What Are the Challenges of Buying a Historic Home?

1.7K Shares

Home is where the heart is, so the saying goes. For many, that means a personal connection with a home and community. That often entails buying a home in a historic neighborhood. Buyers want to be located in a historic part of the city and have a home with unique features like carved moldings, custom fireplaces, and vaulted ceilings.

In some older cities, homes can date back to the 17th century, but often, historic homes were built in the late 19th or early 20th century. Historic homes are registered with the National Register of Historic Place, and they are deemed historic or “architecturally significant” if they exemplify a certain architectural style, demonstrate the essence of a certain period in history or are associated with a famous person.

Historic DIstrict SignHistoric DIstrict Sign

Located in a Historic District

When you consider the purchase of a historic property, you first need to determine if the home is located in a historic district. The United States has 2,300 local historic districts, and those districts place specific regulations on modifications to the property. Before you buy, you need to determine the rules that govern the district. Often times, a historic review board must approve any renovations to the property. The goal is to preserve the community’s historic feel. You don’t want someone adding modern elements to the façade of a historic home.

There is much debate about whether buying a home in a historic district is a good financial investment. Some find the regulations burdensome, but others believe there is strong demand for historic properties that have been well preserved.

“I think buyers see a property in a historic district as a negative because it restricts what they can do,” says Paul Whaley, of Boston’s Coldwell Banker Residential Brokerage. “Investors don’t like it either as it takes longer for approvals. In general, I think it depresses the value of a property.”

However, some studies have proved otherwise. In 2011, a study was done of historic districts in Connecticut, and it concluded that property values increased 4% to 19% annually. A different study of properties in New York City found that values between 1980 and 2000 increase more significantly for properties in historic districts on a per square foot basis.

An Emotional Investment

For many, buying a historic property is an emotional purchase. Historic homes are unique and often have a great story. People feel an emotional connection to the property and the historic community. That is not necessarily a negative, but it’s important to acknowledge that the emotional connection exists. You want to fully realize any potential problems without making an unwise decision. Step back and give some distance when making a decision that has such an emotional investment; it will minimize the chance for buyer’s remorse after purchasing.

Expensive to Maintain

Historic homes by their very nature are old and generally more expensive to maintain than newer construction. Unless they have been updated, the sewer, wiring, and electrical systems can be a nightmare to maintain. Plus, there is always the chance that significant water damage has happened over a long period of time. To conduct maintenance in these areas,  you often need to hire a specialized contractor, especially if changes must be approved by a historic review board. That means living in a historic home can be an involved commitment and require a significant amount of financial resources.

Possible Lead Paint and Asbestos

Lead paint and asbestos used to be common building materials in the United States, but they are now banned. When they are discovered in a historic home, you are often required to hire specialists to mitigate the problem. Lead paint and asbestos are both highly toxic substances, and you do not want them causing health problems to you or your family. You want to have them disposed of properly.

Historic Cape May HouseHistoric Cape May House

Mature Landscaping

Historic homes have been around for generations, and that often means the landscaping has been highly refined. Trees and shrubs are probably mature and well established. This might be an attribute that you desire, but it is something you need to be aware of when purchasing a historic home. You might have less ability to make major modifications to the landscaping.

Possible Tax Incentives

If you purchase a historic home, you might be eligible for tax credits for making modification and improvements. The federal government encourages people to purchase and rehabilitate historic structures and offers the Federal Historic Preservation Tax Incentives program. The program has helped preserve 44,341 historic properties since 1976, and has seen $96.87 billion worth of private investment. States and local communities also offer historic preservation tax credits. For example, Georgia offers a tax credit for 25 percent of qualified rehabilitation costs.

Financing and Insurance Can be a Challenge

Lending institutions often shy away from financing some historic properties, because they can be viewed as a higher risk. Lenders will often charge higher interest rates and fees when providing a mortgage for a historic property given the increased risk. As well, many historic homes do not qualify for a Federal Housing Administration loan guarantee. It’s a good idea to do your research before you make an offer on a historic home. You don’t want to get into the process and realize it will cost a lot more than you anticipated.

The same can also apply to homeowners insurance. Insurance companies want to limit their exposure, and they don’t want to have to pay to repair a historic home to its original condition. Unique architectural elements can be expensive to replace. Many times, insurance companies will want to have someone personally inspect the property before the policy is written. You will probably need to find an insurance company that specializes in covering historic properties, especially if the home is over 100 years old.


James Shea is an award-winning journalist and author. He owns Media Lab, a content marketing and search engine optimization company is Richmond, Virginia.

1.7K Shares

Source: homes.com

10 Best Health Care ETFs of 2021

Technological innovation is everywhere you look.

One of the biggest changes taking place thanks to advancements in technology is an evolution in health care. New technologies are making simple work of some of the most pressing medical conditions known to man. Even the COVID-19 pandemic has been proof that the health care sector is evolving, with vaccines being created and marketed within a year of the outbreak of the novel coronavirus.

Of course, the health care industry is massive. Well-researched investments in a variety of health care stocks and bonds have proven to be lucrative moves. But what if you don’t have the time or expertise to do the research it takes to make individual health care investments?

That’s where health care exchange-traded funds (ETFs) come in.

Best Health Care ETFs

Health care ETFs are funds that pool money from a large group of investors and then invest in health care stocks and other health care-focused investments.

As with any investment vehicle, not all health care ETFs are created equal. Some will come with higher costs than others, and returns on your investment will vary wildly from one fund to another.

With so many options available, it can be difficult to pin down which ETFs you should invest in. Here are some of the best options on the market today:

1. Vanguard Health Care Index Fund ETF (VHT)

  • Expense Ratio: 0.10%
  • One-Year Return: 29.89%
  • Five-Year Annualized Return: 15.10%
  • Dividend Yield: 1.42%
  • Morningstar Rating: 4 out of 5 stars
  • Top Holdings: The top holdings in the VHT portfolio include Johnson & Johnson (JNJ), UnitedHealth Group (UHC), Abbott Laboratories (ABT), Thermo Fisher Scientific (TOM), and Pfizer (PFE).
  • Years Up Since Inception: 14
  • Years Down Since Inception: 2

Vanguard is one of the best-known wealth managers on Wall Street. So, you can rest assured that when you invest in a health care ETF, or any other Vanguard fund, your money is in good hands.

The Vanguard Health Care Index Fund ETF is focused on investing in companies that sell medical products, services, equipment, and technologies using a highly diversified portfolio.

As a Vanguard fund, the VHT comes with an incredibly low expense ratio and a strong history of providing compelling returns for investors.

Pro Tip: Have you considered hiring a financial advisor but don’t want to pay the high fees? Enter Vanguard Personal Advisor Services. When you sign up you’ll work closely with an advisor to create a custom investment plan that can help you meet your financial goals.


2. Health Care Select Sector SPDR Fund (XLV)

  • Expense Ratio: 0.12%
  • One-Year Return: 23.75%
  • Five-Year Annualized Return: 13.15%
  • Dividend Yield: 1.49%
  • Morningstar Rating: 3 out of 5 stars
  • Top Holdings: The top holdings in the Health Care Select Sector SPDR Fund portfolio include Johnson & Johnson (JNJ), UnitedHealth Group (UNH), Abbott Laboratories (ABT), AbbVie (ABBV), Pfizer (PFE).
  • Years Up Since Inception: 17
  • Years Down Since Inception: 5

The Health Care Select Sector SPDR Fund is offered by State Street Global Advisors, one of the largest asset management companies on Wall Street. The firm behind this health care ETF is one with pedigree.

As a passively-managed fund, the XLV was designed to track the returns of the Health Care Select Sector Index, which provides a representation of the health care sector of the S&P 500.

As a result, the XLV ETF provides diversified exposure to some of the largest U.S. health care companies. The fund provides compelling returns and relatively strong dividends for the health care industry. As is the case with most funds provided by State Street Global Advisors, this ETF comes with incredibly low fees, far below the industry average.


3. ARK Genomic Revolution ETF (ARKG)

  • Expense Ratio: 0.75%
  • One-Year Return: 174.19%
  • Five-Year Annualized Return: 43.78%
  • Dividend Yield: 0.93%
  • Morningstar Rating: 5 out of 5 stars
  • Top Holdings:The top holdings in the ARKG ETF include Teladoc Health (TDOC), Twist Bioscience (TWST), Pacific Biosciences of California (PACB), Exact Sciences (EXAS), and Regeneron Pharmaceuticals (REGN).
  • Years Up Since Inception: 4
  • Years Down Since Inception: 2

The ARK Genomic Revolution ETF is offered by ARK Invest, yet another highly trusted fund manager on Wall Street. The ETF is designed to provide diversified exposure to companies that are working to extend the length and improve the quality of life for consumers with debilitating conditions through technological and scientific innovations in genomics.

Essentially, this fund invests in companies focused on the editing of genomes, or base units within DNA, to solve some of the most pressing problems in medical science.

With genomics being a relatively new concept that’s showing incredible promise in the field of medicine, companies in the space are experiencing compelling growth, making the ARKG ETF one of the best performers on this list.

However, it’s also worth mentioning that this is one of the higher-volatility ETFs on the list, which adds to the risk of investing.


4. Fidelity MSCI Health Care Index ETF (FHLC)

  • Expense Ratio: 0.08%
  • One-Year Return: 29.76%
  • Five-Year Annualized Return: 15.11%
  • Dividend Yield: 1.46%
  • Morningstar Rating: 3 out of 5 stars
  • Top Holdings: The top holdings in the FHLC investment portfolio include Johnson & Johnson (JNJ), UnitedHealth Group (UNH), Abbott Laboratories (ABT), AbbVie (ABBV), and Pfizer (PFE).
  • Years Up Since Inception: 6
  • Years Down Since Inception: 1

Fidelity is a massive company that has grown to become a household name thanks to its insurance division. It’s also one of the biggest and most well-trusted fund managers on Wall Street.

The company’s MSCI Health Care Index ETF has become a prime option for retail investors who want to gain diversified exposure to the U.S. health care industry.

The ETF was designed to track the MSCI USA IMI Health Care Index, which represents the universe of investable large-cap, mid-cap, and small-cap U.S. equities in the health care sector.

As can be expected from the vast majority of Fidelity funds, the FHLC is a top performer on the market with a relatively low expense ratio.


5. iShares Nasdaq Biotechnology ETF (IBB)

  • Expense Ratio: 0.46%
  • One-Year Return: 38.14%
  • Five-Year Annualized Return: 13.38%
  • Dividend Yield: 0.19%
  • Morningstar Rating: 3 out of 5 stars
  • Top Holdings: The top holdings in the iShares Nasdaq Biotechnology ETF include Amgen (AMGN), Gilead Sciences (GILD), Illumina (ILMN), Moderna (MRNA), and Vertex Pharmaceuticals (VRTX)
  • Years Up Since Inception: 15
  • Years Down Since Inception: 4

iShares has become yet another leading fund manager on Wall Street, and the firm’s Nasdaq Biotechnology ETF is yet another strong option to consider if you’re looking for diversified exposure to the U.S. health care sector.

The fund was specifically designed to provide exposure to the biotechnology and pharmaceuticals subsectors of the health care industry, and does so by investing in biotechnology and pharmaceutical companies listed on the Nasdaq.

As an iShares fund, investors will enjoy market-leading returns through a diversified portfolio of investments selected by some of the most trusted professionals on Wall Street. The IBB expense ratio is around the industry-average ETF expense ratio of 0.44%, according to The Wall Street Journal, but the fund’s expenses are justified by its outsize returns.


6. iShares U.S. Healthcare Providers ETF (IHF)

  • Expense Ratio: 0.42%
  • One-Year Return: 31.67%
  • Five-Year Annualized Return: 16.5%
  • Dividend Yield: 0.54%
  • Morningstar Rating: 3 out of 5 stars
  • Top Holdings: The top holdings in the IHF include UnitedHealth Group (UNH), CVS Health (CVS), Anthem (ANTM), HCA Healthcare (HCA), and Teladoc Health (TDOC)
  • Years Up Since Inception: 13
  • Years Down Since Inception: 1

The iShares U.S. Healthcare Providers ETF is designed to provide exposure to a different area of the health care industry. Instead of investing in companies that create treatments and therapeutic options, the IHF fund invests in companies that provide health insurance, specialized care, and diagnostics services.

To do so, the ETF invests in an index designed to track large U.S. health care providers.

The fund comes with an expense ratio that’s slightly lower than the average for ETFs, while providing performance that’s hard to ignore. While IHF isn’t the best dividend payer, the iShares U.S. Healthcare Providers ETF does provide compelling returns, making it a strong pick for any health care investor’s portfolio.


7. iShares U.S. Medical Devices ETF (IHI)

  • Expense Ratio: 0.42%
  • One-Year Return: 36.77%
  • Five-Year Annualized Return: 23.60%
  • Dividend Yield: 0.50%
  • Morningstar Rating: 5 out of 5 stars
  • Top Holdings: The largest holdings in the IHI investment portfolio include Abbott Laboratories (ABT), Thermo Fisher Scientific (TMO), Medtronic (MDT), Danaher (DHR), and Stryker (SYK).
  • Years Up Since Inception: 12
  • Years Down Since Inception: 2

The iShares U.S. Medical Devices ETF gives investors access to a diversified portfolio of stocks in the medical device subsector. Investments in the company center around products like glucose monitoring devices, robotics-assisted surgery technology, and devices that improve clinical outcomes for back surgery patients.

In order to provide this exposure, the iShares U.S. Medical Devices ETF tracks an index composed of domestic medical devices companies.

While the expense ratio on the fund is about average, its performance over the past 10 years has been anything but, with annualized returns throughout the period of more than 18%, earning it a perfect five-star rating from Morningstar.


8. iShares Global Healthcare ETF (IXJ)

  • Expense Ratio: 0.46%
  • One-Year Return: 19.93%
  • Five-Year Annualized Return: 11.51%
  • Dividend Yield: 1.27%
  • Morningstar Rating: 2 out of 5 stars
  • Top Holdings: The largest holdings in the iShares Global Healthcare ETF are Johnson & Johnson (JNJ), UnitedHealth Group (UNH), Roche Holdings (ROG), Novartis (NOVN), and Abbott Laboratories (ABT).
  • Years Up Since Inception: 12
  • Years Down Since Inception: 3

If you’re not interested in choosing subsectors of the health care industry to invest in and would rather have widespread exposure to all sectors of health care in all economies, whether developed or emerging, the iShares Global Healthcare ETF is a strong pick.

The ETF comes with an expense ratio that’s nearly in line with the industry average, but its holdings are some of the most diverse in the health care ETF space.

Moreover, the IXJ ETF is known to produce relatively reliable gains year after year, closing in the green in 12 of the past 15 years.


9. Invesco S&P 500 Equal Weight Health Care ETF (RYH)

  • Expense Ratio: 0.40%
  • One-Year Return: 27.93%
  • Five-Year Annualized Return: 13.81%
  • Dividend Yield: 0.51%
  • Morningstar Rating: 3 out of 5 stars
  • Top Holdings: The largest holdings in the RYH investment portfolio are Illumina (ILMN), Eli Lilly (LLY), Alexion Pharmaceuticals (ALXN), Abiomed (ABMD), and Catalent (CTLT).
  • Years Up Since Inception: 11
  • Years Down Since Inception: 3

Founded in 1935, Invesco is a fund manager that’s been around the block more than a few times. It’s all but expected that the firm would make an appearance in just about any “top ETF” list.

Based on the S&P 500 Equal Weight Health Care Index, the ETF provides diversified exposure to all health care stocks listed on the S&P 500. That means when you purchase shares of RYH, you’ll be tapping into a wide range of health care stocks.

In fact, the S&P 500 represents more than 70% of the market cap of the entire U.S. stock market, which is why it’s often used as a benchmark. So, by tapping into every health care stock listed on the index, you’ll be tapping into some of the highest quality U.S. companies in the space.


10. SPDR S&P Biotech ETF (XBI)

  • Expense Ratio: 0.35%
  • One-Year Return: 66.31%
  • Five-Year Annualized Return: 22.56%
  • Dividend Yield: 0.2%
  • Morningstar Rating: 3 out of 5 stars
  • Top Holdings: The largest holdings in the XBI portfolio are Vir Biotechnology (VIR), Novavax (NVAX), Ligand Pharmaceuticals (LGND), Agios Pharmaceuticals (AGIO), and BioCryst Pharmaceuticals (BCRX).
  • Years Up Since Inception: 11
  • Years Down Since Inception: 3

Another fund offered up by State Street Advisors, the SPDR S&P 500 Biotech ETF is an impressive option. While it’s the last on this list, it has also been the top performer on this list over the past year and third best performer in terms of annualized returns.

The XBI ETF was designed to track the S&P Biotechnology Select Industry Index, an index designed to track the biotechnology subsector of the health care industry. As a result, an investment in this fund means you’ll be investing in all biotechnology companies listed on the S&P 500.

Not to mention, while returns on the XBIO have been impressive to say the least, the expense ratio on the fund is below the industry average. While the SPDR S&P Biotech ETF isn’t the biggest income earner on this list, it is a strong play with a relatively consistent history of producing gains far beyond those seen across the wider market.


Final Word

Health care ETFs are a great option for investors who are interested in using their investments to create some good in the world. Not only are the top ETFs in this space known for producing incredible returns, it feels good knowing that your investment dollars are helping companies produce medications, devices, and services designed to improve quality of life and extend the length of the lives of your fellow man.

Although investing in health care ETFs is a promising way to go about building your wealth in the stock market, it’s important to remember not all ETFs are created equal. So, it’s best to do your research, looking into key stats surrounding historic performance and expenses before diving into any fund.

Nonetheless, the ETFs listed above are some of the strongest performers in the health care industry, and make a great first watchlist for the newcomer to health care ETF investing.

Source: moneycrashers.com

5 Reasons You Should Pay for a Pre-Drywall Inspection

When building a new home, there are architectural requirements along with city and state codes that the builder must follow; and while general builder inspections are required along the way, it’s still a good idea to pay for your own inspections, especially the pre-drywall inspection. 

If you’re building (or thinking about building) a new home, congratulations! Unlike buying an existing home, you get to select everything you want from top to bottom, inside and out, to create your dream home. We’re currently building our new home and recently had our pre-drywall inspection. You usually don’t hear much about these kinds of inspections, so I wanted to share with you why we did a pre-drywall inspection, and what we learned.

pre-drywall inspectionpre-drywall inspection
Our soon to be new home!

Isn’t the Builder’s Pre-Drywall Inspection Enough?

During the builder’s inspection, the builder will go over anything you added during the design process,  explain how things work, and show you where things are located inside your walls before the drywall is added. It’s the perfect time to ask questions — but what if you don’t know what to ask? This is where a pre-drywall inspection is beneficial.

Think of it as more of a pre-drywall “walk through”  and not so much of a traditional inspection. The purpose is to look at every aspect of the home, not just the pretty parts. If there are potential issues with the foundation, plumbing, electrical or roof, it’s better to address them sooner and not after signing the papers and moving in.

(READ MORE: The Pros and Cons of Building vs. Buying as a First-time Homeowner)

What the Process Looked Like for Us

We used Chad Brittingham with Cardinal Home Inspections, LLC out of Charleston, SC. The timing of this inspection was perfect because we scheduled to meet with the builder for their pre-drywall walk through a few days later.

Mr. Brittingham went through the house several times and with each pass, looked at different building aspects. The first pass involved the foundation, followed by framing, plumbing, electrical, HVAC, and the roof. We walked with him and he explained the reason for certain building items, pointed out any issues and took pictures for his report, and also took the time to explain how certain systems worked. As an inspector, his job was to comb through the fine details and find potential issues that we as buyers may overlook because we just don’t know. 

pre-drywall inspectionpre-drywall inspection
Chad Brittingham, home inspector, testing the window function.

5 Benefits of a Pre-Drywall Inspection

  1. It can address any issues: Once the drywall is installed it will be more challenging to fix any issues involving the internal items behind the drywall. Cracks in foundation, poor building materials, mold, etc., will simply be a lot harder to see later.
  2. It can check on any modifications you added during your design meeting: We added recessed lighting to some rooms, extra outlets, a security light and a few other things. But, during our pre-drywall inspection, we discovered that a few of those items were not there. It’s a lot easier to add them before the dry wall; like the builder put it, it would be like doing surgery on your house and then leaving scars!
  3. You can visualize where important pieces are in your wall: Word of advice, take pictures. When you move in and you need to find a stud, you’ll have a better idea where they are located within the wall. Most importantly, you’ll know where plumbing, gas lines, and electrical lines are located so you can avoid them before you hang anything or secure anything to your walls. 
pre-drywall inspectionpre-drywall inspection
Taking pictures before hanging drywall will help you avoid any costly repairs when affixing items to the wall.

4. It can reveal workmanship and materials: While builders have a construction manager who oversees everything, each part is handled by a different subcontractor. Getting a chance to see the work of the electrical team, plumber, roofer, HVAC, etc can not only ensure they’re not only using the proper materials, but that these systems are installed within code.

5. It can protect your investment and your peace of mind: You’ll have a written record of the issues that were found and you can document how it was fixed. This is your home that you’re spending your money on and you want to know that your home is sound. After the inspection was over, we were more confident that we picked a great home for our family.

Man bending over pointing to the floor in partially constructed house. Man bending over pointing to the floor in partially constructed house.
Mr. Brittingham pointing out construction details.

After the Pre-Drywall Inspection: Next Steps

At the end of the pre-drywall inspection, Mr. Brittingham gave us a couple items that he felt were of a greater concern to keep an eye on, but overall felt that the items he found were typical for this stage in the building process. Mr. Brittingham provided us with a full inspection report, including the items he found with pictures of areas that needed to be addressed, which I forwarded to the builder prior to our walkthrough. As the buyer, we definitely felt our inspection better prepared us for the walk through with the builder.

While the builder is bound by certain laws and codes, and their own inspections, the pre-drywall inspection we paid for independently, is acting on our behalf as the buyer. I definitely don’t believe our builder is trying to “slide anything past us,” and we did our research on the builder prior to signing. This was just one more step to further protect our investment, which will ultimately protect our family. 

Need More Home Building Advice?

Be sure to check out the Homes.com “How to Build” section, with videos and articles covering a range of topics that’ll carry you on the building journey from start to finish!


Brooke has a lifestyle blog called Cribbs Style and currently lives in Charleston, SC. This wife, mom of two almost tweens, and mom of three fur children enjoys all things DIY and organizing. When she’s not helping others tackle the chaos of life, she’s either working out, at the beach, or just enjoying time with family and friends.

Source: homes.com

Best Neighborhoods to Move to in Nashville | ApartmentSearch

High-rise building in Nashville's city.Are you thinking about making Music City your new home? With its vibrant downtown, ample outdoor space, delicious southern food, and country music galore — there’s so much to love! Whether you’re a young family on the move or a mobile, dog-loving professional, these cool neighborhoods in Nashville have a little something to offer everyone. Learn the best suburbs of Nashville and which one is right for you with this handy neighborhood guide.

The Gulch

The Gulch is the fastest-growing neighborhood in Nashville, and for good reason. Packed with restaurants, shops, bars, fitness studios, and some of Nashville’s trendiest apartments, this area attracts young professionals who enjoy being center of the action.

Nashville is also one of the best U.S. cities for dating — making this small neighborhood a prime location for singles. The Gulch is the perfect home for anyone with the “work hard, play hard” mentality. So, you’ll have tons of unique things to do and fun, young people to do them with!

12 South

This neighborhood spans half a mile along 12th Avenue South – hence 12 South. And it has become one of the most desirable places to live for young, remote-work professionals and families alike.

12 South is a highly walkable neighborhood, so you’ll find no shortage of hot eateries (like Burger Up and Urban Grub), coffee shops (like Frothy Monkey), and stylish clothing stores (like Reese Witherspoon’s own Draper James!). 12 South attracts Nashville natives and excited transplants alike, and it’s an excellent option for someone who always wants something to do or see.

East Nashville

While East Nashville isn’t as walkable as many of the other neighborhoods on this list, it has plenty of perks that make up for it. A hub for musicians and various creative types, East Nashville residents enjoy the neighborhood’s laidback, inclusive vibe and ample green space.

While some may describe East Nashville as “the hipster neighborhood,” it’s home to a diverse mix of creatives, young families, and professionals. You’ll find everything from rental houses to apartment buildings in this lively, on-trend neighborhood. But it’s likely a better option for those with their own vehicle.

The Nations

The Nations is one of the more affordable neighborhoods on this list – though, with how many people move to Nashville a day, it may not stay that way for long. This area was largely industrial only a few short years ago but is now exploding with restaurants, breweries, retail establishments, and residential developments.

Located around the central district of 51st Avenue and about 10 minutes from the heart of downtown, the Nations is an up-and-coming neighborhood that’s attracting a mostly younger crowd. This is a great place to look if you’re on a tighter budget and want all the amenities of a vibrant city. This hotspot will be on everyone’s list of cool neighborhoods in Nashville before long!

Germantown

Chock full of gorgeous, historic townhouses and tree-lined streets, Germantown has become known for its culinary scene. Boasting several critically acclaimed eateries, like Rolf and Daughters, City House, and Henrietta Red, residents of this beloved neighborhood will never go hungry.

Thanks to its location, only a few blocks from downtown Nashville, Germantown has prime access to the sports arenas, music venues, and other attractions in the city’s hub. This neighborhood manages to feel slower-paced and quieter than many other options and has a little something for everyone.

Sylvan Park

A young family looking to settle down should take a good look at Sylvan Park. Known by locals to be safe, quiet, and one of the best neighborhoods in Nashville to live, historic Sylvan Park is full of people who genuinely love their little community.

A quaint, walkable area, Sylvan Park boasts plenty of beloved, locally-owned restaurants, boutiques, and easy access to McCabe Park. Whether you’re raising little ones in Music City or simply enjoy a more residential feel, Sylvan Park is a growing neighborhood you shouldn’t overlook.

Make Your Move to Nashville with Apartment Search

Is there a Nashville neighborhood calling your name? Now that you’ve got an area picked out, explore available apartments on ApartmentSearch! Narrow your search by apartment size, rent amount, amenities, and more. Nashville can’t wait to have you home!

Source: blog.apartmentsearch.com

Do You Need Renters Insurance for Your Apartment? Pros & Cons

It’s increasingly common for landlords to require tenants to carry renters insurance coverage. That’s understandable, as renters insurance limits landlords’ liability for potentially costly mishaps, like a building visitor landing in the hospital after sustaining an injury on the premises. It may absolve them of any financial responsibility for tenant possessions damaged or lost to fire, water leaks, vandalism, and certain other events covered by the policy.

Even when it’s not mandatory, renters insurance has direct benefits for tenants. But it isn’t free. A starter policy with high deductibles and relatively low coverage limits costs in the neighborhood of $150 to $200 per year. Higher-end coverage costs $300 to $500 or more per year, according to Insurance.com. For frugal, careful renters whose landlords don’t demand coverage, that cost might be too much to bear.

Before rushing to purchase a policy you might not need or writing off renters insurance as unnecessary, take a few minutes to consider the benefits and drawbacks.

Pros of Renters Insurance

Renters insurance has some clear advantages, including possible protection from liability, discounts for bundling it with other types of insurance policies, and limited protection from negligent landlords.

1. It’s Not Limited to the Possessions in Your Apartment

When you hear the term “renters insurance,” you probably envision a policy that reimburses you for personal belongings that are lost, damaged, destroyed, or stolen within the confines of your apartment.

This is a key function of renters insurance, but it’s not all it entails. Renters insurance has three distinct components:

  1. Content Coverage. Virtually all renters who carry insurance hold a content insurance policy (also known as personal property coverage) that covers TVs, stereos, computers, furniture, and other valuable items that stay in the rental unit. Content insurance also covers items you keep in your car, provided the vehicle is registered in your name and at your address. If your car is burglarized overnight or while you’re out of town, your policy may reimburse you for the theft of any covered items within it.
  2. Liability Coverage. Renters insurance also protects you from liability issues that may arise in the course of your tenancy. If a guest sustains an injury during a fall or as a result of an accident at your home, your renters insurance policy’s liability coverage may cover the cost of a potential lawsuit, associated legal fees, and/or the guest’s medical bills. Likewise, your policy may cover the cost of fire or water damage sustained by other tenants in your building due to faulty plumbing, outdated wiring, leaky floorboards, and other hazards that originate in your unit.
  3. Loss of Use Coverage. Finally, your policy should cover (or at least provide you with the option to cover) temporary relocation and living expenses you may incur if your apartment becomes unlivable due to fire, flood, or structural damage. This is known as “loss of use” coverage.

Comprehensive renters insurance policies typically include all of these components, while lower-cost policies may exclude relocation coverage.

2. You Can Save by Bundling It With Other Insurance Policies

Your apartment likely isn’t the only thing you’d like to protect. For example, if you own a car, you’re legally obligated to carry auto insurance on it. These days, you’re also required to hold a health insurance policy. Depending on your age and family situation, you may have life insurance as well. And if you own particularly valuable items, like precious jewelry or original artwork, you may need customized policies to cover them.

The good news is that a renters insurance policy can be (and often is) bundled with other insurance types at a significant discount. Virtually every major insurer offers a multipolicy discount, or a premium discount for carrying more than one insurance policy with the same company. Since many renters also own cars, bundling rental and car insurance policies is common.

The discounts can be impressive. For instance, Liberty Mutual claims applicants can save upward of $800 when they bundle home and auto insurance policies. Other insurers offer similar discounts on a case-by-case basis.

3. It Protects You From Landlord Negligence

Imagine this: You head home from work, looking forward to a relaxing evening of eating takeout and binge-watching Netflix. But as you approach your apartment building, you realize something isn’t right. Fire trucks and cop cars surround the entrance, and a thin cloud of smoke rises from the roof.

Eventually, investigators determine that a decades-old circuit shorted out, triggering a chain reaction along some old faulty wiring that caused a fire on your floor. The building isn’t destroyed, but your apartment has been ruined by smoke and heat. Your electronics are useless, and your furniture is irreparably damaged.

Time to put your life on hold? Not if you have renters insurance. Even though this incident is clearly the fault of your landlord, you’d be on the hook for the cost of replacing your damaged possessions without sufficient renters insurance coverage. Your landlord’s insurance covers the unit’s structural components and appliances — and furniture if the place came furnished — but it doesn’t extend to anything you own.


Cons of Renters Insurance

Renters insurance has some notable drawbacks, including higher costs to cover valuable items and significant restrictions on coverage without purchasing add-ons (riders) at an additional expense.

1. Collections or Specific Valuables May Require Additional Coverage

Renters insurance covers the cost of replacing everyday personal property and equipment, but it always comes with a coverage limit. This limit may be as low as $5,000 or as high as $500,000, and it generally doesn’t cover novel or valuable possessions.

For example, if you store multiple pieces of jewelry in your apartment, your renters policy might not cover them (even a regular old engagement ring might not fit the bill). If you have extensive collections of records, stereo equipment, shoes, artwork, or even rare books, you might also be out of luck.

You can still cover these items, but it will cost you. You’ll need to purchase a rider — a supplementary policy covering specific items — or a separate, specialized property insurance policy for high-value items like jewelry. For instance, Allstate offers a scheduled personal property insurance rider that allows you to exceed its standard per-item coverage limit of $1,500 for specific named items with higher intrinsic or replacement value.

2. There Are Coverage Limits and Exclusions

If you’ve ever been in a car accident that wasn’t covered by your auto insurance policy, you know that simply carrying insurance doesn’t necessarily free you from financial or personal liability. Depending on your deductible size, you must make some out-of-pocket payments before your coverage kicks in.

Before you take out your renters insurance policy — and for as long as you keep it — you need to expend some effort to maximize the chance it will deliver when the time comes.

First, take a careful look at your coverage limits and exclusions. According to State Farm Insurance, the average renter owns personal property (property not covered by their landlord’s insurance policy) worth about $35,000. If you’re “average” in this regard, you’ll need at least this much coverage to insulate you against a total loss. It might also be a good idea to take on additional coverage if you anticipate making big purchases in the near future.

It’s crucial to mind coverage limits on specific product categories as well. You shouldn’t expect standard rental insurance policies to cover high-value items, such as $5,000 rings and $10,000 stereo systems. The cost of riders or scheduled property protection can add up quickly. To minimize the cost of a rider or supplemental policy, purchase it at the same time — and through the same insurer — as your main renters insurance policy to qualify for bundling discounts.

It’s also critical to understand what renters insurance doesn’t cover. Like homeowners insurance, rental insurance is stingy about paying for flood damage and sewer problems. If you live in an area that’s prone to flooding, ask your insurer whether you’d be covered in the event of a flood. If you won’t, look into supplemental flood insurance policies, which may be subsidized by state or federal programs.

For example, if you occupy a ground-floor or basement apartment that’s prone to flooding or damage from sewer backups, your renters policy may not cover associated cleanup costs. Your insurer should offer supplemental “sewer and drain” coverage. Ultimately, however, you’re reimbursed for a specific insurance claim may turn on events that aren’t wholly within your control.

3. “Replacement Value” Coverage Can Be Costly

When you take out your renters insurance policy, you must choose between a “replacement value” policy and an “actual cash value” policy. In the event of an accepted claim, a replacement value policy reimburses you for each lost or destroyed item’s value at the time of purchase (so be sure to save your receipts). An actual cash value policy, meanwhile, reimburses you for each item’s depreciated value.

Depreciation calculations are complex and difficult to generalize. But as a rule of thumb, electronics such as computers and TVs tend to lose most of their value within three to five years. More durable items like couches, tables, and jewelry may retain their value for longer.

4. Credit Issues Could Increase Your Insurance Costs

One of the lesser-known consequences of a bad credit score is the potential for higher rates for auto and property insurance. Renters who have solid credit scores (about 660 to 680 and up) generally pay less for comparable policies than those with suboptimal scores.

This can be a problem for renters required to carry property insurance or who seek the peace of mind that comes with coverage. Of course, you’re free to reapply for coverage as your credit score improves, but in the meantime, you’re stuck paying more.

5. Potential Caps on Reimbursements for Temporary Living Expenses

Many insurance companies place a dollar cap or time limit on reimbursements for temporary living expenses. Suppose it takes four months after a fire to restore your apartment to a livable condition, and your renters insurance policy only covers relocation expenses for two months. In that case, you’ll need to pay out of pocket for the other two months of living expenses.

In other words, it’s probably best to assume your renters insurance policy won’t cover every single expense that arises out of an unfortunate circumstance. Having a healthy emergency fund saved up is one way to keep unexpected costs like this from derailing your finances.


Final Word

Choosing to purchase or forgo renters insurance is not a decision to make lightly. Nor is it a decision to agonize over and blow out of all proportion. If your renters insurance cost-benefit analysis has you at an impasse, consider this: You stand to save far more each year by moving to a more affordable city for renters than by doing without renters insurance.

In the grand scheme of things, peace of mind is relatively inexpensive.

Source: moneycrashers.com

Should You Use A Home Equity Line To Buy An Investment Property?

The lure of real estate investing has long since grabbed the attention of many people. The potential for wealth building, financial freedom, and retirement planning are all notable benefits of real estate investing. However, one of the trickiest parts of purchasing investment properties is financing. While there are multiple avenues & strategies available, often accumulating the cash needed for the initial investment is one of the biggest hurdles. One option available to alleviate this problem is a home equity line of credit, sometimes called a HELOC. Simply stated, a home equity line of credit is borrowing against the equity in your current home.

According to BankRate, “To figure out how much equity you have, subtract the amount you still owe on your mortgage from the value of your house. The difference is the amount of the equity, and part of that can be used as collateral for a loan.” Rather than sitting on the equity in your current home, a HELOC allows you to utilize that equity- in the form of purchasing an investment property, paying down outstanding credit, or financing home repairs. A HELOC can be a good alternative to traditional financing; however, it’s important to understand the full picture before cashing out the equity in your current home.

Should You Use A Home Equity Line To Buy An Investment Property?

HELOCS Are Not Traditional Home Loans

Unlike applying for a conventional or FHA loan, a HELOC is borrowing your current equity in your home.  You can borrow some or all of the equity in your home, and the specifics of the HELOC can vary bank-to-bank. According to Dawn Doebler, co-founder of Her Wealth & Senior Wealth Advisor at The Colony Group, “The interest rate is variable and you’re only charged interest on the amount outstanding…HELOCs can be a better choice than traditional loans for short-term projects or for unexpected cash needs.”

HELOCS Can Provide Access To Cash For Multiple Purposes

Again, unlike FHA, RD, or conventional loans, a HELOC can be used for more than acquiring real estate. Some people even utilize home equity to pay down substantial debt, finance a home remodel, pay for kids’ college education, or even finance long-term care. The flexibility that comes with a HELOC is attractive to many wanna-be investors, as they can avoid inspections & oversight that accompany construction type loans. However, it’s important to fully understand the bank’s fine print, requirements, payback schedule, and interest rate.

There Is More Than One Type

A HELOC is a home equity line of credit. However, there is another equity loan available: a home equity loan. According to Dawn Doebler, the primary difference is “A home equity loan is disbursed all at once in a lump sum at a fixed interest rate for a fixed amount of time, usually 10 years or longer. By contrast, a home equity line of credit is more like a credit card. The interest rate is variable, and you are only charged interest on the amount of the credit line that is outstanding.” Depending on your goals and timeline, one option may be better suited to your needs. It’s important to consult thoroughly with your lender to see which option is the best fit for you.

Read The Fine Print Before You Sign

As with any type of loan, there are risks. Knowing your financial capabilities and income forecast is crucial. In addition, knowing the specifics on the loan payback is also important. Most HELOCs are variable rates, and depending on the current rates, can either be good or bad. In addition, most home equity loans offer a certain time period in which the loan & interest must be paid. You also should understand that the with a HELOC or home equity loan, your home is being used as collateral in most cases to secure the loan.


Jennifer is an accidental house flipper turned Realtor and real estate investor. She is the voice behind the blog, Bachelorette Pad Flip. Over five years, Jennifer paid off $70,000 in student loan debt through real estate investing. She’s passionate about the power of real estate. She’s also passionate about southern cooking, good architecture, and thrift store treasure hunting. She calls Northwest Arkansas home with her cat Smokey, but she has a deep love affair with South Florida.

Source: homes.com

Welcome to Hollyweed: Luxury Real Estate Developer Starts Building Weed Mansions for Celebrities and Athletes


When California made recreational marijuana use legal at the beginning of 2018, the state turned itself into what many have called the country’s largest pot market. And while talks of a pot-powered real estate boom had already started, they were mostly centered around the industrial and retail sectors. On the residential end, most of them revolved around regulating marijuana use among tenants.

But one savvy real estate developer knew to look for better opportunities.

Ramtin Ray Nosrati of Huntington Estate Properties is building what the media has now coined “marijuana mansions” — custom-built homes with dedicated cannabis smoking rooms and a few other nifty perks for weed lovers.

“I’m always looking for something new to bring to our homes, to the market. Something different and something unique. I think this is something that within the next ten years we’re going to start seeing a lot more of,” Huntington Estate Properties founder Ramtin Ray Nosrati told mgretailer. “Adding this to our high-end homes, we feel that it’s going to be a pretty big hit. The guys that we’re dealing with are, you know, are CEOs, musicians, a lot of celebrities, and athletes. It’s getting more popular,” Nosrati added.

And right he is. Athletes in particular have been famously taking advantage of the pain-relieving effects of marijuana, while celebrities — from former president Barack Obama to real-life Tony Stark — have been fairly open about their weed-smoking habits. And that’s exactly the demographic Huntington Estates Properties is going after.

Weed mansions – Featuring cannabis rooms and professional growers

marijuana-mansions-los-angeles
Image credit: Ramtin Ray Nosrati

The first custom built home is slated for completion in Fall of 2019, and will likely be priced in the $30 million range, according to the developer.

Designed and built by Ramtin Ray Nosrati, the founder and man behind Huntington Estate Properties, each home will come with its own cannabis room and organic garden.

The cannabis rooms were envisioned as a modern equivalent of cigar rooms, where owners can also grow up to 6 plants, California’s legal limit for homegrown plants. And if you haven’t upped your weed gardening skills, that’s okay: when you buy a weed mansion, you’ll also be getting two years’ worth of professional gardening services.

There’s even a dedicated cannabis garden space — that can be easily converted into an organic veggie garden, if weed isn’t really your thing.

renderings-marijuana-mansions-los-angeles
Image credit: Ramtin Ray Nosrati

More celebrity homes:

David Guetta’s New $9.5M Miami Beach Apartment Finishes Redesign, Now Ready to Welcome Renters
Robert Downey Jr. Lives in this Charming Windmill House in the Hamptons
Shaquille O’Neal’s Longtime Home — and Shaq-apulco Paradise — Now on the Market for $22M
A Look Inside Kris Jenner’s House, Her Zen-like Refuge in the Hidden Hills

Source: fancypantshomes.com

Blanket Mortgage Loans – Definition, Pros & Cons of Using for Real Estate

For real estate investors, juggling multiple property deals and loans can get complicated.

Blanket loans often help simplify matters. Borrowers take out a single loan to cover multiple properties.

Even so, blanket loans come with their own quirks and have their pros and cons. Before entering into a blanket loan as an investor, make sure you understand exactly what you’re getting yourself into.

What Is a Blanket Loan?

A blanket loan is simply one loan that attaches to several real estate investment properties.

For example, if you buy a portfolio of five properties, a blanket loan allows you to take out one mortgage that covers all five buildings. The lender attaches a lien against each property, so if you default on your loan, the lender can foreclose on all five properties to recover their money.

Lenders do typically include a release clause, allowing the borrower to sell individual properties held as collateral as part of a blanket loan. However, they require the borrower to either repay a portion of the loan at the time of sale or put the money toward another investment. The lender then attaches a lien to the new investment property as a replacement for the sold collateral property.

That keeps their collateral — your remaining properties secured by the blanket loan — sufficient to cover their loan risk.

Who Takes Out Blanket Loans?

Blanket mortgages are exclusively for real estate investors and developers, not homeowners.

Investors can use blanket loans in many ways to invest in real estate. Landlords can take out a blanket mortgage to buy a portfolio of turnkey rental properties, as outlined above. Flippers could do likewise, to buy several fixer-uppers to renovate and flip, all with one loan. As they sell off properties, they typically repay a proportion of their loan.

Real estate developers use blanket loans to buy large swaths of land that they plan to subdivide into many units. As they build and sell off those units, they can either repay portions of the loan or put the money toward adding more properties to the portfolio.

Businesses with multiple locations and commercial properties can also use blanket loans. That could mean refinancing multiple existing loans into one blanket loan, or using a blanket loan to buy several new locations in one sweep.

When You Should Use a Blanket Mortgage

As touched on above, you can either use a blanket loan at the time of purchase or you can refinance to consolidate multiple mortgages into one loan.

It makes sense to use a blanket loan at the time of purchase if you plan to buy multiple properties simultaneously. You may also be able to negotiate staggered funding if you buy multiple properties in rapid succession but not quite simultaneously.

Another possibility with blanket mortgages includes buying only one new property, but securing the loan against other properties you own for additional collateral. Real estate investors sometimes do this in lieu of making a down payment on the new property.

For example, say you own a property worth $100,000, but you only owe $50,000 on it. You want to buy another property for $100,000, and the lender demands a $20,000 down payment.

Rather than cough up the $20,000 in cash, you offer your existing property as additional collateral for the new mortgage loan. The lender agrees to fund the full $100,000 for you to buy your new property, but puts liens on both properties. They now hold the first (and only) lien against your new property, and they have a second lien against your old property.

Advantages of Blanket Loans

Blanket mortgages come with several upsides for real estate investors.

To begin with, they can save on lender fees and settlement costs by holding one combined closing rather than having to pay separately for several. Lenders charge flat fees in addition to points, and those flat fees add up quickly. Title companies also charge many flat fees for each closing. With blanket loans, borrowers can pay those flat fees once, rather than at each settlement.

Aside from saving money, combining financing for several properties into one loan can also keep your finances and cash flow simpler. Rather than keeping track of 20 mortgage payments and loans, you need only track one or two.

When buying new properties, blanket mortgages can potentially reduce or eliminate your down payment if you use equity from an existing property for a cross-collateralized loan. Consider it one more way to pull equity out of your properties — and one that doesn’t require a totally separate settlement with its attendant costs.

Larger loans often mean more negotiating room for you as the borrower as well. Lenders don’t need to charge as many points on a $1 million loan to make it worth their while, compared to five $200,000 loans. Similarly, borrowers can often negotiate lower interest rates as well.

Downsides of Blanket Loans

Blanket mortgages come with their share of risks and disadvantages.

To begin with, it can be hard to find lenders that offer these loans. Up to this point in your real estate investing career, you may have established relationships with two or three lenders — none of whom might offer blanket loans. That forces you to go out and build new relationships with lenders who do.

Expect more intensive scrutiny by the lender for these larger, more complex loans. Rather than using a garden variety underwriter, bank managers might underwrite these larger loans themselves. Lenders might ask more probing questions and require more extensive documentation and paperwork from you. They may require higher credit scores than their typical loan products.

Blanket loans often come with shorter loan terms than traditional mortgage loans. Rather than the 25- or 30-year loan terms you’re used to, lenders often limit blanket loans to 10 to 15 years. That could come in the form of a balloon payment, or the loan could be entirely amortized over those 10 to 15 years. In the case of short-term amortization, that means higher monthly payments.

Finally, blanket loans pool your risk for many properties into a single loan. If you default on that loan, you could lose all the properties secured by it to foreclosure, not just one. In contrast, if you hold separate loans for each property, in a crisis you could isolate your losses to one property as long as you can afford to make your other monthly payments.

Where You Can Borrow Blanket Loans

Conventional mortgage lenders don’t typically allow blanket loans. Commercial lenders, portfolio lenders — who keep loans on their own books rather than selling them — and hard money lenders often do allow them.

Make no mistake, these lenders usually charge more than your personal home mortgage lender. But they also allow far more flexibility, and as a real estate investor, that flexibility is often necessary.

Call up your local community banks to ask whether they offer blanket loans for real estate investors. You can also reach out to portfolio lenders such as Lending Home and Rental Home Financing to inquire about them. For commercial loans, make sure you choose a commercial lender, because even many portfolio lenders only handle residential (single-family and 2-4 unit multifamily) properties.

Word to the wise: start building these connections now, before you actually have a time-sensitive deal on the line. Real estate investors need to be able to move fast and close deals quickly, else they risk losing the deal entirely.

Final Word

The average mom-and-pop property owner with a couple units on the side of their full-time job will probably never need to take out large blanket loans. But for real estate developers and full-time real estate investors, blanket loans can help them scale their investment portfolios faster and cheaper.

Start expanding your network of lenders now, before you have a hot deal at risk of falling through. Think in terms of building a financing toolkit of many different options for buying your next investment property — or portfolio of properties.

Source: moneycrashers.com

10 Best Artificial Intelligence (AI) Stocks to Buy in 2021

Technology has made amazing leaps and bounds over the past decade. Among recent innovations like autonomous vehicles, machine learning, and Bitcoin, artificial intelligence (AI) is a major force that’s changing the way the world works.

Today, some of the world’s largest companies are using chatbots to provide faster, more accurate customer service, detailed algorithms and deep learning capabilities are leading to better outcomes in health care, and cloud computing has changed the way data is stored, served, and used.

These innovations have made the world a different place, and have made many investors fifthly rich in the process.

Wise investments in tech companies like Amazon.com, Google (now Alphabet), and Microsoft in the early 2000s would have yielded returns of more than 4,800%, 3,200%, and 320% respectively. These are among the major players in AI and cloud computing, making them some of the strongest AI stocks today.

But in a market that’s becoming saturated with many artificial intelligence stocks, choosing the best investment opportunities in the space may be a daunting task. So where do you start?

Pro tip: Earn a $30 bonus when you open and fund a new trading account from M1 Finance. With M1 Finance, you can customize your portfolio with stocks and ETFs, plus you can invest in fractional shares.

Best AI Stocks to Buy for 2021

When looking for strong opportunities in the artificial intelligence industry, it’s important to look for companies on the leading edge of innovation. As we saw with the once-king of the smartphone, BlackBerry, and the once-king of social media, MySpace, when companies in tech fail to innovate, they get bulldozed by the competition.

It’s also important to look into how these companies are actually implementing their AI technology and the market potential that comes along with their applications.

As is the case in any industry, each company has its own history, risks, and potential future. So, it’s important to do your research and make wise investment decisions when diving into the space.

Some of the best AI stocks on the market today include:

1. Amazon.com (NASDAQ: AMZN)

The brainchild of Jeff Bezos, Amazon.com is one of the biggest success stories that has ever taken place in the stock market. The stock traded at just $1.73 per share 23 years ago, and few had faith that it would ever become anything worthwhile.

By early 2015, the stock was trading at around $300 per share, and there were still plenty of naysayers. Bezos seemed to be on a spending spree as he piled on debt to build out a world-leading infrastructure.

Then something amazing happened. That expensive infrastructure gave Bezos the edge that led it to become the biggest e-commerce company in the world. The company was already the go-to online shopping experience before the COVID-19 pandemic, got a major boost as coronavirus kept people indoors, and continues to see rapid growth in revenue and earnings, as well as interest from investors.

So, what does a massive e-commerce company have to do with artificial intelligence? Everything!

As a major player in tech, the company realized early on that AI would be the way of the future, and it became one of the first online stores to incorporate the technology into the shopping experience. It’s the technology that leads to suggestions as you shop, makes it possible to predict what you’re looking for as you type into the search bar, and connects related products often purchased together to build an unmatched shopping experience for consumers.

But this tech conglomerate is far more than just an e-commerce play. The company is incorporating artificial intelligence into products for various industries.

AI Applications

Aside from running major features of the company’s e-commerce shopping experience, Amazon uses AI technology in several other applications; primarily:

  • AWS. Amazon Web Services (AWS) is the company’s cloud computing service, the type of service that hosts artificial intelligence programs. AWS is a cloud computing powerhouse, dominating the industry with control of over 30% of the global market.
  • Alexa. Alexa is the company’s well-known artificial intelligence assistant. The voice behind the Amazon Echo family of products, when paired with compatible devices, Alexa can turn lights on and off, close and open smart blinds, make phone calls, and perform a vast array of other tasks, bringing AI and automation home, quite literally.
  • Autonomous Driving. Through its AWS product, Amazon offers a full suite of cloud computing services specifically designed to address the challenges of making advanced driver assistance systems and autonomous driving possible.

Considering the company’s dramatic growth since inception, its proven ability to stay ahead of the curve in innovation, its impressive use of AI technology, and the dominance of its core e-commerce business, AMZN stock is one for the watchlist.


2. Alphabet (NASDAQ: GOOG | GOOGL)

Alphabet originally started as Google, a company so important in American and global culture that it became both a noun and a verb — to Google something is synonymous with searching for it online. Very few companies have ever achieved this kind of brand awareness.

Google has long been a player in the artificial intelligence space. One could argue the company laid the groundwork for modern AI with the algorithms it has been creating for its search engine since its inception.

As you might imagine, AI is part of just about everything the company does today. It’s the reason you receive relevant ads when you use Google Search, how the search bar knows what you’re typing after you’ve entered just a handful of letters, and how you receive relevant localized results for businesses near your location.

But, like Amazon.com, the company is far from a one-trick pony.

AI Applications

Alphabet changed its name from Google as it entered into several industries, where it incorporates the power of AI technology. Some of the most impressive include:

  • Autonomous Vehicles. The company was one of the first to explore the possibilities of autonomous driving. The company plans to use this technology to gather data for Google Maps and Google Earth with driverless cars and provide disabled consumers a safe way to travel. For example, the company’s autonomous driving capabilities appeared in a video in 2016 in which a blind man used a Google vehicle to get around.
  • Health Care. Alphabet is also using its AI capabilities as a means to better outcomes in the health care space. The company has already demonstrated its AI detects breast cancer more accurately than standard testing procedures, has received FDA clearance for a smartwatch for arrhythmia monitoring, and used its AI to provide communal data during the COVID-19 pandemic.
  • Advertising. You can’t mention Google without mentioning advertising. It’s the leading player in the space and advertising revenue represents the lion’s share of the company’s top line. The fact is the company wouldn’t be a leader in the advertising space if it wasn’t for its artificial intelligence technology. Through this technology, the company is able to show more relevant ads, resulting in higher click-throughs and sales for advertisers and a better experience for the end user.

Over the past couple of decades, the company has proven an ability to dominate any space it touches. With a history of consistent growth and an ability to stay ahead of the competition in terms of innovation, GOOG stock is one to pay close attention to.


3. Apple (NASDAQ: AAPL)

Apple is another household name. The company is the maker of smash-hit technology products like the iPhone and iPad. Its innovation and continued dominance in the mobile devices space is what makes the company the massive success it is today.

The smartphone pioneer was one of the first companies to put artificial intelligence into the hands of everyday people with Siri, an AI assistant that comes installed on every iPhone and iPad. Consumers can ask Siri questions, have the AI solve riddles, and even have the intelligence write out texts and make phone calls.

Just about anything that can be done on the iPhone can be done through Siri. However, Siri isn’t the company’s only application of AI technology.

AI Applications

  • Autonomous Vehicles. Apple is yet another massive tech company that’s working on the future of transportation: self-driving cars. The company is actively working to develop the Apple car. When it hits the market, the car is expected to be a fully electric vehicle capable of driving itself and providing quality entertainment during your ride.
  • Facial Recognition. The company was also one of the first to incorporate artificial intelligence technology into the way you unlock your phone, with the iPhone being one of the first smartphones to provide facial recognition features.
  • Sleep & Fitness Tracking. The tech giant also uses its AI technology in the health care space, with sleep and fitness tracking built into the Apple Watch.

Apple has proven its dominance through the years and continues to do so. It only makes sense that the company is staying on top of innovation as artificial intelligence leads to yet another pivotal shift in the way people do just about everything. Moreover, this leadership and innovation makes the stock a great pick for the tech stock investor.

Pro tip: Before you add any stocks to your portfolio, make sure you’re choosing the best possible companies. Stock screeners like Trade Ideas can help you narrow down the choices to companies that meet your individual requirements. Learn more about our favorite stock screeners.


4. Microsoft (NASDAQ: MSFT)

If you haven’t heard of Microsoft, chances are you live under a rock. The company is a leading player in software and dominates the computer operating system space. According to Statista, the company controls more than 76% of the global operating system market.

We’re talking about the company behind Windows and the Microsoft Office suite of products, including Word, Excel, PowerPoint, and Outlook.

As a leading player in the technology industry, Microsoft is also leading the way in artificial intelligence innovation. AI is used in just about every piece of software developed by the company, driving better user experiences than its competitors and keeping the company in the leading position.

The tech pioneer isn’t just using AI in its software offerings; the company’s activity in artificial intelligence spreads into multiple areas of tech.

AI Applications

While the company’s use of artificial intelligence in its own software keeps it in the leadership position, the company is incorporating its AI in various applications, including:

  • Cloud Computing. Microsoft is a big player in the cloud computing space. Its cloud computing platform Azure is second only to Amazon Web Services in terms of market share.
  • AI Classes. Knowing that building a community solidifies its leadership in the AI space, Microsoft hosts an AI school, bringing new talent into the community every day.
  • AI for Good. The company is also the pioneer of the AI for Good movement, which is designed to use AI as a tool to overcome humanitarian, environmental, accessibility, cultural heritage, and health challenges.

Microsoft has a strong history as a solid performer in the stock market. This history and likely future gains are the result of the company’s ability to consistently innovate, bringing cutting edge solutions to consumers and businesses. This trend is likely to continue along with the AI revolution, making MSFT stock an investment worth consideration.


5. NVIDIA (NASDAQ: NVDA)

Artificial intelligence wouldn’t be possible without advancements in microchips and graphics processing units (GPUs). These top-of-the-line technologies are used in the data centers that house the cloud and keep artificial intelligence alive. In essence, they can be thought of as vital organs for artificial intelligences.

This is where NVIDIA thrives.

The chip maker is a dominant player in the GPU space. According to WCCF Tech, the company controls 82% of the discrete GPU market as of the fourth quarter of 2020. That’s a massive statement, showing that the company has created a balance between cost and effectiveness, providing top-notch GPUs at reasonable pricing and attracting the vast majority of its target market.

AI Applications

NVIDIA’s most prominent application of AI technology is the use of its GPUs in the data centers that make up the heartbeat of today’s AI. The company also is involved in AI in other areas, including:

  • Intelligent Machines. The company’s GPUs and other technologies provide the framework needed for intelligent machines like autonomous vehicles and robotic surgery technology.
  • Improved Communication. NVIDIA researchers have found a way to use artificial intelligence to greatly reduce the bandwidth needed to make video calls while simultaneously improving quality and reducing latency.
  • Breakthroughs. According to Forbes, NVIDIA chips have been used in nearly every major artificial intelligence breakthrough, from detailed graphics in video games to self-driving cars.

Artificial intelligence wouldn’t exist without graphics processing units, and without NVIDIA, they may have never been invented. Since the introduction of the technology, NVIDIA has continued to innovate, maintaining a growing and controlling share of its market. As the AI industry grows, it only makes sense that the company will continue to grow, making it a strong investing opportunity.

Pro tip: Before you add any stocks to your portfolio, make sure you’re choosing the best possible companies. Stock screeners like Trade Ideas can help you narrow down the choices to companies that meet your individual requirements. Learn more about our favorite stock screeners.


6. IBM (NYSE: IBM)

Just about everyone has heard of International Business Machines by its acronym, IBM. Throughout its history, the company has centered itself around providing top-of-the-line technology to businesses to improve productivity while reducing costs.

It’s done a great job of doing so too, and in the process IBM has grown to a market cap of more than $110 billion.

As the business environment changes and new tools become available, the tech giant has worked to stay ahead of the curve. As the AI industry started to bring new, more effective solutions to businesses, IBM jumped all over the opportunity.

AI Applications

Like just about every other company on this list, IBM uses artificial intelligence technology in a wide array of applications, including:

  • Watson. Named after IBM founder Thomas J. Watson, Watson is an artificial intelligence designed to answer questions. The AI is capable of answering questions posed in natural human language, one of the first AIs with this capability.
  • Watson for Business. Once Watson became capable of answering questions, the company continued to work on the AI to make it a perfect tool for business owners. Today, Watson for Business can be used to discover and solve inefficiencies in just about any process.
  • Watson Health. Finally, Watson Health is quickly becoming an important aspect of clinical trials during the development of new therapies that address some of the world’s most challenging medical conditions.

Throughout IBM’s history, the company has been a leader in technology, specifically aimed at providing efficiencies in the business process. With such a strong history, it’s hard to imagine the future would be any less fruitful as the company continues to grab the AI bull by the horns and bring solutions to some of the most challenging problems in business today. All told, IBM is a stock that’s well worth your attention.


7. Baidu (NASDAQ: BIDU)

A leading technology company in China, Baidu is making a splash among American and other investors around the globe, and for good reason. The company is essentially China’s version of Google, which poses an incredible opportunity.

China is an emerging market that’s evolving quickly. As a result, investments in thoughtfully chosen Chinese stocks are proving to be fruitful. With Baidu leading the way in Chinese innovation in Internet services such as search and advertising, as well as artificial intelligence, it is a clear leader within this emerging economy.

As with Google, the Chinese online search leader uses artificial intelligence to provide quality search results as well as advanced advertising capabilities. Moreover, the company also uses artificial intelligence in several other applications.

AI Applications

While Baidu uses artificial intelligence in online search and advertising, it’s not a one-trick pony. Some other ways the company applies AI technology include:

  • Brain. Brain is the leading AI open platform in China. The platform has more than 220 capabilities and is used by more than 1.5 million AI developers.
  • Little Fish. Little Fish is Baidu’s artificial intelligence for consumers, and like Amazon’s Alexa, consumers can purchase Little Fish units to bring artificial intelligence into their homes.
  • Home Assistance Robots. Finally, Baidu is actively working to develop home assistance robots that will help with menial tasks around the house.

Baidu is a massive company and a clear leader in the Chinese AI and online services markets. Considering how quickly the Chinese economy is emerging, and the fact that there’s still a vast audience for the company to tap into as the economy grows, BIDU is a clear choice for any tech and AI investor’s portfolio.


8. Netflix (NASDAQ: NFLX)

When you think of Netflix, AI may not come immediately to mind. After all, the company is a video streaming service — albeit a leading streaming video service, but a streaming video service nonetheless.

So, what is Netflix doing that makes it worthy of inclusion in a top artificial intelligence stocks list?

Netflix isn’t working to solve some of the world’s most pressing health or social challenges. It’s not a company that is using AI in various applications and industries. The company’s aim is simply to provide the best home entertainment experience possible. However, it’s doing a great job of using artificial intelligence technology to do just that.

Netflix uses machine learning technology to create custom lists of video content that you might enjoy based on what you’ve watched in the past. The company also uses artificial intelligence to choose the thumbnails that are most likely to lead to clicks when displayed in browsing screens.

All told, the company’s use of artificial intelligence is a major reason for its leadership in the highly-competitive streaming video industry. According to Business Insider, Netflix controlled about 34% of the streaming video market share as of the fourth quarter of 2020.

With a leading position in a highly competitive industry, Netflix is obviously doing something right. As it continues to use AI to create a more compelling user experience, growth is likely to continue, making Netflix a strong stock to consider for your portfolio.


9. Salesforce.com (NYSE: CRM)

Salesforce.com isn’t exactly a household name. But if you’re a business owner, chances are you’ve heard the name. The company’s claim to fame is its customer relationship management (CRM) software.

Through the use of the company’s software, companies are able to streamline the workflow, ensuring customer satisfaction while taking advantage of every reasonable opportunity to upsell.

As artificial intelligence became available, Salesforce.com jumped on the opportunity to incorporate it within its services. As a result, the company’s customer relations management software has stayed ahead of the curve, dominating with over 19% of the market share according to Forbes.

Salesforce.com developed an artificial intelligence known as Einstein. Einstein provides intelligent case classification, making it possible to get more done in a shorter amount of time. It also assists in the provision of more personalized customer service and streamlines sales through deep learning capabilities.

As Salesforce.com continues to use artificial intelligence to streamline sales, customer support, and lead generation, it will continue to be an integral tool for businesses of all sizes moving forward, allowing it to capture more and more market share and making it an investment that’s hard to ignore.


10. Tesla (NASDAQ: TSLA)

Tesla is a household name in transportation. The company is known for its electric vehicles and its eclectic founder and CEO, Elon Musk.

So, what is an electric car manufacturer doing on the list of the top AI stocks?

Like Salesforce.com and Netflix, Tesla isn’t in a rush to use artificial intelligence to solve a wide array of problems. Instead, it’s focus is more singular: to provide a safe, reliable, clean, and enjoyable driving experience.

To do so, the company has incorporated artificial intelligence into its vehicles through the use of its Autopilot AI. All the company’s new vehicles come with driver assistance capabilities.

Interestingly, AI has created a network through its vehicles, collecting data from each and mapping that data to create an improved driving experience for all. Moreover, this data collection will make the company’s vehicles safer and more efficient when the company begins mass producing fully autonomous versions of its vehicles.

Tesla is by far the leader in high-tech vehicles, and there’s no sign of that changing any time soon. As the company continues to use AI to provide a safer and more enjoyable traveling experience, its vehicles will continue to be met with high levels of demand, making it a stock that should be paid attention to.


Final Word

Artificial intelligence can be seen all around you. Chances are you have it in your home either through smart-home technology, smart-television technology, or simply on your cellphone. This technology is changing the way people treat illnesses, work out, connect with others, and run businesses, and it’s generating massive profits for the companies on the leading edge of innovation in the industry.

The stocks listed above are some of the strongest players in the AI industry as it stands today, and they provide compelling opportunities for significant growth ahead.

As is always the case, before making any investment decisions, it’s important to do your research. Investing without research is akin to gambling and will likely result in significant losses. Nonetheless, if you take the time to research opportunities in AI and make well-thought-out investment decisions, the potential returns can be mind boggling.

Disclaimer: The author currently has no positions in any stock mentioned herein nor any intention to hold any positions within the next 72 hours. The views expressed are those of the author of the article and not necessarily those of other members of the Money Crashers team or Money Crashers as a whole. This article was written by Joshua Rodriguez, who shared his honest opinion of the companies mentioned. However, this article should not be viewed as a solicitation to purchase shares in any security and should only be used for entertainment and informational purposes. Investors should consult a financial advisor or do their own due diligence before making any investment decision.

Source: moneycrashers.com