All Forum Posts by: Jay DeCima

Jay Bee

I have done all links of deals and like all kinds or real estate, but let me share a few thoughts:

I have done many flips, but I soon realize doing them was a job and not really investing.  You pay taxes at the higher ordinary income rate, you pay social security tax as an employee and employer (ouch) you get really no tax benefits and no long term financial benefits.

I have a few BP blogs that may give you some ideas.  

At my high point I had 250+ rental homes in Northern Calif.  I buy groups of homes (usually 5 or more on a single parcel), in need of repairs.  They will always be in older areas of town, not in the suburbs.

Because banks will not finance 5 or more ugly houses the sellers of these know that and will usually take back the financing.  Over 85% of my purchases over the years had seller financing.

Get the rents coming in then leave your job when rents are replacing W2 income.  Long term rentals are terrific.  

Find a mentor.  Check there name on google. They can save you a lot of wasted time.

Good Luck

Fixer Jay DeCima

Nick

Math!

I have a philosophy that if you are not an expert on ALL YOUR FINANCIAL AFFAIRS and dealings, someone one else is going to made those financial decisions for you.  Not a good idea. 

When it comes to being a real estate investor, YOU CREATE THE DEALS.  By that I mean, others may bring the deal to you, or a seller may be selling, but YOU CREATE THE DEAL that is good for you......otherwise why do it.

Read, Read, Read.  Throw in a few real estate investing books.

I have some BP blogs that may help you.

Good luck.

Fixer Jay DeCima

Joe

Here are my answers.  At my high point I had 250+ homes for rental in Northern Calif.  All were groups of homes on a single parcel.  Almost all had seller financing because a bank will not finance 5 or more homes, THAT NEED WORK, on a single lot.

1:This is my specialty.  Buying groups of houses on a single lot.  

2: You can make any kind of deal you want on the 6th house.  YOU CREATE THE GOOD DEAL. Probably not worth the effort to split the parcel.

Alester

A few comments from an old timer:

I have done all kinks of real estate deals.  There is a time and place for different kinds.

I have done flips and wholesale deals but realized a long time ago that these are like having a job. You are taxed at the high ordinary tax rate, have to pay into social security as the employee and employer and you really get no real tax benefits.  It is a job.  You also do not get any long term financial benefits for all you work.

As for financing, I can say that in all my rental home deals I got seller financing over 85% of the time (for my kind of properties).  I buy groups of older homes on a SINGLE PARCEL.  Maybe 5-7 homes on a single lot, in need of fix up.  For properties of 5 or more homes......YOU WILL NOT GET BANK FINANCING.  Sellers of these type properties know this and will usually take back financing (remember these are not a single house on a single property).

It takes some time to learn where and how to find these properties but it is worth it.  Many of my students over the years have created nice home rental businesses with these long term rental houses.  

Alester.

Good for you.  Go for it early.

I started my investing in Sacramento and later ended up with 250 rental home in Northern CA

My advice (50 years of experience):  

Choose the type of investing you think you may want.

Find the experts in that field (google them, etc).

Pick and expert as a mentor.

If you do this you will save so much time and effort NOT CHASING every link or real estate.  If you do not focus in this business you become, what I say, A WANDERING GENERALITY.

Geo

Let me give you  some "gray hair" advice. At my high point I had 250 rental homes in Northern Calif.

1.  In Los Angeles, go to the city building and create a fictitious name application.  Simple, one page, cheap.  Make it for the name of your new real estate company. Example:  GT Home Rental Company.

2.  Open a bank account with the the fictitious name.  ONE bank account for all your properties, not one for each one.  

3. Do LLC later when you have a reason for one. PLEASE NOTE, IF YOU PUT PROPERTY IN AN LLC, YOU CANNOT DO YOUR OWN EVICTIONS (which I DO advise when you start). You would need to hire an attorney.

4.  With 250 properties, that I managed myself, I had to come up with a simplified way of doing it. 

Ronald

I would think twice about spending $3k.  Have you bounced the name of the seminar to the BP group?  Your profile is as a wholesaler.  Is the $3k course on wholesaling.  If so, remember that all profits are treated as ordinary income and you really have no tax advantages.

I have done all kind of investing, but holding long term rentals has been great for me over the years.

On BP, I am allowed to display my website url.  

Good luck.

Fixer Jay

What is the bootcamp?

Fixer Jay

Andrew

You are not far off with your areas and what you are looking for.

For 40 years I have been investing and teaching about my kind of real estate vehicle.  Let me explain by telling you what has worked for me over the years with 200 rental houses at my "high point":

Northern Calif.

Smaller cities.

Older "groups of houses", ideally 5 or more on a single parcel.

Poor condition is good for me.  The sellers have fewer options.  With 5 or more dumpy looking houses, you will never get a bank, commercial loan.  Sellers of these properties know they will be carrying the financing.  This IS HUGELY LUCRATIVE, mutually beneficial and I have had seller financing on over 85% of all my purchases.  Many times I have even gone back to these sellers that were carrying the financing and bought back my note (the money I owe them) for big discounts of 20-40%, years after I bought the property.

I always buy in the older, blue collar, part of town.  Never in the slums.

Over the years my down payments have been about 10% (remember, I don't have a bank telling me THEIR requirements).

Although I have done all kinds of real estate, holding simple rentals has been far and away the best kind of investment for me.

My fix up cost run about 10% of purchase price for a light fixer and 20% for a heavy fixer. Note that all the work does not have to be done right after purchase.

I like safety in numbers.  If I have  5 simple rental houses on a single parcel, and have a vacancy, my vacancy rate is 20% (I can live with that).  If I have vacancy with a single family house

My best piece of advice is to pick the kind of real estate vehicle you think will work for you, find the experts in that field, thoroughly check that person out.  Then do that kind of investing. Use that person as a model.  If you look at several kinds of real estate investing, you will never get good at one of them..........you will become a "wander generality".

Take a few dollars and invest in books and courses regarding what you think will be your type of "vehicle".  DON'T think you need to buy a fancy $5-$20,000 course.  Most folks on BP would tell you the same--LOUD AND CLEAR.

Good luck.

Fixer Jay DeCima