In getting started, I know that it is very important to view as many properties as possible that are located in possible acquiring areas to get a feel for what a property’s value is. My main concern is that while I continue to learn and get comfortable with values, how do I keep the real estate agent from feeling like I’m wasting their time? I certainly wouldn’t want to keep them from making a commission off of someone who is ready to buy, but I understand the importance of scouting out the area. Does anyone have suggestions? (Obviously a FSBO doesn’t require an agent, but many properties here are realtor listed.)
I’ve heard alot of different advice when it comes to owning in your name, an LLC, a corp etc for liability purposes. I would like to be able to find a good lawyer and accountant that are used to dealing with rental properties, but I’m not sure where to start unless I need to go through a local REI club. Any thoughts?
Getting pre-approval for a loan would be a good start. You would at least be able to show capacity to do a deal. You can also just get some addresses of your target properties from your Realtor. Drive by some of them yourself and see what you think. You can at least canvass the area and see if you would be comfortable buying there. You’ll also get to see what people are asking for houses in certain parts of town. You might even be able to look inside thru a window if there’s no window coverings. Realtors expect to take people to multiple homes because people generally aren’t going to buy the first thing they see, but if you’re expecting them to escort you around to 100 houses and you have no ability to purchase, you probably will be disappointed.
Try to ask around to find some investors in your area. Chances are, some of the Realtors there will know people who invest in the area. See what they’re doing for ownership. You may find, however, that some people own properties in their own name and don’t even use leases.
Where I am I can get searchable access to MLS listings. I put in my criteria number of bedrooms number of bathrooms number car garage square footage and sort from cheapest in my target area. I get a list of houses to consider. I then search the neighborhoods that these houses are in. I find that these neighborhoods sell for a certain amount per square foot. For example if the average dollars for square foot in this neighborhood may be $60 and I find a 2000 sqft house for sell for $60k. That house is $30/sqft and would potentially be a deal. What I would do then is walk that house to see what kind of shape a house that is for sale for 50 cents on the dollar looks like (and smells like).
There are 2 kinds of houses retail houses and wholesale houses. Retail houses are what a house with no distress will sell for. They are bought by a natural buyer (family). Wholesale houses are distressed in some manner and are sold at a discount to an investor who relieves that distress. When people say they bought a house and captured $50k in equity. That is the difference between the retail prices of that house and what the house was bought for and the distress relieved. So you need to understand both of these values.
You can do this without a real estate agent. What you are going to find is that you are going to run upon a house that you just have to buy right now. It has $50k after fixed up equity and not much work to be done. You need to be prepared for that. As justin0419 said you get prepared by getting preapproved before you start looking.