I recently saw an article “How to lose a million dollars in real estate” what a great title! Then I saw the author Verna Jones-Cox (real estate short sale expert) no wonder it had a great title. I met Verna about two years ago and I would have expected no less. So with my apologizes to Verna, your title was to eye catching not to play on.
My own book “One House At A Time / Finding And Buying Single Family Rentals” is directed at real estate beginners and burnt out students of TV real estate gurus, the very people that can't afford to lose money. These are also the very people that are most likely to lose money, especially when miss lead as so many are.
“One House At A Time” is subtitle “Finding And Buying Single Family Rentals” the key words are “Single Family” most people should stick to what they know! Single family homes whether rentals or flips are just like the houses most of us have lived in all of our lives. Maintenance, improvements and day to day upkeep are the same as you've been doing ever since your mother first noticed you were big enough to push a broom. Buying and selling them is just like your own home.
New real estate investors have enough to learn, single family rentals are simple to maintain (just like your home), but you have to deal with tenants, rental laws, and contracts. Flips require different decisions retail or wholesale, paint or paper, landscape or simply clean, etc . . . Sticking to what you're familiar with will ease the learning curve and most new investors will make money, if only because it hard to make a big mistake!
Rule # 1. To make money expand upon what you know!
On the other hand even if a person has lived in an apartment for 30 or 40 years, walked on land, shopped in stores and worked in an office every day of their life there is very little relevant experience to owning and managing them! I attended a meeting of would-be real estate investors, a group I knew well. Their Guru (with little experience but more money that his audience) spent more than two hours urging the audience to liquidate their single family homes to buy into commercial projects! It wasn't until the very end that we learned he was pimping a $5,000.00 week end book camp on commercial investing! Most of these people had not yet mastered single family rentals! Some didn't yet have a home of their own. The only thing this program was offering was a chance to lose $5,000.00.
Rule # 2. Avoid pimps!
Most of you reading this don't yet have a million dollars! Your losses will accrue from inaction, delay, and procrastination. In today's real estate market most of you will not lose a million dollars. You will lose several million dollars!
Rule # 3. Buy houses! Now!
“NO!” That's the advice most often given if you foolishly ask anyone if you should do anything. There is never a risk telling you “NO.” If you ask a friend should I and he says “yes” and you fail he lost a friend! If a friend says no and you succeeded anyway “you got lucky” everyone wins. If you lose, there's great bounding in commiseration, and great satisfaction in “I told you so!” You'll get the same “NO!” from your attorney or CPA, but they will send you a bill for bad advice. Strangers will say “NO!” because they don't want you to succeed. Family will say “NO!” because they don't want you to get hurt.
Rule # 4. Avoid third party advice.
Some people will advise you to “do it.” They're the ones who get paid! We all know what you call someone who “does it” for money. Getting paid is good, I'm a mortgage broker I get paid when you “do it” just like your real estate agent. I'm also a Guru. Be careful, good advice is worth paying for, but whores are whores!
Rule # 5. Avoid Whores!
About the Author: William J Archambault Jr in lending and real estate since 1969. A mortgage broker in Las Vegas, NV. He writes about up to the minute investment real estate tempered with the wisdom of our grandfathers. He's the author of:“One House At A Time/Finding And Buying Single Family Rentals” avaiable at http://www.reii.org E-male author@reii.org
Source: www.isnare.com