All Forum Posts by: Gino Barbaro

@Lenin Belangonda

Hi Lenin

I agree that investors should strive for cash on cash returns of at least 10% based on ACTUAL performance, but it may be difficult to hit that target here in NY and CA.  Investors flock to other markets and bid up those assets to achieve the return. In Knoxville, where I am currently investing, you can look around and find CA investors owning many units, but they tend to buy at higher asset prices because these prices look so cheap to their market.

Investors sell for many reasons, retirement, burned out, buying bigger asset, wanting to pay bills,etc

Your job as an investor is to find these motivated sellers and try to purchase them

Gino

@Maya S.

Hi Maya

Good luck.  That sounds like a great plan.  Keep reading the posts on this site.  There are countless investors on here with a ton of knowledge 

@Raul Barnes

Hi Raul

Real estate is a people business. I would take sales training not just to sell real estate but to learn how to market yourself.  You are a brand and you have to learn how to market your talents

Every investor needs to learn how to analyze and decipher income statements and balance sheets.  Basic finance is crucial to being successful in any business especially real estate

@Perry Ivy

Hi Perry

You should establish a strike price for the property, a price that you will not exceed.  Do NOT tell this price to anyone, especially a broker, and begin to negotiate around 10% below that price.  You have  to stay disciplined and make sure the strike price is based on actual numbers.  If you lose the deal, then move on to the next one.

Is he giving you a legitimate reason why you should increase the price?

@Iman Yu

Hi Iman,

Investors typically buy with all cash to get a better price on an asset.  It is much easier to close and shows the seller that the buyer is serious and closing will be faster and no complications from the bank.

If I am going to buy a property all cash, I want to buy at a discount, reposition the property, thus increasing the value.  By buying at a discount and increasing value, you may be able to go to bank and take out a mortgage for whatever money you have invested in the deal.

It all depends if you want to own a few properties free and clear or own several properties with debt.  Leverage works both ways.  It can create inordinate amounts of wealth or it can crush you.  If your goal is to create wealth, then I would mortgage properties.

Good Luck

Gino

@Gustavo Martinez

Good Luck Gustavo.  You live in a really nice market.  Do you want to be a residential broker or cater to investors?  It is a huge difference

Gino

@Samantha Hopkins

Hi Samantha,

The only way to answer that is to check on your competition.  See if there are any rentals in the market similar to yours and check their amenities.  That will give you info on pricing your rental to the market's.

You can always try to rent with the old appliances, and if you see prospects object about them, then you know you have to fix.

It's always easy to change them, but it is an added cost.  I would probably change them though

@Daniel Vazquez@Jake Stenziano

Doing deals without money is possible if you have experience and credibility.  I had my doubts a few years ago.  My partner and I just completed in August a 281 unit deal for 11 million dollars with 20% owner financing and rest financed by the banks, two of  them.  We had to deposit 180,000 in escrow in one bank, but they will be releasing 1/3 of amount for the next 3 years.

The ONLY reasons this was possible was that we had terrific relationships with the banks, we already owned a well run portfolio of over 200 units, and the deal was purchased from a motivated seller who just wanted to retire and know that he was not going to take this property back.  The banks appraised the deal for 11.7 million at closing.

I only write this to dispel any notions that no money down can not be accomplished.  Investors do it every day by using other people's money.  It would be risky if an investor has limited experience, and I would not recommend on the very first few deals, but like anything else in life, with practice comes proficiency.

The funny thing about this deal was that the seller's first offer was for owner financing.

Keep reading the investors on BP.  There are a ton of knowledgeable and generous people here.  Pick a niche in investing and start your journey.

Good Luck

Gino

@Donna Salmiery

Hi donna

It really depends on your investment goals. If your goal is for yield, cash flow, then buying a more stable asset is probably more suitable 

If you are looking to create wealth and cash flow then your mindset should be to add value.  

There are many ways to add value, fix deferred maintenance, raise rents, reposition tenant base, switch to higher and better use.  These are only a couple of avenues

@Rod Desinord@Jake Stenziano

Hi rod

I think fear plays a big role.  I also think a persons reason has to overcome any doubts.  His should become his must.  My father smoked 45 years and could not quit.  One day doctor told him if he didn't quit, he would develop emphesema in six months and eventually die.  Dad quit for good 2 days later.

I also think that instant gratification plays a huge role.  All the successful BP members will tell you that they have failed countless times and stuck with it

Fall seven times and get up eight should be everyone's mantra.  Having a good support group will hold you accountable.

Easier said than done, but I think that's why only a small percentage become truly successful

One other note.  Most of us don't have defined written goals.  You can't hit a target if you don't have one.

Hope that makes sense

Asking the question means you are on the right path

Gino