Posted by Dan on July 05, 2001 at 16:31:50:
If you find a good deal,investors will be breaking down the door to get to you.I have investors that I work with.Just put a ad in the paper.The lowest that I ever made on a wholesale flip was $2000 and the highest was $14,000.wholesaling is just another tool in your toolbox.I also rehab,L/O,buy subject to.
Not as easy as you think! - Posted by Greg
Posted by Greg on June 29, 2001 at 07:40:41:
Real Estate investing is not a get rich quick program. When you see people on T.V. claiming they made all this money well there is probably a 1 in 1000 chance you are going to make some money. There are lots of people doing what you and I are doing. I have been to dozens of houses, sent hundreds of letters, talked to lots of people, sheriffs sales and found out that “most” people are not willing to sell their house to you regardless of what creative way is presented. Most people rather file bankruptcy, ruin their credit and keep their house. Or the properties has so many liens against it is not profitable. Or the homeowner just dont care and let the house go to the sheriffs sale, then you have to compete with 50,000 other people trying to make some $. I am not going to give up because I know everyone is not going to file for bankruptcy. “Keep hope Alive” Any suggestions?
Re: Not as easy as you think! - Posted by True
Posted by True on July 01, 2001 at 09:59:02:
Yep. It is not a get rich quick thing. Anyone that says it is…is full of it. Hard work.
Re: Lots of deals out there. - Posted by Dan
Posted by Dan on June 30, 2001 at 09:50:32:
Ya,your right.There are no houses out there where you can make lots of money.I’m glad most people think this way,because why your saying it can’t be done,I’m getting great deals.I bought 3 last month. 1st deal-no money down.Its a 3/2/1 in a great area.It needs $3000 in repairs and comps out at $72,000.I paid $35,000 for it-hard money.–2nd deal 4/1/1.Wholesaled 2 hours after I bought it for $2500–3rd deal 3/1/1 needs $4000 in repairs,comps out at $40,000.I paid $5000 for it.
Re: Not as easy as you think! - Posted by Stu Silver, R.W.Trainer
Posted by Stu Silver, R.W.Trainer on June 30, 2001 at 09:03:28:
Greg,
I know exactly how you feel. It sounds like you mainly work foreclosures, and profitability in foreclosures goes thru cycles.
Sometimes in foreclosures there are unbelievable profits, too many deals to buy, and little competition. This happened in 1991 and 1992. Other times, like right now in Florida, there are tight profits, few deals, and too much competition.
I had to learn to keep abreast of several different types of real estate profit centers in order to survive. Perhaps you will too.
In 1997, the crowd was running to houses, and houses became unprofitable, so I ran to land, and got it at great discounts, with owner financing. In the last two years, I sold off my land, because the crowd was buying now and ran up the prices. Granted land has negative cash flow, but I learned how to split it up and sell off pieces so I could carry it for a few years and not get hurt.
Last year, I jumped into tax deeds, because there was little competition, and lots of deals. This year, the competition stepped up on tax deeds, so I’m out of tax deeds and into beat up warehouses.
Beat up warehouses are a great profit center now in my area. I am buying them for no money down (and taking out cash at closing because of commissions from my real estate license.), fixing them up, and renting out for positive cash flow. I rent at half the rates of new warehouses, which the crowd is running to buy. I expect the crowd will soon run to buy beat up warehouses, and I will be selling then, or raising my rents, and be off to some other investment in real estate.
The best advice I can give you is to feed your mind, and look into other areas of real estate for profits.
And try to be ahead of the crowd, not behind it. Usually that means buying what others are afraid of, and knowing how to solve the problems they are afraid of.
Stu Silver, CCIM
Lead Trainer at Russ Whitney’s Millionaire U
Re: Not as easy as you think! - Posted by Ray
Posted by Ray on June 30, 2001 at 06:30:42:
Mr Starr’s post is dated June 20 and titled “How to get rich”. If your new and have been listening to the sellers of books, tapes, and other “Get Rich Quick” Gurus, do yourself a favor and read Mr Starr’s post. Not only read it, but stop and think what it means…what you have “to bring to the table”. Everyone has something, no matter how bad off you think you are. Find that “something”, and hopefully, your on your way. Ray
Re: Not as easy as you think! - Posted by DaveIL
Posted by DaveIL on June 29, 2001 at 23:26:15:
Greg,
The biggest thing I would have to say is don’t get discouraged. Slow and steady wins the race. I, by far, am not a seasoned rei, but I have been doing my homework and realized a while ago that you have to look down different avenues to find your niche. The other thing that is important is who you know. I have a group of people working with me to get what and where I need. You need people that will bend over backward to help you and of course you need to do the same for them. The old I’ll scratch your back theory. Remember that you will have to incur some risk, but risk is only what you make of it. If you know what you are doing and you do your due diligence, then the risk is reduced.
You said you have tried different things, sherif sales, bankruptcy etc… have you spoken to realitors, title complanies, banks? Have you considered rental units? As I said it is very much who you know and what you know. let others help you to the top, it makes for an easier climb.
good luck.
daveIL
Re: Not as easy as you think! - Posted by Ronald * Starr
Posted by Ronald * Starr on June 29, 2001 at 14:26:06:
Greg------------
You’ve just described reality. Yes, if it were as easy as Carlton and like make it seem, everybody would be rich. Or fighting each other for every dollar of equity.
I posted on this C.S. forum (and on the main forum) about 1 1/2 or 2 months ago my recommendations for the beginning investor. It is a pretty long post and may be of some benefit to you.
Good Investing and Good Studying***Ron Starr
Re: Not as easy as you think! - Posted by Lor
Posted by Lor on June 29, 2001 at 12:02:41:
Any suggestions?
Well, you can do what I did and probably what a lot of other people do. Live frugally, work hard, save your money for down payments and buy houses the old fashioned way. Then after 10 or 15 years you might have a solid rental income and profit from selling some houses to invest in the stock market or more properties. Even after I had bought my 7th house I stayed a renter myself to save money. I do think that you need some entreprenurial spirit. I started by buying and selling Arabian and ex track horses then moved up to houses.
Yes, I have bought houses with no money down and also VA foreclosures but they were losers because they didn’t have enough equity and were too far away to manage.
So, my only suggestion is to get a second job, save your money for a down payment and buy a fixer in a quickly appreciating area. If you are in California - Vallejo, Half Moon Bay, Pacifica, Pinole, Truckee, South Lake Tahoe and any city in Amador and Caleveras County are still appreciating in price. Good luck.
Question for Dan… - Posted by Charlene Pye
Posted by Charlene Pye on July 06, 2001 at 19:40:02:
How did you find your hard money lender and what questions did you ask before you decided to work with them?
Thanx,
Charlene
What? - Posted by jeff
Posted by jeff on July 03, 2001 at 07:32:29:
Sound like you just cleaned up big time man!
Did you do the work yourself or hire sub contractors?
Let me ask you a stupid question.
In a month or so I am going to have about 10k in cash…You think this is enough to start flipping??
Month note payments are no problem I got 2 other inveter that can spare 300-400 a month till the home is sold
Re: Lots of deals out there. - Posted by Ronald * Starr
Posted by Ronald * Starr on June 30, 2001 at 12:51:36:
Dan-----------------
You forgot to mention to Greg that you are feeling depressed because this has been such a bad month for you, only getting three deals which will only make you $65,000 or so.
Good Investing and Good PostingRon Starr**
Good advice… - Posted by HR
Posted by HR on July 01, 2001 at 07:10:16:
Greg,
First, you are exactly right: this business requires work. It ain’t easy, it ain’t automatic, but it can be wildly profitable once you know what you are doing.
Greg, I suspect your problem comes from one or two main, common, newbie mistakes (maybe both): 1) Inadequate education. You are missing deals because you don’t know enuf “back door” strategies for making money, so you miss deals. Solution: improve your education. Making CS offers ain’t gonna cut it; learn how to make all cash offers with hard money, lease option, wholesale flips to rehabbers, etc. 2) If you are struggling this much, you are trying to fit a round peg into a square hole. Your approach is inappropriate for your market. You need to get a better sense of all the money making areas in your market, and then pick one that can be reliably profitable and attractive to you. Then, master that niche and make money as long as you can. Stu gave some good personal examples of that.
Just ‘cause it ain’t working for you doesnt’ mean it doesn’t work. It just means it doesn’t work for you. So learn more, and focus on a better niche, so you can make it work for you. You’ll love all the cash when you do.
Good luck,
HR
Re: Not as easy as you think! - Posted by Ronald * Starr
Posted by Ronald * Starr on June 30, 2001 at 12:45:17:
Ray--------------
Yes, that is a recent post. A couple of months ago I made a still longer post with similiar information and a longer description of how to get going. I called it something like “for the beginner” or “beginners: how to succeed.” That would probably be about mid May or so.
Good InvestingRon Starr****
Thought I was the Only One - Posted by Frank Chin
Posted by Frank Chin on July 02, 2001 at 08:10:30:
Hi Lor:
Enjoyed many of your posts here.
The wife and I went into RE some 20 years ago by selling our SFH and buying a 3 family MF where the rents paid the mortgage and we lived rent free. We then drove around in a old car and thus no car loan.
The result was we lived on one salary and saved the other.
With that, we bought several more MF’s along the way. During the RE crash here in New York City in 91-93, picked up some more RE through foreclosure auctions at very little down.
Yes, we still live frugally. It amazes me that some of my tenants are behind on their rent after coming home from their second vacation for the year and has a new car in the driveway. They tell me they’re struggling.
Also I’m glad I bought in fast appreciating areas where prices had tripled in the past 15-20 years. With that, I can unload overpriced properties in a day.
Between that, and the hight rents that I now collect, I’m able to live frugally and independently.
Frank Chin
PS - I have to head off and collect my July rents.
Re: Question for Dan… - Posted by Dan
Posted by Dan on July 07, 2001 at 09:45:45:
I found my hard money by talking to other investors.Some mortgage brokers can also hook you up.The questions I ask my hard money lender are, How many points? 5 is about average.What interest rate,I pay 12-15%.How long is the loan.Mine are 5yr balloons.Is there a pre-payment penalty,yes with my lenders its one year.If I pay them off before one year,it will cost me 3 payments.
Re: What? - Posted by Dan
Posted by Dan on July 03, 2001 at 10:10:15:
Last month was a good month.Most of the time,I average a house a month.I do 30% of the work myself and my handymen do the other 70%.You don’t need no money to wholesale flip.If your going to retall,you need to have enough to cover fix up costs and holding costs.
Re: Not as easy as you think! - Posted by Ray
Posted by Ray on July 02, 2001 at 20:03:10:
Mr, Starr, You should ccp that older post and repost it. Ray
Re: What? - Posted by quincy
Posted by quincy on July 03, 2001 at 19:30:21:
“You don’t need no money to wholesale flip” What do you mean by that? Don’t you have to have money to buy the property? If not, how do you aquire the property?
Re: What? - Posted by jeff
Posted by jeff on July 03, 2001 at 19:20:36:
OK,
When you say wholesale flip you mean like sell it to another investor after you do a few repairs?