You are probably seeking to make real estate a successful side business, or a way to add a few extra dollars to your retirement. After all, it can be a fairly safe, long-term, and a generally appreciating strategy to invest in land and property. You are most definitely not alone in realizing this. But what strategy do you utilize? How do you maximize your profits? Do you buy and hold (a favorite among investors in an area that’s already booming)? Do you buy 3 of the ugly houses in an area that is just beginning to see investor activity and fix them? Do you know how to spot investor activity? Do you want to position your buy and holds so that you purchase them before the area is widely known as hot (meaning you buy for cheaper and sell for more) before the market bubble, that may only be 6 square blocks, pops?
These are the questions I will answer in this series of posts entitled Buy and Hold: Spotting Gold and Avoiding Woe.
The first thing you need to know is whether or not you have an investing strategy. You will never make any serious money if your approach to Real Estate Investing is like walking around your house with a shotgun looking to kill a housefly.
Do you have a strategy? Good. Let’s move on.
Your strategy was most likely pulled from a list including choices like buy and hold, fix and flip, land-lording, development, condos/apartments, and or working with a broker/agent to help you find the best deals. Brokers are typically hardworking folks that really put time and effort into finding deals. I have nothing against them, except when it comes to one thing.
Broker/Agents really only have one place to find deals. That’s it. Full Stop. Period. One place. This majestic wonderland of all-encompassing information called the MLS or Multiple Listing Service.
“What’s so wrong with that?” I hear you asking. “If the information in the MLS is all encompassing, why is that a bad thing?” Well, I am not going to tell you that you cannot make a profit or find a decent deal on MLS. But the deals you dream about are not on MLS. Brokers set deals up to sell, based on their BPO or Broker Price Opinion. Then taking into account any and all expenses like taxes, utilities, and interest for the longer spectrum of the how long they think the property may sit on the on the market (MLS) counted in DOM or days on market. They take all of these expenses and predict (based again on the conservative principle of overestimating cost to themselves) their Break-Even point. They typically love this number to be around 60-65% of market value. Then they add in profit for their clients and charge their clients for their services in the form of commissions. That means the deals on MLS are routinely going to land in the mid 80th percentile. This means if you spend $100,000 on a deal they have, and after you pay fees, commissions, closing and title costs, taxes, and utilities you may only make 5 or 7 thousand dollars, where you started with $20,000 built into your deal. Now, my deals are available to investors at around a 30% acquisition cost rate. After you factor in all expenses adding to your costs, a deal worth $100,000 is sold for $70,000 with other 40% of the rehabilitation, taxes, fees, commissions (if you have an agent represent you), and all other costs are built into the deal. So now you own a deal truly and wholly at 70%. So selling this deal at $100,000 will net you $30,000 because all of the other expenses were planned for and built into the structure. You’re welcome.
If there is a good deal on MLS believe me, you are not going to be the first person to see it, and you certainly won’t be the only person looking to snag it. What does that mean for the seller of this deal you want really, really bad? A bidding war, and more money for them.; for you it means, to win the deal you have to outbid all other contenders. You are in essence buying a deal, and paying for it, with what could have been and should have been your profit. You are taking your potential profit and moving it from the back of the deal (where your pockets are), to the front of the deal and into someone else’s pockets. The reason this happens is because MLS is like a fishing hole. Only this isn’t a secluded fishing hole off the bank of a small creek on your private property. No, it’s on the largest public lake in the country and every other angler is there. They are crossing your line with theirs, they are loud, they have better rods and tackle, and some are so inexperienced they do the unthinkable… they try to and sometimes succeed in stealing your fish because they don’t know how to catch their own.
What are you going to do? All of your deals are most likely coming from one source. One source that is highly trafficked and highly competitive. No offense, but that will not work on scale to meet your dreams.
If you are getting your deals from Broker/Agents, I understand your pain. I have met more brokers offering false hopes and making empty promises than you will ever see in your nightmares. And don’t forget, brokers collect fees and commissions on top of causing you heartaches. I understand your struggle. Which is why I am willing to share with you my secret so you can go around everything that is eating your profits up.
That secret is www.noneedtobrag.com. At noneedtobrag.com all of my deals are 35-50% lower than market prices on MLS (true market rate with all additional costs carefully calculated and built into that price). And I never charge you any of my commissions or fees. How? Well, I use a variety of techniques and a proprietary method to source deals that are not on MLS. I find sellers that are so motivated to sell to me they strike deals on the spot. These deals that I have an equitable interest in, are then sent out to my list of highly valued friends (let’s make our friendship Facebook official, like my page at www.facebook.com/noneedtobrag you will thank me later). I know you want to be us to be friends because at the end of the day, I have your profit in mind and I will prove it.
I will show you over the next couple of posts in this series; exactly how buying property deals from me will increase your profit 10-30%. And if you’re thinking I am just a wholesaler…well, you’re right. I am the most honest, forthcoming, hardworking, and highest earning wholesaler you have ever met or thought to know that might exist. I am a machine when it comes to finding deals, and here is my dirty little secret. I do MASSIVE volume in all 50 states and the District of Columbia. Your deals that you get from me have the most profit built into them for you to take because honestly, I need to sell deals as fast as I can so that I can keep moving. And how do I sell individual deals so fast all over? I sell them, dirt cheap, with barely anything in them for myself. I only look to pay for my marketing and to feed my family. There is more than enough to go around. I am not looking to make $60k or $100K on a wholesale like those others guys you have met. A friend of mine always says something that has really stuck with me, “I’m not greedy, just needy.” Meaning, I’d rather do 10 deals for a little profit than 1 deal for a lot of profit. I am not into making commissions on deals from MLS. I never charge people for deals. I do what I do, really and truly, because it benefits me to be of benefit to everyone I do business with. When you buy one of my deals, you will soon realize that when I say you could make “$XX,XXX” on a deal, it was probably a low estimate of what you are able to realize.
Next time we meet, I wanna touch on How To Spot Investor Activity. It doesn’t matter what your strategy is. If you are not investing in the right areas at the earliest time, you will never earn a high income from real estate.
Please remember, I will teach you how to earn a high income in Real Estate, for free! All you have to do is all the work to make it a reality. Or you can let me do all the hard work and simply buy the best turnkey solutions available at http://www.hinersmithandsons.com.