I am always hearing about these seminars that tell you how to make it “big” in the real estate business. Well my question is this:
If you really work at it, how much money can you make rehabbing “fixers” and selling them at a profit?
Can you make over $250,000 per year profit?
Are there any investors that you know of that are making a substatial income consistantly?
How do YOU do it? :
dealmaker-
Contrary to how the speakers at seminars want you to believe, it’s not that easy to make it big in anything. Simple- but not easy.
If you do 1 rehab at a time and do them rather quickly, there is no reason why you shouldn’t make atleast $250,000 a year. If you have a business infastructure in place to allow you to do multiple properties at once, theres no reason why you can’t make $250,000 a month or even a week.
DannyTheGreat-
$250,000 per month sounds very interesting to me. Can you give me a brief outline describing the infrastucture I will need to accomplish rehabbing 30 to 40 properties a year? I am moving to Denver at the end of this year with $400,000 to invest and a HELOC of $200,000.
I would suggest you first start a few properties on your own to get the ball rolling in Denver. However you should also phase-in several key people as employees. Some of the job titles I use are:
Project Managers- Hires contractors, Keeps everything on schedule and budget, picks out colors of paint, carpet, types of cabinets and countertops.
Marketing Director- Deals with all things marketing- from finding deals to assisting the agent in selling.
Investment Analyses- They are my home inspectors with calculators. They weed out the bad deals from the good deals. Also they do most of the negotiating and purchasing.
I am also in the process of finding a General Manager who I will give a small percentage of ownership to. They will be taking over everything that I do so I can open another office somewhere.
$250,000 a year is a very small goal. I made just over $250,000 on my very first deal a couple months after my 18th birthday. Ofcourse not all deals turn out that well but you can do better than that.
DannyTheGreat-
$250,000 on one deal is pretty impressive.
What was the deal?
How much did you pay for the house?
How did you structure the finacing?
Did you rehab and sell immediately or did you hold on to the house for a period of time?
My first deal was a rehab. It was fairly extensive but a good learning experience. It was a house that was vacant for about three years and has a broken window so all the rain and snow has no problem getting in creating mold covering the front- middle portion of the house down to the ground. Since the porch was falling apart I just had the entire front of the house ripped off and redone.
I paid 90,000 for the house with about 120,000 in rehab costs and sold for 480,000. The houses on either side were kept in immaculate condition and this one was covered by vegetation and forgotten about.
I financed 100% of it with hard money. So ofcourse I had to sell it immediately. From start to finish the project was probably the scariest thing I ever did.