Here’s a tip. Hiding your jealousy by calling someone an idiot makes you look an real idiot. How about taking some initiative and risks in life to become successful instead of trolling all day on the internet sitting on your candy eating chocolate insulting people that you are jealous of. I earned what I got. What are your qualifications? None, troll.
Leveraging OPM is only one of the many ways to look at real estate investing. Sometimes the best deals require cash. And if you don’t have cash, you’re sh-it out of luck on that deal.
As for how do you interview people if you don’t know anything about real estate investing. That’s ridiculous reasoning. It’s called the straw man argument. You created a false scenario and then attacked it. The guy already said he’s spent a year reading books on it. From just one biography, you can learn a hell of of a lot. There’s plenty of books out there on how to interview people properly. Just look. I’m sure he knows plenty and your argument makes absolutely no sense.
You don’t need an MBA to invest in real estate. It’s not even relevant Inexperienced MBAs can get jobs as CEOs right out of college. Happens all the time. It all depends on the salesmanship of the candidate and individual attributes. I’ve met guys who’ve done that. Those same guys could probably become a front runner for US president. It’s mostly politics and salesmanship to become a CEO. Most CEOs are not like Alan Mulaly. Just because you are incapable of doing it doesn’t mean someone else couldn’t. That’s completely ridiculous.
And just because you may have lost money before doesn’t take you permanently out of the race because of a bad reputation with money. You’ll still find lenders and you learn from your mistakes. Trump’s reputation isn’t damaged for losing other people’s money. It happens. Even Henry Ford came from nothing, bankrupted two motor companies before becoming successful (first-Detroit Automobile Company, second-Henry Ford Motor Company, and finally the Ford Motor Company–where he became a billionaire). In Ford’s second venture, he designed a luxury car and the company went under because the car was too expensive. Then he decided to try again with an economy car. Yet, Henry Leland found lenders and took that second bankrupt company and called it Cadillac Motors and became successful selling those expensive cars. And Cadillacs are still well known luxury cars. Henry Leland was a better salesman than Henry Ford when it came to luxury cars. Ford reevaluated his business model and become successful the third time. He still found lenders.
Control your emotions sir.
I take plenty of risks. Just because you are mad doesn’t mean I am incompetent or unsuccessful. You have nothing to base your opinion on. I, on the other hand, tell it how it is. You talk about banging young hot women and having a sports car? Big man.
Great men are not remembered by the size of their pickup or the length of their personal watercraft. You, sir, need a lesson in humility.
So great men are not allowed to have egos? Thank-you, Mr. Congeniality. Yes, I’m the big man. I’ll own it.
Ha, you don’t take risks. You’re just a jealous troll who sits in front of the internet all day. If you weren’t, this wouldn’t bother you so much.
I’ll have you know I am much, much younger than you. I go on here sometimes to read other ideas and have an intelligent discussion. But what I am getting from you are very immature personal attacks.
It was Carnegie, you know… the man who’s on your avatar, who said “It is the mind that makes the body rich. There is no class so pitiably wretched as that which possesses money and nothing else.”
You talk about banging young hot women and having a sports car? Big man.Great men are not remembered by the size of their pickup or the length of their personal watercraft. You, sir, need a lesson in humility.
I can hardly breathe that is so hilarious…! :beer :biglaugh :biglaugh :biglaugh
We’re quoting Carnegie now? I just noticed that if you flip your name 180 degrees around it says “poop”. Is that what you stand for? Being a big bucket of useless “poop”? Or maybe you just enjoy stepping in it often. Or maybe that’s just a metaphor for where you are at in your life.
Let me remind you that you started with the personal attacks. As they said in a university Latin class I took when I was 18, “Quid quo pro.”
Gentlemen, Let’s keep it civil in the Forums.
Wow… I would have taken davewindor’s first post seriously if it weren’t for the next couple of posts. If you are in your mid 30’s there is no reason why a bunch of anonymous people on an internet forum should be able to get you that worked up. Congratulations on your success, but aren’t you discounting the value of those smaller deals in helping you to be successful in your future lager deals by assuming you would have done just as well ten years earlier without that experience?
I like the think big mindset but $1M on my first deal is way out of my comfort range. Not only that but I doubt that even with the money I could find someone to finance such a large deal for someone my age with no previous experience. There is a big difference between theoretical knowledge and real world experience no matter how much you read. If I had a great network of experienced people I could rely on I would have no problem going after bigger deals but I don’t at this point. The only way that I really know to build my network is by starting with a couple smaller deals and working with people, keeping the people who worked out, and replacing anyone who did not.
As far as the $2M goes. It is not something that I would ever mention to anyone. I only mention it here because it separates my situation from other real estate investors and I would like to figure out how to maximize that advantage (I know its also dangerous but there is no denying having that money should give me a huge edge if used correctly)
This probably one of the more interesting posts I’ve seen here. Just my two cents. There are several markets in the US that you can buy property, turn around and rent it for an immediate profit. I live in Las Vegas and right now it is cheaper to buy a home than it is to rent it. Condos are going for 20 to 50k, depending on the area and there are several partially finished buildings here as well.
My advice is to start small, bank the profits and stay liquid. Buy in multiple markets, vary your portfolio and get EXPERT local help. Talk to several realtors in each market and have a plan.
Well, each to their own. If you’re not comfortable, you shouldn’t have asked. But, good luck with that. Follow your instincts. Do something you believe in.
As far as responding to personal attacks in kind, who says I need to be professional all the time? It’s not a law. I don’t know what people here are expecting, but even Trump gets dirty when provoked. Doesn’t make him any less respected. Remember Trump’s personal attacks on Rosie O’Donnel? http://www.youtube.com/watch?v=d32577Hom08
I got a kick out of dave getting worked up its called passion for what you do and what you know lol nobody should get upset about his bragging cause in worst case scenario if it were you you’d be doing the same thing he’s doing… :beer
Anywho hello everyone ive been here awhile so i had to say something i understand everyones point and i kindof agree with dave ive seen him here for a while and he’s the real deal and i understand the other points of everybody else that its two much money to throw out there…this is what i take from it and IMO basically you dont have to start that small if you have 2 mill in the bank. you dont need ton’s of experience to be that successful in anything as far as jumping out of college and being ceo’s and etc lol all you really need to know how to do is be a good manager of people and you’ll do fine there are million’s of people everyday that dont know jack about the core of their business but that doesnt take away from them being successful at it by being a good manager of the people that manage it for them… real estate is all about taking 1 dollar and turning it into 4, sometimes that cant be done in financing cause financing can take away from leveraging that for another building or deal of whatever of something in some cases not all… some deals you do have to buy all cash cause thats where the deal is… but its all on what avenue you wanna take… Dave is successful with what he does so he see’s things differently on a level some posters may not be on. different levels of success equals different mindsets :cool take from javipa and dave what they said its gold for your situation just adjust it to your liking… :beer
Hi,
At least I am not in the middle of this heated discussion, Yet?
Ok, so you have a few bucks more than the average starting rookie investor? At 25 years old your getting an opportunity that few other’s here ever had, and that’s the cash to use for a prudent reserve, down payment and closing cost’s to buy portfolio real estate without having to earn it one property at a time!
I am going to guess that at 25 you did not earn this money and quite frankly how you got it matters very little, but keeping it is another story all together, some here want you to go big or go home, others would like to see you error on the side of caution, use conservative practices and hold on to your money.
There are a lot of guys here with lot’s of experience, who have become experts through time and lot’s of trial and error experience as most of us started with nothing and have been persistant in continuing forward regardless of the temporary outcome taking success with failure.
There are dozens of guys on here capable of shelling out a half a million to a million for the right property, however these guys know exactly what there looking for, how to run the numbers and maybe most importantly how to negotiate a sweet deal, but that’s only the first step as after purchase you have to know how to manage and operate your investment, this is where things get tough as this can make or break you.
I quite personally believe you should make your way from the ground up regardless of how much money you have, learn to discern a good investment, how to analyze the numbers, learn how to negotiate the price, create a contract and close the deal. Learn how to manage, care for and maintain your investment and how to collect rent, handle evictions and what to do to market and promote your property to gain a new tenant.
Then and only then will you truly understand the potential of capital, how to make smart investment decisions and what type’s or kind’s of investments to make!
GR
Dave,
With all due respect……especially with the +30 count apartment figure……
But correct me if I’m wrong….didn’t you post a year or two ago….about one of your early career purchases….where you took a total bath by buying wrong….and then spent the next year or two working at minimum wage rate unburying yourself from it?
With that in mind……how do you come off telling this guy to drop 50% of his 2 million net worth….on his 1st……. :shocked……property?
So the guy has read a few books….big f’ing deal……doesn’t mean squat and you know it.
Btw……don’t even think I’m interested in debate on this……way too busy for that… :bs
Donald Jr:
Stick with posts from javipa, Gold River……and my favorite….fdjake, (archived).
Until you know how to make money, (hand over fist from your own ingenuity), keep that NW parked in reserve.
I don’t recall saying I bought wrong early in my career, but there were times early in my career where I had to work at min. wage (over a decade ago).
Maybe by bath you were talking about the 31,000 sq. ft. vacant commercial plaza I bought on foreclosure a few years. I sold it for a little more than what I bought it for, but my corporation lost a lot of money to carrying costs and renovations and I had to get a trustee to write off 75% of the debt. The reason it tanked was because I based the project completion on borrowed money and didn’t have a huge cash reserve of my own money and it tanked because a lot of my credit lines were cut midway when I started using them for rehabbing it to make it rentable. I never lost my apartment buildings because the restructuring guy I hired was worth his weight in gold. I also give credit to having some good lawyers. Had I had a cash reserve or another source of financing available to me, it would have turned out totally different and been completed and rented and refinanced and I would have made a lot of money off of it. But, this project was 100% financed using other people’s money, not my own, and it’s an apples to oranges comparison as this wasn’t a rented out apartment building or something that had money coming in. I should have bought a couple more apartment buildings with that credit instead.
The real answer is to sit down with a financial planner and diversify your money. For example, you can use insurance policies that give you a 8-12% compounded interests with no risk which is also liquidable if needed while shielded from any lawsuits.
For flipping property, use a self directed real estate roth IRA. Definitely I would buy a few rental properties.
Hi,
A Roth IRA has contribution limits, even if you could qualify with $2,000,000 dollars it would take 3 lifetimes to put $2,000,000 into a Roth IRA.
In order to qualify for a Roth a person can not make more than $110,000 if single and can not make more than $160,000 as a married couple.
The yearly contribution can not exceed a little over 7% of gross income!
With 2,000,000 dollars I would hope the current holding place of this money is paying more than $160,000 per year or 8% interest!
I do not recommend putting money into an annuity as they are not as liquid as the last poster believes them to be!
GR
thedonaldjr;
I was in a very similar position when I started investing in properties … so maybe my point of view is somewhat applicable. Congratulations, you are now a small time millionaire! However, you are so smalltime and so young that even 2 million does not set you up for the balance of your life expectancy. You might find it is much easier to lose the 2 million you have than make 2 million more. Regarding the advice to see a financial planer: I talked to 3 and not a single one suggested investing in RE. If I had actually listened to ANY of their advice I would have lost at least $2M in the 2008/2009 market crash. Turns out my RE investments have provide a Cash On Cash return of around 10%. Now, 10% is no magnificent return, but that doesn’t take into account the tax sheltering benefits or the appreciation ( yes I actually have appreciation of around 30% on all of my properties because I bought the worst property in the neighborhood at bargain prices and improved then to the level of the neighborhood).
In my opinion, start small and make small mistakes because you WILL make mistakes. Most small mistake can be recovered from without killing you but a big mistake on a million dollar property could cost you a significant portion of your nest egg. Also, remember, this is real estate INVESTING, not simply real estate buying. The classic rules of thumb still apply: 1) buy low because you make your money when you buy 2) location, location, location; it is the only thing money can’t change about any property you buy 3) do not over-improve.
Best of luck to you!
Gold River:
I was hoping you might share where you can get 8% interest in this market. Unfortunately, my cash investments are returning substantially less and I’d love to upgrade. Thanks for any info you might be able to provide.
satarnag:
“8-12% compounded interests with no risk” … Really? … Zero risk? If so, these must be FDIC insured, right?
If you know how to get an 8% risk free annual return you should be a billionaire in no time. Treasuries, considered the risk free rate, return less than 2% and even those are far from risk free at this point. A 5 year CD would also give you far less than 2% right now. With rates so low you are forced into riskier assets to get any return.
I am not getting anywhere near 8-12% return on my money right now. It is one of the reasons I am looking to diversify further by investing in real estate.
JMD,
I would be interested in hearing more about what you did when you were first getting your start coming from a similar situation. I do have my money with a financial adviser and non of them have ever recommended real estate either. The reason is because the more of your money they manage, the more money they make. If you are taking it out to invest in real estate they are losing out on buisness. If they were to suggest investing in real estate I am sure it would be through a REIT or other housing related stocks.
You say that 10% COC return is not magnificent but I would be extremely happy with that right now. If I could consistently get a 10% return on my cash while taking advantage of tax benefits, equity accumulation, and appreciation I would take it.