Obtaining a Real Estate License

There's something about a career in real estate that calls to many people, especially those considering a career change. Real estate is a good option for anyone thinking about shifting careers because a license can be obtained relatively quickly and easily, and without any major financial investment. When one compares this to pursuing a full college degree, a career in real estate seems like a much easier option.

A new career in real estate awaits! © buchachon ' Fotolia.com

In general, it is not all that hard to get a real estate license. There is some coursework to complete, and a state licensing exam to pass. You may also need to make some connections within the real estate community. Read through the following steps to see just how easy it can be to become a licensed real estate agent.

Education

Before setting off down the path toward a career in real estate, you will need to first enroll in an educational course. These classes can be taken in person, at a local college or real estate office, or they can be taken online. The amount of coursework you need to take depends on the licensing requirements of your state. Before getting started, do some research into your state's requirements to make sure the course you attend is sufficient to qualify you for the license.

There are a few advantages in choosing to take a course in person. For one, the learning environment will be more personal, and you can learn more from the questions of others in the class. Also, you can talk directly to your teacher. Along the way, you may find yourself making some useful connections with those already in the real estate business. Those connections can help down the road when it comes to looking for a job.

On the downside though, attending classes can be problematic because the schedule can be fairly rigid ' you will be required to attend at the same time each and every week. Some may appreciate this more traditional learning environment, but others may have trouble getting their classes to fit into their already busy schedules.

If you opt for online classes, there will be no trouble on the scheduling front. You can do the work whenever you want, from wherever you want. That freedom is appealing to a lot of people, and works great for those that have full-time jobs already. Also, if you are in a hurry to obtain your license, online classes allow you to proceed at your own pace. If you are willing to work hard, the education requirement can be fulfilled in a matter of weeks.

Exam

After completing your coursework, you can fill out an application to take the state real estate licensing exam. The exam will test your knowledge of real estate rules and laws, and your classes should have provided you with all the information you will need. By being committed to your coursework and putting in the appropriate hours studying, the exam should not be a big hurdle towards getting your license.

Obtaining a real estate license doesn't have to be difficult © iQoncept ' Fotolia.com

One aspect of passing the exam that applies in some states is being sponsored by a currently licensed agent. If this is a requirement in your state, it might be smart to take your courses in person so you will have the opportunity to network with local agents who could sponsor you for the exam.

Overall, the process of getting a real estate license is not hard. The keys to success in this pursuit are good old preparation and hard work. None of the individual steps are particularly challenging as long as you remain focused on the goal. The bottom line is that if you are motivated to become a real estate agent, the licensing process will not stand in your way.

 

About the Author: Shannon Durr is a former real estate professional with over 13 years of experience.  She current writes at charlesbarnes.com as well as other sites.  She has taught many real estate classes and is committed to offering sound, real life advice. When she is not writing, she loves to be outdoors and travel with her husband and 3 beautiful girls.  Follow her on twitter @ShannonDurr1

A Peek Inside The Real American Economy ' Trickle Down And Trickle Up Economics

In all of the media wrangling over the fiscal cliff, the tax increases, phony spending cuts, 'trickle down economics' and all the rest, I think the media and the federal government have lost all sense of the realities of day to day life for the typical small business owner.

Image by Occupy* Posters via Flickr.com

They say they want to create jobs. But as a small business owner, struggling to maintain profits in this economy, I have to ask myself 'how can people who are not responsible for a business, have never hired anyone and never had to make a payroll, understand how to solve economic problems which they themselves created in the first place?'

The guys in Washington just got a pay raise courtesy of a presidential order. That was handy. Congress can now avoid being lambasted for voting themselves a raise, the president simply ordered that they get one. But it doesn't work that way for the small business owner. No one I know of can sign a document that will automatically guarantee that my income will increase in 2013.

So let me get this straight' we have people who receive a regular paycheck, can order or vote themselves a pay raise, exempt themselves from any particular law they don't like, like the social security system and Obamacare, for example'claiming they are going to solve the economic problems in an economy that they don't have to deal with and whose operation few of them even understand.

Hmmm, what's wrong with this picture? If I wanted to hire a consultant to help me make my business more profitable, would I hire someone who's business model involves taking money from others by a threat of force? Isn't that also the definition of 'armed robbery'?

The reality is that our economy, at the small business level, does trickle down and even occasionally trickles up. As my mom used to say, 'poop always runs down hill'. But sometimes poop can get backed up and go up hill as well.

I'll be candid about my own experiences as a small business person as an example. Most of the time we all like to give the impression that things are rosy, but I think it's time we took a hard look at how the economy really does trickle down and trickle up for the small business owners who are supposed to be the primary job creators in this country.

By 2005 I had been in the real estate industry for 10 years. I was part of a group that operated a well established, well funded business that employed a core team of folks, but had revenues that were spread among as many as 100 commissioned people who contributed to our sales base.

Prior to the market peak, we were buying and selling more than 200 cash flowing properties per year to real estate investors. The company generated revenues in excess of 1 million dollars per year, and paid nice salaries, bonuses and/or commissions. But by 2006, steady increases in housing prices, property taxes and insurance had virtually eliminated all the positive cash flows.

Properties began to sit on the market, unable to generate a positive cash flow for their owners. Within a year the entire business collapsed. This didn't just happen in my market, Atlanta, GA. Local governments riding the backs of property owners all across the U.S. helped destroy the goose that was laying the golden property tax eggs. A clear case of government policies causing a trickle down effect for property owners.

Local governments increased taxes on real estate with relentless regularity, using the money to pay themselves higher salaries, increase department budgets and build fancy new municipal buildings to work in. This process trickled down onto the heads of every private property owner, and helped destroy the real estate market.

Today hundreds, perhaps thousands of municipalities worry about how they will collect enough 'revenue' to keep their massive bills paid. In this case, the 'poop ran back up the hill' to the ones who dished it out in the first place. Local and state government has been forced to eliminate several million jobs as a result. This is an example of 'Trickle up economics' at it's finest.

With my real estate business hitting the rocks, I started another small business involving boat and RV storage. From 2002 to 2005 I grew this business while caring for a husband who was terminally ill at the time, and built a small property into a thriving business. By 2005 my little lot was full of vehicles, and our shop was busy refurbishing boats for customers. I also had a boat trailer dealership, selling trailers manufactured by a local small business that had been around since the 1960's.

The storage business continued to chug along, until late 2007, when other cutbacks in defense spending at the local Lockheed plant forced several of my storage customers to transfer out of state, resulting in less income for my business. Next a few customers who were also in the real estate industry suddenly lost their businesses, resulting in the repossession of their vehicles. A few more spaces opened up and revenues continued to fall.

By late 2009 I had lost 40% of my storage business, due to my customers losing jobs and incomes as the market crash ensued. The problems my customers had were trickling down to me. The boat trailers stopped selling as well. With folks losing their boats, who needs a new trailer? By 2009 my trailer sales had evaporated, and the trailer manufacturer went out of business after 40 years. More trickle down economics.

Image by uvw916a via Flickr.com

I was able to stay in business by cutting my expenses to the bone, and eventually I regained most of the storage business. But the shop is currently closed and the trailer dealership is long gone. That resulted in reduced business for my vendors ' more trickle-down economics. Taxable incomes were falling, so we owed less in federal and state taxes. The government was collecting less and less from me ' another example of 'trickle-up economics' at it's finest.

Governments will never succeed at increasing tax revenues by implementing administrative, tax or monetary policies that continue to send unending streams of poop flowing down from 'the hill'.

 

Donna S. Robinson is a real estate investor, author, and housing market analyst located in Atlanta, GA. Follow her on twitter at donnaconsults. Her latest book is now available on Amazon.com. It's called Basics Of Real Estate Investing

Sarasota Home Builders Offering More Multi-Family Real Estate

According to Sarasota Bay Real Estate, multi-family homes will increasingly become a growth market. Buyers who cannot stretch to the price of a single-family home are looking towards multifamily homes as being a more affordable option.

Multi-Family homes set to grow in popularity © slavun ' Fotolia.com

Nowadays construction companies are aiming at buyers who are able to purchase a home below the $250,000 level. The unit costs of multifamily homes are far more affordable and more can be accommodated on to residential acreage. Construction costs are rising which has in turn pushed up the price of a single family home in the area. Levels of home inventory in Sarasota were reported to be close to their 10 year lows in November. There were 4.1 months of supply of single-family homes, and 6.1 months' supply of condos.

Jill Meeks, sales and marketing vice president for homebuilder D.R. Horton, has confirmed the fact that it's difficult to find a single family home for less than $250,000. D.R. Horton's portfolio currently includes carriage homes which have four residences per building, and town homes which have 6 to 8 homes per building. These homes are priced between $150,000 and $250,000, with floor plans ranging from 1,300 ft.² to 1,950 ft.². D.R. Horton began building and marketing townhomes and carriage homes in Southwest Florida two years ago as it anticipated the rising demand. According to Meeks it fully expects to build more, and is looking for sites for future multifamily housing developments.

Lennar Homes is another developer keen on developing multifamily residences, with 122 permits for multifamily homes in the 12 months ending last September. Homes for sale by this developer include condos in Riverstrand's maintenance-free Terrace condo in Bradenton. According to Sarasota Bay Real Estate, Neal Communities is another developer actively looking for land to purchase for multifamily homes.

Sarasota Bay Real Estate Internet assets receive more than 1,000 visits from prospective buyers each day, and the website contains a wealth of local community information.

NAR Reports Pending Home Sales Index Up Regionally

In a release from the National Association or Realtors, November demand in the Northeast and West has apparently driven home sales for the month to the highest level in almost three years. Pending home sales grew by 1.7 percent  during the month, up almost 10 percent over the previous year numbers.

According to NAR's Pending Home Sales Index, pending home sales have now posted annual increases for the last 19 months consecutively. Lawrence Yun (left) , NAR's Chief Economist, offered this comment via the release:

'Even with market frictions related to the mortgage process, home contract activity continues to improve. Home sales are recovering now based solely on fundamental demand and favorable affordability conditions.'

Furthermore, the NAR projects that existing-home sales will rise between 8 to 9 percent for 2013.

The Pending Home Sales Index is based on a huge national sample, which represents about one fifth of all transactions for existing home sales. Existing-home sales for December are to be announced January 28; release times are 10:00 a.m. EST.

The video below from NAR offers more details.

#ICNY To Tell of 2013 Tech, Trends and Tribulations

Next month, Real Estate Connect New York City promises to supply plenty of ideas and trends for the industry. The speaker list reads like a 'Who's Who' of investing and Internet marketing too, with experts from Craig's Lists' Craig Newmark to our pal Nicole Nicolay of Agent Evolution.

Coming January 16th ' 18th to the Grand Hyatt New York, ICNY speakers and agenda will speak of things to come for 2013 ' positive and negative trends, opportunities, technologies, and so forth. A short list of other speakers includes; Pamela Liebman, President & CEO,The Corcoran Group; Jon Steinberg, President and COO,BuzzFeed; Sherry Chris, President and CEO,Better Homes and Gardens Real Estate LLC, and Rich Barton, Co-Founder and Executive Chairman, Zillow; Founder, Expedia.

To keep abreast of this version of 'Connect' readers who use Twitter should follow the #ICNY. You can also follow Inman Connect at @InmanConnect as well as on Facebook. Those planning on attending should know Real Estate Connect's reserved block of rooms at the Hyatt are sold out, but accommodations nearby may still be available at:

Roosevelt Hotel
Fitzpatrick Grand Central
Bedford Hotel
Library Hotel
New York Helmsley Hotel
Roger Smith Boutique Hotel

A Little? A Lot? Down Payments and Your House Payment

Your down payment represents the initial blood, sweat and tears that you put into your new home.  It's one of the factors lenders review when evaluating a mortgage application along with credit, income and job history.  But how much is the ideal amount for a down payment? Don't lenders want at least 20 percent of the sales price as a down payment?  Or is it best to keep your funds in the bank and put as little down as possible?  That really depends on the type of mortgage you're applying for.

© yuriyzhuravov ' Fotolia.com

Conventional mortgages using lending guidelines established by Fannie Mae and Freddie Mac ask for a down payment of at least 20 percent for a primary residence.  But they'll take less.  A conventional mortgage will accept a down payment as low as 5 percent of the sales price, even lower under special loan programs, but down payments less than 20 percent down will require a private mortgage insurance policy, or PMI.  That means higher monthly payments.

PMI is indeed an insurance policy whose premium is paid by the borrower with benefits paid to the lender and insures the lender the approximate difference between 20 percent down and the actual down payment made by the borrower.  On a $300,000 home and a 5 percent down payment, a PMI policy will pay the lender the difference between 20 percent down and 5 percent down should the loan default.  In this example, the approximate payment to the lender is $45,000.  And the PMI premium paid by the borrower under this scenario?  About $160 extra per month added to your house payment.

Interest rates may also vary based upon the amount of down payment in relation to your credit score.  Those with excellent credit may not see any change in rate at all, but borrowers with credit scores as low as 620 and a 10 percent down payment can expect an interest rate one-half percent higher compared to those with a credit score above 740.  This can mean an additional $75 or more each month on a $260,000 loan amount.

FHA-backed mortgage loans are a bit less stringent regarding a down payment, requiring as little as 3.5 percent down.  FHA loans also have their own mortgage insurance requirement, called a Mortgage Insurance Premium, or MIP.  HUD has increased the monthly MIP premium beginning in January, 2013. Again using a $300,000 sales price, the new monthly MIP payment adds another $503.

Finally, are you one of those lucky borrowers with VA-loan eligibility?  VA-backed mortgage loans require no money down and have no additional monthly mortgage insurance premium payment.

The amount of a down payment can vary based upon the type of loan as well as the borrower's credit.  Many borrowers have a choice of how much to put down while others are on a tighter budget, saving enough for to buy a home. Regardless, the amount of a down payment can have a profound effect on a house payment.  So save a little or save a lot; just remember your house payment awaits your decision.

 

David Reed is a published author and columnist with expertise in the real estate, financial, investment, consumer credit and mortgage industries with more than 20 years of hands-on experience.

4 Ideas For Saving Thousands Of Dollars On Your Mortgage Payment

If you are a typical home buyer, paying less than 20% down, there is about a 90% chance that you'll use an FHA, VA or USDA loan to finance the purchase of your first home. If you do choose one of these 'government insured' loans, you'll be subject to high fees and interest costs that will amount to more than the entire price of your home.

Image © Paul Heasman ' Fotolia.com

In fact, a $100,000 home financed by an FHA insured mortgage, with a 5% down payment will cost you approximately $235,000 over the life of your 30 year mortgage, and you'll be paying virtually nothing but interest, taxes, insurance and loan fees for about the first 12 years.

Here are some quick and easy tips for saving tens of thousands of dollars on your home mortgage:

1. Pay as much as you can up front in your down payment. Most people opt for the lowest down payment possible, to minimize up front costs, but this means that the loan will be that much more expensive over time. Reducing your loan balance saves a lot of money over the years in interest expenses.

(Don't fall for the argument that mortgage interest is tax deductible. That deduction will probably disappear in the near future. And the data shows that most first time or lower income home buyers do not itemize their taxes anyway.)

2. Prepay something on your loan principal from day one.

If you are buying in the near future, make plans to pay an additional amount each month, over and above your regular mortgage payment. Write a separate check for this amount. Do NOT add it into your mortgage payment. Write two checks. One for the mortgage payment, and one for the additional amount you wish to pay towards your loan principal. Label this check as 'payment on principal' and check your monthly statement to insure that the additional prepayment is credited to your loan balance.

You can take a 30 year mortgage so as to keep your regular monthly payment as low as possible. But in order to save interest, include a prepayment each month as stated above. If you financed $95,000 for 30 years at 5% interest, and pay nothing but your regular payment each month for the entire 30 years, you'll pay out $88,593 in interest on that loan, and assuming your first payment was January of 2013, you will not have this loan paid off until December of 2042. And it will be 2030 before your regular monthly payment reaches the point where you are paying your loan down instead of paying mostly interest.

If you pay just $25 per month extra, starting with your very first mortgage payment, you'll save $10,323 in interest costs, and your loan will be paid off 3 years earlier. Paying $50 per month extra will save you around $20,000 of interest, and your mortgage will be paid off a full 5 years earlier.

Shortening your loan length increases the monthly payment, but also pays the loan down faster. However, you can have the benefits of a 30 year loan combined with a shorter, lower cost loan, simply by financing long then prepaying as much as possible on the principal. Only $100 extra applied each month will cut your loan term by virtually 10 years. The $1200 invested yearly for 20 years will save $30,000 in interest costs. This is an 8% return on your money instead of a $30,000 expense.

Even if you have already owned your home for a few years, prepayments always make sense for the typical owner-occupant buyer with an income below $100,000 per year. If you are in the later years of an existing mortgage, you can still shorten the time frame and lower the effective interest rate with the use of prepayment strategies instead of a refinance which may actually cost more.

3. Take The True Costs Of Ownership Into Account Before You Buy.

No one tells you how much your home is really going to cost to maintain and 'own'. Ownership responsibilities and costs go well beyond the principal and interest on your mortgage payment. A $100,000 home, relatively cheap by today's standards, will have property taxes to pay ranging from hundreds to thousands of dollars each year. And any home with an FHA insured loan will require insurance; another $1000 or so per year. These two items will also be part of your mortgage payment, in order to insure that they are paid on time each year.

Will this home need painting every few years? How about the condition of the roof? Are the HVAC and plumbing new or older? These are all items that will cost something to repair or replace over the life of a 30 year mortgage. All extra expenses over and above the purchase price.

4. Pay Attention To The Fees And Other Loan Costs.

FHA insured loans come with a variety of fees that may be included in the monthly payment. It's important to understand what those fees are, what they are for, and how much they will cost you. In my experience as a real estate agent, I've noticed that few buyers are aware of these fees and expenses related to their home purchase. Some of these fees could add up to thousands of dollars. Pay attention to these costs and negotiate to get them reduced whenever possible.

Housing Market Stability Rests On A Foundation Of Home Owners

Many homeowners with FHA insured loans are in over their heads already. Default rates are high and neighborhood upkeep is low. This is combining for a one-two punch in many neighborhoods across the country. It's no fun for the borrowers either. Losing your home is one of the most traumatic events one may face in their lifetime. Buyers often have no concept of what the true ownership costs will be. This can destabilize them financially and lead to numerous other problems.

It would be in the best interest of the buyers themselves, the entire housing market, the professional real estate industry and the U.S. taxpayers to require that all first time home buyers who are qualifying for government insured home mortgages, take a course on home ownership, with the specific purpose of educating the buyer to the real costs involved, and create a realistic budget for a buyer up front, before they choose a home.
Donna S. Robinson is a real estate investor, author, and housing market analyst located in Atlanta, GA. Follow her on twitter at donnaconsults. Her latest book is now available on Amazon.com. It's called Basics Of Real Estate Investing

Real Estate Predictions 2013: Five Key Issues Affecting Homeowners and Realtors

The end of the year is almost upon us, and so once again real estate experts are looking ahead to see what might lie in store for the next twelve months. The housing market actually saw some marked improvements over the last year, and many experts are expecting this momentum to gather pace during 2013.

Housing issues for 2013 © art1art ' Fotolia.com

Nick Timiraos' recent column in the Wall Street Journal offered up his own expert opinion on what we can expect to see in 2013, identifying the five most important housing issues that will affect consumers and real estate professionals alike:

1. Housing Prices Set To Inch Upwards

The WSJ article warns that much will depend on the success of the economy at large, but should this improve and the unemployment level decrease, many of the housing market's biggest problems ' such as foreclosures, the large number of homeowners underwater, and tough credit standards ' will likely ease somewhat, paving the way for home prices to inch upwards even more.

2. Inventories to Grow

In order to meet the level of demand, Timiraos predicts that home builders will take production up another notch, whilst more homeowners may decide that the time is right to sell as housing prices continue their upward trend.

3. Rising Demand as Home Prices Rise

With home prices set to continue rising throughout 2013, the WSJ predicts that buyers will show increased urgency and make more efforts to close on deals sooner.

4. Lending Standards Remain Tight

Unfortunately for first time buyers, it's unlikely that will see credit becoming any more accessible in the year ahead. The WSJ believes that new credit regulations will likely lock banks into their current 'defensive posture' when it comes to lending ' if anything, standards could become even more strict.

5. Shadow Inventory to Shrink

But only a little. The WSJ suggests that banks may look to speed up the process of foreclosure in those markets that already have large backlogs, but even so they are likely to remain cautious so that markets do not become inundated again.

We should note that all of this is nothing more than speculation of course, and while most economists are tentatively predicting an improvement in the economy overall, the housing market could quickly take a turn for the worse if these predictions don't pan out. The WSJ reminds us that housing is still very fragile, and much depends on whether or not lawmakers can agree on a compromise to avert the 'fiscal cliff'.

Bali's Property Business to Thrive in 2013

Property business in Bali is expected to present promising opportunities in 2013, the Bali chapter of Real Estate Indonesia predicting an overall 15% growth fueled by island's positive economic growth estimated for the next year. According to the chapter's chairman, Dewa Putu Selawa, business in the property field was expected to grow and reach a record growth in 2013 compared to previous years.

'One of the main factors that is boosting the property business in Bali is its year-on-year economic growth, exceeding national economic growth,' Selawa explained.

Bali's economic performance in 2012 was labeled as outstanding, with a 6.6% annual growth, above the Indonesian average national economic growth of 6.1%. Bank Indonesia released data showing that, despite the global economic downturn, Indonesia and Bali in particular, continued to see strong economic growth. The inflation was also rather low, with a reported value of about 4.6%

Other than the general economic state of Indonesia, property business in Bali will also be fueled by the various infrastructure developments that are currently underway, a fact that has positively influenced investor's confidence in this particular real estate market. The construction of a toll road connecting Benoa, Ngurah Rai International Airport and Nusa Dua, an underpass at Dewa Ruci intersection, and the expansion of the Ngurah Rai airport are the biggest such developments in the area.

'Low interest rates, at an average of 9 percent, also contribute to the growth of the housing sector,' Selawa added.
REI Bali's data also showed that land prices in several areas close to the city center and in the Badung regency were expected to to skyrocket to around Rp 4 billion (US$420,000) per 100 square meters.

'Next year, the price of a 100 square-meter plot could reach Rp 4 billion, up from Rp 2.6 billion this year. Last year, the price was still hovering between Rp 1.7 billion to 2 billion,' Selawa said.

In Kuta, Seminyak and Legian, all hot spots of the Badung regency, prices would reach around Rp 3 billion to 4 billion for 100 square meters in 2013. For properties around Denpasar, the price has already increased from Rp 200 million to Rp 300 million, and is expected to further increase and reach 400 million.

Property consultant Elite Haven-Knight Frank has released the finding of the research he had conducted which shows that land prices in various strategic areas of Bali have reached a 43% growth, the highest increase of the past 10 years. Price growth has previously varied between 8 to 16%.

Photo source

Rick Otton Launches UK Real Estate Conference

Young adults in the UK are often referred to in the newspapers as being 'Generation Rent' due to the difficulties they face in trying to get onto the property ladder. A report by the Institute for Public Policy (IPPR) has shown problems with affordability have indeed created a generation of renters.

Now Rick Otton, a property investment specialist, is to hold a real estate conference for the UK. It will be focused on strategies for home ownership that don't involve the banks. Mr Otton is quoted as saying 'I was a little shocked to see that the current crop of young families in the UK have actually acquired the label of 'Generation Rent' by the IPPR. Though most economists have acknowledged that rising rental rates in the UK have been part of a challenging economic environment, the social implications are not so readily acknowledged.'

Dalia Ben-Galim, associate director at IPPR commented on the report saying 'Our analysis shows that the lack of houses is dragging young people down. A huge majority of today's younger generation want to own their home, just as most of their parents have done. But the prospect is slipping even further over the horizon. Insecure renting stops them from putting down roots, but it is bad for society too.'

Although the report is focused on the 18-30 age group, Mr Otton believes it is relevant for anyone in the UK who wishes to buy their own home. He is keen to point out there are other ways of achieving home-ownership available to those who cannot obtain a mortgage through the banks. His Zero-Debt Property Cash Flow Conference2013 is being held from April 19-21. Anyone booking before the end of the year can take advantage of a payment plan that divides the cost of conference attendance into four monthly payments.

Rick Otton has made money by purchasing inexpensive homes and using them to build wealth. He now teaches these strategies to others, having originally unveiled these methods to the UK back in 2008. More details about the program can be found on his website.

A Comprehensive Guide to Real Estate Link-Building

Certain aspects of search engine optimization are simple, easy to understand, and something that can be done to your website in an instant. If you're a real estate agent with a website and have taken the time to understand even the basic fundamentals of search engine optimization, you likely already know that quality content, appropriate headers, correct keyword implementation, and various other techniques will benefit your website's ranking with the major search engines.

Link juice is essential for ranking real estate sites on Google. Image by Mark Kens via flickr.com

Link building, however, is one of those search engine optimization practices that many real estate agents fail to understand and misuse entirely. If your real estate website has been live for an extended period of time or you've explored search engine optimization services with third-party companies, there's a good possibility you've seen numerous advertisements and spam e-mails for effective, low-cost link building.

Of course I certainly understand that everyone has a budget when it comes to web marketing and everyone loves a great deal. But before you risk all the hard work you've already put into your real estate website and the ranking your site has already achieved, you need to be absolutely certain the link-building strategies you implement are legitimate and follow white-hat search engine optimization practices. So what exactly does that mean? Here's a comprehensive explanation of everything you need to know about real estate link-building:

Link-Building Basics

Real estate link building is the process of obtaining relevant, high-quality, inbound web-links to your real estate site, which ultimately help your website achieve a higher ranking among major search engines. In this simplistic definition, take note of the words 'relevant' and 'high-quality.' This doesn't mean writing poor quality articles with links to your site and submitting each to an article directory. In addition, this also doesn't mean constantly spamming blog comment sections with opinions, suggestions, and links back to your site. Instead, real estate link-building starts with writing quality content for both your real estate site and outside websites and building relationships within the internet community!

Proper Link-Building Practice

When I explain to real estate agents that writing quality content and superior blog posts will eventually translate to relevant link-building, it isn't long before a confused look of disbelief is starring me right back in the face. The logic behind writing engaging, noteworthy content and blog posts is that other professionals, website owners, and media personnel might eventually take notice. How does that help?

 

For starters, if you write an interesting piece about the unique history of a listing or special features of a home for sale in your local market, there's always the possibility someone else may find that topic interesting as well and write a follow-up piece on your original article, including a link within the context of their work back to your site. Don't believe me? Believe it. This actually happens more than you think; but in order for someone to be motivated enough to share your post or link back to your original content, it of course has to be worth sharing'i.e. interesting, engaging, unique, funny, or significant.

Image by HubSpot via flickr.com

Is it a definite possibility you'll have success with outside parties sharing or linking your content? Simply put: no. But that's where building relationships comes into play. Obviously, the likelihood of someone sharing or linking back to your real estate website is much greater if you know or have established a rapport with that individual. Quality link-building doesn't just happen overnight and it rarely occurs randomly. So think of link-building as virtual networking. Start including relevant links in the content you write and the blogs you post, and you never know who might contact you or return the favor.

Guest Blogging & Link Building

Waiting for someone to mention your website or article isn't enough when it comes to real estate link-building. If you're serious about generating quality backlinks to your real estate website, be proactive. Find high-traffic real estate blogs and news websites and request to be a guest blogger. Guest blogging not only helps advertise your services as a real estate agent while providing backlinks to your website, but in doing so, you're also supplying content for the blog or news site itself, which will benefit that site as well.

But before you jump at the opportunity of becoming a guest blogger, be absolutely certain you're capable of providing engaging, well-written articles that people will want to read. Website owners don't want to post low-quality articles, and even more importantly for you personally, it's your name attached to the article, so make sure it's something you can be proud of and will want to share with the rest of the internet world.

Create Your Own Links

A common misconception regarding the link-building practice of creating your own links is to buy a domain name, throw together another quick real estate website and link it back to your primary real estate website. Unfortunately, the process of creating your own backlinks is much more involved and quite a bit more time consuming. Instead of simply throwing together a handful of cheap, low-quality real estate websites and inner-linking each one, pick out your top 3-5 market specializations and build a substantial web presence for each.

Whether it's several high-end condo buildings or a group of highly-desirable subdivisions in your community, make the determination that you specifically want to rank for these market segments. Next, buy a relatable domain name and create a high-quality, comprehensive website and include every piece of information about that community from the history and original builder(s) all the way down to home features and pricing. Make sure these websites are the go-to sites for any buyer considering a home or condo within that community. Regularly blog about events, units for sale, and community happenings and dedicate just as much time to these sites as you do with your primary, lead-generating website. Over time, all of these sites will gain authority and you'll have a useful group of websites that will not only help generate more business, but can also be used to inner-link and help significantly boost your core search ranking.

Real estate link building is perhaps the most involved and complex search engine optimization technique around. It requires a lot of effort, focus, and even a little bit of luck. But doing it the right way will ensure an increase in traffic and an improvement in how your real estate website is found on the web via search engines. So stop relentlessly commenting on blog posts and start your journey towards high-quality link building today!

 

Joe Heath is a graduate of Indiana University and also holds a Graduate Certificate in Real Estate Development from Drexel University. After working as a Market Research Associate and writing published Market Snapshots for Hanley Wood Market Intelligence in Chicago, Joe now works as a Web Marketing Specialist and is a managing partner at Real Estate Web Creation, LLC.

Free Webinar Explores Investing in Mortgage-Free Real Estate

Real estate investment adviser and speaker Ted Thomas  has just released a new webinar on his website to help people become educated about the different types of investments in mortgage-free real estate that are available to them. Ted Thomson taps into his over 25 years of industry expertise to teach the free webinar and educate the public about investing in this market. The top investment speaker has previously authored more than 30 books on the topic of mortgage-free real estate, exploring the investing strategies employed by successful real estate agents when buying properties at discounted sale prices.

This latest webinar is accessible entirely online, from any device with an Internet connection, thus offering an alternative to books and strategy guides.

'Personal investments in stocks, businesses and other high-risk industries do not come with a guarantee,' said Ted Thomas in his webinar. 'Those that can invest wisely in property and other forms related to real estate could find these types offer less risk when used correctly according the new online webinar.'

Along with the free webinar, Ted Thomas has also launched a new book online, the Tax Deductible Retirement book, addressing those who are nearing retirement or already retired. It teaches people to make smart choices with their available money when it comes to planning retirement investments.

For more information on the free webinar and all the books authored by Ted Thomas, visit his official website.

2013 Home Buyer Confidence Survey

A survey conducted last year by the NATIONAL ASSOCIATION OF REALTORS® revealed a great deal about home buyer trends this year. Among the other findings, it became clear motivations for buyers made many shifts with regard to the ongoing economic conditions. Such variables as job situation, family needs, and repeat versus first time buyer stats were revealed.

Courtesy © peshkova ' Fotolia.com

In keeping with this work, the short survey below from ProProfs, attempts to highlight potential buyer sentiment for early 2013. For those intent on buying a home in the near future, please take a few moments to give us your feedback.

PSY Brings 'Gangnam Style' to Beverly Hills Condo

K-pop star PSY's spectacular success with hit song Gangnam Style has just catapulted him from the most upmarket neighborhood in Seoul to its North American equivalent Beverly Hills, with the revelation that he's just snapped up a luxury condo in the exclusive Blair House development for a cool $1.25 million cash.

PSY brngs Gangnam Style to Beverly Hills

TMZ reports that PSY, real name Park Jae-Sang, completed the transaction for the luxury condominium late last month. According to the original report, the five-star premises features valets, concierge services, a pool, a spa, a gym, a sauna and several tennis courts.

As for the abode itself, PSY has just afforded himself the ultimate in Beverly Hills luxury, with the 2,700 sq. ft home said to feature three bedrooms with en-suite bathrooms and spectacular views.

PSY's stylish new Beverly Hills condo

Given the awesome success of Gangnam Style, it's no surprise that the K-pop star didn't need to bother with financing. TMZ reports that the condo was paid for in full with cash wired directly from South Korean. It's believed that PSY has so far earned $8.1 million this year, from sales, endorsements, ad revenue and performances.

Its unclear how much time PSY plans to spend in his new luxury condo, especially given his apparent 'dislike' for Americans. A big controversy erupted recently when it was revealed that the star had previously produced a song in 2004 containing violently anti-American lyrics, something which PSY has since apologized for.

Amenities include this luxury swimming pool

On the other hand, PSY has reportedly only just signed a deal with US music producer Scooter Braun, who counts Justin Bieber and Carly Rae Jepsen among his other clients ' something that suggests PSY could well be spending a fair amount of his time in the US as he looks to further his popularity in the US, where he already has a massive fan base within the Korean community.

 

Main image via KOREA.NET ' Official page of the Republic of Korea ' Flickr.com

Condo images via Jane Siegal, Wilshire Corridor Real Estate.

Bill Clinton, Humana Challenge to Boost Palm Springs Real Estate

Brad Schmett of Luxury Homes by Keller Williams recently announced the Bill Clinton and the upcoming PGA Tour's Humana Challenge Golf Tournament will give the Palm Springs and La Quinta real estate market a big boost. This golf tournament used to be called the Bob Hope Classic, and has been ongoing for the last 53 years. As well as the involvement of the former President Clinton, the tournament will include the participation of many popular celebrities, helping to focus more attention on the Palm Springs area, and of course its real estate.

Brad Schmett is an expert in Palm Springs real estate and specializes in helping buyers maximize their investment when purchasing second homes on golf courses and gated communities, and other vacation properties. Over the years he has earned quite a reputation for being able to provide a high level of service to his clientele.

Commenting on the upcoming golf tournament Schmett said, 'Year after year I'm always quite pleased to see the heightened level of interest in our real estate as a result of the Humana Challenge. Based on current market conditions and this year's anticipated tournament turnout, we're expecting the 2013 Humana Challenge to possibly be the best ever to boost local real estate activity.'

The 2013 Humana Challenge is a four-round, 72 hole event being held January 14 to 20th in La Quinta at the historic La Quinta Country Club and PGA's West's Nicklaus and Palmer Private courses. In the tournament name coincides with an eight-year sponsorship deal with healthcare conglomerate Humana, a working relationship with former president Bill Clinton, and a four-day, three course format which began with the 2012 Humana Challenge. The tournament still celebrates and honest legacy of Bob Hope and ends with the presentation of the Bob Hope Memorial Trophy.

Schmett went on to say 'As in past years, a significant portion of my out of area real estate sales activity during tournament week comes from tournament goers who are also looking to buy real estate in the Palm Springs area. There is always a great deal of excitement about learning more about the incredible real estate buying opportunities here in the Palm Springs area.'

He went on to point out that the area is currently benefiting from some of the lowest real estate prices in more than a decade, and the current inventory covers a broad range of properties giving home buyers a greater choice than ever before. You can find out more by visiting his website.

Chicago's @Properties & Chicago Apartment Finders Make the 2012 Inc. 5000

As we approach the end of 2012, it's that time of year when annual honors and awards are handed out to various real estate brokerages and companies around the country. One honorary list I always like to follow at the end of each year is the Inc. 5000. This year 67 real estate companies made the Inc. 5000 list with Validation Management Group taking home the top honor among real estate businesses at #29.

Living in Chicago however, there are two companies on the 2012 list that immediately caught my attention: Chicago Apartment Finders and @Properties. Chicago Apartment Finders is primarily an apartment finding service in the city that focuses on finding students, young professionals, and just about anyone else searching for a Chicago rental anything from quaint studio apartments to larger detached single-family homes for rent.

While Chicago Apartment Finders has only been in business since 2002, this top Chicago apartment locater has actually made the Inc. 5000 list every year since 2007, with its highest ranking being that same year at #1,032. Since it's beginning, Chicago Apartment Finders has grown from 2 agents in a small, one-room office to 4 offices, more than 150 team members, and a branded fleet of cars agents are able use to transport clients from apartment listing to apartment listing.

@Properties is also a fairly young real estate company in Chicago, yet still considered to be of city's top brokerages. Investing millions of dollars in state-of-the-art technology and cutting-edge marketing services, it's no wonder why @Properties is also one of the city's most recognizable real estate companies with signage seemingly all over the downtown area. In addition, @Properties also prides itself on holding each and every agent within the company to a higher standard of customer service and professionalism.

And with previous Inc. 5000 honors for @Properties coming in 2006, 2007, 2008, 2009, and 2010, there's no doubt this effort and hard work has continued to pay off. Since 2008, @Properties' revenue has climbed from $45.6 million to $60 million in 2011'a 32% growth'and there's certainly no sign of slowing down. Along with the company's core residential real estate business, @Properties is also an industry leader in commercial real estate, while also working to expand into property management with the recent acquisition of Venterra Sales and Management.

So congratulations to not only Chicago Apartment Finders and @Properties in Chicago, but all the 2012 Inc. 5,000 recipients and here's to hoping 2013 brings even more success!

 

Joe Heath is a graduate of Indiana University and also holds a Graduate Certificate in Real Estate Development from Drexel University. After working as a Market Research Associate and writing published Market Snapshots for Hanley Wood Market Intelligence in Chicago, Joe now works as a Web Marketing Specialist and is a managing partner at Real Estate Web Creation, LLC.

AEI Study Shows How FHA Financing Is Destroying Thousands Of Neighborhoods

According to American Enterprise Institute Fellow, Edward Pinto, the FHA mortgage insurance program is helping to destroy the neighborhoods that FHA is most heavily involved in. A detailed study of FHA lending practices and default rates shows that lower income borrowers and home owners with FHA loans are much more likely to default on their loans. And when these borrowers, their home, and their FHA loans are concentrated within a specific zip code, the result tends to be drastically higher foreclosure rates, leading to lower home values and loss of equity across the entire area.

Slowly but surely, the FHA is trashing America's neighborhoods' © Giuseppe Porzani ' Fotolia.com

This helps to explain why some cities such as Atlanta and Detroit are still struggling to recover from the housing market melt-down. An excellent overview of the problem, along with maps that show foreclosure rates and FHA participation levels down to individual zip codes can be found at NightmareAtFHA.com There are very high concentrations of FHA loans in many of the most troubled zip codes in the nation. In these areas, even property owners who have their property paid for may suffer a significant loss of equity due to the foreclosure of dozens or hundreds of neighboring homes. In some zip codes the default rate on FHA insured mortgages is as high as 25%. Compare that to a private sector default rate of less than 4%.

The problem is with the high number of loans approved by FHA for borrowers who are not actually able to afford to own and maintain a home or cannot afford the price of the home they have chosen to purchase with an FHA insured mortgage. Lenders have little incentive to curb the use of these loans, because they are insured by the taxpayers. This means that if a borrower with an FHA loan does default, the lender can recover the entire value of their loan from the Federal Housing Administration. (FHA)

Another reason for the much higher rate of default is due to the way in which FHA loans are underwritten, using a benchmark known as the 'debt-to-income-ratio'. This ratio uses the gross income amount, and therefore it does not take into account the actual amount of take home pay that is available for a mortgage payment. The result is that FHA borrowers tend to borrow too much money. Buyers are commonly encouraged to purchase 'as much home as they can qualify for' rather than thinking about other expenses such as home maintenance and repairs, along with other big unplanned expenses such as an emergency car repair.

FHA mortgages are notoriously expensive, in spite of their reputation as the mortgage of choice for lower income borrowers. There are a number of fees attached to this loan. Even at today's lower interest rates, FHA loans carrying a 30 year term with a 5% down payment will cost the borrower about 2.5 times the total amount borrowed over the life of the loan.

This means that a $100,000 home with a 95% Loan to Value will cost about $250,000 by the time you pay your last payment in 30 years. Of course, the vast majority of borrowers do not keep their home long enough to pay off a 30 year mortgage with 360 payments. And when they move, they are often shocked to find out how much they still owe on their home loan. In today's market it can be very difficult to sell a home for enough to pay off an existing FHA loan that was created in the last 10 years.

It takes more than 12 years of monthly mortgage payments before you actually begin to pay more on your loan principle than you pay in interest each month, if you only pay the required mortgage payment. If you are a typical lower income borrower, you'll pay virtually the entire value of your home in loan interest expense over the first 15 years of your FHA loan.

This is hardly affordable housing, yet the FHA product has been sold as the loan of choice for 'affordable housing' for over 50 years. But the high costs of this loan are one of the primary reasons why lower income borrowers are more likely to get foreclosed on. They pay and pay for years with little accumulation of equity in their homes. By the time you add in the up front costs for origination fees, appraisals, taxes and insurance, virtually all 95% FHA loans are in a negative equity situation from day one, even in a normal housing market.

Today we are in a situation where FHA is insuring virtually 90% of all new mortgage loans, even as default rates continue at crisis levels in neighborhoods with a high percentage of lower income FHA borrowers. This is leading to a situation in which FHA could default on it's insurance obligations, requiring another big bail out for a program that is 'too big to fail'. Without FHA mortgage insurance, the housing market would come to a virtual standstill in terms of new loans for the majority of lower income home buyers.

FHA has now been over 3 years without an official director, as congress, the administration and the professional real estate industry fear what would happen if someone actually had to face the problems at FHA. The National Association of Realtors lobbied heavily to push FHA into more lending activity after the housing melt-down destroyed the vast majority of private mortgage insurers and lenders. FHA is under capitalized to the tune of some 46 billion dollars and is headed for a fiscal cliff of it's own in the near future. For more details and research data, check out FHA Watch.

 

Donna S. Robinson is a real estate investor, author, and housing market analyst located in Atlanta, GA. Follow her on twitter at donnaconsults. Her latest book is now available on Amazon.com. It's called Basics Of Real Estate Investing

Are Young Buyers In Danger of Missing the Boat?

What with prices bottomed out across the nation and mortgage interest rates at all-time record lows, there's never been a better time to buy, or so the experts keep on telling us. So why is it that young people aren't listening?

© Fotowerk ' Fotolia.com

According to a recent article in Reuters, it would seem that contrary to all the expert advice, the majority of young people seem to be sitting on the sidelines. But why are they choosing to do this, and will they regret not making a move now later on in life?

Certainly, the majority of young people haven't turned their backs on the idea of homeownership. A recent poll of renters by the real estate firm Trulia showed that as many as 93% of those in the so-called millennial generation have plans to buy a home at some point. But despite this, very few of them are making the move, with first time buyers accounting for just one third of all home buyers at present.

So could it be that most of the millennials simply aren't in the position to take advantage of the market at present? According to Linda Stern of Reuters, that's exactly where the problem lies.

'Generally those now in their 20s to early 30s'don't have the jobs that qualify them for mortgages,' explains Stern.

In addition, many younger buyers simply don't have the funds necessary to afford a down payment right now, while still others are frightened of entering the property market in light of the foreclosure crisis that is far from over, says Stern.

The good news is that these buyers may not need to make a move just yet in order to capitalize on today's low prices. The Fed recently announced that it intends to keep interest rates low until the level of unemployment falls back under 6.5%, something that it doesn't envisage happening until 2015 at the earliest.

During that time, real estate professionals can do their bit towards helping the younger generation get into a position where they can afford to buy a home.

The Reuters article suggests that realtors can help advise millenials on ways in which they can improve their credit score, and once they attain that magic FICO score of 740, protect it.

'If your score is anything less than 740, find out how you can raise it ' paying down a credit card balance, putting more time between you and your last late fee,' writes Stern.

Other steps that young adults can take include shoring up their spending habits so that they can start putting some cash aside towards a down payment on their home, and learning about the different kinds of mortgages designed for first time buyers, such as those offered by the FHA.

5 Tips to Make the Best Real Estate Deal

Real estate is a tough competitive market. If you want to succeed here both as a buyer and a seller, you have to know the tricks. In most of the cases, one party always loses out and you surely wouldn't want to be that losing party. Here are five easy tips that will help you get a good deal in the real estate market:

© Reicher ' Fotolia.com

Understand The  Market

A real estate market benefits both the seller and the buyer. You necessarily need not be in a market and follow the trend to make a good deal. When you have to buy or sell any property, try to understand what the seller or buyer would want from the property and then put it on the market by highlighting those aspects. You need to know what the other party wants and then take the help of the market to get a good deal.

Try To Get  Leverage

You are not the only one in the market who is trying to get a good deal. There are millions others trying to get same. If you want to make a good deal, you will have to stand out from the crowd. For the glen homes for sale, try to catch the buyer's eye before your competitors get there. Place advertisements on the front pages of local newspapers and magazines that catch the buyer's attention.

If you want to make a good deal, try not to be in the news for the wrong reason. Negative publicity doesn't help you in making a good deal.

Make A Deal That  Favors You

In the same market, two similar properties may not cut a deal that favours one side. If you are seller of a property which has competition from a similar property down the road, you can get a better deal by offering the buyers some added bonus. You could paint your house, repair the roof and clean the front loan. This will make your property more attractive to the potential buyer and they would be willing to pay you more than the quoted price because you have prevented them the hard work of renovation.

Financing

The real estate market focuses on finance just like any other market transactions. If you want a good deal, get a thorough check done on your potential buyer. Check to see whether they are financially in a good position and will get a loan for the property. You wouldn't want to be stuck showing off your properties to buyers who will ultimately not be able to buy the property. Make deals when the deal seems worthy of the effort you put in.

Get Help From An  Expert

If you are a new buyer, in order to get a good deal in your property, get help from a buyer's broker.To make a successful deal, you have to develop a strong bargaining skill. Be smart and follow these tips to get success in real estate.

 

Brenda Lyttle is an enthusiastic custom home builder. She loves her job as she helps people frame out their dream homes from their imaginary canvas into reality.

Westcore Properties Closes Massive Commercial Real Estate Deal in Sacramento

San Diego based Westcore Properties has recently closed a deal to acquire a collection of Sacramento's industrial real estate. The purchase, valued at $600 million, includes 110 buildings amounting to 11 million square feet of space, a property portfolio put together by local developer Joe Benvenuti. Most of the buildings, about 8 million square feet, are located in Sacramento, the rest are commercial properties in the Midwest.

This is the second largest commercial real estate deal in the history of Sacramento, outranked by a transaction closed back in 2007 when Wells Farago Center and other office properties, valued at $760 million. The deal is also the largest in industrial real estate closed this year in California and the second-biggest in the USA, according to Mark Demetre of Jones Lang Lasalle, who helped broker it.

Demetre, as well as other commercial real estate experts, see this massive acquisition of warehouses and other industrial properties as proof of investor's faith in Sacramento's commercial property market as a long-term investment. It also marks a significant ownership transfer from a small group of local developers to outside investors, backed by a large infusion of Wall Street money.

Westcore President and CEO Don Ankeny expressed his company's eagerness to continue the plans drawn up by Benvenuti, who passed away earlier this year.

'Joe was a legendary guy in your marketplace,' Ankeny said. 'The opportunity to step into the shoes of his lifetime's work doesn't come along very often. When we got wind of that opportunity, we jumped on it.'

After Benvenuti's death, his heirs made a decision to sell most of his assets.

'It was basically a family decision. My dad passed away a few months ago and my mom a couple of years ago,' said Richard Benvenuti, the late developer's son.

This major deal included most on Benvenuti's 13 million square feet commercial real estate holdings. About half of the properties Westcore aquired are located in North Natomas, along North Market Boulevard and Del Paso Road. The other properties are in West Sacramento, Rancho Cordova and Placer County. The Midwest properties included in the deal are mostly made up of distribution centers, light industrial buildings and office buildings from St Louis and Indianapolis.

[Infographic] Your Contribution to Zillow and Trulia Winning More

Ever wonder how come Zillow and Trulia truly outrank your site? I mean, other than having millions to spend on PPC or other marketing, the big names outrank you and other competing names for a multitude of reasons. The infographic below reveals something called 'predatory back-linking' ' not the least of the reasons you and others have to turn to these two for more visibility.

Infographic Courtesy of Real Geeks

Reggie Hunt Named Top Producer in Devon, PA

Reggie Higgins Hunt, a sales associate with Long & Foster Real Estate Inc., has been named Top Producer for November for the Devon office located at 92 Lancaster Avenue, Philadelphia.

Reggie is listed as being one of the 10 most reliable realtors on the East Coast in Forbes magazine, and is consistently a top producer for the company. In addition, she has also been listed as one of the top 5% of sales agents in the country.

Janet Gordon Rubino, vice president and manager of the Devon office had this to say about Hunt:

'Reggie has been listing and selling real estate for over 25 years in the Philadelphia suburbs and the Main Line. Being a native of the area, she has full expertise of the area schools, and the important nuances of each neighborhood. Her experience with land, estates, horse farms, older homes, historic homes and new construction reflects vital knowledge needed to service buyers and sellers.'

Reggie Hunt is a relocation specialist and holds the SRES (Senior Real Estate Specialist) designation. In addition Reggie is a designated Extraordinary Properties® Specialist and a Christie's Great Estates® Specialist. Before becoming a realtor she worked on Wall Street for 10 years in the financial services industry. Reggie has a bachelor's degree from Wheaton College and has served on the Board of Directors of several local companies. She also finds time to be actively involved in many charities. She lives in a beautifully restored older stone house, and her hobbies include horse riding and tennis, and has bred champion Norwich Terriers.

Hunt can be contacted on a 610-888-6313.

Long & Foster Companies is the parent company of the largest independently owned residential real estate company in the United States, Long & Foster Real Estate, Inc., which has more than 12,000 agents in seven Mid-Atlantic States, plus the District of Columbia. Last year the company sold more than $22 billion worth of homes, and helped more than 69,000 people buy and sell property. More information about Long & Foster can be found on their website.

New Home Construction Booms, But Will There Be Any Room?

There's been lots of construction activity over the past 12 months, giving builders real encouragement that the worst years of the housing slump are finally behind them. But while these developments will be warmly embraced, construction firms could soon be facing an altogether different problem ' a lack of space on which to build.

Housing construction booms, but are we running out of space? © sellingpix ' Fotolia.com

One of the best gauges of the construction industry's health is housing permits, those certificates issued to builders giving them the go ahead to break ground on new developments, and the number of these being issued has soared by 3.6% over the last month (November).

This increase can be taken as a sign that builders are execting 2013 to be a prosperous one by previous years' standards, and this argument is further strengthened by the news that the total number of housing starts is expected to see 25% growth compared to the previous year.

But all of this renewed building activity has led to an altogether different problem for building firms, one that they would never have imagined just 12 months ago ' a scarcity of available lots on which to build their new homes.

As demand for new housing picks up pace, construction companies are now grappling with a shortage of new lots on which to build on, with those that do exist seeing rapid increases in price as builder's compete for the space.

Megan McGrath, home building analyst for MKM Partners, told USA Today that builders are now scrambling to secure what few lots are still available.

'No one has developed land in six years,' she says. 'Builders are now running to catch up.'

Builders say they are running out of lots on which to build. © Leo Blanchette ' Fotolia.com

The result of this shortage is that the price of building lots has risen dramatically in recent months. Across the nation, 90% of building firms report that lot prices have risen substantially, compared to just 10% reporting similar rises two years ago.

Not surprisingly, it all depends where you are based. Lots in Phoenix, Arizona, have seen some of the biggest increases, rising by 30% in some parts of the city, whilst North Carolina (25%) and Denver (15%) have also seen steep increases.

The pressure will now be on local officials to free up more available land to meet the rising demand for new home construction. In the meantime, builders won't be worrying about whether they can sell the new homes they're building, but whether they can even build them in the first place.