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Monday, November 21, 2005

The WRONG Way to Invest in Real Estate

by William Bronchick

"Real estate fever" . . . it's hit the Country like a plague. Zillions of "newbies" are hitting the bandwagon, trying to make a profit where they lost in the stock market. I meet them all the time, and many are making big mistakes!

Mistake #1: Stock Market Mentality

You'd think after losing $7 trillion in the stock market people would have learned! Nope, they are making the same mistake, which is assuming what happened yesterday will happen tommorrow. Nine of ten new investors I meet say they are interested in real estate because they saw someone else make money from the rapid appreciation of the market over the last few years. But, buying real estate solely for short-term appreciation is often a big gamble! If you buy real estate to hold for 15 years or more, the chances are you will come out on top. If you buy a property and flip it in within a year, you probably are fine, too. And, despite the risk, many people can intelligently time the "boom" of a local market (or subdivision within a market) and make a profit. But, if you buy a rental property for full market price with break even or negative cash flow, you'd better have a backup plan if the market doesn't keep going up. Investing is a lot like surfing... if you don't know how to ride the wave, you will drown!
So, should you refrain from investing if you think the market has peaked? Absolutely not! You can find bargain-priced properties in every real estate market, even the hottest. You can find low-interest rate financing that will increase your cash flow so if values drop, you still are covered. You can plan short-term (six to 12 months), because real estate markets rise and fall slowly. And, if you keep a cash reserve for your business, you won't sweat when the market tanks, because you know that in the long run, real estate markets virtually always come back.

Mistake #2: Investing Blind

You'd think after losing $7 trillion in the stock market people would have learned! Nope, they are making the same mistake, which is blindly buying real estate based on bogus advice or complete lack of education. Real estate is one of the few investments in which risk is directly proportional to knowledge. True, it has a higher learning curve than investing in the stock market, but there's no proof that having knowledge of the stock market reduces risk (just ask your mutual fund manager).

I read a comment on a real estate discussion group on the Internet. In response to an inquiry as to whether a particular seminar or training program was worth the money, someone answered, "Why waste your money on that stuff? Just use your money as a down payment and learn as you go." This is probably the worst advice you could ever give a beginner. Money for real estate deals is easy to find if you can find good deals. But, you won't know what a good deal is without having first invested in your education!

The more knowledge of real estate investing techniques, financing, acquisition, negotiating and, of course, your local marketplace, the less risky your investments will be. A bargain real estate purchase will generally always be a safe investment; a bargain stock purchase isn't - after all, who says the company you bought into will be in business next year?.

Mistake #3: No Cash Reserves

Moreof this artical....

William Bronchick has served as President of the Colorado Association of Real Estate Investors since 1996. He is admitted to practice law before the bars of New York and Colorado.
You may contact Mr. Bronchick for consultation by phone, fax, e-mail or correspondence at:
Bronchick & Associates, P.C. 2821 S. Parker Rd. Suite 405Aurora, Colorado 80014 Tel 303-398-7032Fax 303-671-0516

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Tuesday, November 15, 2005

Buyers gain clout as market slows

Buyers gain clout as housing market slows

Glen CrenoThe Arizona RepublicNov. 11, 2005 12:00 AM

Metropolitan Phoenix's home-selling frenzy is beginning to calm and beleaguered buyers suddenly have more power in the fight for leverage in house deals.The housing market is showing clear signs of slowing after a yearlong buying binge fueled partly by speculators. The latest evidence: The price for a typical Valley house fell last month for the first time in nearly two years.People close to the market say it has a new personality. Sellers aren't necessarily calling the shots and can no longer assume a house will sell quickly after buyers stage a frantic bidding war, pushing sale prices thousands of dollars beyond the list price.

Buyers now are gaining the upper hand, though it's too soon to call it a buyers' market. But it is headed in that direction. With more homes for sale, sellers are cutting prices. Buyers also can take more time to think about a deal rather than snatching up a house just to beat a dozen competitors.
Portions from Read full Article…..

Saturday, November 05, 2005

$35,000,000 IDA Excise Tax Bonds

AUSTIN, Texas--(BUSINESS WIRE)--Nov. 1, 2005--Fitch assigns an initial 'A-' rating to the $35 million Industrial Development Authority of the County of Yavapai (AZ) convention center facilities excise tax revenue bonds, series 2005 (taxable). The Rating Outlook is Stable. The bonds are scheduled to sell the week of Nov. 7 via negotiation to M. L. Stern & Co.

The bonds are secured by a loan agreement to the borrower, Prescott Valley Events Center LLC, which will construct and operate the facility. Loan repayment resources include net operating income from the facility, as well as transaction privilege (sales) taxes (TPT) from the facility and generated within a designated entertainment district where the facility will be located. Further repayment support includes the TPT from an additional geographic area adjacent to the entertainment district. Bond proceeds will be used to construct a 5,000-seat convention and events center and provide for capitalized interest and a debt service reserve fund.

The 'A-' rating is based primarily on the historical and prospective growth of sales taxes within the Town of Prescott Valley, including the potential for increased dedicated sales tax revenues within the entertainment district; ....More

find out more the Globel Entertainment group at

Community library lo

Community library loses donations in fire
Associated PressNov. 4, 2005 12:00 AM
PRESCOTT - Residents of a small Arizona community will have to start over on a book drive to fill their new community library after flames gutted a home used for storage.About half of the 8,000 books locals had donated for the new Dewey-Humboldt Public Library were destroyed in a fire at the Humboldt home Monday night.

Good Reasons to List

Good Reasons to List Your House During the Holidays

  1. People who look for a home during the holidays are more serious buyers.

  2. Serious buyers have fewer houses to choose from during the holidays, so you have less competition.

  3. Houses "show better" when decorated for the holidays.

  4. Buyers are more emotional during the holidays.

  5. Buyers have more time to look for a home during the holidays.

  6. Many people want to buy before the end of the year for tax reasons.

  7. January is traditionally the month for transfers. Transferees can't wait until spring to buy. You must be on the market to capture that market.

  8. You may still restrict showings during your personal family events.

  9. You can sell now, but specify a delayed closing or extended occupancy until early next year if you so desire.

  10. By selling now you have an opportunity to buy during the spring, when many houses are on the market.
Bottom line? By listing now, you may have fewer actual showings, but more qualified and motivated buyers.
The Reason. You have less competition, resulting in a quicker sale and a better price for you.

For more information got to

Brad Bergamini, real estate agent on Zillow

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