How Lack of Knowledge Hurts New Investors
Tamar Hermes is a full time real estate investor and educator. After building successful businesses in the retail and entertainment industries, she turned her attention to real estate with a mission to get more women to become investors and continue to build her portfolio. Tamar has been investing for over 20 years with a focus on appreciation with buy and hold single family homes and duplexes in Los Angeles. In the past few years, she has expanded her portfolio to include passive multi family investments across multiple states, private lending, and Airbnb properties. She bought her first duplex when she was 28.
As an educator and advocate for women to become educated and invest in real estate to grow wealth, Tamar focuses her time empowering and educating women across the country through her masterclass, The Real Deal Formula. She also coaches and consults women and couples privately about the opportunities to build their assets through real estate and supports them to connect with reliable partnerships through her Wealth Warrior Woman Alliance.
Tamar always had a knack for saving money, but it took her years to discover there were other ways to earn income besides working a 9 5 job. She now firmly believes financial freedom is possible through real estate and understands the importance of knowing how to allocate and invest your money and protect assets is a critical piece of sustaining financial independence and creating a legacy.
Tamar currently lives in Los Angeles with her husband of 18 years and her two children. They plan to relocate to Austin at the end of 2020. When she isn teaching, reading, or learning more about real estate investing and self development, you can find her on a hiking trail with her rescue terrier Teena, listening to the BiggerPockets Podcast.
She also loves traveling, yoga, hosting dinner parties with friends, supporting her favorite non profits, hanging out with her Gobundance Women Tribe, and binge watching Curb Your Enthusiasm. She currently serves as the co director of the Los Angeles Chapter of The Mona Foundation, which has worked for 20 years to alleviate poverty through gender equality and education around the world.
Tamar first book on real estate investing for women will be published this year.
Before Tamar discovered real estate investing, she attended Pitzer College and the American Academy of Rome. She majored in communications and fine arts.
In addition to growing her portfolio in real estate, Tamar became a certified life coach, holds a real estate license in California, and studied finance so that she could master the knowledge she needed to own her financial destiny.
We are living in a time where everyone wants everything fast and easy. But convenience can come at a high cost, especially with real estate.
Besides being busier than ever, people are looking for ways to dive into real estate and get deals done fast, but they may not have all the necessary knowledge. A survey polling 1,000 millennial Americans on topics related to real estate reveals that there are several facts about the industry that many do not understand.
Often, people think of real estate as a very complicated process and do not take the time to learn basic information. The results are unnecessary fees and confusion about the costs of homeownership.
results of the survey highlight the extent to which the real estate industry has historically complicated the process, added unnecessary fees, and created confusion about the costs of homeownership, states Homie, the real estate technology company that conducted the survey. polled were largely unaware of many of the complexities involved in buying and replica hermes jige clutch
selling real estate, underscoring the need for better transparency and education. buyers do not understand the real estate process and are unaware of the excessive amount of money they are leaving on the table. As an educator and coach for real estate investors, nothing gets me more upset. We all work too hard to throw money away.
You are busy, and I get it. So let me shed some light on some simple facts and adjustments you can make that will pay off big.
Learn the Basics
Yes, there are details to learn and essential questions to ask. You won always be able to anticipate them all, but you need to stay aware of the process and what makes logical sense to you.
It does not take that long to find your way to transparency and education on the basics of how real estate works. With BiggerPockets and informative free blogs galore, the information you seek is only a click away.
Related: Ultimate Beginner Guide to Real Estate InvestingA notable 65% of the millennials surveyed did not know how much of a commission goes to Realtors when selling a home. The rate is commonly 6% of the home price, split evenly between the buyer and seller agents. The seller pays for all commissions.
While 6% for a commission is standard, fees can sometimes be negotiated or created. For example, if you sell a home by owner, you will save those fees. You can also use Redfin or an agency to pay a fee to list your house on the MLS only to save on commission fees.
You may not need to use a real estate agent at all! However, it can be worth the price if you don want to deal with some of the processes or need support. The right agent will help you market, negotiate, and do all the legwork in selling your home.
It is critical to read the fine print on any contract and to ask questions. Companies like iBuyers charge 6 14%! While they make the process very easy, on a $300,000 home sale, you could be paying $42,000 at 14% for the service.
Almost half of those surveyed thought that it was free to use a buyer agent to purchase a home. myth has helped keep real estate commissions artificially high because the current system has made it difficult for sellers to negotiate the buyer agent commission (BAC). The fact is that the buyer money typically used to pay both the listing and buyer agents in the transaction, Homie pointed out.
Related: How to Find an Investor Friendly Real Estate Agent
Whenever you sell a property with an agent, you (as the seller) are responsible for paying commissions for both the buyer and seller. If you sell a home for $250,000, 6% of that, or $15,000, goes to pay the agents. For sale by owner deals or the absence of an agent often save a buyer on the purchase because the seller does not have to pay the agent fees.
While there are many benefits to using a great real estate agent, 16.5% of the millennials polled erroneously believe that consumers are legally required to use one to buy or sell a home.
Real estate transactions can be complicated, but if you hire an attorney or use an escrow company (depending upon the state regulations for real estate transactions), you can handle the dealings with the proper paperwork and documentation to ensure the legal guidelines and protect the deal.
What more, a little over 80% of millennials surveyed were unaware that you could obtain a real estate license in only a few weeks in most states. Remember, real estate is not brain surgery. It takes far less time to learn and is less pricey than becoming a medical surgeon.