Posted by: Scott
on Feb 5, 2010
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How to save money on real estate investment repairs
As a real estate investor, there will come a time when you will begin to see certain repairs over and over again. From fixing sinks to laying carpet, the nuances of owning real estate can be pretty overwhelming, if you let it.
Knowing little secrets of the trade and being able to get things fixed at a lower cost will save you time and money. Here's a few things I know about flooring that may save you some cash!
Posted by: Scott
on Feb 3, 2010
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HUD Homes Are NOT Hard To Buy!
There is a common misconception that HUD homes are trashed out, dilapidated and often times totally worthless. This could not be further from the truth. Many HUD properties require minimal repairs and can be discounted by far more than it will cost to make the repairs.
On occasion, there will be homes with foundation issues, mold, or water damage that most owner occupants will not be able to pay cash for, or can not get a mortgage company to finance, so keep your eyes out for these deals. I have bought and sold many HUD homes with profits ranging from 20% to 30% and even 75% on one occasion, so don't think that it can't be done.
What is a HUD home? A HUD home is a property that was once purchased with a Federal Housing Administration (FHA) loan and is now foreclosed. Once the home has been foreclosed and the principal balance paid back to the mortgage lender, the home is then sold at auction by the Housing and Urban Development (HUD) at near or close to retail value.
Posted by: Scott
on Jan 28, 2010
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There are a lot of new investors that never get past the step of searching for investment properties. For many, it is due to not finding the deal fast enough or someone else beating your low bid on a home. Why do some make it in the real estate business and some don’t?
Quite simply, the successful investors are the ones that either know something you don’t or do something you won’t. It is not that they have a secret website that has all the good deal and you can’t get to it. They are however, following up on the ones you wont or trying something you have not.
For example – Lets say your online looking around the IRS home seizure website at: http://www.ustreas.gov/auctions/irs/ and you found a home that you were interested in. The beginning investor would write down the address, do his due diligence and find out as much about the home as he could and go to the auction.
A seasoned investor would do all of the same things as the beginning investor accept one important thing. He would not go to the auction, he would try to acquire the property before it ever hits public access. How? Call the owner and find out why it’s being sold. In this particular case, the IRS may have a lien on the property for non-payment of taxes. If this were the case, maybe you could bring the taxes current and have the owner sell the home to you in exchange. What an idea!
Posted by: Scott
on Jan 25, 2010
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An Example of Real Estate Cash Flow
Although I receive emails all the time asking me questions about how to make money in real estate, it never seems to amaze me how you Noobs can't get the concept of cash flow.
So.. For all your enjoyment..
MailBagDear Pwn Homes. Even though I'm sure I will regret asking, can you please explain to me how you cash flow a property? I have read rich dad poor dad and a few others and have read your blog for a few months now, but I just don't see how breaking even or how its even possible to cash flow when most houses can't be bought for as cheap as you say. -Sarah
No matter how many times I try to beat it into you Noobs head, some of you just can't grasp the concept of cash flow.
Real Estate is cash flow dependent. Without cash flow, your business of owning and investing in real estate will be moot unless you are wholesaling or flipping, which is not real estate investing. Having cash flow is important for two reasons:
Posted by: Scott
on Jan 8, 2010
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Having Doubt As A Beginner Investor
It is common to have second thoughts when it comes to parting with large sums of money. Buying real estate seems to be one of the best at causing this worry. In fact, theres been coined phrases to state this feeling - Buyers Remorse. Having the feeling that you made a mistake or just didn't think things through well enough will often send a buyer into another well used phrase - Paralysis of Analysis.
At a time when I had first started my investment career, I too had some issues with trusting myself. Although I was not a noob, I may have had some of your familiar tendencies. Over thinking, second guessing, and even backing out at the last minute will not only deter your development, it may prohibit you from ever acting in the first place.
Taking time to calculate your risk and planing your exit strategy should always be in your game plan, but not to the extent that it prohibits you from just making a move. With so many resources to help the beginning investor in researching the purchase, holding and ultimate sale of a property, it is just a matter of putting a plan into action that will ultimately determine your success or failure.
