Hi all,
Pennsylvania tradesperson looking to buy my first rehab property. I have read the following titles:
- Rich Dad Poor Dad
- Retire Young, Retire Rich
- Buy it, Fix it, Sell it, Profit
- Buying Real Estate Foreclosures
- Real Estate Investing A-Z
- Making Money with Rental Properties
What indicators should one look at when investigating a region for possible rehabs? According to Kiyosaki in his Rich Dad titles he made a large portion of his wealth in investing in the Portland, Oregon market while it was depressed and then moving into the Arizona market with his proceeds. How did he know the Portland area was depressed? How did he know the Phoenix area was ripe for appreciation? Hard data of some sort?
I know where I currently live has a large number of older homes that are in rehab condition (Older population = deferred maintenance on properties). However, I also know that the population base is still declining for the last twenty years and that if the local government doesn’t get over its ‘tax and spend’ mentality it is not likely to see an uptrend anytime soon. I would hate to buy into the market with flippers and holders, only to see the market trend down over the next ten years. Suggestions on enlightening sources?
There are currently a couple of REI clubs and companies in the area. One wants $5,000 to mentor investors through their first deal. Seems steep to me (I could make a lot of small errors for $5000, or one big one ). The second is a member of the NREIA but I have not had any luck contacting them. There is also a franchise of the HomeVestors network operating locally (We Buy Ugly Houses).
My general business plan is to find properties that have the right things wrong with them. Determine the cost of repairs, holding, etc and make offers to purchase. Once my offer has been accepted I will rehab the property through a combination of sweat equity and bid proposals for the more involved repairs (electrical, plumbing) and either flip or hold depending on the neighborhood.