Why Invest in Emerging Markets?

Investment Analysis – Emerging Markets:


Developing countries, also known as the emerging markets, are fast becoming the driver of global growth. Why invest in emerging markets? To cash in where the growth is today, and for the foreseeable future. http://ow.ly/3pAKKc

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Sam Zell, Ex-Partner Face Off in Emerging Markets

Emerging Markets – Real Estate


Since an acrimonious split two years ago, Sam Zell and his former partner Gary Garrabrant have kept their distance. Now they are preparing to square off on turf they once conquered together: emerging-markets real estate… http://t.co/E3Ex7YparT
 
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Donald Trump Launches Trump Towers Mumbai

MUMBAI – Residential Developments:


US Real Estate Magnate Donald Trump has unveiled Trump Towers Mumbai. The first and only Trump project in the city has been launched in collaboration with Indian real estate developer Lodha Group.
 
 The tower, with its crystal glass inspired architecture, will feature three- and four-bedroom residences with interiors designed by HBA Singapore – the world leading hospitality design firm.
 
 Mumbai /mʊmˈbaɪ/ (also known as Bombay) is the capital city of the Indian state of Maharashtra. It is the most populous city in India, second most populous metropolitan area in India, and the fifth most populous city in the world, with an estimated city population of 18.4 million and metropolitan area population of 20.7 million as of 2011.
 
 Along with the urban areas, including the cities of Navi Mumbai, Thane, Bhiwandi, Kalyan, it is one of the most populous urban regions in the world.
 
 Mumbai lies on the west coast of India and has a deep natural harbour. In 2009, Mumbai was named an alpha world city. It is also the wealthiest city in India, and has the highest GDP of any city in South, West or Central Asia.
 
 Carlisle Mitchell Insider Tips for Real Estate Investors is a trusted and reliable source of expert investment and market analysis for real estate investors world-wide. NEW! Now follow Carlisle Mitchell Insider Tips for Real Estate Investors on Facebook and Twitter

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Foreign Buyers Boosting U.S. Housing Market Recovery

The U.S. housing recovery continues and international buyers are a big reason, with the Chinese leading the charge. Chinese buying is up more than 70% to $22 billion — nearly 1 in 4 dollars of all foreign purchases, according to the National Association of Realtors.

Canadians are No. 1 in total homes bought, but the Chinese buy more expensive homes: An average price of $591,000.

The Chinese also bring a lot of cash to the table: More than three-quarters of their purchases were all-cash buys.

California is the biggest market for the Chinese, accounting for a third of their purchases.

Washington State, however, is coming up quickly, accounting for 9% of buys. It’s followed by New York, Pennsylvania and Texas.
Why are they buying? Only 39% of Chinese buyers said they intended to use their purchases as their main home.

Some may buy condos for their children attending U.S. colleges. They hope that, in addition to saving on dormitory fees, they can make benefit from home price appreciation by the time the students graduate.

Others are becoming landlords, buying cheap homes in distressed economic pockets, like Detroit, and renting them out.
Still others use the homes as vacation properties a couple of weeks a year and rent them out the rest of the time.

In addition to the Chinese buyers and the Canadians, Mexico, India and the United Kingdom filled out the top five list. India also had a notable jump in money spent — 48% growth.

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Carlisle Mitchell | India – Insider Tips for Investors

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Loan-To-Value Ratio

Loan-To-Value Ratio is a lending risk assessment ratio that financial institutions and others lenders examine before approving a mortgage. Typically, assessments with high LTV ratios are generally seen as higher risk and, therefore, if the mortgage is accepted, the loan will generally cost the borrower more to borrow or he or she will need to purchase mortgage insurance.

Calculated as: Mortgage amount divided by the Appraised Value

For example, Jim needs to borrow $92,500 to purchase a $100,000 property. The LTV ratio yields a value of about 92.5%. Since bankers usually require a ratio at a maximum of 75% for a mortgage to be approved, it may prove difficult for Jim to get a mortgage.

Similar to other lending risk assessment ratios, the LTV ratio is not comprehensive enough to be used as the only criteria in assessing mortgages.

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What is the Cap Rate?

Definition of Capitalization Rate
 A rate of return on a real estate investment property based on the expected income that the property will generate. Capitalization rate is used to estimate the investor’s potential return on his or her investment. This is done by dividing the income the property will generate (after fixed costs and variable costs) by the total value of the property. If you want to get technical, it is basically the discount rate of a perpetuity.
 
 Capitalization Rate = Yearly Income/Total Value
 
 Also known as “cap rate”.
 
 
 Capitalization Rate Explained
 
 Capitalization rate is a good jumping-off point to quickly compare many investment opportunities, but it should not be the sole factor in any real estate investment decision. Many more factors need to be looked at such as the growth or decline of the potential income, the increase in value of the property, and any alternative investments available.
 
 For example, if Stephane buys a property that will generate $125,000 per year and he pays $900,000 for it, the cap rate is: 125,000/900,000 = 13.89%.
 
 But it gets a little more complicated. What if the property’s value rises to $2 million two years later? Now the cap rate is a less favorable 125,000/2 million = 6.25%. This is because Stephane could potentially sell the property for $2 million and use that money for an alternative investment.
 
 
 

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