Thread: Motivated and READY to invest, but need guidance!

After gobs of googling and reading threads on here as well, i want to see what you guys think of my current situation and input for me to get ahead

I've been dreaming of investing in real estate since i was a child. i just never had the foundation to do it, but i THINK i'm ready to take the dive - i just want to do it WISELY.

I'm 25, single - no dependants, full time career making decent money for my age, also go to school part time...but i want MORE!

I am basically looking to do a buy, fix, flip situation. I, of course, want a good return but im more concerned with MINIMAL RISK. There's nothing that would pain me more than to invest my hard earned money and being put in a hole.

What i have at hand:

Real estate agent friend who will do his best to guide me (however this is his first time investment), a loan officer who i used to work with, a friend who is a handy man - he's worked on lots of housing projects in the past, and i, myself have good credit.

i'm not rich by any means, but i think i have a good head on my shoulders.

i've done small flips here and there buying and flipping sportbikes a few times, but this is a whole new ball game for me

i live in the southern california region (ventura/LA county) but if there are regions that are great for buying, i'd be game for it. I recall a few years back when i livfed in seattle there was a huge property boom. Maybe i should've took the dive then!

I wish I can answer you but I am in the same boat. Dont worry your going to get some good input from these guys. Subscribed.

I'd stay clear from flipping homes in this market. Period. While there is money to be made, I would highly advise against it for a beginner until you get more experience in the real estate industry.

However, now is a fantastic time to BUY real estate and HOLD it. There is much less risk and a high long term upside. Buying undervalued homes, lightly renovating, and renting the homes will provide a much better investment than buying, fixing, and flipping. If you buy right, the rental costs should be enough to easily cover your mortage, taxes, and other expenses. From my experience, if you do your homework, you should easily be able to make a profit every month. Several properties I work with are showing returns of 30% annually -- and this is no exaggeration. Also get to learn and thank the government for Section 8 housing.

What's the budget that you're working with? Many of the distressed properties are in demand and typically sell to an all cash buyer within hours of being listed with no contingencies.

Graham

^^ thank you greatly for your input...i may have to re-think my strategy then.

I don't mind holding onto a property and renting it out IF it can cover + give me returns as you are speaking.

As for my budget, i can comfortably put down 10k - not working with much in terms of cash. I was going to get a pre-approved loan and see if that figure is something i could afford to work with.

are there some ground-rules when it comes to buying properties that i plan to hold? 1 rule of thumb i was told is to get a fixed rate loan

Stay tuned.... I'll be speaking the the L4P community soon about this.. Got something very unique coming

GoneSingle...

That's actually what I do for a living. We work in the San Fernando Valley and under a $320,000 purchase (all cash). Generally, we put in about $25-40K in rehab and try to use a "green approach".

I always look to leave a profit margin of $100K between initial purchase until final sale, this way even if you factor in AT MOST $60K in cost (work, closing costs, unexpected issues) we still pull in a nice return for my investors and I.

Originally Posted by J08M3

Stay tuned.... I'll be speaking the the L4P community soon about this.. Got something very unique coming

how soon?!?!

Originally Posted by Amongst Kings

GoneSingle...

That's actually what I do for a living. We work in the San Fernando Valley and under a $320,000 purchase (all cash). Generally, we put in about $25-40K in rehab and try to use a "green approach".

I always look to leave a profit margin of $100K between initial purchase until final sale, this way even if you factor in AT MOST $60K in cost (work, closing costs, unexpected issues) we still pull in a nice return for my investors and I.

how does this "group of investors" work? i ask because i may eventually want to put together a group as well...or maybe get myself involved with some investors?

Idk where the best place to start telling you is, but here goes..

You're going to need more cash.. Short sales and foreclosures go to people who are cash buyers and good deals go quickly. I know foreclosures that are bought for investment in my area are bought before they are on the public market, most times within a few hours. So you've got to be ready to jump on a deal as soon as possible and make quick assessments of the property. Cash is king.

You're best bet of doing this right is also having a realtor that deals with foreclosures, they have the inside lines and contacts at banks that most other realtors don't. I get that you and your friend want to help each other, but it will be tougher to get deals with someone that doesn't have the connection with the banks.

Good deals are bought quickly, what remains are properties that require 1.) large loans to purchase or 2.) large amount of work, to where it is not worth it.

All investment comes with risk, especially real estate, you could very well, lose your ass on one bad deal. There is no such thing as MINIMAL risk in real estate, not in todays market, sorry.

If I was you, with that 10k liquid I would look to get a dealer license, and flip a few cars, you can easily make money buying for less at auction and selling for more on the street, I know a lot of people who do this, and even if you lose with one car, you've got another one selling to make the difference. Where as with houses, one bad deal can ruin your life for a long time.

If you still want to invest in real estate, look to get something you can afford to hold onto, the market will comeback, maybe not how it was, but something that you can hold, rent out, and cover your costs with the rent. A few years down the line it will be worth something and you can sell then, but I honestly believe the days of flipping a house in a couple months for ridiculous profit are long gone.

Originally Posted by GoneSingle

how soon?!?!

About 1-2 weeks or so