Whether you are an experienced investor or just a beginner, you should always beware of the guru who read a couple of books and armed himself with some general information. I'm not talking about the book and tape salesperson here, but rather the realtor, wholesaler or self proclaimed real estate specialist who is trying to sell you an investment property. Whether you're buying a property or going into business with someone, you should always do your homework.

In this article, the first of two parts, I'll offer some of the questions you should ask anyone before working with them.

1) Are you, yourself, an investor and how many properties do you own in the local area?
If they answer "none" or say they just rent an apartment, run!

Watch out for the slick book and tape sales people who don't own any investment property and know nothing about the local market. They will take your money and run. I met a new investor last year who had paid over $5,000 to attend a two day seminar taught by a guy out of California who knew nothing about the Atlanta market. Nothing good can come of that. Deal with locals who not only know the concepts but can help you find the right properties to invest in.

2) Can you provide me with a list of bank owned and foreclosed properties in my area?

If they can't provide this, run!

If they can provide you a list, pick a property on it and ask this next set of questions.

3) What's the property's tax value?

This is a "DUH" question - if the or Investment Specialist can not give you the assessed value of a property, they need change careers. You would be surprised by the numbers of "PROS" that don't even know where to start to look for that information.

Generally, the tax value or the accessed value put on a property in Georgia is typically 10 to 20 percent below the market value. When I start my search for possible deals, the first thing I look for is properties priced below the accessed value of the property.

Example #1

List Price is $200,000

Accessed Value is $220,000

This might be a possibility because I estimate the Retail Value of the house to be 10% higher than the Accessed Value or $242,000.

Example #2

Just reverse #1 - list price is $220,000

Accessed Value is $200,000

I probably would not consider this house because I estimate the Retail Value of the house

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Read the full story at http://www.prweb.com/releases/Georgia-Land-Auction/Land-for-Sale/prweb1230004.htm

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Read the full story at http://www.prweb.com/releases/2008/08/prweb1226484.htm

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Nystrom Building Products, Brooklyn Park MN, announces the acquisition of Arden Architectural Specialties, Inc., New Brighton MN, effective immediately. Nystrom Building Products is the world's leading direct-to-site provider of complementary building products for the commercial construction industry. Nystrom and Arden Architectural offer complementary lines of products serving the same markets.Nystrom has experienced consistent growth in both domestic and international markets, more than doubling revenues over the past five years. The addition of Arden Architectural is expected to boost growth by another 15%-20%, while expanding the company's overall market reach. (PRWeb Aug 20, 2008)

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to be $220,000 - no deal here!

Remember tax value is only one of the factors you should consider before buying a house but I consider it a good starting point. If someone is trying to sell you a property and they can't provide tax value, it could be they don't want you to know.

4) Can you give me a list of comparables in the area?

Another "DUH" question. Most Realtors can pull a Comparative Market Analysis (CMA) which will show the sales history for the past year to include the following categories: Sold, Expired, Under Contract, and Active Listing. Additionally, the should be able to provide a Area Market Analysis (AMS) which will provide the average Days On Market by category.

5) How many days has this property been on market (referred to as Days On Market, or DOM)?

If their reply is “I don't have access to that information”: run. Any should know that information is available but finding it is the trick. Keep in mind the length of time the property has been on the market does not coincide with the foreclosure date. It could take 30 to 60 days after a property has foreclosed to get it listed with a and into the MLS.

Why are days on market important? The longer the property has been on the market - the more flexible the seller. Banks and other financial institutions are not in the property management business. Everyday expenses include loss of income, maintenance, insurance, and possible vandalism. I like to submit low offers on properties that have been on the banks books for over 4 months. Offer cash with a quick closing - you will be surprised how flexible the banks will become considering it may be the only offer they have received on the property.