What is the game now?

Question

Watched a video from Phil Pustejovsky, he noted that the game coming out of the housing crash was foreclosures & shorts.  My question is: what is the game now?  In the intro forum Justin mentioned that the MLS is not were most of the deals are.  My questiom is where are they now?  Thx.

Tyler Grant · Answer

Actually @Jeff Caravalho , In my current situation, I'm in need of my own residence, and so I'm looking into getting a FHA 3.5% loan so I can purchase a duplex or triplex. I intend to occupy one unit and rent out the vacant units to cover my mortgage payment costs. The goal is to be able live rent free via my tenants paying rent. This will allow me to truly position myself in a financially stable place via working a job and attempting to invest in other areas such as wholesaling. I'm still quite the new investor myself but I'm very confident that I can do what it is I set out to do. Just keep telling yourself you'll make it and you will!

Best of luck to you in all your future endeavors!

Joe Fairless · Answer

@Jeff Caravalho it depends on the market that you're investing in. If might be a buy and hold market (i.e. KC) or it might be a fix and flip (i.e. Chicago). Also depends on what you're investing in (i.e. homes, apts, office, retail, etc.).

Jeff Caravalho · Answer

Sounds Great!  My 2 cents would be if your not handy, get handy, it'll save you money you need for your next deal, and you'll be better equipped to deal w/ contractors or property managers in the future...good luck!

Jeff Caravalho · Answer

Hi Tyler,

Thanks for the great input.  I've been soaking this sight up like a sponge lately!  I agree about the niche part.  Are you marketing to FSBO's?  Do you farm your local area.  I'm really thinking local (Sacramento, Placer), and really becoming an expert on my neighborhood.  I also agree with that do more flips in the beginning & doing more holds afterwards is the way to go for me.  As far as becoming a RE, I think if you have a close buddy or even family member who is one, you may be able to get what you need from the MLS.  But if you don't & are serious about REI, I would recommend getting a RE license.

Thanks again & best of Luck to you.

Tyler Grant · Answer

Hey there @Jeff Caravalho

As I'm sure others will tell you, the deals are where you make them. You know alot of the "gurus" claim that the best place to start is in wholesaling. The reason so many people fail in the real estate "game" right away is because they follow these words and discover it is too hard for them. Wholesaling is totally possible in the beginning. I've read plenty of stories of others getting their start in wholesaling.

I simply suggest you research all aspects of RE. This is the path I'm taking and quite often do I find myself learning valuable rehab tips when I was originally reading about wholesaling or some other matter. This community has an enormous collective knowledge that you should take advantage of.

A lot of people recommend that you specialize in a niche and that's exactly how you should approach this. However, I also suggest that you familiarize yourself with other aspects of RE. It's better to fully understand one area and some of all the others rather than none of the others. The last thing you want to do is be caught with your pants down in this industry.

The MLS is a great tool if you know how to use it, let only get access to it. If you're truly interested in RE, I would suggest you consider acquiring a RE salesperson license. I'm currently in the process of doing so myself and am learning an abundance of information in combination with my participation in the BP community.

That is not to say that the MLS is your only option. You'd be surprised by all the great deals you can find via marketing to for sale by owners.

I myself think that the passive income game is where you want to be. To truly build financial wealth, you want to acquire as many residual income properties as possible. These will supply the cash flow needed to sustain your daily lifestyle and any other investing you'd like to pursue.

Research, learn, take action. This is your key to being a successful REI. Don't get caught up in that Analysis Paralysis.

Jeff Caravalho · Answer

Derek, I think you hit the nail on the head with "leveredge local knowledge", Thx

Terri, Thx for the meetup info and best of luck to you in Chico :)

Derek Daun · Answer

@Jeff Caravalho

I use strategic to mean 'an area that I think is more likely than not to outpace appreciation than the city at large.'

Although demographics play a role, it's more about trying to leverage any local knowledge I have that might give me an edge on the bigger players who are sweeping up properties.

Jeff Caravalho · Answer

Justin, Thanks for research link, is there a way to get more local data like this? This looks more national.

Derek, there are a million ways to invest, great point.  When you say strategic location, is that more personal or demographic.  I would think I'd like to have my investments relatively close to where I live.  I have a sister with a few rentals spread out across the country, she has some horror stories...

Derek Daun · Answer

The definition of a 'deal' is very relative to your goals, your experience, your business model, the amount of time you have, and the amount of cash you have.

For me, I might see a flip listed on the MLS as a good deal. It's turnkey and ready for renters to move in. Assuming it's in a strategic location, there might still be a lot of value in appreciation in the next couple of years as longs as the rent covers short term expenses. This could be a win win. The flipper gets their 30k, and I get long term value wihtout a lot of work to put in.

For someone else, this might not be a deal. they might not like the idea giving that value gained by flipping to someone else.

Justin Cooper · Answer

I would say we are in a seller's market as far as the greater Sacramento area is concerned. Inventory is less than 3 months, homes are selling in less than 30 days, prices are increasing and properties are getting multiple offers.  Most of this info can be found on the internet.  Check out this site.  http://www.realtor.org/research-and-statistics/hou...

You can talk to people who are active in the market too and of course BP!

Zillow is nice and user friendly, good for research but not real values.  Redfin is great for a quick comp search and easy to use.

What is the game now?

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