Editor's Note: In this world everyone needs someplace to lay their head and that's why real estate will never get played out as an profession. With that said, I had some questions about real estate and the process as well as how and why it affects the communities we live in. You know the deal.If I can get some answers then we all can so I talked to a young entrepreneur from Generations Realty Group named Kamil Salter. Here's what I got.

GeoClan.com (GC) : How did you get involved in Real Estate and what has made you the success you are today?

Kamil Salter of Generations Realty Group (GR) : I was introduced to Real Estate through my father.   Hearing about the additional income that he was able to make seemed interesting to me, but I wasn't one hundred percent sold on being involved with Real Estate.   It wasn't until I came home from college, and read, "Rich Dad's Guide to Investing", and began what I like to call my corporate enslavement that I really had a burning desire to figure this Real Estate thing out.  

GC : What's you role in the home buying process?

GR : In the arena of Real Estate I wear many hats, and one would be that of a Real Estate Agent (REA).   As a REA assisting someone in purchasing a home, my role would be to show the potential buyers properties that fit their criteria.   So typically, I'll send them a list of properties, they'll pick out the ones that they like, I take them to see them, and we place an offer on the property that they are most interested in.   Once an offer is accepted, I assist them with scheduling the appraisal and home inspection, and reviewing the home inspection, and finally I will go to settlement with them where they seal the deal on their purchase.

GC : What misconception(s) people often come with when dealing with you and trying to buy a home?

GR : The biggest misconceptions that I come across from communicating with individuals buying homes is either individuals believing that they cannot afford to buy a home, or that it doesn't cost anything to buy a home referring to the whole, "No Money Down" phenomenon.   Purchasing a home can be a very affordable and simplistic process.   If you are renting, you can pretty much afford a house.   There are so many banks, and mortgage companies out there that want to assist first time home buyers it's literally impossible not to get a loan unless you are just being lazy.   All you have to do is ask around, whether if its people you know, or go to a bank, and ask fill out an application, and you'll be able to get a loan.   As far as the whole "No Money Down" phenomenon, yes it is possible to buy a house with no money down, but in a traditional purchase of a home involving properties listed on the market with real estate agents involved, it's not likely that you will be able to pull off a "No Money Down" deal.   I will say that it is highly likely that in the purchase of your first home you could potentially keep your out of pocket expenses to around $2,000.00.   Also, when the phrase "No Money Down" is used it can also be translated to mean "None of Your Own Money Down".   In instances where you borrow down payments and/or closing costs from friends, family, credit cards, credit lines, the government, etc.

GC : How does credit affect what the potential buyer can do?

GR : When applying for a mortgage, credit can drastically affect the type of financing options available to you.   Low credit scores may mean not being able to qualify for 100% financing, high interest rates, or simply not being approved.   Whereas higher credit scores will do the exact opposite.   There are special financing programs out there that can assist with low credit scores, such as FHA loans.   If you have questionable credit I would recommend repairing it because not only will repairing your credit simplify the home buying process, but good credit makes life easier.   You can go to www.truecredit.com , or www.myfico.com for credit repair assistance.   Another option is to have a co-signer who has a higher credit score than you that can qualify for better financing options. Have them purchase the home with you.  

GC : How easy is it to get a home and would you say it's a buyer or seller's market?

GR : Right now I would say it's a Seller's market just because the interest rates are still relatively low, so there are more buyers than sellers because more people can qualify for loans.   Also, because Real Estate investing is so popular now, and everyone is looking to invest in Real Estate it makes the seller's property a hot commodity, so he or she can demand a higher price from the market.

GC : What should people look at before considering buying a property? What do you look at?

GR : When I purchase homes, I'm looking at a home from an investment standpoint not a home buying standpoint, which is two totally different mindsets.   So when I'm looking at a home I'm looking at the numbers because it's all a numbers game.   If I'm looking to potentially rent this property, I'm figuring out the monthly mortgage, insurance, and tax payments, how much work the property will need to make it rentable, and what kind of rent can I get for the property.   The difference from the rents and the mortgage, insurance, and taxes, and the amount of repairs will help me determine my monthly cash flow, and the monthly cash flow will determine if decide to go ahead with the purchase of the property.   If I'm looking to flip a property, I'm looking at what the comparable properties in the neighborhood are going for, or what they have sold for, and how much it will cost to make the property marketable.   The comparable sales from the area minus the repairs and the offer I'm willing to make on the property determine my profit, and the amount of profit will determine whether or not I will continue with the purchase of the property.

GC : Does someone have to take a class to become a real estate agent and how much do they usually cost?

GR : To become a Real Estate Agent you need 60 hours of schooling on Real Estate Fundamentals, and Real Estate Practices.   These course usually range anywhere from $300 to $500, and there are so many different class schedules available that if you want to be a Real Estate Agent the classes will fit into your schedule.   www.learnrealestate.com is a school with classes with a number of different scheduling options.

GC : Ok, tell us about GRG Houses and any other ventures you have going on?

GR : Generations Realty Group, LLC is a company formed between myself and my father to acquire real estate with limited liability.   Basically, we pool our skills, resources, networks, and knowledge to build a company that can build up the community, create passive income streams, and in the future mentor individuals who want learn how to invest in real estate.   For more info about us you can go to www.grghouses.com .

GC : Do you think more can be done with some abandon homes in most major cities to help those less fortunate like the homeless? Do you make an attempt to help low income people in your dealing

GR : I do believe that more can be done with abandon homes in most major cities.   I know for a fact that there are number of individuals who have the resources to revitalize these properties.   The major problem at least in Philadelphia is being able to obtain these properties.   I'm not an expert on acquiring these types of properties, but I have found that acquiring an abandon building is not the simplest process.   Even though I have heard of the Philadelphia Housing Authority www.pha.phila.gov assisting non-home owners to acquire these buildings.   I believe in allowing low-income individuals the opportunity to live in respectable, and quality homes.   A number of my rental properties are in low-income areas, and I like to try to create a respectable environment for all parties involved, so as long as the property is treated with respect and not negligence then I'm one of the first people that will open my rental doors to anyone.

GC : What are the going percentages for services (as of Feb 2006)? Does it depend on several factors?

GR : As far as purchasing a home these are the statistics that I usually come across.

1. For homes that are 100k and under you usually will have to put down a maximum of $1,000.00
2. Closing costs on cash deals are around 5% of the purchase price.   When a mortgage is involved your closing costs can be around 8-10% of the price of the home.
3. Home Inspections range from $275-400 (duplexes, triplexes, etc. costs will vary)
4. Appraisals $250-350 (duplexes, triplexes, etc. costs will vary)
5. Selling your home traditionally the cost is 6% of the sale the seller incurs.
6. Any sale of property in Philadelphia transfer tax is 4% of sales price which is usually split evenly between the buyer and the seller.   I usually include this figure in my closing cost estimate.  

GC : Where can people go if they feel they are being beat by the real estate people (Is there some sort of fair policy commission or program)?

GR : If an individual thinks that they have been taken advantage of in a real estate transaction by a real estate agent they can go to www.dos.state.pa.us , and search for the PA Real Estate Commission to find out how they can have their problem resolved.

GC : Do you feel any responsibility to make sure the homes you sell are well kept and don't become an eyesore to the community?

GR : I'm a firm believer in taking care of my properties.   By taking care of my properties the renter enjoys their home, the property is less likely to experience any major malfunctions or repair costs, the neighborhood has a better overall look, when the neighborhood looks better, properties increase in value faster because the area is more desirable, and as a property owner, I feel better when I can look be proud of the appeal of something I own.  

GC : Do you have your own property and how's that working for you? How long did it take you to build the capital and what are the advantages of being a landlord and multiple home owner?

GR : Currently, I have over five properties that are a mixture of duplexes and single family homes.   First of all, there are EXPENSES when dealing with your rental properties, but overall I enjoy the monthly passive residual income.   I can say that as long as you have systems in place, and don't take shortcuts then the rental business can be a very simplistic business.   Some of the benefits of having a portfolio of real estate investment properties are the following:   Equity build up – as the tenants pay the rent, you are paying the mortgage, and every time you do that you are paying down the principal, so your net worth is increasing.   Property Appreciation – Real Estate in general usually appreciates 7% per year, so your asset is worth more money over time.   Monthly Cash Flow – Speaks for itself, but one way to look at it using rental profits to pay for certain expenses, such as car notes, personal mortgages, etc.

The first property I bought was with my father, and I was living at home and working, so I had some pretty good cash flow with no major bills, so I was able to make a substantial monthly payment to the property owner to pay for the installment sale that would allow us to purchase the house.   As far as saving for a house goes, I'll say that I was taught to save at least 10% of your income into at least a separate bank account that pays interest (PAY YOURSELF FIRST), and also make sure that you DO NOT spend this money, and you will be able to build up the down payment money in no time.   So whenever I come into extra money, combined with my savings, I would start looking to buy a property.   

GC : Do you see any trends in the game as a buyer, seller that you can highlight?

GR : Some current trends I see in the Real Estate market are buying properties where there is speculation.   For instance, when it was announced that Donald Trump was exercising his option on the Bud Building then the Allegheny, Nicetown, Hunting Park, North Philadelphia area exploded with higher sales prices, and more hungry buyers.   Another popular trend in Philadelphia right now is the Condominium conversions going on all over the city.   It appears that there are so many condos that are being built that I don't know where all of these condo purchasers are going to come from, so eventually the prices of these condos will have to drop.   Also, flipping is and I believe always will be a popular trend as long as one can find good deals, have reliable contractors, and a

good resale strategy.

GC : Do you see more minorities moving out of the city neighborhoods and more people from the suburbs moving back into the city? What are some reasons you hear and do you think it's purposeful?

GR : It does appear that lower income individuals are being pushed to the outskirts of the city while higher income individuals are moving back in to heart of the city.   Some reasons that I believe this is happening is because of the proximity to downtown Philadelphia.   People like to be close to their jobs, and if they can eliminate a forty-five minute to an hour commute than why not move closer.   Also, because property and land on the outskirts of downtown can usually be bought for a reasonable price, developers are buying up the houses and land and bringing the suburban lifestyle to the city.   Also, people seem to like the sizes of the homes surrounding center city, and there's so much that can be done in these homes to cater to someone's personal tastes.   I believe that this transition will have a lot of pros and cons, but hopefully the pros will exceed the cons.

GC : If you could change one thing you could change on either side of the game (or each) what would it be?

GR : In Philadelphia, the Landlord has the bad guy image, and it seems that the landlord is always guilty until proven innocent.   If the city was more receptive to landlord's wishes, and more helpful in assisting landlords with problem tenants then life as a landlord would be so much easier because most of the landlords are good landlords who care about their properties, and their businesses, but they can't operate their businesses effectively because the city has labeled them, "The Bad Guy."   Luckily there are organizations out there like the HAPCO www.hapcoassoc.com that is always fighting for landlords' rights in Philadelphia, but it's still not enough without the city's cooperation and assistance.  

GC : Why does it take some communities get rundown to the ground and remain like that for years until a big redeveloper or community corporation comes thru buys up everything. (i.e. Temple and North Philly, Penn and Drexel and University City, etc, etc, etc)? Is it more the community fault or the city for letting it get so bad without a response?

GR : Run down communities are a new phenomenon to me because growing up in these communities I never thought of them to be run down until I started doing business in them.   I believe that communities get run down because of negligence on the part of the property owners, and on the part of the city.   It seems that until money and/or politics get involved the communities will not get better.   Unfortunately, a lot of property owners in our city don't have pride in ownership, so the neighborhoods get run down.   The city isn't paying any attention to this process because in my opinion, they don't stand to profit, or no one is running for a position, so the neighborhoods deteriorate.   It's not until someone can make some money such as Temple running out of housing, and the need for student housing which means the campus radius will be extended, and housing and college amenities need to be built, so money can be made, and now the community looks better.   So, once again, in my opinion if there's no money to be made, and if the property owners practice neglect then the deterioration of our cities' communities will be a continuous cycle in different areas throughout the city.

GC : Give us your Background? Education, Where you are from etc?

GR : My background is pretty simple. I was born in California, lived in Philadelphia from about the time I was one until I was around seven.   My family then moved to Cheltenham, and I lived in Cheltenham until I moved to Germantown a few years ago.   I have a bachelor's degree in Accounting from North Carolina Agricultural and Technical State University.   I have over four years experience in the network marketing arena where I built nationwide sales forces, and some of which are still growing to this day.   I have some experience with Web Design, and Information Technology.   After College I worked in Corporate America for 16 months as an accountant.   Currently, I'm a Real Estate Agent, Real Estate Investor, and my family has a CPA firm, JSM Consulting Group, LLC, where I work as an accountant.

GC : What do you think about change (thinking of course of GeoClan.com's slogan, Uploading Change)?

GR : I think change is a good thing you just have to be prepared for it.   Everything changes over time, so it's up to you to continue to grow and aspire to your highest potential.   Stagnation is not a good thing we see what happens to stagnated water mold and fungus, so that leads me to believe I always need to be moving, learning, growing, experiencing, and aspiring to higher levels, so that I can reach all of the goals that I've set for myself, and I can leave a legacy for my family, so when I'm gone they won't have to start from scratch like a lot of us had to.

For more information please email Kamil at kamil@grghouses.com or go to the website at www.grghouses.com

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