Getting Started

 Why am I doing this now: Because I can. Because the bargain real estate deals are out there now. Because for the last decade real estate was just a so-so investment. Because when the real estate market is bad, the risk to the investor just coming into the market is actually less, as he is able to buy right. Because I am a dirt man, by that I mean I have to own it, it is in the genes. Because it is fun. Because it is an opportunity to make more money, why? To buy even more real estate.

I have years of experience doing real estate deals and I own income producing real estate. That gives me the confidence and some resources to work with as I start this new real estate investing company.

You have your own resurces and contacts to get started with, plus you have this web site to teach you everything I know. You also have us telling you what we are doing and how we are doing it, to give you the confidence to do something similar.

Money: We started with $12,000 and we are adding more as we go. The amount of money we add in each month varies, depending what we are doing. This method is slower then borrowing money for property repairs but it reduces risk. As our goal is to refinance our first property as soon as it is re-habed inorder to free up money to purchase a larger property, we want as much equity in the property as possible. Paying cash as we go adds to that equity.

Raising money is the hardest part of real estate investing. The more you do it the better you get at it. The more properties and income you aquire the easier it gets and the more options you have. Raising money will always be difficult but going through the process sharpens your skills. Learn to think out side the box and consider all sources. For example some money sources might be; Loans, barter, trade, partnering, credit cards, etc.

Innovating: Eventually after we get to larger properties we will use less innovating in our property rehabilitation. To start with we are using barter, partnering, trading, borrowing of equipment, using a credit card for materials, bargain shopping, and calling in favors to get as much done as possible at the least cost. We want to get the re-hab done without taking out a second loan.

When you are rehabilitating larger properties the number of vacant units not producing income because the remolding is slowed down, usually off sets the savings from trying to be to cheap. It always comes down to time or money. Saving money takes time. When you get more money and resources to work with you can speed things up. As a rule the faster you get the work done the cheaper it is.

Timing: I figure we have a five year window to get up to a size that will be self sustaining. That would be somewhere between one and two million dollars in equities, earning 20% per year, and netting at least 15%.
There are always bargain priced properties available and one only need adjust the investment strategy to make money. It is not always possible to build equities quickly, to do that requires bargain priced properties. This is just such a time and I must take advantage of the opportunity now as I am getting older. These buying opportunities tend to occur about every ten to fifteen years. This is a five to ten year adventure so it will be my last and my biggest.

Get started: Time to get with it. I will keep you posted of the progress as we go along. So jump in. Even if you just do one or two deals, get started. The scary part goes away by the third deal, so get out there and break the ice. Even if you screw things up the down side risk is only 10% to 15% of the purchase price and the upside potential is 20% or more.

Good luck: Rich people seem lucky because they make their own luck. You cannot get lucky enough to hit a home run unless you step up to the plate, bat in hand.