All Forum Posts by: Douglas Larson

WHOLESALE UPDATE:

I have kept in touch with my buyer on this stunning little castle. He completed the remodel for about 15k in about 2 months and sold it for $95,900 within the first weekend it went on the MLS. He made a true net profit of about 18k after all carrying costs, commissions and repairs.

Pics below:

@Adam F

Very cool and thanks for the pics! I love to see a plan come together! I think commercial space is so foreign to most residential investors like me that we pass by some great opportunities. Commercial property intimidates me! I felt the same way about land just 4 years ago but I am very comfortable in that space now. I would love to know more about your deal and commercial space in general.

How did you come to the decision of a restaurant space rather that retail or office space?

How did you market the property and find your tenant?

Is the tenant responsible for final renovations like kitchen needs, 50's decor, etc?

How long of a lease did you get and does the 50's restaurant company have a track record in other locations?

If not, how do you screen for the right commercial tenants?

@Mark Whittlesey Thanks for the info. I will check out "Equity Build."

@Dmitriy Fomichenko I was dissappointed to hear that I can't roll the SD Roth IRA into a solo 401K. Maybe it's time for me to start another retirement account.

@Gautam Venkatesan - Both UBIT and UDFI sound like good reasons not to flip inside retirement accounts. Thanks.

@Mark Whittlesey

I see you are in Encinitas! Love that place! I did a flip there (actually Leucadia) in 2011 and one in Carlsbad in 2012. Flipping in an IRA adds other layers of fun I'm sure! I would love to hear more about your note buying business model, especially within your SDIRA. Notes and wholesales have really grabbed my interest in the BP podcasts because they just seem cleaner and easier . . . and I'm tired of swinging a hammer and babysitting subcontractors!

@Dmitriy Fomichenko

Thanks for the info. You appear to be quite the expert on the Solo 401K strategy. At first glance there seems to be similar advantages to the Self-Directed ROTH IRA and some other bonuses too. Do I understand that the solo 401K does not require a custodian? I know that 401Ks can be rolled over to an IRA but can you go the other direction from IRA into a 401K?

@Dan K.

Thanks for your story Daniel. How do you deal with rent payments? Do your tenants auto pay directly to the account? Also, who do you use for the checkbook control of the SDIRA?

About 3 years ago my Wife's 85K IRA was making mediocre returns and we decided it was time to use it for real estate, which we understand far better than stocks. We converted it to a ROTH and took the tax hit in a low income year (no more taxes to pay!)

We then transferred the account from Fidelity to a Self-directed custodian (Equity Trust - BTW, they have worked well enough for us but there have been several frustrations with lost paperwork, mistakes and slow processing). Then we purchased 2 REO lots in a nice subdivision. We sold one of them after about a year to a builder for a 30K Profit. The other will sell in a few months for a 40K profit. We have already reinvested in 2 more lots in other areas and plan to hold for a while. According to appraisals, our properties in the account are now worth 160K, almost double what the account started with. If we can continue to roll into investments with similar returns we should see about 500K by retirement time in 7 years. Please follow up with me in 2021 to see how we fared.

Before we invested in land we entertained the idea of private lending, buying a cheap rental or doing a rehab flip within the IRA. We have quite a bit of experience with these in our daily investing business so we understand the ins & outs. There are enough difficulties with paying bills, getting bids, collecting rents, buying supplies and materials, etc. with rehab and rental properties that we decided that vacant lots would just be easier in an IRA. There are big discounts when you pay cash for land, and less competition because most investors want cashflow, which you generally don't get from vacant lots.

I personally know other investors who have used their SDIRA funds to "partner" with other investors or to leverage with private money, non-recourse loans into larger deals. I think any of these can be an effective way to grow your retirement account if you understand the business model and are willing to work through the restrictions and extra layers of paperwork that are a part of SDIRA investing.

I would love to hear from other investors who have had success with SDIRA investing.

I can only speak about using an SDIRA. I know there are many similarities and restrictions about what to buy, how to buy it and how the property can be used (not by you, your children or parents).

I convinced my wife to use her IRA for buying vacant land (mostly improved lots in approved subdivisions), and it has worked out very well. So far we are up about 90% in just under 3 years. We have found our lots through banks (foreclosures) and private sellers.

The account has grown from 85K to 160K in value and we hope to have 500K in another 7 years. Time will tell . . .

Hey @Jason Fraser ... its good to see you on here my SLREIA friend!

I don't know about books or courses on master lease options but I did find this under BP resources.

Also, Brian Gibbons on BP appears to be very knowledgeable on assigning lease options. His .

Have Fun!!!

I have to take the opposite side of this coin from Mathew.

Absolutely the most important thing is to find the deal! If it is a great deal, and you get the word out, you will suddenly have lots of very excited investors at your door.

I have been investing for over 15 years with several rentals and quite a few flips. I never considered wholesaling until about 8 months ago. It took me long enough to locate a great value property in my target areas that I wouldn't consider letting it go for a few thousand bucks wholesale fee. After listening to BP podcasts () and reading some great BP posts on wholesaling I expanded my search area to include nearby cities where I have no interest in being a landlord or flipping. I found a great property with only a little effort. Just a few days after I had it under contract I passed out flyers at a local REIA meeting and posted an online ad on a local, free real estate site. I had an offer with earnest money within 24 hours and 8 other serious buyers called within the next few days! I kept all their names and contact info and when I found another deal in the same area I started at the top of that list and sold the home within a half hour. I made about $8K on each wholesale and I'm looking for more.

I promise that if you find a sweet deal and get the word out, the cash investor buyers' list will find you!