Investor · Fontana, CA · Member since 2017 · 33 posts · 14 votes
Hey Guys,
I sold my rental house , cashed in about 100k capital gains on it. Got my real estate license this year. I am trying to figure out the best possible way to invest in flippers using the BRRR strategy. I am in SoCal and have been looking at foreclosures, REO's in my area. I need a plan to make the most of my available liquid cash of around 150K. Any suggestion?
Ashish Brar
Would you consider doing a JV, in South Florida? I'm currently looking to acquire an apartment complex in broward county, FL. If you are interested PM and let's discuss. I look forward to hearing from you soon.
Regards,
I'm not really following you simply due to the fact that I'm completely unfamiliar with that strategy. I'm personally looking to do flip and BRRRR deals since that's what I have been inundating myself with information and education on in preparation of my first deal. Your strategy sounds very interesting and like it's quite profitable but it's just not clicking for me.
@Brian Garrett Think of it this way: If you like hammers, saw dust, and hands on remodeling, then do Flips. Not a lot of money in it and it is the riskiest approach to investing in real estate but it is personally satisfying to a LOT of people. It is like a job. You always have to do the next one with no guarantees of when you will find the next opportunity or how long it will take to sell. But, it is hands on, material, physical. (I have done lots of flips, some from the ground up.)
The other way, you are the bank. You locate off market properties of people who want to sell. You buy the house Subject To or on a Wrap or Land Contract. You start making their payments, find someone to sell the house to (a Tenant Buyer) who gives you the down payment, title transfers to them, so you no longer have to worry about fixing it up, (they do the fixing since they now own it), and of course you charge more for the mortgage payment than you are paying. This "cash flow" gives you freedom year in and year out. I was a landlord and I got all of those calls landlords get. This is far better. And, you get their down and the "back end" equity. Normally this is taught through joint venturing. My students tell me the first one crystallizes the concepts and the next two or three make them fairly self-sufficient and independent with occasional calls to me for support. Yes, this can be taught remotely. Or you can learn it searching through BP.
@Brian Garrett Think of it this way: If you like hammers, saw dust, and hands on remodeling, then do Flips. Not a lot of money in it and it is the riskiest approach to investing in real estate but it is personally satisfying to a LOT of people. It is like a job. You always have to do the next one with no guarantees of when you will find the next opportunity or how long it will take to sell. But, it is hands on, material, physical. (I have done lots of flips, some from the ground up.)
The other way, you are the bank. You locate off market properties of people who want to sell. You buy the house Subject To or on a Wrap or Land Contract. You start making their payments, find someone to sell the house to (a Tenant Buyer) who gives you the down payment, title transfers to them, so you no longer have to worry about fixing it up, (they do the fixing since they now own it), and of course you charge more for the mortgage payment than you are paying. This "cash flow" gives you freedom year in and year out. I was a landlord and I got all of those calls landlords get. This is far better. And, you get their down and the "back end" equity. Normally this is taught through joint venturing. My students tell me the first one crystallizes the concepts and the next two or three make them fairly self-sufficient and independent with occasional calls to me for support. Yes, this can be taught remotely. Or you can learn it searching through BP.
Thanks for the explanation Ken but that process is not for me. I also disagree with your outlook on flips. Just a difference in opinion and strategy. Different strokes for different folks I guess!
@Brian Garrett Of course, that is the fun of real estate. So many different ways to do things. I'll be interested to hear how you feel a year from now after your first flip. Most people underestimate how long they take. ;-)
@Brian Garrett Of course, that is the fun of real estate. So many different ways to do things. I'll be interested to hear how you feel a year from now after your first flip. Most people underestimate how long they take. ;-)
My realistic expectation for my first flip is 4 months from start to finish but I will use 6 months in my calculations (holding cost, etc) to allow for some extra cushion. We'll see how it goes!