Hello to all and thank you in advance.
I am 27 with a job in IT making $47k and newlywed and just realized that I am not going to amass any wealth while participating in the 9-5 rat race, so I bought Keller’s book and I am completely and totally ready and willing to do what it takes to become a real estate investor! And the spouse is on board! We have excellent credit and some debt - about $20k combined. Just bought a house for $300k with 5% down.
Anyhoo, in all of the purchase scenarios in the Millionaire Real Estate Investor Book by Keller, a 20% discount off of the purchase price is assumed. How is this achieved? Is this available ONLY to investors? Is this the same as wholesale price?
This (and any other) advise would be super!
Discounted property is all around you. You just have to know where to look. You need to find motivated sellers and then you will find your 20% discount.
Keep reading everything you can find. In fact on this site under site navigation is some great information. The Real Estate Investing Books are awesome. Maybe start with Bill Bronchick’s book Flipping Properties.
Check out this book at Amazon.com ( Missed Fortune) by Doug Andrew.
And make sure you are patient until you have a clear path.
I see that you put 10% down on your primary residence.
What if you pulled that 10% back out and put a little down on a fixer upper and used the rest to rehab it. Then Flip it and take the money from that one and do it again.
Good luck and feel free to send me an email anytime.
I am a little wary of rehabbing and flipping for my first property. I would think that rehabbing takes lots of experience, of which I have none.
My husband and I were thinking more along the lines of buying a multi-family in a nicer neighborhood / improving (new counter tops, washer & dryer) / renting at higher rate.
Would you suggest that we rent or flip for our first time out?
The idea of pulling that 10% out is a little too scary for me. I don’t want to mess with my mortgage payments. Hubby and I are saving to put a little down and then use the rest for fixing up kitchens / bathrooms on what we buy.
Ramona, I have heard that investment property mortgage rates are higher than primary residence rates. Is this true?
Let me demonstrate how easy it really is to find 20% in a property!
lets say that you find a property before it is listed with a realtor here is my
appraised value 300,000.00
Deduct realtor fee's 6% 18,000.00
Deduct an repairs (make them high) 18,000.00 Deduct Holding costs waiting for a buyer 6 mos. 12,000.00
Most buyers ask for a 5% seller consession 15,000.00
Right there you are at a 80% L.T.V.
OK, so basically what you are saying is that I need to find a home for sale before the seller contacts a realtor.
So, if the seller wants to sell the house for $300,000, I tell the seller that there is $18,000 worth of repairs to be made, and so that must be knocked off the purchase price? I have lots of reading and learning to do
Where do most people look for homes for sale? For Sale By Owner is golden, correct?