What Are Your 2007 Real Estate Goals?
Joshua D.Pro Member
BiggerPockets Founder · HI · Member since 2008 · 16k+ posts · 5k+ votesWe're conducting a 2007 real estate goals group writing project for those people who blog about real estate. With that in mind, I thought it would be appropriate to ask our members to set their own real estate goals for next year.
:groovy: What are your 2007 Real Estate Goals? :wowie:
i bought and have been vacant since November 30th. trying to find a tenant in the winter, 20 miles from home, and taking 9 days vacation in Austria, were not the ideal setup.
Happy New Year to You Josh!
Great topic, I was thinking the same thing.
My goals for the year are simple. Increase mortgage origination market share with builders. Increase T.V. advertising coverage. Pick up 2 or three more rentals. Obtain licensing for a couple of more states. Purchase rather than rent our office space. Bring down some of my debt load. In a nutshell work less make more!
Thanks for the New Year's wishes, Dick! I think you're dead on with "work less make more!"
Best Wishes!
Buy my first rental property. Convince myself to give it a shot. Convince myself to let go of the hard-earned cash (love to see it in the bank) and take a risk that could turn into a nice future (or not - darn it!) ...
Believe in myself enough to do this so I feel like I'm not totally dependent on a business that I don't own...even though I have a great job. I have a fairly significant income but I can't say that I enjoy my work. I'd like to get up each morning happy, knowing that it's me, not a boardroom full of stuffed shirts, in control of my destiny...
Goals:
*Purchase 2 or more additional rental properties. More specifically and importantly, doing that with my newfound analysis knowledge. The first prop I got is doing well but I jumped in feet first without the proper research to justify the decision from an investment perspective.
*Complete my first rehab project.
*Join the local RE club to learn and network (next week!)
*Read as many RE books as I can get my grubby hands on. (almost finished with the first)
*Take over the world!! jk
-Kamal
Believe in myself enough to do this so I feel like I'm not totally dependent on a business that I don't own...even though I have a great job. I have a fairly significant income but I can't say that I enjoy my work. I'd like to get up each morning happy, knowing that it's me, not a boardroom full of stuffed shirts, in control of my destiny...
Eager Texan,
I was in the same boat as you last year but an opportunity presented itself and I 'took the plunge.' It was a nerve-racking experience but the beauty is, we have our day jobs to support us if we do make mistakes.
In hindsight, my suggestion to you would be to study up on how to figure out if a deal makes sense financially and stick to some baseline ROI figures that you personally set. Then look at all property using this filter. Take the emotion out of it, and trust your numbers and the data you have to support your decision and that will help to reduce your risk and hopefully set your mind at ease as you do your first deal. Good Luck.
-Kamal
A brief overview of my 2007 Goals
I have never understood why 95% of people spend more time putting together a map of how to get to their vacation spot, than they do putting together the map that will shape their lives. Without goals you are essentially trying to put together a puzzle without having a box to look at the picture on.
1. Rehab 20 homes and sell at least 13 of them
Steps I have taken so far
a. I am currently rebabbing 11 properties so I am off to a good start
2. Make at least $200,000 flipping, buying, and wholesaling real estate
Steps I have taken so far
a. I have 6 homes under contract to sell which I will profit very well on
3. Make at least $120,000 selling other real estate as a realtor
Steps I have taken so far
a. Started running ads
b. Started calling leads back again
4. Help at least 40 people turbo charge their investment careers
Steps I have taken so far
a. Have done 11 phone consultations with new investors
5. Develop a 100 person buyers list for wholesale deals
steps I have taken so far
a. Started running ads again
b. Started calling old buyers back
6. Build up to $4,000 net cash flow
steps I have taken so far
a. I have 33 units, Mostly single families, a couple twos and a couple 3's. To be honest I have no idea what I spend or what I take in. These figures would seem somewhat important so I hired an accountant this year.
7. Be more organized
Steps ive taken
Hired an accountant
Hired 4 contractors to do my work
Thats a brief overview of my real estate goals. I have the long version using the steps below but I will save you the reading. I will say this Goals are powerful tools once written, here is what happened to me with my first goal setting attempts.
When I was around 24 years old, I had started reading about the importance of writing down goals. I was sitting at my desk one day (at a job I wasnt overly fond of) and began writing out my goals, I don’t remember all of the details but I do remember the major themes of the goals.
Goal #1 Own a Harley before I was 30 years old
Goal #2 Have at least $30,000 in the bank before I was 30
Goal #3 Make at least $100,000 a year by the time I was 30
Goal #4 Own at least 5 investment properties before I was 30
Goal #5 Have a fun car by the time I was 30
I think I must have been about 29 years old and was working on cleaning out my basement when I discovered my old book of goals. Upon opening the book I realized that I had achieved every single one of these goals without even realizing it. I had a harley in my garage, a convertible corvette in the garage, a jeep wrangler for days I didnt want to drive my vette, a lexus for my winter beater, I had been making 6 figures for a few years already, had over $100k in the bank and had 9 rentals. It was as if once my goals were written down I began to attract all of the tools that the universe could offer. :beer:
1st What is the end result that I would like to have? Be very vivid in your description of your end result. Think of things like how you will feel, what you will look like, and how other will see you.
2nd What time frame would I like to achieve my result in? Does your result need to happen in a week, a month, a year, or a decade.
3rd What am I willing to do, to make these results happen? If I were to pick out the most important step of goal setting it would be this one. Layout every action that will be required in order to achieve your goals. Be sure to include every step that will need to happen in order to make your dreams come true.
4th What will happen if you don’t achieve your result? By answering this question as thoroughly as possible you will be creating your big WHY and building your leverage. Building leverage is important because leverage helps you stay on track when the going gets tough. If your end result was too lose 20 pounds, your leverage might be I will die 5 years earlier, I will continue to feel fat, or I wont be able to play sports with my son.
5th What has caused me to fail in the past when I have tried to achieve the results that I desire? This type of brainstorming can help aid you when roadblocks come up. Identifying what has lead to past failure will help you avoid repeating the same failure again
6th What will my new reaction be when the same roadblocks come up in the future? Having a written plan of action in place can help prevent future failures at your goal attempts.
Here is a sample of using the 6 step method.
1st, Make $20,000 wholesaling 3 homes by June 1, 2007
2nd June 1, 2007
3rd Steps to Getting Homes to Wholesale
1. Put out we buy house signs
a. Get 1800 for signs
b. Hire someone to put out signs
2. Call 5 realtors a week
a. Ask them if they have investors that they work with
b. Offer to take them to breakfast to discuss investing
3. Find buyers
a. Run ads in newspaper
b. Call other wholesalers
c. Ask realtors for buyers
4th List of What will happen if I don’t achieve my results
1. Be 20,000 poorer
2. Wont be able to put my son through school
3. Wont be able to buy that new car I wanted
4. Wont be able to take my dream vacation
5th List of what has caused me to fail in the past.
1. Analysis paralysis
2. Didn’t look at enough properties
3. Didn’t have enough properties to see
4. Didn’t have enough buyers in place
6th List of what I will do to get past the old road blocks
1. I will prevent analysis paralysis by having all the proper contracts, buyers, and market analysis tools in place.
2. I will run ads, put out signs, and network to find properties
3. I will run ads, put out signs, and network to find buyers.
I hope this helps at least 1 person to sit down and write their goals out, then achieve them.
:groovy: What are your 2007 Real Estate Goals? :wowie:
Goals this year are to buy a very large apartment complex of possibly 44 units and continue to invesment in real estate buying more rental properties and doing a flip somewhere in between.
My goal for 2007 is to brow beat my painter into fixing that awful spray paint job he did yesterday on my new rehabbed kitchen cabinets, finish the bathroom in the same house (at the stud level) and FSBO my 3/2 project by the spring market. Hopefully after the house sells then roll over the investment into another 1031 exchange and pray that my attorney will do another exchange--which he hates. Like a good investor, I am prepared to hold the house for the Congressionally approved 5 years and live in the house the last two years to receive favorable tax treatment should all of the above fail --praying all the while for a decent tenant who could actually take care of a freshly rehabbed house AND change filters AND cut the grass. IS IT ASKING TOO MUCH?
How many years have you owned the home that you are going to 1031 exchange? Dont you have to own it at least one year and to be safest 2, or have you purchased with the intent of renting, and then decided because of some financial hardships that you need to sell. (wink, wink).
That was my understanding of the 1031 exchange that you can sell faster than 1 year if you bought the property with the intent of renting it, and because of a financial hardship, or relocation you have decided to sell. If you know something that I dont let me know because I am going to be taken to the slaughter house on my gains this year.
I do intend on starting a self directed IRA for the purchase of real estate that I plan on keeping some of my holdings and gains in for the 07 year
I can't really find any definitive answers with regards to 1031 exchange holding period regarding continuing to reinvest. The IRS clearly doesn't want you to do an exchange and sell the property. My CPA and my former National Tax Service accountant with years of experience (also has real estate broker's license) says you can sell the relinquished property in less than a year as long as the equity is "continued" in another like kind deal. CPA said he has clients that reinvest in a shorter period than what I"m talking about.
All of the money must be continued in the next 1031 exchange and it will be spread over two tax years so I may just plan to do that. Both say I'm not in the danger zone of being cast as a "dealer".
I'd have to hold one year and a day at least I understand if I did move in it as a residence and hold for five years to get tax free gain.
I also know you do not have to rent the replacement property. Also, there is some discussion that the hold period for the relinquished property was 7 years. That could make a difference too.
If anyone has any experience in this holding period mess I"d appreciate their input.
I don't believe there are any "required" holding periods for 1031 exchanges. There is some interpretation of case law about it (which is where the 1 year idea comes from), but not any definite guidelines from the IRS. Dealer status and homestead tax free gains are separate subjects from exchanges, though they do intermingle in some ways.
Dealer status comes from flipping "too many" properties (a definition not definitively defined by the IRS). Dealer status means everything you make is tagged as ordinary income with self-employment tax on it. No long term capital gain status even if you hold it for over a year and no 1031's.
Tax free gain on a homestead actually does not require you to live there for 5 years. The law says something to the effect of 2 of the last 5 years, and I believe that 1031's and homestead's can not be intermingled. I don't remember the laws exactly on the latter, but I remember that claiming a 1031 as a homestead was a no-no.
I know enough about these subjects to get myself in trouble, so I'd like Wexeter to take this over. He is the resident expert here on 1031's, but I haven't seen him around for a couple weeks.
goals for 2007:
complete construction of real estate web directory by March 2007
have 50 businesses listed on site by december 2007
buy first apt building by december 2007
consult builders in Texas to consider building new homes on lots we own and apply for permits, begin construction by december 2007.
grow other website subscriptions to over 150 by august 2007
increase revenues from websites by 20% per month, every month.
increase traffic to sites by 10% per month.
build mine and my wife's dream home.
:D
All of the money must be continued in the next 1031 exchange and it will be spread over two tax years so I may just plan to do that. Both say I'm not in the danger zone of being cast as a "dealer".
I'd have to hold one year and a day at least I understand if I did move in it as a residence and hold for five years to get tax free gain.
I also know you do not have to rent the replacement property. Also, there is some discussion that the hold period for the relinquished property was 7 years. That could make a difference too.
If anyone has any experience in this holding period mess I"d appreciate their input.
You are correct there are no required holding period for doing a 1031 exchange, but the bare minimum you would want to do is one year and even that is pushing, it does not guarantee they will come after you if you do it sooner, but it does greaten your chances of them auditing the transaction. I recently met with a tax man (former IRS agent so I do believe him) who advised me of this. He told me to be on the safe side and truly avoid red flags I should wait closer to 2 years.
1031 exchanges are based on INVESTMENT property that is bought with the intent of an renting or for business or commercial use, in other words not flipping (dealing), so in an audit situation you must be able to show that you intended to purhcase the property for investment purposes but for some unforseen circumstance (job moved, bad spot financially you had to sell).
I wish that you were right in this case because I would save alot of money, but I tore the tax guy apart with questions and this is what I was told. He still has lots of contacts on the inside so I am pretty sure he knows what he is talking about, and its not old information.
But hey if your guys knows more than him, by all means exchange away.
You make it sound so evil :goofy:
My goals for 2007 are:
1. to add another 20 rental units (we're closing on 10 at the end of this month)
2. in addition, to find and purchase one larger project, ideally a 50 unit apartment complex, mobile home park, or RV Park (generating a minimum positive cash flow of $100/unit/month)
My goal for this year is to:
By July make $30k from wholesaling
By Oct Invest in 4 rentals and/or lease options ( SFH and multi-plexs ) resulitng in a $3000 cashflow altogether.
By November realize that I need to break my notions of making it in this biz, and start looking at the real deals out there!
Dec 31st 2007 write down all these numbers with more zeros after them.
My partner and I have stepped forward, calling at least 3 - 4 people a day. RE agents, title companies, joing RE Forums, Hard Money lenders, traditional banks, local builders, RE Lawyers, and even city halls.
two new business lines, cards printed, and ads designed and ready to print.
I can tell ya one thing, its easier being brave with someone to back you up. Thanks Jay.
Whew....
Thats that in a nutshell
wish me luck!
They say luck favors those who are active. It sounds like you're on the right track :lol: