Real Estate industry news and information source Inman has once again named the industry’s most forward-thinking and groundbreaking members in its annual list of Innovator Award Finalists for 2019, and The Menkiti Group has been named one of ten finalists for the Most Innovative Brokerage or Team.
Recognition has been given to 60 different finalists from across the real estate industry, grouped into the following six categories:
Most Innovative Real Estate Technology
Most Innovative Real Estate Company
Most Innovative Brokerage or Team
Most Innovative Podcast or Video Show
Most Innovative MLS, Association or Industry Organization
Most Innovative Marketing
Of note, The Menkiti Group with the nationally recognized sales team of MG Residential is the only Washington, DC-based brokerage or team to be included on the Brokerage or Team list, AND in the overall Inman 2019 Innovation finalists.
Also of note, KW Command, the industry-changing, one-stop mobile application that streamlines agents’ workload, allowing them to automate tasks, create customized marketing campaigns and manage databases and contacts from Keller Williams was named to the Most Innovative Real Estate Technology list. The Menkiti Group is the operating and management company behind Keller Williams Capital Properties, a leading mid-Atlantic brokerage and Top 15 of all KW national affiliate companies.
In July, Inman will announce its Innovator of the Year winner, someone who has consistently pushed the envelope this year, as well as the Nate Ellis Give Back Award winner, honoring an individual or organization that has made a difference through its philanthropy, activism or other commitment to the industry this year.
Learn more about The Menkiti Group, MG Residential, or KW Capital Properties by visiting menkitigroup.com
Buying and owning real estate is an exciting investment strategy, that can be both satisfying and lucrative. Unlike stock and bond investors, prospective real estate owners can use leverage to buy a property by paying a portion of the total cost up front, then paying off the balance, plus interest, over time.
While a traditional mortgage generally requires a 20% to 25% down payment, in some cases, a 5% down payment is all it takes to purchase an entire property. This ability to control the asset the moment papers are signed emboldens both real estate flippers and landlords, who can, in turn, take out second mortgages on their homes in order to make down payments on additional properties.
KEY TAKEAWAYS
Aspiring real estate owners can buy a property using leverage, paying a portion of its total cost up front, then paying off the balance over time.
The four chief ways in which investors can make money through real estate are: 1) becoming landlords of rental properties, 2) real estate trading (a.k.a. flipping), 3) real estate investment groups, and 4) real estate investment trusts (REITs).
Here are four ways in which investors can put properties to good use:
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1. So You Want to Be a Landlord
Ideal for: People with DIY and renovation skills, who have the patience to manage tenants. What It Takes to Get Started: Substantial capital needed to finance up-front maintenance costs and cover vacant months. Pros: Rental properties can provide regular income while maximizing available capital through leverage. Moreover, many associated expenses are tax deductible, and any losses can offset gains in other investments. Cons: Unless you hire a property management company, rental properties tend to be riddled with constant headaches. In worst case scenarios, rowdy tenants can damage property. Furthermore, in certain rental market climates, a landlord must either endure vacancies or charge less rent in order to cover expenses until things turn around. On the flip-side, once the mortgage has been paid off completely, the majority of the rent becomes all profit. Of course, rental income isn’t a landlord’s sole focus. In an ideal situation, a property appreciates over the course of the mortgage, leaving the landlord with a more valuable asset than he started with. According to U.S. Census Bureau data, sales prices of new homes (a rough indicator for real estate values) consistently increased in value from 1940 to 2006, before dipping during the financial crisis. Thankfully, sales prices have since resumed their ascent, even surpassing pre-crisis levels.
2. Real Estate Investment Groups
Ideal for: People who want to own rental real estate without the hassles of running it. What It Takes to Get Started: A capital cushion and access to financing. Pros: This is a much more hands-off approach to real estate that still provides income and appreciation. Cons: There is a vacancy risk with real estate investment groups, whether it’s spread across the group, or whether it’s owner specific. Furthermore, management overhead can eat into returns. Real estate investment groups are like small mutual funds that invest in rental properties. In a typical real estate investment group, a company buys or builds a set of apartment blocks or condos, then allow investors to purchase them through the company, thereby joining the group. A single investor can own one or multiple units of self-contained living space, but the company operating the investment group collectively manages all of the units, handling maintenance, advertising vacancies and interviewing tenants. In exchange for conducting these management tasks, the company takes a percentage of the monthly rent. A standard real estate investment group lease is in the investor’s name, and all of the units pool a portion of the rent to guard against occasional vacancies. To this end, you’ll receive some income even if your unit is empty. As long as the vacancy rate for the pooled units doesn’t spike too high, there should be enough to cover costs. While these groups are theoretically safe ways to invest in real estate, they are vulnerable to the same fees that haunt the mutual fund industry. Furthermore, these groups are sometimes private investments where unscrupulous management teams bilk investors out of their money. Fastidious due diligence is therefore critical to sourcing the best opportunities.
3. Real Estate Trading (a.k.a. Flipping)
Ideal for: People with significant experience in real estate valuation and marketing. What It Takes to Get Started: Capital and the ability to do or oversee repairs as needed. Pros: Real estate trading has a shorter time period during which capital and effort are tied up in a property. But depending on market conditions, there can be significant returns, even in shorter time frames. Cons: Real estate trading requires a deeper market knowledge paired with luck. Hot markets can cool unexpectedly, leaving short-term traders with losses or long-term headaches. Real estate trading is the wild side of real estate investment. Just as day traders are a different animal from buy-and-hold investors, real estate traders are distinct from buy-and-rent landlords. Case in point: real estate traders often look to profitably sell the undervalued properties they buy, in just three to four months. Pure property flippers often don’t invest in improving properties. Therefore investment must already have the intrinsic value needed to turn a profit without any alterations, or they’ll eliminate the property from contention. Flippers who are unable to swiftly unload a property may find themselves in trouble, because they typically don’t keep enough uncommitted cash on hand to pay the mortgage on a property, over the long term. This can lead to continued snowballing losses. There is a whole other kind of flipper who makes money by buying reasonably priced properties and adding value by renovating them. This can be a longer-term investment, where investors can only afford to take on one or two properties at a time.
4. Real Estate Investment Trusts (REITs)
Ideal for: Investors who want portfolio exposure to real estate without a traditional real estate transaction. What It Takes to Get Started: Investment capital. Pros: REITs are essentially dividend-paying stocks whose core holdings comprise commercial real estate properties with long-term, cash producing leases. Cons: REITs are essentially stocks, so the leverage associated with traditional rental real estate does not apply. A REIT is created when a corporation (or trust) uses investors’ money to purchase and operate income properties. REITs are bought and sold on the major exchanges, like any other stock. A corporation must pay out 90% of its taxable profits in the form of dividends in order to maintain its REIT status. By doing this, REITs avoid paying corporate income tax, whereas a regular company would be taxed on its profits and then have to decide whether or not to distribute its after-tax profits as dividends. Like regular dividend-paying stocks, REITs are a solid investment for stock market investors who desire regular income. In comparison to the aforementioned types of real estate investment, REITs afford investors entrée into nonresidential investments, such as malls or office buildings, that are generally not feasible for individual investors to purchase directly. More importantly, REITs are highly liquid because they are exchange-traded. In other words, you won’t need a realtor and a title transfer to help you cash out your investment. In practice, REITs are a more formalized version of a real estate investment group. Finally, when looking at REITs, investors should distinguish between equity REITs that own buildings, and mortgage REITs that provide financing for real estate and dabble in mortgage-backed securities (MBS). Both offer exposure to real estate, but the nature of the exposure is different. An equity REIT is more traditional, in that it represents ownership in real estate, whereas the mortgage REITs focus on the income from mortgage financing of real estate.
The Bottom Line
Whether real estate investors use their properties to generate rental income, or to bide their time until the perfect selling opportunity arises, it’s feasible to build out out a robust investment program by paying a relatively small part of a property’s total value up front. But as with any investment, there is profit and potential within real estate, whether the overall market is up or down.
For the first time in a year and a half, long-term mortgage rates have dropped below 4 percent.
On Thursday, May 30th Freddie Mac reported mortgage rates are now at 3.99 percent with an average 0.5 point as the average for a 30-year mortgage, down seven basis points from last week. Long-term rates haven’t fallen below 4 percent since January 2018.
“While economic data points to continued strength, financial sentiment is weakening with the spread between the 10-year and the 3-month Treasury bill narrowing as fears of the impact of the trade war with China grow,” Freddie Mac’s Sam Khater said in a release. “Lower rates should, however, give a boost to the housing market, which has been on the upswing with both existing and new home sales picking up recently.”
The UrbanTurf / Menkiti Group Mortgage Rate Disclaimer: The rates reported by Freddie Mac for 30-year mortgages are usually the best rates that the most qualified borrowers can get, so borrowers or those considering refinancing should not necessarily read this news and think that they can go out and get a loan with the quoted interest rate.
The award-winning MG Residential Sales Team is currently hiring for passionate real estate professionals licensed in DC, MD, and VA, who seek career growth and can see themselves embracing our mission of Transforming Lives, Careers, and Communities through Real Estate.
Join us on Wednesday, May 15th from 5:30-7:00 PM for a happy hour and panel discussion with four of our Neighborhood Experts and learn how a full-service team culture may benefit you and your business. Registration is requested: http://bit.ly/2ZMt3ey
Renovations can make us happier in the places we call home, but some of the most dramatic updates can add real value when it’s time to sell.
Since kitchen, deck and other upgrades can represent a significant cost, it’s helpful to know what kind of return you might expect before you decide to write a check.
Whether you plan to stay in your house for a long time or just a few years, it’s smart to know which home renovations add the most value. Here are the six home remodeling projects that deliver the highest returns.
Garage Door Replacement Average cost: $3,611 Average resale value: $3,520 Cost recouped: 97.5 percent
A good-looking garage door tops the list when it comes to getting cash back on your investment when you decide to sell your house, according to the 2019 Cost vs. Value report. The estimate is based on the cost of removing and disposing of an existing 16-by-7-foot garage door (2-car garage) and replacing it with a new four-section garage door with heavy-duty galvanized steel tracks, assuming the motorized garage door opener is compatible. This curb-appeal enhancer will get you back almost every dollar you spent on it when you sell your house.
2. Manufactured Stone Veneer Average cost: $8,907 Average resale value: $8,449 Cost recouped: 94.9 percent
Replacing vinyl siding with stone veneer on part of your home, such as an entryway, is a big curb-appeal upgrade for your home. Existing vinyl siding is replaced with adhered manufactured stone veneer. This average cost estimate is based on installing 36 linear feet (LF) of sills, 40 LF of corners and one address block, with materials including two layers of a water-resistant barrier, corrosion-resistant lath and fasteners and more. This cosmetic improvement and accent design element is likely to catch the eye of a potential buyer and can allow you to recoup nearly 95% of your costs.
3. Minor Kitchen Remodel Average cost: $22,507 Average resale value: $18,123 Cost recouped: 80.5 percent
Creating a modern-looking and functional kitchen can add more than just value to your home; it can boost your enjoyment of everyday activities like cooking, entertaining friends and sharing meals with your family. However, potential buyers see the intrinsic value of this kind of upgrade. On average, you’ll recoup a little more than 80% of the cost of a minor kitchen remodel. In a remodeling project of this kind, you might replace appliances with new, more energy-efficient models, reface cabinets with new shaker-style wood panels, install new countertops, replace hardware, install a new sink and faucet, add new flooring and repaint.
4. Deck Addition (Wood) Average cost: $13,333 Average resale value: $10,083 Cost recouped: 75.6 percent
If you’re lucky enough to own a house with a big yard, having a wooden deck can be an extra enhancement to enjoy the outdoors around your home. The average cost of adding a wooden deck from scratch (estimated based on a 16-by-20-foot deck, including a railing system with pressure-treated wood posts, railings and balusters) is approximately $13,333. But the good news is that this feature, which also includes a built-in bench and planter, can hold more than 75% of its value come sale time.
5. Siding Replacement Average cost: $16,036 Average resale value: $12,119 Cost recouped: 75.6 percent
Old, dilapidated siding can make even the nicest house look worn-out. For the average home, replacing 1,250 square feet of old siding will cost you just over $16,000 and you’ll get back roughly three-quarters of that investment upon resale. This upgrade includes the factory trim at the openings and corners.
6. Entry Door Replacement (Steel) Average cost: $1,826 Average resale value: $1,368 Cost recouped: 74.9 percent
You will recoup nearly 75% of your cost by replacing your main entry door with a 20-gauge steel door, complete with clear dual-pane half-glass panel, jambs and an aluminum threshold with composite stop. These doors come factory finished with the same color on the front and back sides.
RISMedia has announced it has chosen Bo Menkiti as a member of the Class of 2019 Real Estate Newsmakers, which will be revealed in the December 2018 issue of RISMedia’s Real Estate magazine, and featured online at RISMedia.com.
RISMedia’s Real Estate Newsmakers is an exclusive group of industry luminaries who have contributed in newsworthy ways to real estate. The 2019 Class was chosen by RISMedia editors for headline-making initiatives and successes, including, but not limited to:
Advancing the industry
Impacting change
Technology achievements
Diversity and inclusion
Business accomplishments and growth
Humanitarian efforts
Industry activism and support
Thought leadership and influence
Excellence in customer service
Creativity and innovation
“RISMedia’s Real Estate Newsmaker Awards honor the industry’s real newsmakers—the people who are positively affecting our industry and the millions of consumers we serve,” says John Featherston, CEO and president of RISMedia. “Our industry promotes and provides consumers with a pathway to responsible homeownership. Over the past three-plus decades, RISMedia has covered, chronicled and celebrated the professionals making news in real estate, and we are honored to continue to formalize these honors with the 2019 annual RISMedia Real Estate Newsmaker Awards.”
Washington, DC, October 3, 2018- The Initiative for a Competitive Inner City (ICIC) announced that The Menkiti Group has made the 2018 Inner City 100 list of the fastest-growing inner city businesses in America, based on revenue growth. ICIC, a 25-year-old national nonprofit founded by Harvard Business School professor Michael E. Porter, promotes economic prosperity in America’s inner cities through private sector investment that leads to jobs, income and wealth creation for local residents.
The list was revealed at the 20th Annual Inner City 100 Conference and Awards in Boston October 1-2. The full list is available on Fortune’s website. The Menkiti Group, led by CEO Bo Menkiti was ranked #93 based on its growth rate from 2013 to 2017 of 68.26% and 2017 revenue of $17,515,873.
2018 marked the 5th appearance on the prestigious list for The Menkiti Group, placing the company into the ICIC fastest-growing companies Hall of Fame. Keller Williams Capital Properties was also ranked for a record 5th appearance, this year at #92, which places the company into the Hall of Fame as well.
Said ICIC CEO Steve Grossman, “Inner City 100 companies are forces of economic opportunity, optimism and transformation in their communities. They lead the way in innovation, job creation and economic revitalization and it’s an honor to shine the spotlight on their leadership and accomplishments. In addition to excellence in business, these pioneering entrepreneurs have demonstrated a deep commitment to and passion for their communities, which significantly impact the wellbeing of their local economies”.
Now celebrating its 20th year, ICIC’s Inner City 100 list has long celebrated urban entrepreneurship. Since its inception, ICIC’s list has recognized 975 companies, which have seen average growth rates of more than 400 percent during a five-year period and have collectively created more than 126,000 meaningful jobs in America’s distressed and underserved communities and neighborhoods. The Inner City 100 program opens doors for other budding urban entrepreneurs and stimulates inner city business development and job creation through recognition, networking and learning.
“These businesses and their owners are a testament to the impact innovation and entrepreneurship have had in rejuvenating urban areas across the U.S. Companies such as (COMPANY NAME) are experiencing revenue growth and increased investment, which are in turn creating more jobs and economic opportunity for citizens in the communities where these companies call home” said ICIC President and COO, Matt Camp.
2018 Inner City 100 by the numbers:
Average growth rate of 436 percent between 2013 and 2017
Represent 46 cities in 23 states
Employed 10,085 individuals in 2017
Created 5,516 new jobs in the last five years
On average, 36 percent of employees live in same neighborhood as the company.
Average company age is 15 years
Average 2016 revenue is $14.8 million
31 percent are women-led
38 percent are minority-led
Represent 26 industries
CEOs from the winning companies were invited to the Inner City 100 Conference and Awards, two days of robust networking opportunities and educational sessions led by Fortune 500 executives and academics from top-tier universities, including Harvard Business School. Past winners have reported connecting with multi-million dollar investors as a result of appearing on the Inner City 100 list and attending the Conference.
Initiative for a Competitive Inner City (ICIC)
ICIC is a national nonprofit founded by Harvard Business School professor Michael E. Porter. ICIC’s mission is to promote economic prosperity in America’s inner cities through private sector investment that leads to jobs, income and wealth creation for local residents. Through its research on inner city economies, ICIC provides businesses, governments and investors with the most comprehensive and actionable information in the field about urban market opportunities. The organization supports urban businesses through the Inner City 100, Inner City Capital Connections, Goldman Sachs 10,000 Small Businesses program, and Santander Bank’s Cultivate Small Business program. Learn more at www.icic.org or @icicorg.
Washington, DC-based brokerage included in top 1% of Inc. 5000 Fastest Growing Companies with notable growth.
Today Keller Williams Capital Properties, an affiliate company of The Menkiti Group, was recognized on the 2017 Inc. 5000 list, an exclusive ranking of the nation’s fastest-growing private companies in America. 2017 marks the eighth year that the brokerage has appeared on the list for the remarkably consistent high growth displayed by the company.
Keller Williams Capital Properties (KWCP) is an Inc. 5000 Honoree, with a minimum of five appearances on the Inc. 5000 list, and is in rare company with eight consecutive appearances, placing the brokerage in the top 1% of all companies that have been included in the annual ranking since it was first published 36 years ago.
Since the brokerage was founded in 2006, KWCP has grown to seven offices throughout DC, Maryland, and Virginia, with nearly 1,000 agents. In 2016, KWCP recorded just over $2.1 billion in sales, with 4,414 transactions, marking significant increases in both areas over 2015. These figures all represent the brokerage’s standing as one of the fastest-growing Keller Williams Realty International franchises.
To learn more about Keller Williams Capital Properties or to discuss business and career opportunities in leadership or agent entrepreneur roles, please contact Brandon Green at 202-350-9777.
