I was forced to become a Real State Investor

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I was forced to become a Real State Investor

Daryl Arias
Miami, FL · Member since 2015 · 20 posts · 3 votes

My name is Daryl Arias, Live in Miami Florida, and a couple of months ago i helped a friend, buy a Foreclosed Condo around the Hammocks Area, we fixed it and now its rented and giving him a healthy 15 percent per year plus the value of the home is now around 25% more than what we paid. This sounds like a boring story if we compare it  with what you guys do here in terms of money and returns, But I kind of need your help, because my friend has recommended me to many of his friends and they have some serious money to invest. So it seems to be an opportunity that I'm "forced" to explore.

So my question would be, can somebody share a way of finding these properties, I do have a Realtor friend that is always sending me stuff, but is there any other way to actually be ahead of the foreclosures? Pre Foreclosures?

They are willing to invest in all of south florida, so if you think you can help me find opportunities like that let me know 

Thanks In advance

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Sean Edgar
Rental Property Investor · Applegate, OR · Member since 2012 · 177 posts · 51 votes
10y

Hi Daryl! Great job on the foreclosed condo. That is exciting! Sounds like you have a great opportunity in front of you. There are many companies out there that offer pre foreclosure lists for a fee. Just do a google search for "pre-foreclosure leads". There are also companies such as Property Radar, which I highly recommend, that offer an online service where you can find and track foreclosures as well as look up all kinds of property data as well. 

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  • Sean Edgar
    Rental Property Investor · Applegate, OR · Member since 2012 · 177 posts · 51 votes
    10y

    Hi Daryl! Great job on the foreclosed condo. That is exciting! Sounds like you have a great opportunity in front of you. There are many companies out there that offer pre foreclosure lists for a fee. Just do a google search for "pre-foreclosure leads". There are also companies such as Property Radar, which I highly recommend, that offer an online service where you can find and track foreclosures as well as look up all kinds of property data as well. 

    1Reply
  • Daryl Arias
    OP
    Miami, FL · Member since 2015 · 20 posts · 3 votes
    10y

    @Sean Edgar Thanks for your input, will def look for those leads, and Property Radar doesn't work for FL, I tried and even enrolled then had to ask for refund, they say they are thinking of expanding so lets see..

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  • Bill Devola
    Wholesaler · Bogota, NJ · Member since 2016 · 128 posts · 64 votes
    10y

    Pre-Foreclosures are a huge market.  But there's a metric ton of info to cover.  And its different than buying homes on the retail market through a realtor.  This answer isn't helpful, but you're looking for more info that can be comprehensively given in a post. 

    If you're new, I wouldnt re-invent the wheel just yet.  The "market" is telling you all you need to know about 15% return and 25% appreciation.  Namely, its in demand.  Dont know why youd think its tame.  Its not a home run, but you can see people would be plenty happy with it.  Enough to run and tell their friends. 

    If your aim is 25% return and 40% appreciation, pump your brakes one time.  Pigs get fed. Hogs get slaughtered.  Seriously, replicate those returns and youll make yourself and your friends wealthy.  

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  • Lee Smith
    Residential Real Estate Broker · Indianapolis, IN · Member since 2009 · 477 posts · 304 votes
    10y

    I was forced into becoming a property manager 8+ years ago, and now I own a property management company... haha

    Pick a target neighborhood or two or three.... drive around the neighborhood looking for properties that are in disrepair and see if you can pull the tax records to snail mail to the owners and offer to buy.

    Call some probate lawyers and see if you can get in on some of their houses that need to be sold.

    Pull property tax records for a neighborhood and see who owns multiple properties.. You may find a guy that can give you advice on finding wholesalers, etc.. Also that investor may be winding down and looking to sell...

    Get involved in your local REIA(Real Estate Investor Association).. You will make lots of contacts and should be able to get some deals via that!

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  • JD MartinBusiness Member
    Moderator
    Rock Star Extraordinaire · Northeast, TN · Member since 2015 · 10k+ posts · 16k+ votes
    10y

    I am a little confused. You wrote:

    i helped a friend, buy a Foreclosed Condo around the Hammocks Area, we fixed it and now its rented and giving him a healthy 15 percent per year plus the value of the home is now around 25% more than what we paid. 

    Where does the "investor" part come in for you? As best as I can tell, you own/partially own something that someone else is making money from. That sounds more like a loan/gift than an investment. Are you collecting some of the funds, or is the plan to sell it and pay you the appreciation, or something similar? 

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  • Daryl Arias
    OP
    Miami, FL · Member since 2015 · 20 posts · 3 votes
    10y

    @Bill Devola Your post is definitely helpful, I am completely happy with the return plus appreciation of the condo, and its something I would take everyday, I was talking about Pre-Foreclosures as I understand that some of them actually become  forclosures, so very conservatively I would research about them to be better prepared and get them maybe before they become foreclosures. Also the idea is to create a portfolio in which 60-70 percent of the properties get similar returns and then 40-30 percent will be invested in single family homes that could be flipped within 4-6 months.  

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  • Daryl Arias
    OP
    Miami, FL · Member since 2015 · 20 posts · 3 votes
    10y

    @Lee Smith nice!! well I would like to chat with you a little more, because part of the plan is for me to manage their properties as most of them are not living in the US

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  • Daryl Arias
    OP
    Miami, FL · Member since 2015 · 20 posts · 3 votes
    10y

    @JD Martin ok so in that instance i just had  to find and organize the deal, whats being offered now is that I will be handling their investment plus some of mine as well, In that first deal I just got payed a commission, but moving forward I would basically act as fund manager/owner and I have to design the payment structure for that too...

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  • JD MartinBusiness Member
    Moderator
    Rock Star Extraordinaire · Northeast, TN · Member since 2015 · 10k+ posts · 16k+ votes
    10y
    Originally posted by @Daryl Arias:

    @JD Martin ok so in that instance i just had  to find and organize the deal, whats being offered now is that I will be handling their investment plus some of mine as well, In that first deal I just got payed a commission, but moving forward I would basically act as fund manager/owner and I have to design the payment structure for that too...

     OK, I understand a little better now. Whenever you will be handling/responsible for someone else's money, you need a good legal structure in place to protect yourself and the client. I would suggest consider the framework for what you want to do and find a (relatively) inexpensive business lawyer that can draw up a template contract that you can use for these investors. Finding houses is the (relatively) easy part in this equation - dealing with payment, profit and losses is going to be the sticky points. You should also consider some kind of business insurance in case something really goes south. 

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  • Bill Devola
    Wholesaler · Bogota, NJ · Member since 2016 · 128 posts · 64 votes
    10y
    Originally posted by @Daryl Arias:

    @Bill Devola  I was talking about Pre-Foreclosures as I understand that some of them actually become  forclosures, so very conservatively I would research about them to be better prepared and get them maybe before they become foreclosures. 

    I get what you're saying.  What I failed to make clear in my post is that pre-foreclosures turning into foreclosures is a little like the worm turning into the butterfly.  You don't know what your going to get when you see the worm, it hides and goes away for a few weeks, and when it comes back it can and does easily flutter away.  

    pre versus post foreclosure are different worlds, with totally different sellers and strategies and skill sets.  It seems intuitive that if foreclosures are good, finding them earlier and when they are lesser known is even better.  But they are a totally different animal before they are post.   Still worth doing, still profitable, but a different ballgame. 

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  • Jack Butala
    Los Angeles, CA · Member since 2014 · 2k+ posts · 515 votes
    10y

    Hello @Daryl Arias and welcome to BP. BP is a great place to learn about real estate while connecting with other real estate investors. I wish you all the best. You are not alone in your real estate ambition. 

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  • Crystal H.
    Flipper/Rehabber · IA · Member since 2015 · 157 posts · 35 votes
    10y

    @Daryl Arias Are you a licensed Realtor? I did not see anything about that, only that you had a Realtor friend, and you said you collected a "commission" for finding the property. That is a serious violation of Florida law. However you plan to move forward with these investors, I wish you the best of luck and also suggest you seek legal advice to protrct yourself.

    1Reply
  • Daryl Arias
    OP
    Miami, FL · Member since 2015 · 20 posts · 3 votes
    10y

    @Crystal H. thanks for the comment, the word commission might not be the correct one, it wasn't for finding, we basically fixed the house for him and got the tenant, so it was more like return of investment just that my investment was really time... But thanks thats precisely my idea, we are looking for the best financial structure in order to do this full time.

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  • Michael Lee
    Investor · Coppell, TX · Member since 2008 · 2k+ posts · 646 votes
    10y

    Hello and welcome to BP,  There is no such thing as being forced to do anything.  You must be seen by others to get things done, so therefore there is a talent.  You are in probably a good plwc

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  • Daryl Arias
    OP
    Miami, FL · Member since 2015 · 20 posts · 3 votes
    10y

    @michael 

    @Michael Lee you are correct ive always liked real state, but I say it in a way like "they gave me an offer i couldnt refuse"

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  • Michael Lee
    Investor · Coppell, TX · Member since 2008 · 2k+ posts · 646 votes
    10y

    I messed up and hit the wrong button.  As I was trying to say is that you are probably in a good place to have diversity and population growth.  It is a good thing to have others that have money who want to give it to you.  There are a few things to remember.  Education is they main key for you to get what you want.  Finding/Getting Team members who can do the things you do not no how to do or do not want to do.  The local and experience main team members are Attornies, Real Estate Agents, CPA's, Inspectors, and General Contractors.  Always do the number and make sure they are all real and try to look at them before you make an offer or at least have a clause in the sales contract that will allow you some time to look and possibly back out without a penalty beyond your earnest money.  Always take out an insurance policy after you close to protect yourself if there is a loss.

    I and 59 years old and I am still trying to decide what to do.  I also went to college, it is not mandatory, and got a business degree that emphasized real estate.  Since I went to school in Texas I was qualified to get a broker license without having to take anything extra.  Regardless of what I had I felt more comfortable in the construction business so I went there.  I have been in the construction industry since I was 17.  I have done motley remodeling but I built a bunch of condos back in the 80's. My father has been in real estate sales for about 40 years and he has taught me a little bit.  If you think that I can help you please contact me through BP at any time.  Good luck!

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