Posted by Ronald * Starr(in No CA) on January 14, 2003 at 13:26:26:
Posted by Ronald * Starr(in No CA) on January 14, 2003 at 13:26:26:
Wholesale High Priced homes - Posted by Mike
Posted by Mike on January 13, 2003 at 19:21:26:
Is there a market for wholesaling High Priced homes…or does it have to much inherent risk? I have an opportunity to obtain a house for $490K with comps valued at 700K ot $1Mill. Would anyone want to rehab such a house…anyone ever done one like this?
Re: Wholesale High Priced homes - Posted by Ronald * Starr(in No CA)
Posted by Ronald * Starr(in No CA) on January 13, 2003 at 22:19:33:
There are definately investors who would be interested in a bargain buy on expensive homes, provided they can foresee a profit upon resale.
Robert Campbell(CA) has made some good suggestions to you. However, here is Ron’s Rule number 28: “Leap before you look.” When you have a property that on appearances is a good deal, leap on it–get a contract to buy it right away, before somebody else does so. Just make sure that you have the right to pull out of the deal after inspection, if you are not satistified. Then “LOOK” the deal over carefully and decide if it is one you want to go forward with.
Robert is right about that range being way too wide. You have to study your marketplace better so you can narrow it down so that is no wider than about 10-15% of the value of the property. So, is it worth $700-*00K or $900-1,000K, or something between those two ranges.
You might get some help from real estate agents who deal with the high end houses. You might get them to look at it with you and give their impressions of it. Only after you have a contract or option on the property, of course.
Now, if this has been exposed to the open market for more than a few weeks and it has not sold, it is probably not worth the asking price. If it is something you dug up which has not been listed for sale, it might well be worth lots of $10K-profit chunks to you.
Good InvestingRon Starr***
Five initial questions … - Posted by Robert Campbell
Posted by Robert Campbell on January 13, 2003 at 20:28:56:
While there are many important questions that must be answered before you go forward, these five questions should should probably be considered before any others:
How about the rest of “Ron’s Rules?” - Posted by Robert Campbell
Posted by Robert Campbell on January 13, 2003 at 22:47:40:
Ron’s Rule #28 is great: Leap before you look.
What about Ron’s Rules #1-27 and Rules #29 through 100?
Are “Ron’s Rules” a ruse? Fake? - Posted by Ronald * Starr
Posted by Ronald * Starr on January 13, 2003 at 23:39:07:
Ok, you are forcing me to confess. I don’t have a written out set of Ron’s Rules
From time to time I put out some sdvice which would go into a set of “Ron’s Rules” if there were one. Then I just tag on a number that pops into my mind. In fact I posted one today that was over 100.
I did a search on “ron rules” into the most recent CREONLINE.COM archive and found a few hits. So, here they are. There may be some more from before this archive, I don’t know.
Rule number 3 of Ron’s Real Real Estate Rules is: “You never have to buy a property.” You can always walk away.
Ron’s Rules of Real Estate Investing:
Rule # 17 – Pay absolutely no attention to any appraisal provided by the owner of the property.
The important point, even more important than the rate of return one gets with borrowed money, is to pay off the loan. And, if one has rental properties, the money comes in in drips and drabs, a little bit each month. So, an amortizing loan with monthly payments “fits” pretty well with the cash flow situation. Thus, it does make some sense, on a practical basis, to pay down loan slowly with the monthly cash flow. This is not maximizing the return one can get. But it helps insure that one pays off one’s obligations as agreed.
If one has big chunks of cash coming in fairly regularly, one would never need to do amorizing loans, as an investor. One would just take in one of those big chunks of cash or several coming in near the same time and pay off the non-amortizing loans that one uses. That would be the interest only and the straight note loans. Thus, this approach makes a lot of sense for the transaction investors and rehab folk, who are flipping properties and getting big chunks of cash at a time. They are not getting monthly cash flow from rentals, so they should not be committing themeselves to make monthly amortizing loan payments nor, if they can avoid it, interest-only monthly payments.
I guess we could call this the rule of financial consonance. Match your loan pay-out obligations to the money coming in pattern.
I guess we could call the above Ron’s Rule # 19.
Incidently there are some other “Ron’s Rules” which are not from me here is the URL for a different Ron and some rules he propounds for doing section 8 rentals.
Maybe it is spreading. Maybe more and more people will be doing Ron’s rules in the future.
There are a lot of numbers with no rules attached to them yet. I plan to continue to add some more on an occasional basis.
Here is Ron’s Real Real Estate Investing Rule Number One. “Don’t get too serious about real estate rules, you’ll live longer and better.”
Good Investing and Good Educating***********Ron Starr*************
Re: Are “Ron’s Rules” a ruse? Fake? - Posted by Mark-WV
Posted by Mark-WV on January 14, 2003 at 13:00:03:
Check your book for the rule #, my book also has a rule 17 but it says “never rent to party age single girls or female relatives” it has always worked for me until I break it, then it comes back to haunt me !!
Don’t burst my bubble… - Posted by JT-IN
Posted by JT-IN on January 14, 2003 at 12:07:09:
Here for the past, almost 2 years now, I have been diligently collecting the “Ron Starr Rules of Investing in RE”… and thought that I almost had a complete set…
What, now after all that process you tell me it is a “Ruse” and a “Fake” and you have been adlibbing this all along. I am insensed… and want my money back! Oh… I forgot, I didn’t pay anything for that course/book. Well, it would be the 1st book that I bought and never had to pay anything for…
Maybe we could have Jeanne delete the prior post, and later today I could check back and see that this was all a bad dream, and there really are Ron’s Rules to Investing in RE… after all.
Please nudge me and tell me that I am dreaming here… Oh well, just another one of lifes theories shot to heck. Just when you think you are on to something, somebody comes along and ruins it for you…
Disgusted in IN… or wait, now I’m in OH…
Re: Are “Ron’s Rules” a ruse? Fake? - Posted by Robert Campbell
Posted by Robert Campbell on January 14, 2003 at 24:05:00:
I like all of the Ron Rules you presented except #19.
It’s too long.
Haven’t you heard the “rule” about stating “rules?”
It’s this: No rule can be more than 15 words long.
Keep up the good work.