smartest use for your money, that doesn’t mean you should do so blindly.

Putting off paying down your credit card balance to try your hand at picking some winning stocks is a (really) bad idea, but failing to make regular 401(k) contributions in an effort to pay off your fixed-rate mortgage a couple of years early is probably going to cost you in the long run — especially if you’re missing out on matching funds from your employer by doing so.

So, in a certain sense, Mark Cuban is right: Paying down debt is very rarely going to be a bad idea, and it’s almost always the safest choice. But that said, it’s still worth taking the time to examine the circumstances of your specific situation to be sure you’re not the exception that proves the rule.

Source: Entrepreneur – Joel Anderson , 

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The 10 Best Big Cities to Live in Right Now

You don’t have to empty your savings account to afford city living in America—at least not in these locations.

Urban areas offer a gateway to culture or a medley of activities, but they typically come with a high price tag. That’s why MONEY crunched the numbers to find big cities—those with a population of 300,000 or more—with the best of all worlds: attractions, iconic neighborhoods, a relatively low cost of living, and promising job growth.

Here are our top 10 picks for best big cities to live in. (See MONEY’s full 2018 ranking of the Best Places to Live in America.)

1. Austin, Texas

  • Average Family Income: $87,389
  • Median Home Price: $326,562
  • Projected Job Growth (2017-2022): 10.9%

Texas’s delightfully bohemian capital nabs the list’s top spot because of the thriving job scene, coupled with memorable food, music, and a startup culture.

Not only is Austin projected to see a whopping 10.9% increase in jobs over the next four years, but the current unemployment rate of 3% also sits below the national average. The city’s median family income is $87,389, and the median home sale price is $326,562, according to realtor.com. Much of its job growth comes from small businesses and the tech sector—Dell, IBM, and Amazon are some of the biggest employers. Entrepreneurs, take note: CNBC ranked Austin as the No. 1 place to start a business, while Forbes named it one of the top 10 rising cities for startups.

Once you do land a job, you won’t have to worry about how to entertain yourself. Dubbed the Live Music Capital of the World, Austin is bursting with talent and more live music venues per capita than anywhere else in the nation. Visitors flock to the annual South by Southwest festivals, featuring concerts, speeches, and comedy showcases.

And then there’s the food. Restaurant-rating powerhouse Zagat named Austin the second-most-exciting food city in the U.S. last year, thanks to mainstays like Franklin Barbecue and new favorites such as ramen restaurant Kemuri Tatsu-ya, which combines Texan flavors and Japanese techniques for a meal as distinctive as the city itself.

2. Raleigh, North Carolina

  • Average Family Income: $82,021
  • Median Home Price: $263,000
  • Projected Job Growth (2017-2022): 9.6%

Part of North Carolina’s tri-city university hub, called the Triangle, along with Durham and Chapel Hill, Raleigh is home to a relatively young, diverse, and educated population.

Like Austin, Raleigh is a hotspot for employment seekers: Moody’s Analytics projects the area’s jobs will grow 9.6% by 2022. Forbes this year ranked Raleigh among the top 10 cities for jobs, owing in part to its 17.25% job growth over the past five years. And people are listening: There’s been a 13% increase in population since 2010, according to MONEY’s Best Places to Live database.

Your wallet will feel the benefits too: With an average sales tax of about 7.25% and average property taxes at $2,632, the city’s cost of living is relatively low compared with our other big cities.

As the historically significant birthplace of Andrew Johnson, Raleigh is host to dozens of museums, earning it the nickname Smithsonian of the South. The North Carolina Museum of History reaches back 14,000 years into the state’s past, and at the massive North Carolina Museum of Natural Sciences, general admission is free.

There’s a strong sense of community as well. Every fall, the North Carolina State Fair draws 1 million visitors to Raleigh for a 10-day festival featuring rides, music, games, and crafts from local artists. Tickets cost about $10 for adults and $5 for children.

3. Virginia Beach, Virginia

  • Average Family Income: $82,927
  • Median Home Price: $255,000
  • Projected Job Growth (2017-2022): 2.6%

The living is easy in Virginia Beach, also named one of MONEY’s best beach destinations last year. The area’s unemployment rate is about 3.1%, below the national average, and crime, relatively low among the big cities here, is also well below the national average. Despite an only 4% increase in population since 2010, the area is booming for retirees: The number of people age 50 and over grew 22% over the past eight years. But perhaps best of all, there are 213 clear days a year, giving residents plenty of time to enjoy six major beaches over 35 miles of coastline.

There’s a sandy stretch for nearly everyone, starting with the family-friendly First Landing State Park at Chesapeake Bay Beach. For surfing, head to Virginia Beach Oceanfront, or for a quieter, picturesque view, go to Sandbridge Beach.

The Sandbridge area is also home to Back Bay National Wildlife Refuge, where you can learn about the region’s snakes, frogs, and turtles during a guided nature hike on Bay Trail. Nearby is First Landing State Park, the most visited state park in Virginia, named after the arrival of English colonists in 1607. First Landing offers outdoor activities as well as cabins, a boat launch, and swimmable waters.

Culture vultures won’t feel left out: Renowned symphony orchestras play the Sandler Center for the Performing Arts, and comedians headline at the Funny Bone Comedy Club.

4. Mesa, Arizona

  • Average Family Income: $64,455
  • Median Home Price: $246,000
  • Projected Job Growth (2017-2022): 8.1%

Seeking a sunny city with easy opportunities to escape to the outdoors? It pays to head west.

Mesa, just 20 miles outside Phoenix, has experienced a 12% growth in population over the past eight years and is projected to see jobs increase 8% in the next four years. The majority of new job offerings here, unlike in Austin, are in the investment and manufacturing sectors rather than tech.

Local government leaders say businesses are moving to Mesa, as well as the surrounding East Valley area, for its low tax rate and relative affordability. Average property taxes are around $1,444, the second lowest among MONEY’s big cities, and the median home sale price is $246,000 as of March.

Once you’ve settled in, you won’t have to look far for an outdoor retreat. Mesa gets an impressive 296 clear days a year, and a whopping 115 campsites surround the area. Camping reservations for county parks can be made online as early as six months in advance. You’ll pay $32, including a reservation fee of $8, for a developed camping site with electricity and restrooms or, if you’re a bit more daring, $15 for a site with no amenities.

To learn about the area’s history, visit the Mesa Grande Cultural Park, which preserves ruins believed to be the religious center of the ancient Hohokam civilization, dating back to 1100 A.D. Admission to the ruins costs $5 for adults and $2 for children. For more insight into the Hohokam ancient people, you can check out the Park of the Canals, which features 4,500 feet of an extensive canal system used to farm corn, beans, squash, and cotton.

5. Seattle, Washington

  • Average Family Income: $112,211
  • Median Home Price: $676,889
  • Projected Job Growth (2017-2022): 7.5%

The Emerald City enjoys a growing job market and vibrant cultural attractions but at a cost—the median home sale price, $676,889 as of March, is the most expensive among the cities on this list. But the high price tag might be offset if you could score a lofty job at Amazon, which employs more than 40,000 Seattle residents across its 8.1 million square feet of office space. The company’s dominance has spurred other major tech giants to build their own offices—and poach local employees.

Despite the relatively high cost of living, the area provides plenty of affordable attractions. Nearly 200 wineries cover the region and are ideal for visits. Check out the Charles Smith Wines Jet City tasting room for offerings from one of the state’s largest wine producers. Be sure to also try the famous cream cheese–covered Seattle-style hot dog at Monster Dogs.

To live like a tourist, get a two-in-one ticket to Seattle’s iconic sites: the towering Space Needle and the glass-sculpture garden at Chihuly Garden and Glass. They happen to double as ideal date spots. If you’re young and looking for love, Seattle is the perfect match. MONEY named it one of the best places for millennials and singles.

6. San Diego, California

  • Average Family Income: $91,199
  • Median Home Price: $555,000
  • Projected Job Growth (2017-2022): 4.4%

With 1.4 million residents, San Diego is the most populous city to make the list. It’s also one of the more racially diverse cities in the country, with 40% nonwhite residents.

Head to the east side, and you’ll find mountains and canyons perfect for hiking, mountain biking, and fishing. The area also boasts Las Vegas–style casinos and resorts, including Viejas Casino, home to 2,200 slot machines and an outdoor concert venue. California beaches outline the city’s west side, from mile-long La Jolla Shores, perfect for children and seal lovers, to bonfire-friendly Pacific Beach, often referred to as “the Strand.” And don’t forget to visit the rare giant pandas at the world-renowned San Diego Zoo.

7. Colorado Springs, Colorado

  • Average Family Income: $75,795
  • Median Home Price: $285,000
  • Projected Job Growth (2017-2022): 7.1%

About 70 miles south of Denver, Colorado Springs was recently ranked one of the country’s best tech hubs by the Computing Technology Industry Association. The city will see projected job growth of 7% by 2022, and the cost of living is relatively low among big U.S. cities, according to PayScale.

Skiers enjoy the region’s proximity to major ski getaways like Aspen and Vail, as well as the area’s surrounding resorts, including Eldora Mountain Resort, which offers 680 acres of terrain and 300 inches of snowfall a year.

Here’s a summit for the courageous: the 2,000-foot-high, one-mile hike up the Manitou Incline. Climb all 2,744 steps, and you’ll be rewarded with gorgeous views of the city below. Nonathletic types are welcomed too. The annual Labor Day Lift Off features hot-air balloons and a festival with live music, skydiving demonstrations, and a doughnut-eating contest.

8. Lexington, Kentucky

  • Average Family Income: $74,531
  • Median Home Price: $131,000
  • Projected Job Growth (2017–2022): 4.3%

Good news for potential residents: Lexington has some of the lowest taxes among the cities on this list, with a sales tax of 6% and average property taxes nearing $1,921.

Moving to Lexington means embracing equestrian culture. Nicknamed the Horse Capital of the World, Lexington was the first U.S. city to host an FEI World Equestrian Games, in 2010, drawing half-a-million attendees. Residents and visitors alike can ride horses and ponies at the Kentucky Horse Park.

For a crash course in bourbon distilling, the Town Branch Distillery offers tours and tastings, and one of the South’s best bourbon bars, The Bluegrass Tavern, is home to Kentucky’s largest bourbon collection.

If you’re looking to root for the Wildcats, the University of Kentucky’s basketball team where NBA All-Stars Anthony Davis and John Wall got their start, head to Winchell’s Restaurant for 25 TVs and passionate fans.

9. Jacksonville, Florida

  • Average Family Income: $63,735
  • Median Home Price: $196,000
  • Projected Job Growth (2017-2022): 7.7%

As the largest metro area by landmass in the continental U.S., Jacksonville, like many other cities on our list, claims a growing job market and population. In the past eight years, the city’s population increased by nearly 9%, with a projected job growth of 7.7% by 2022. Those seeking employment, specifically in the tech industry, should head to the area’s growing job market, say ZipRecruiter and Indeed.

Visitors can support the home team by attending a Jacksonville Jaguars game at TIAA Bank Field. The coastal city also features 22 miles of mostly public and dog-friendly beaches. Learn to surf at Atlantic Beach, or brave souls might try a taste of alligator at nearby Mayport’s historic fish camps.

For a combined farmers’ market and artists’ hub, head to the Riverside Arts Market, which attracts thousands of people every Saturday. You’ll listen to live musicians, eat local bites alongside the St. Johns River, and support local artists, all in one day.

10. Columbus, Ohio

  • Average Family Income: $61,513
  • Median Home Price: $185,000
  • Projected Job Growth (2017-2022): 5.7%

Columbus is one of the fastest-growing cities in the U.S.—and in the Midwest—with a population increase of nearly 11% in the past eight years and job growth of 14% in roughly the same period.

Big 10 Ohio State University is the city’s biggest employer, and you can take advantage of the college town’s vibrant culture by attending a football game at Ohio Stadium, which seats over 100,000 people. Following the game, head to the Thurman Cafe and indulge in its massive, double-patty Thurmanator burger for $21.99.

If college athletics aren’t your thing, check out one of the area’s 96 museums, such as the hands-on Center of Science and Industry, or the Columbus Museum of Art, featuring modern and contemporary works.

Methodology

To create MONEY’s Best Big Cities ranking, we looked only at places with populations of 300,000 or greater. We eliminated any city that had more than double the national crime risk, less than 85% of its state’s median household income, or a lack of ethnic diversity. We further narrowed the list using more than 8,000 different data points, considering data on each place’s economic health, cost of living, public education, income, crime, ease of living, and amenities, all provided by research partner Witlytic. MONEY teamed up with realtor.com to leverage its knowledge of housing markets throughout the country. We put the greatest weight on economic health, public school performance, and local amenities; housing, cost of living, and diversity were also critical components.

Finally, reporters researched each spot, searching for the kinds of intangible factors that aren’t revealed by statistics. To ensure a geographically diverse set, we limited the Best Big Cities list to no more than one place per state.

Source: TopBuzz.cum November 19, 2018 6:12 AM

 

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The Best Cities To Own Rental Property In Florida

 

Credit: Getty Royalty Free | Miami Beach. Florida. USA. The Miami metro area is a hotbed for investment property investing.

Florida is an intriguing state when it comes to buying and owning rental property. On one hand, demand for homes — especially single-family homes — has been consistently on the rise in Florida. Yet despite the demand, it doesn’t necessarily convert to more homebuyers. Instead, even though Florida boasts fairly low housing prices statewide, many people are still opting to rent instead of buy. As a result, rental rates are skyrocketing.

Now add into the mix low property taxes and insurance, as well as no state income tax. Great climate and top-of-the-line healthcare are bonuses that help make Florida one of, if not the best, states for America’s retiring Baby Boomer masses.

Here’s a look at the best places in Florida to own rental property and turn a solid profit.

Tampa

Although Tampa home prices have risen in recent years, the city still has plenty of neighborhoods and zip codes where investors can find properties at affordable prices, and rent them out for $1,405 to $1,527 a month on average.

Tampa’s economic prospects really boost the city’s appeal to rental property owners. Tampa’s year-over-year employment growth beat the U.S. average. According to Bureau of Labor Statistics data, U.S. nonfarm employment increased approximately 1.6% from 2017 to 2018, while Tampa managed a 2.3% increase.

Healthcare and social assistance is the dominant employment sector in Tampa. This isn’t a bad thing considering jobs such as home health aides, personal care aides, physician assistants and nurse practitioners all rank among the top-10 fastest growing occupations in the country, according to BLS Employment Projections.

Here’s a breakdown of some important figures to consider before buying property in Tampa:

  • Median list price – All Homes: $312,995
  • Median list price – Condo: $239,900
  • Rent list price: $1,527
  • Median rent: $1,405
  • 1-year job growth rate: 2.3%
  • 5-year population growth: 12%
  • Average 30-year fixed mortgage rate: 4.40%
  • Rental yieldSee rental yields for Tampa

The trajectory of Tampa’s population growth is very conducive to potential future property owners. Since 2013, Tampa’s population has risen by an impressive 12%, one of the highest rates in the country. With a local economy worth well over $130 billion, Tampa is easily one of Florida’s best markets to buy and own rental property. For a more in-depth look, or just to explore, take a look at this interactive map of the Tampa real estate market.

Jacksonville

Robust job and population growth as well as great affordability greet prospective investment property owners in Jacksonville. Florida’s largest city is also home to a first-rate healthcare system, and burgeoning biological sciences sector. The population in Jacksonville has grown about 8% from 2013 to 2018, and 24% since the year 2000. Plus, the median home price is $210,000 in Jacksonville, which is 33% cheaper than the national average, $278,900.

Jacksonville’s average rental yield is among the highest in the U.S. Rent growth is also healthy. The city’s 2.6% increase is better than the national year-over-year average of 0.5%. Specific markets within the Jacksonville metro area, such as Butler Beach, are displaying rent growth rates in excess of 10%.

Here’s a breakdown of some important figures to note before buying property in Jacksonville:

  • Median list price – All Homes: $210,000
  • Median list price – Condo: $134,950
  • Rent list price: $1,250
  • Median rent: $1,345
  • 1-year job growth rate: 3.2%
  • 5-year population growth: 8%
  • Average 30-year fixed mortgage rate: 4.40%
  • Rental yieldSee rental yields for Jacksonville

The reasons for all this growth and development are manifold. Jacksonville’s cost of living is below the national average. And to this is we can add the usual Florida amenities, like warm weather, conducive business climate and no state income tax.

See interactive map of Jacksonville real estate market >>

Orlando

In terms of both employment and population growth, Orlando really outshines. From summer 2017 to 2018, employment increased 4.3%, which is almost three times the U.S. average growth rate. Its population surged by 14% from 2013 to 2018.

The most common employment sectors for those who live in Orlando are accommodation and food service (12.3%), which includes workers of Orlando’s world-class resorts like Disney World and Universal Studios Orlando. Second most common sector is healthcare and social assistance (11.9%), followed by retail trade (11%).

Here’s a breakdown of some important figures to consider before you buy property in Orlando. Also, here’s an interactive map of Orlando’s real estate market to help out.

  • Median list price – All Homes: $285,000
  • Median list price – Condo:$140,000
  • Rent list price: $1,600
  • Median rent: $1,478
  • 1-year jogrowth rate: 4.3%
  • 5-year population growth: 14%
  • Average 30-year fixed mortgage rate: 4.40%
  • Rental yieldSee rental yields for Orlando

Rents grew 2.3% in the last year, which is well ahead of the U.S. overall growth rate. Rent yield in Orlando is markedly higher than in most other cities. Comparatively low home prices combine with relatively higher rent prices to create a city that is especially suitable to owning rental property.

Source: Forbes –
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Here’s how much money you have to make a year to afford an ‘average’ home in the hottest US cities

Business district area of downtown San Jose, California.

Mark Miller Photos | Getty Images
Business district area of downtown San Jose, California.

The median U.S. household now earns about $61,372 a year, up nearly 2 percent from 2016. Still, in order to afford to buy a home in one of the country’s hottest and most expensive cities, like San Jose, California, you’d need to make more than four times that amount.

That’s according to financial website How Much, which crunched numbers from the National Association of Realtors and mortgage-information website HSH.com to determine where it’s most expensive to buy an “average-sized home.”

Researchers found the median price of homes in the 50 most populated metro areas across the country and “calculated monthly principal, interest, property tax and insurance payments buyers have to pay for a 30-year fixed rate mortgage,” says How Much.

They then calculated what salary would be needed to afford each home, assuming a 20 percent down payment and that the total housing payment would not make up more than 28 percent of gross income.

How Much: Annual income needed to buy a home

Based on the data, here are the top 10 cities where you to earn the most money to buy a typical home:

1. San Jose, California

Annual income needed to afford a home: $274,623

2. San Francisco, California

Annual income needed to afford a home: $213,727

3. San Diego, California

Annual income needed to afford a home: $130,986

4. Los Angeles, California

Annual income needed to afford a home: $114,908

5. Boston, Massachusetts

Annual income needed to afford a home: $109,411

6. Seattle, Washington

Annual income needed to afford a home: $109,275

7. New York, New York

Annual income needed to afford a home: $103,235

8. Washington, D.C.

Annual income needed to afford a home: $96,144

9. Denver, Colorado

Annual income needed to afford a home: $93,263

10. Portland, Oregon

Annual income needed to afford a home: $85,369

“Median household income across the United States recently reached a record high, which is great news for workers,” says How Much. “The bad news is that isn’t enough to afford a typical home in 25 out of the 50 cities on our map.” That’s especially true on the West Coast.

“Our map reveals three tiers in annual income workers need to earn to afford a median home. First, the West Coast stands out as by far the most expensive market in the country,” the report says, “with four out of the top four markets in California alone.”

In Los Angeles, San Diego, San Francisco and San Jose, California, median homes range in value from $618,000 to more than $1.3 million, according to real-estate site Zillow. The U.S. national median home value, by comparison, is just above $216,000.

“Median household income across the United States recently reached a record high, which is great news for workers. The bad news is that isn’t enough to afford a typical home in 25 out of the 50 cities on our map.”-HowMuch.net

“The second tier of expensive locales is along the East Coast,” How Much reports, “led by the familiar hot spots of unaffordable housing like Boston, New York and Washington, D.C.

In Portland and Denver, meanwhile, homes aren’t as expensive as they are in California or New York, but workers would still need to make about $85,000 a year to afford to buy.

Some lower-profile American cities do still offer professional opportunities and good deals. In these three up-and-coming metro areas, for example, jobs are plentiful yet housing is affordable.

No matter where you fall on the map, though, living within your means and employing common-sense budgeting tactics can help you save in the long run. If you’re looking to buy a home, be sure you’re ready to transition from renting and if you’re going to continue to rent, check out these savings hacks and other ways to make your money stretch further.

 

Source: CNBC.com –  

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