been studying a year, fear i was on the wrong path, want advice on approaches

short and sweet: 1 year ago i got a ridiculously overpriced ($600) course on marketing. put up tons of fliers, foreclosure letters, etc. I spent all of my extra cash every week to keep up with the mailings (500-1000 weekly), which I also stuffed/stickered/wrote myself, with my fiance’s help. got a ton of responses, some looked good… bottom line was i came to realize that i was generating leads that i had no idea what to do with. with what i’ve learned in the meantime, some of them woudl have been disasters.

i cut off the marketing and went back to studyign, as working and dealing with my (useless) leads left me no real time to learn more about realty, to make me better able to understand what i was doing.

fast forward to the present. i have read books, went through a hand me down sheets’ course, and still didn’t feel like i knew what i was talking about. i also found a website (which i know is hugely flawed, as the guy himself is tryign to sell while bashing others who are trying to sell), but it really made me think about how a lot of books make it seem so easy to just make tons in real estate with basic knowledge.

anyways i’m sorry i couldn’t make that more precise. i don’t know where to turn. I am saving like crazy, and my fiance and i expect to have savings in the area of 20-25K in january '07, when we will be driving to florida with plans of purchasing a 4 unit property through an HUD 203 (not sure between ‘b’ or ‘k’ yet). naturally i am very concerned with making sure that this becomes a great first investment, and not a nightmare. I have my brother coming with me (dropped out of technical high school a year ago, in his last semester, so he isn’t a qualified carpenter/cabinet type worker, but he will be great cheap labor (i know he cannot do the contractor work on a 203(k) loan as he is not licensed, and i believe HUD chooses anyways). I have my savings, and i have our credit. I just don’t know what to do now to further prepare myself.

basically it boils down to (2) early 20’s kids who are engaged, and the guy’s brother, heading to florida to start making money. we will have enough capital to get into a 4 unit (as far as my research has let me believe). my fiance and i both have fico scores above 740, and assuming we don’t quit (hahaha) between now and then, we are both making about 30K / year as managers of retail stores (which i won’t mention, but i bet both are at your local mall if it has 2 stories).
We just want to know what to study. everyone has a goddamned agenda. i know that is the case, and i don’t mind paying whatever, but i really don’t want to go down the wrong path and get burnt. I want to make real estate investing my life. of course i want to get rich quick, who doesn’t? I want to get rich as quickly as possible, but I am not a completely ignorant dreamer. i know it will be hard, and i know it will take longer than many gurus would want you to believe. That doesn’t bother me. if it’s hard work, then that is just fine, that’s how i play. i’ve worked full time all through college. i am actually in school right now, i will be wrapping up in fall with an econ degree, and i still work 40 hours a week as a retail manager, run an online business (selling students’ stuff on ebay hahaha), and do school/athletics simultaneously.

i don’t care about hard work. i just don’t want to waste my precious time studying stuff that is either a) too advanced for me, or b) a joke in the first place that will either make me go broke trying a dumb approach. any suggestions (if anyone is even still reading this now) would be sooo greatly appreciated. I am currently devouring my ‘bible’, “Real Estate Principles: A Value Approach”

This book is great, it is actually the textbook for an online real estate course i’m taking through my uni right now, but of course i’m not doing it for the course as much as i just want to learn.

wow that was a HUUUGE rant…

to the point for those who don’t care about the scenario. i’ve read as much as i care to, and attempted wholeheartedly to implement (without success) what i was taught, and realized the ‘no money down’ type books i was reading didn’t put me to the level i wanted to be. i am currently reading more school-style books for a real education.

i want to get rich quick, of course, but i intend on real estate investing being my career. i’m a scratch away from doing my last uni semester (economics), and have never ever even contacted or lightly entertained the idea of using my degree. I want to be a real estate investor. i’m an entrepreneur to the bone. i practically thrive on hard work, and have since i was thrown out of my house at 17/18 (senior year high school). I’m now 23, about to buy my first property with ~20K in hand (and two perfect ficos, plus two ~30K/year jobs signing on the loan), and don’t know where to look for more information past the book i linked in my first paragraph.

oh, and i don’t really have any good investor’s groups out here. the one out here seemed solid for a while, but then i started to seriously question their credibility after being asked to buy their 3K$ courses at every damned meeting. i was actually going to intern for the head guy, hoping the experience would help, but got disillusioned and figured i would learn more just reading online/books than i would doing his busy work. that’s where i’m at right now, i just want people’s suggestions of where to go to learn more. people who are actually successful, not people who have a couple properties, or just study the stuff and haven’t even bought yet. i’m serious about that, and i hope it didn’t come off the wrong way, but i’d really like to hear advice from people who have success, because if you haven’t had decdent success yet i have no way of believing that what you’re recommending as good learning material is. you’re making that judgment, and if i wanted amateur judgments on things to study, this thread would be totally pointless, i’d just go right back to amazon and continue adding to my investing collection.

Nice rant.

I put in 8 years time total before “going it alone” in real estate. 4 years as an employee in construction & remodeling, 2 years as a sub-contractor once I had my own company and $20,000 worth of tools and work vehicles, and the last two years as a general contractor, working almost exclusively for a large real estate investor. Basically I did everything for the guy on each job. Towards the end, he never even SAW the job, as I was in complete control of everything.

Everything EXCEPT the final cut of the profit, of course. It was then that I decided to sink or swim and started working for myself. My head is still above water, so something must be going right (That was nearly 2 years ago now).

To my point.

WHY FLORIDA? If you look at the HAI (Housing Affordability Index) florida is right there at the top of least affordable places to live, and there’s a 50% chance you’ll see a housing correction take place there. Even if prices do not fall, I fail to understand how it’s possible to make an investment property cash flow in that region with standard money down. If you have to put 40% down on a property to get it to cash flow you’re investing in the wrong area. Honestly, I believe the places to be investing in right now are Utah and Idaho. Yes, I said it, IDAHO! Even here in Wisconsin prices are downright cheap as compared to other places in the country.

When you’re first starting out cash flow is king, but you shouldnt have to put 50% down to realize it!


You’re studying what? In the year’s time, what have you determined to be your focus? Wholesale, Sub2, Rehabs?
Where have you been reading? Have you read through all of the free information on the site? Which authors strike you? Of those authors, which of their niches appeal to you?

Where do you currently live? What did you study from the market? What’s your next best alternative?

Answer those questions. Keep the warm leads from the marketing. Determine your focus, and your niche, and you’ll be able to forge ahead.

When I came here a year ago, one of the more experienced members told me that I had too many irons in the fire. It sounds like you’re doing the same.

Without focus, that $20k will be gone before you can remember how you lost it.

As my grandmother used to say, ‘a fool and his money are soon separated.’

It can be exciting, and it’s obvious that you have a hard work ethic… now channel that effort and energy, or the lesson will come at great expense.



Your studying has not been fruitless. You seem to have done enough studying to realize that the stuff published by most of the “gurus” is overly optimistic at best and in many cases total nonsense.

The techniques taught by th gurus work, but they typically FAR underestimate the expenses and the work. All businesses are essentially the same, and involve buying wholesale and selling retail. Learn to properly evaluate the numbers in any business and you stand a good chance of being successful. I recommend talking to other full time investors and professional organizations such as the National Apartment Association. Real (successful) investors know the real numbers associated with the business and don’t spout hype in order to sell you a course.

Good Luck,


that’s part of the problem, i don’t really have a niche. the reason is because i don’t even know what to belive. for instance, i originally thought it would have been foreclosures. after reading about them forever, going to auctions, mailing preforeclosures, i never felt comfortable to take a step. in retrospect, it was really, really good i didn’t (prices are now dropping where i live. not too badly, but people’s houses are on market way, way longer, to the point they have to discount them to move. very glad i didn’t buy around here). basically i didn’t feel i knew enough to do what the gurus stuff told me. in their examples, the numbers work (well, i did find some where there were gross omissions that they really didn’t work, but whatever). however, they don’t really go in depth to teach you about what you really need to know, like how to read a local market, or how to see flaws in a property. so i put the marketing on hold (that was last summer), and have been studying since then.

that book i posted has been very refreshing. it is a very technical, college textbook. i’m not even done yet, and as soon as i got a few chapters down i felt dumb for having wanted to take on such huge responsibility with the insanely small amount of knowledge i had.

why florida? i always thought it was the cheapest. as i said, i wanted to do a 203b or 203k, so my 20-25k will either be a good down payment on something closer to 400K, or i will get somethign cheaper, adn try to hold some of the money in my pocket. I kind of have a need (a fiance) to be near teh ocean. if i could make a killing in idaho or wherever midamerica, i’d check it out, but as far as i’ve ever heard, florida is cheap. my mom lives there and her rent is extremely cheap compared to where i am, so i figured (again, without really understanding more, the best i really went on was that common knowledge says florida is cheap) florida would be the best place.

niche? my studies have really covered all of them. being that i am now realizing that stuff like ‘conventional loan plus seller taking a second’, or whatever, are not really hugely reliable, i wnat to go more conventional. why? because when january arrives, and my fiance, my brother and myself load up the uhaul(s), and head down to florida, i don’t want to be chasing a dream. i don’t want to go through half of our cash reserves waiting a year before i find someone who will do full seller financing or something. i want something more solid. as i said, i’m an amateur. not even an amateur, i’m just a hack. i’ve studied, i’ve tried, failed, then went back to studying. i don’t care, i actually am more into it now than i was before, but i have a responsibility for other people here. if things woudl be better doing creative tricks, but the likelihood is much less, i can’t risk that. unfortunately i don’t think i know enough right now to decide what is likely to work and what isn’t. sooooo, i decided on this approach:

-decide on my area of florida by choosing whether i want to have cash flow, or whether i want the building (4 unit building here, max units for a residential, way low% down) to appreciate over the year i’m there. if it cash flows, i work on it to make it flow harder. if it is in an appreciating market, i do what i can to make it better. those last two sentences are thigns that i have in mind while searchign, i’m not planning on paying retail and thinking a paint job will spike the value or somethign.

-sell property for a profit, buy another.

-continue on until i can get where i want to go, large unit# commercial (apartments, specifically)

i figure that this approach should be able to yield good cash if done properly, and should be a pretty reliable approach. something where i can assume that after a month or two of hard searching in FL, i can find something for a good discount, or something that needs some repair (in which case i’d go for 203k. i was also thinking it may be profitable, zoning permitting, to use a 203k to convert a 3 unit to a 4 unit, who knows).

this approach seems to make good use of the considerations in my situation:

  • 3 kids with low % down, only 1 of which understands anything about real estate
  • 2 co-signers with ficos of 740 and up
  • 2 co-signers who, if needed, can transfer their jobs at 30K/year (individually) to florida
  • 1 kid with responsibility to the other two that they don’t waste their time chasing a dream that the kid in charge was sure woudl work, then found out hte hard way that finding an assumable mortgage is near impossible, or something like that (not saying they are, just saying i don’t feel comfortable with ‘creative’ strategies, as i feel that with no experience i cannot properly evaluate them as well, so i am seriously risking putting our lives on a path that is just not gonig to work out.

again, i’m a dreamer, but very real and down to earth about what must be done. my goal in life is to be very, very big time in real estate. i know how much work will be required, but if you read my original post you’ll see that i am the kind of person who does what is necessary to get what he wants. i’ve always had way more than my peers, because i work much harder and longer than anyone else. i am ready to do whatever is necessary to make my first investment work out well, even if it means trying to convince my brother and my fiance to go somewhere besides FL. I guess i’m just really confused about what works reliably and what doesn’t, and really don’t want to waste a year or two learning that i was doing dumb techniques, outdated techniques, or techniques that didn’t even apply in my market. the work, the learning, all of that is fine, i just want to learn more and almost everythign i find seems to be the same old ‘lease option’ or seller financing or whatever creative approach. there just has to be more reliable ways to make cash. i know this is investment, and i am starting with only 20K roughly, so i can’t expect i’m gonna make hundreds of thousands off my first investment or anything, but ideally we would
-find our area
-find a great property that needed major - major/minor rehab (major we would use an HUD 203k loan, minor we’d do ourselves as our jobs)
-live in 2 of the 4 units for a year
-sell for a profit, then repeat the process with the profit money, which necessitates, that we make considerably more on teh tail end than we had going in. say i come out with 60 or 80K on the other end, then that is just a down payment on a new 4 unit (well, if it were really something like 80K that would probably become a down payment on a commercial loan for a junky 10 unit or something, who knows)

i just don’t want to waste my time learning useless or near useless techniques that i may be able to make use of once in my career. i need to know what some very solid ways to start are. my best plan of attack now is to determine area for best growth/flow/whatever, then find an undervalued property, buy it and fix it/do something profitable (like making a 3 unit a 4 unit), then sell and use profit to repeat. my brother is a slacker but has great technical knowledge for some cabinet/carpentry type stuff. my fiance and i are both the kind of kids who worked full time all through difficult college degrees, and were even athletic as well. i was actually a full time manager, full time semi-senior in econ, vice president of my uni’s wrestling team, and running a small business simultaneously. hard work is fine, i just want the work to be done in a way that i will be more likely to profit from.

so sorry i keep making this so long. i guess i really want to make the point that i am not like the average poster on here who seems like they saw a sheets’ commercial, and are acting like they’re all about investing, and will probably fizzle out in a few months. i (really) have a mini collection of we buy houses signs that i take from the main strip near me, since there’s always a newbie who will put htem up for a few months and disappear (like me last summer!). i want to make it clear that i have intentionally burned my bridges. real estate investing will be my life. i have an econ degree but have never done an internship or even talked to my advisor about a job. in fact i don’t even really like economics. i’ve been entrepreneurially oriented my whole life. i will be in this for the long haul, so i’m looking for what is tried and true, what is reliable, and not just what ‘could’ work if i happened to be in exactly teh right place at the right time.

(i feel so bad for writing so much… i’m also a personal trainer (haha that was another small business i had before becoming a manager of my retail store)…you have been very gracious reading my essays and providing very useful responses.)

i guess my previuos post was way, way too long haha

mike, what professional organizations would you recommend for someone like me? (recap: 23 years old, about to get first property with a few tens of thousands down, great credit score (750+), 1 year studying; trying to decide where in america i can go, come january/feb '07, to make the most profit on my money. plan on getting a property through an HUD-insured 203b/k loan; spent much time studying ‘guru’ approaches, attempted a ‘foreclosure operation’ which was a total waste of my time, and have since been studying more ‘textbook’ real estate stuff. I am about two months away from really mastering most of my big real estate school textbook, which is giving me a great background; i am proficient in finance/accounting, very solid in management marketing, and other skills as well. about to get my econ degree. after i finish this book, i want to go into something more up my alley, something more about how to find the cheapest property i can, in the best area of america to give me max cash flow. don’t know what to study next)


I think that you have studied enough to get started. If you’ve made a real effort to learn the material, you should be an expert in a year! When I started, I studied the Carleton Sheets material for one week and then started. The concept is not difficult, buy very low and sell or rent for a profit. Having said that, I am not a member of the “Just Do It” crowd. Without understanding the basic concepts, a person is doomed to fail.

In my experience, there is no one technique or strategy that you should master to be successful. Deals come in many forms and you need to be able to exploit them all. Generally, no one type of deal comes along often enough to support a full time business. So, to be successful, you need to be prepared to do them all. I have worked with realtors, bought REOs, bought property at foreclosure (sheriff’s) sale, bought using a lease-option, bought with owner financing, bought at estate auctions, paid cash, used bank financing, etc, etc, etc. I do single-family houses, multi-family houses, and apartment buildings. I have low income and middle income rentals. I also have wholesaled a few deals and assigned a few contracts. Whatever it takes to make some money - which is the goal in the first place.

One of the biggest mistakes that newbies make is thinking that they can do all of this without ever leaving home (I’m not saying that is you). This can NOT something that can be done sitting at a keyboard. You’ve got to get out there and meet people. Find a hungry realtor, join your local REIA (wherever you will be investing), meet the other successful investors in your area, get to know your area intimately (look at 100 houses), etc.

Finding great deals is EASY. Making a profit is more difficult.

To answer your question directly - there is no “best” area of America to get max cash flow. Pick a “red” (republican) state anywhere in the midwest and jump in. Work six 12-16 hour days for the next 5 years and you might have something!!!

Good Luck,


“i just don’t want to waste my time learning useless or near useless techniques that i may be able to make use of once in my career. i need to know what some very solid ways to start are. my best plan of attack now is to determine area for best growth/flow/whatever, then find an undervalued property, buy it and fix it/do something profitable (like making a 3 unit a 4 unit), then sell and use profit to repeat. my brother is a slacker but has great technical knowledge for some cabinet/carpentry type stuff. my fiance and i are both the kind of kids who worked full time all through difficult college degrees, and were even athletic as well. i was actually a full time manager, full time semi-senior in econ, vice president of my uni’s wrestling team, and running a small business simultaneously. hard work is fine, i just want the work to be done in a way that i will be more likely to profit from.”

Just wanted to make a few comments to you regarding the above. First of all, life is a learning process. You will never stop learning. Life is also not black and white, you cannot expect to read everything and just know it all. You would be best off starting with some small goals and continue working while you do it. Whether you like to do hard work or not does not matter. You need to involve only yourself in this dream of yours-why involve your fiance and your brother? If this is your dream don’t use family–you will be minus the guilt!!! If you are truly interested in making it in real estate then decide exactly what you want to do–have a goal for yourself. Do not involve your fiance, your brother or your mother. Real Estate works everywhere. Notice we are all from different states and we all are trying to in a positive way work through whatever problems we run into with each others support. You may not want to hear this but, there are some books that I have read that are very motivating and yet realistic. Read Jay P. DeCima-he has two books out, Douglas A. Keiper and Sean M. Lyden have a very good book out and for fun I have even read “Trump the Art of the Deal”. Go to the library, don’t purchase them. Sounds like you would like to find a mentor. Maybe look for a real estate agent in your area that does his or her own rehabbing and see what they have done. You don’t have to jump right in with them and buy until you are ready. Don’t even tell them you have money to spend and great credit–just ask if they would be willing to mentor you for awhile. You may even decide to change careers and become a real estate agent and see if you would like to be in that area to begin with. Or find a construction remodelor person and see if they would mentor you in actual fixing up so you can learn a few things first hand. Do that in your spare time and continue to work if you want to.

I am a stay at home mom and my husband is in commercial and residential construction. I was a nurse by trade. I and my husband had always had a dream to do fixer uppers. Well 3 kids later. I don’t work so I can stay at home with my kids. My husband now hates the thought of doing fixer uppers. It is my passion. I don’t involve him or my kids if I don’t have to. I do as much of the work myself as I can. I sub out the things that need a licensed person such as electrical, plumbing, etc. We are not rich. But, I get to do what I love to do and fix up an amazing house for someone to enjoy. I found a way. You can to. Hope these ideas help you. Good luck. Graciez

i appreciate your thoughtful response, but with all due respect, if you don’t know my personal life situation regarding my brother and my fiance you really can’t know what is best.

again, i don’t think that is best FINANCIALLY, but there is more to life than that. i know that i will be the most talented in this area of all of us, and i could be more efficient without them. that still doesn’t make me want to drop them out.

about studying stuff tho, i totally agree, i ABSOLUTELY need to get out there and just do stuff. i am planning on that though, as soon as i get to my area. i may get there and immediately try to be a realtor, to get connects and have a possible way of finding a better deal for my first purchase.

in the meantime, til early '07, i am in a pretty decent paying job that i have a commitment to, so i will continue to do that til i move. because that job pretty much prohibits me from taking up another (remotely serious) job, all i can do in the meantime is study (can’t make contacts because i’m not yet where i will be investing, and don’t even know where that will be yet). since all i can do is study now, i want to make the best possible use of my study time.

for instance, my real estate textbook, as tedious as it is, definitely gives me MUCH more general knowledge in real estate than any of the get rich quick books. i’m not even close to done with the textbook, but am already much much smarter in just realty in general. i plan on completing the book (~700 pages, textbook style…), and then simultaneously reviewing my notes/highlighted stuff while studying my next materials. i’d imagine after that i will have time for another couple rounds of books before i head out early next year.

How well do you know your local real estate market? The answer to that question will have a lot to do with whether real estate investing provides a lucrative future for you and your family or rueful memories of what might have been.
By knowing your local real estate investing market, you’re able to keep your finger on the pulse of your local community and to stay abreast of changes in trends, sales prices and rental rates. Knowing immediately about these changes is critical to your investing future. Here’s how each of these three areas will affect your future:
• Trends – National media outlets report gloom & doom outlooks for real estate, but even in the most depressed real estate market there are isolated pockets and neighborhoods with property values that are increasing. If you don’t know your local real estate market, you’re simply taking a wild guess as to value. When negotiating with a homeowner, it’s imperative that you know what the property is worth. Otherwise, you run the risk of overpaying or offering too little, which could offend the property owner and get you kicked to the curb with your hat in your hand.
Another reason you want to know your local real estate market is because certain areas within a given community make better investments than others. If you invest your hard-earned dollars in an area that is declining, property values could fall and some or all of your investment could be at risk. By keeping an eye on trends within your local real estate market, you can more readily take advantage of opportunities to get in on the ground floor of an investment and ride the wave of property appreciation, which will have a positive impact on your bank account.
• Sales prices – How much is property worth in your local real estate market? Do you have a clue? You need to be cognizant of local sales prices – especially now – because property values can change very rapidly. In today’s volatile investing environment, it’s not unusual for the value of a property to fluctuate by $10,000-$15,000 in a given month. If you have a property that you’re considering selling, you can gain or lose a tremendous amount of money in no time.
• Rental rates – Current knowledge of your local investing climate is imperative when determining what rental rates are in a particular neighborhood. If you do a cash flow analysis on a property and you assume that it will rent for $1,500 per month and in reality it will only generate $1,100, you could have a problem, especially if you were anticipating a positive monthly cash flow of $200. If the rent a property can command is $400 less than you anticipated, you would have a monthly loss of $200. Negative cash flow sets the stage for a constant drain on your financial resources, and could eventually cause you to rethink your commitment to real estate investing.
Today’s real estate investing climate makes accurate and timely information critical to your success. If you don’t know your local real estate market, you could be in serious trouble. An excellent way of developing a proper and accurate knowledge of your local market is by trailing an experienced mentor who knows what he or she is doing. In addition to teaching you how to analyze current market conditions, you’ll also be able to better understand what to look for in your local real estate market.
Real estate investing is a great way to expand your financial opportunity, but a failure to know and understand all of the variables within your local market can very quickly erode opportunity. Learn your local real estate market and make this your best year ever!