All Forum Posts by: Anthony Griffin

We all have to get started somewhere and I wish that someone would have been there to hold my hand when I got started. 

I want to know what has been your biggest problem, frustration, or just a lack of knowledge in getting started with investing in real estate. Since I've joined the BP, I have seen so many helpful people and those site and I want to use this post as an opportunity to give back.

So fire away........

P.S. The only dumb questions are the one you don't ask.

Thanks Danielle, I'm already making some very helpful connections.

Thanks for the mention Jd, I'll give you an example of an office building that I purchased 5 years ago. I bought a 2-tenant office REO from a bank that had foreclosed 3 years prior. The bank initially asked $250,000 and I told them based on my contracting experience that the property would need significant updating (I'm a licensed contractor and did the upgrades for cost of materials and labor so no big deal) and that the tenant base was shaky due to one unit being vacant and the other unit was a 3-year old month to month lease.

At this point, the bank countered at $175,000 and I still stuck to my guns and told them it would be nearly impossible to get the building financed due to the above mentioned problems. I already know that $175,000 is a great price so I start negotiating with the current tenant and get them to commit to a new 3-year lease at higher rent and I started marketing the vacant unit. I found a tenant willing to lease the vacant unit and they were willing to sign a 3 year lease. Remember, I've done all of this without the bank knowing anything. 

I come back to the bank and told them that the best i could do based on the condition of the building is $115,000 and they accepted and I closed on the property. I have now owned this property for 5 years and based on the financials, it is currently worth a little north of $500,000. 

This is why you should know your walk away price before you even start negotiating. If I hadn't, I may have possible paid $250,000 instead of $115,000.

If this one gets away from you, trust me a better one will come along soon.......

Brandon, whenever you look at a property, you should develop a strike price. This is the final price where the property actually makes financial sense. The reason you come up with this price first is that often we become emotional and want to make a deal work because we have put time into researching it or we just really like the property.

I can't tell you the number of times I've seen people at an auction blow past a reasonable offer because they wanted to go all in. A strike price will tell you when you have to pull out. Now, with that price in mind, I typically start my offer at around 10% under my strike price, this offers me a little wiggle room with the seller. 

If the seller likes working with you they will likely counter your offer and then you can work with them until both of you come to an agreement on price. I want you to think about the following example:

If you immediately give them the asking price, they will feel like they didn't ask for enough. If you start with your strike price, they will almost every time, want to go higher and now you can't negotiate. At this point, you like like you don't want to be flexible and they will probably stop working with you. 

So in conclusion, come up with a strike price and start your negotiations about 10% under that amount.

Welcome to the BP Josh, sounds like you are starting out just like I did, swinging a hammer. There is nothing wrong with that approach. My starting advice for you is to figure out exactly what real estate can do for you. We sometimes forget that any business is really a means to an end. Nobody wakes up in the morning and says I want to own a business. The business is usually to provide some kind of rewards such as more savings, more time with family, vacations, etc. 

Once you figure out the goal of your investing, then you should come up with a dollar figure that you are trying to reach by using real estate as the vehicle. Let's say for example, you are trying to increase your income by an extra $1,000/month. What kind of activity would you have to do in order to get this money? If you do flips, how many buyers do you have on your list that you can find property for? If you buy and hold, how many units would you need? Etc.

I know I've thrown a whole lot at you, hit me up if I can help you figure out some of this. I also have a blog on BP that can help you to get started. 

Glad to have you on the BP.

I would personally stick to the terms of my lease. Cats can do a lot of damage to a property from scratching up the trim and floors to spraying. I used to own a cat years ago and you can never get rid of that smell from them spraying. 

According to your original post, you also stated that they would only sign a short term lease. This tenant will become trouble for you, just wait it out and get a better tenant. You set your rule for "no pets" for a good reason, stick to it or you'll probably be kicking yourself later. 

Just my .02

Absolutely.........

If you are using an accountant at the end of the year, and you should, I would recommend Quickbooks. Most of them uses it and it will save you some money if you can just give them the file instead of a box of reciepts.

P.S. Make sure you use the PC version instead of Mac, most accountants are using a PC and the two systems don't play nice together when you try to merge the files. Ask me how I know.....

My first step would be to learn how to build a buyer's list. Without buyers, you shouldn't even attempt to flip something. 

A typical "flip" has to have three parties involved in order to be successful: seller, flipper, buyer. Let me break it down a little further. 

The seller is typically someone who is having financial trouble or just inherited the property. I like to call them "don't wanters". The flipper is someone like you who is looking to be the middleman in a transaction and make a "commission" for introducing the buyer to the seller. The buyer is usually an investor who is looking for a good deal on a piece of property. You are their eyes and ears on the ground so to speak. 

My advice to you is to build a large buyers list, and you can look this up on YouTube, and then go out and find specifically what they want to buy. If you will take the time to do it this way, it's a license to print money. 

Just my .02

Welcome to the BP Raheem, I'm an investor in the commercial sector. I own office property and have owned multifamily in the past. 

Just let me know what questions you have and I'll try to help you to get started. Look at my profile and I have a blog set up on BP, some of those articles may help you get started.