All Forum Posts by: Nathaniel Hovsepian

@Cameron Tope just kind of made my point for me here. DMM relies on some list that you pull from a source who's information you can't be sure is entirely correct, PPC relies on the user to show intent by searching you out. 

Why would you shoot a shotgun out there and hope that you are aimed in the direction of a target when you can have the target place itself 2 feet in front of your face?

For all you DMM people out there, if it is working for you, then good for you. I am just saying that there is a better way to be spending your marketing dollars that doesn't take months for you to determine if it is working or not. 

I had a gentleman reach out to me yesterday about a home that he is renting. He and his family are on a fixed income through disability and cannot afford to purchase the home that they are renting now that the landlord is looking to sell it. 

He told me that the owner is asking $25k for the house, and that he can only afford about $350 per month for rent.

He wants to do some sort of deal where he were to pay me the rent for a specified period of time and then he would become the owner. Sounds like a lease to own to me. 

The kicker is that he has no money for a downpayment of any sort to buy the option at the outset. I was thinking that I could put up the money on the home and just collect a "mortgage" payment from him.

This seems very risky to me because he essentially has no skin in the game, besides having a place that he and his family can live for $350 per month. 

The numbers seem really good though as far as ROI. Curious to know any opinions on this one, if anyone has any experience in this type of deal, good or bad.

@Paul Wolfson there are some variables at play that you aren't taking into account, and probably can't take into account because we don't know what the next downturn is going to look like. 

First off, what if the market falling doesn't happen until 5 years from now? You would have lost all of that cash flow in the meantime, and would have actually lost money due to inflation and your money just sitting there.

Second, why would you assume that interest rates are going to remain the same during the downturn? More than likely, the interest rate is going to rise, causing that mortgage to look very similar to what you assumed it would be at the moment. 

The best thing you can do is to use a "dollar cost averaging" kind of strategy. Always be buying. That doesn't mean that you should just buy anything and everything that comes your way. Like @Jeffrey Isenberg said, you still have to be selective in what you are purchasing. 

There are very few people out there that have timed the market successfully, and it may just be that they were lucky, because there are tens of thousands more that thought they were timing the market, but totally missed the mark. 

@Kevin Moore what market are you in? How are you planning on finding a deal that you can BRRRR?

I would never try to "time the market". If you are buying at the right price, dips in the market won't matter that much. 

I am a buy and hold investor primarily, so if a property is cash flowing, who cares if it drops in value by 10, 20, 30% in the short term? I know almost for certain that 30 years from now properties will be higher in value than they are today. (of course, not if we get taken over by china somehow haha).

It is the same thing with the stock market. Do you think that 10, 20, 30 years from now the Dow and S&P are going to be higher or lower than they are today? 

Don't get me wrong, we will never be all in. We will always have some cash reserves ready for market dips where we can enter at better prices, but we aren't waiting around to try and time the market out and letting cash flowing properties pass us by in the meantime. 

@Paul Wolfson you are in one of the toughest markets in the world being in LA. What you need to do is go out and find some deals on your own that you can get for 60 cents on the dollar or better. Then you put yourself in an excellent position no matter what the market does.

@Cassi Justiz That is totally what I figured. I was also thinking that you may have been tossing out Edmond MLS numbers as well, which would be totally different from properties in the South or East OKC areas.

I really liked the area just south of 240, West of Norman area. That is a sweet spot for solid price to rent ratio, even off MLS

@Jamie McCauley I haven't even messed with FB yet. I only use google. FB is almost like DMM, where as you set certain parameters (zip codes,age.....) and those are the people that will see your ads.

Google only shows your ad to people who show intent. By that I mean someone types in "who buys houses in ...." and then they see your ad saying "I buy houses in....!"

I will never mess with advertising in which the user hasn't shown intent first ever again.

@Joe Horan I think that it is the best way to find off market deals. We are in a fairly competitive market in Augusta, and are getting above average numbers as far as click through rate and conversions. I hired my campaign out to a guy. He did the first month for free so I could see that he was worth his weight, and now it is $1000 per month for him to manage the account. I just factor it into my advertising costs and call it the cost of doing business. I am hoping that by Q3 of this year, that $1000 is almost insignificant in my ad budget. Right now, not so much lol

@Joe Horan currently I am right around the $1200 per deal mark. I think that number is actually going to come down over time if I am able to close a couple other deals like I think I am going to.

I have also just begun passing along seller info to realtor when the numbers just don't make sense for me to make a deal. This will lower my costs as my realtor is going to give me a percentage of what they make if they are able to sell the house. That is an unknown as of yet though.

@Jamie McCauley that is exactly what I am talking about, and exactly why I suggested it. You wouldn't have netted that entire $8k, due to whatever ad budget you had set up, but you would have gotten more than you ended up with. On top of that, you would have more leads that you could work in the meantime while the flip was ongoing. 

Forget cold calling, DMM, bandit signs (suckers!), the way to find deals now and going forward is through online advertising. Sellers find you, instead of the other way around.