New to Biggerpockets..Need Opinions Please..
Hello All.. I thank all of you for your postings, as I have gathered alot of interrestiong information here the last few times I have logged on.
I will first explain a little who I am, and why I take interrest in this web site.
I am a 35 year old auto mechanic who is looking for a better way.
This all started about 2 years ago when I purchased my first house for my family. It was a worn out bugalow in need of some TLC, and I had watched many TV shows on how to repair homes, and I bought this house.
One of my good friends who happens to be a land developer/realtor helped me purchase the home, and 2 years later, I completely redid the house inside and out. New windows,rugs,paint,removed cedar shake roof, and installed second story with HUGH master bedroom and 12x12 marble bathroom ...Alot of work, and I did it all for under 25k. Needless to say I impressed alot of people that doubted me, pretty much everyone.
Now, the house was appraised at 130k more than what I payed for it, and it seems like a no brainer to me, that is, that realestate is the way for me.
I sat down with my friend who sold me the house, and basically told him I want him to teach me the ropes. He has 17 rentals, all owned outright, and has developed approx 700 houses. Built his last 119 house development WITHOUT a bank loan, so I guess you can see, he has done well for himself.
Anyway, the deal is, I have all the mechanical ability and own all the tools for repairs. He has a ton of liquid cash, and all the experience in the business end, plus he is a broker as well.
I look and examine all the sherrif sale houses. I send out the letters offering to buy the houses, buy and rent back, fast cash settlement, ect.
The letters often come back, as the people have moved and left no address. I have been doing this for 5 months now, and gone to 4 sherrif sales. We are very conservative as to what we bid on, and price isn't really a concern, as long as we feel we are stealing it(to resell) We have been mainly looking at decent property, reason being, we would rather buy in better areas, and try to do cosmetic work verses poor areas, and whole house rehabs.
The problem is that:
1) The last sale we were at, we were sure we would get 2 houses, but we were out bid buy a large city investment firm that buys alot of houses, and is more interrested in quantity. They don't mind making 5k on a house, because they do so many. We on the other hand would like to make alot more, but on fewer houses. My friend tells me it will happen, but I have never done it before, and I am becoming discoraged. To be honest with you, if he never got another property in his life, it wouldn't matter, but for me, it really matters, becasue I have only one, and I live in it, not renters..
2) I am sending out mailers, but NOT getting any takers. I had one lady call and leave a nasty message on my machine about a letter she received, and another person called today and left no message. I called the number back on the called ID and said that I noticed this number on my phone, and was just returning the call to see who it was(I was playing dumb.) The lady said" Oh yes, my husband called you, and when she handed the phone to him, he hung up on me..
Is this typical to what the rest of you go through? I thought that the hard part would be coming up with enough capital, but now that I have a backer worth millions, it seems like the real problem is getting the right deal. I spend hours on the internet and I drive around and inspect all the houses, I seem to pick the houses that go to the sale, but either the Up-set price is out of this world, or someone else bids the house up too high.
Any input I would love to hear. Again, I am new to the foreclosure world, but have a great mentor, but at the same time, I want to be successful, and my buddie already is. I am sure he would like to make some more money, but I am not sure if he is as hungry as I am.