All Forum Posts by: Don Konipol

Most of the books you mention provide plenty of rah rah, but little in the way of actual practical knowledge. The classic real estate investing book (for residential real estate) of all time is Bill Nickerson's "How I turned $1000 into $3 Million Investing in Real Estate - In My Spare Time". Despite the hokey sounding title, this book, first publsihed in 1959, has has some 20 odd number of printings, and has been the intriduction to real estate for many of us who have been successfully investing in real estate for the last 30 years.
For commercial real estate investing, most books written by Jack Cummings are realistic and well worth reading. Investing in Debt by Jimmy Napier is the classic for trust deed investing. Back in the 70s and 80s Jimmy would give 3 hour workshops to real estate groups and charge $39 per person - and always donated the proceeds back to the real estate club! I could honestly say that Jimmy Napier was responsible for leading me into a very successful career as a trust deed investor.
I have read most of the real estate books now available; the majority are so bad and unrealistic I can't get thru them. Others have no "meat", i.e. buy low sell high is not a valuable piece of information.
Exotic strategies in real estate work in a few instances, i know no one successful using exotic strategies as a stand alone investment formula.

I need to correct some misinformation. All state foreclsoure laws are different. In Texas for example, a first lien holder has no obligation to notify any other lien holders prior to the trustee conducting a foreclosure auction, except in the rare circumstance that a first lien holder acknowledges a inferior lien and promises notification of default written into the deed of trust. In Texas the foreclsoing lienholder is under no obligation to search for and notify any entity other than the party mentioned as owner of the property in the deed of trust.

read it a little closer still and realize that the post you commented on is two years old!

If there is some reason to believe that the value of the property will increase significantly in the future, then getting a 8% return on your money while the asset is appreciating can be a good deal.

Late last year I was negotiating with a non profit housing provider to do a master lease on a 34 unit apartment project we own and were just completing rehab on. If we had been able to structure a deal with them paying $20K or so deposit with $7500 per month I think the deal would have gotten done. After originally claiming interest at these terms (they came to me with the idea of master lease), they found out that the numbers didn't work out like they had anticipated. To make the numbers work they wanted me to remodel the apartments for institutional housing use, at a cost of $100,000 +.
A master lease may be a good way to obtain control without a large down payment and without qualifying for financing. The leasee should also get a realistic purchase option so that the benefit of the hard work of managing the apartments (appreciation of value) accrues to the leasee, and not the owner.

the reason the banks did not show up for the foreclsosure sale was that the banks all passed on foreclosing that month. Most federal lending institutions have just ended a agreed upon moratorium on foreclosing owner occupied properties. Tax sale liens are a tricky area that requires investor sophistication. While a tax lein will wipeout most other liens, there are various requirements for notification of current lien holders. the taxing authorities are selling with no guarantees. If the existing lien holders were not properly informed of the foreclosure they may still have a valid lien secured by the auctioned property. the main problem with the "forced" sales is that title insurance is not available at the time of purchase. Hence it is quite easy for an investor to miss a superior lien in a title search and have a very unpleasant suprise after purchasing the property.

Hey Rich thanks for the info! It's always fun when someone personally knows of a "guru's" real world situation. To the novice, all guru ideas sound like they're the Holy Grail. Real and close examination shows most gurus to be nothing more than pitch men or actors. their pitch is just so much more enticing than the real road to successful real estate careers: hard work, long years of education, familiarity with a specific market, and above average intelligence to recognize an opportunity along with the guts to risk your capital (having risk capital helps alot too!). Compared with the guru pitch of no money needed, follow the 4 simple rules and of course the latest non sense of flip houses in 2 minutes withould leaving the comfort of your armchair. It's always amazing to me how ardent the inexperienced are in defending their choosen "great one" guru. It's as if anyone who has any negative information about the guru or method is a heathen with a personal vendetta against his holiness! and that has not changed in my 30 + years in real estate investing.

Robert Allen has been a real estate "guru" for over 30 years (give him one for longevitiy). Although I think much of his writings are either useless or nonsense, he was at least partially responsible for getting me involved in real estate, something that has become a very successful fulltime career for myself. Back in 1978 Robert Allen published a book called "Nothing Down" in which he explained various techniques for acquiring property with none of your own money. Numerous "RAND" clubs were formed around the country (Robert Allen Nothing Down). After attending one of his introductory seminars, my interest in real estate was heightened, I read every book I could on real estate and joined the local RAND Club, which eventually joined with another club to for the RICH club in Houston Texas (still one of the most successful clubs with over 1000 members.
The granddaddy of individual real estate investing was Bill Nickerson, whoose book written in the late 1950s "How I Made Three Million in Real Estate Part Time" is the all time classic. He was joined to the 1960s by Al Lowery, and together they formed the Nickerson - Lowery seminar circuit. Robert Allen added the nothing down nitch, and set up seminars in competition with Nickerson - Lowery.
The great thing about Nickerson was that he had a 30 year successful record of real estate investment before he wrote the book and started teaching seminars. Almost all the gurus following either lucked out for a few years by investing in California real estate before the boom or never were successful at investing at all.
If you read and absorb Nickerson's book, Jack Cummings commercial real estate books and Jim Napiers classic "Investing in Debt" you will be far ahead of everybody who are reading the latest "fantasy" books by the newest real estate "mentor"

Your syndication offering will probably be an exempt intra state offering so as not to have to comply with the expense of Federal (SEC) guidelines. Each state has different regulations concerning real estate syndication offerings. Although an individual state may exempt certain intra state offerings, such as offerings presented only to accredited investors or offering subscribed by less than a certain number of investors (35 is a popular number), the state guidelines if any for a state registered offering will tell you what the securities division of the state considers the minimum deal investors should receive from a syndicator.
State securities laws change with every legislative session. It is imperative to engage the services of an attorney with familiarity in the practice of limited partnership offerings. If proper disclosures are not made, or accepted guidelines followed, a lawsuit(s) is virtually guaranteed whether the venture is successful or not.

This basically only works in a market with very little product and many buyers, and easy financing. You can use a modification of this marketing whereby you set a very low minimum price and asks for bids at or above the minimum, in essence having an auction. However, this requires significant extra work, skill and experience to pull off successfully.