All Forum Posts by: Turner Wright

@Ryan Vega Welcome to the club! Like you I am new, too. I'm ALL IN wholesaling trying to find deals for others. BRRRR, is an awesome strategy that will only work if you can find the right deals and the right lender(s). To do this, you have to network. Reaching out on this platform is great, but I suggest you become a member of the local real estate Meetup groups, like North Houston REI, 713 Houston Area, and Wholesale Nation. Continue to read and learn, but you really need to connect with others who can help.

You can also find good deals driving around different neighborhoods and tracking distressed homes. To learn more about it, check out DEAL MACHINE, watch their videos, and download the APP—it’s awesome! You can reach out to me, I’m from Houston! PM me.

Hey David, I feel your frustration!  I've been there, and as a new investor myself, I'm still frustrated about certain aspects of this business.  But, I can also tell you that knowledge is KEY to this business.  You must decide, though, how serious you are about the real estate investing business.  Do you just want to own a few rentals?  Or, do you want to scale and own a portfolio full of rentals that will cashflow right into your bank account?  There is a big difference, believe it or not.  Your approach, how you find your properties, and how you fund your purchases and rehabs can be very different.  Knowing what I know now, there is absolutely no point in owning just a few rentals.  If you go that far, you might as well keep adding more!

But, like I said, the approach is different.  Owning 1-3 is just a hobby and a headache.  It doesn't really matter if you buy these properties retail or at a discount, because your return on your investment is so small.  Owning such few rentals just means you don't care about 'investing' like an investor--you just like the 'idea' of owning rentals.  So, find what you want retail, pay cash or get a conventional loan from the bank and manage the rentals yourself, because it won't be worth the time, money, or headaches to learn the business and do it right, otherwise.

On the other hand, if you are serious about real estate investing, then the goal is to continually add investments to your portfolio, which can include flips, notes, owner-finance, etc. But, you can't do this without knowing the business. There is a lot to learn, like where to find the best deals, how to finance your deals without using your money, how to Joint-Venture on projects, best practices and resources for rehabbing, how to best manage your properties, how to protect yourself from lawsuits, and much, much more! I highly encourage you to read up on articles and different forums on Bigger Pockets, as well, as watch the webinars. And, it is very important that you continue to reach out to the REI community with posts like this and to join different meetup groups, like North Houston REI, 713 Houston Area REI, and Wholesale Nation. Also, complete your BP profile and add a pic. People will take you more seriously.

I'm a local wholesaler who just started in this business the first of this year.  I didn't start out that way, though.  Because of COVID, I had to change strategies, which is how I got into wholesaling.  As a newbie, I didn't want to risk financing a project during the pandemic and wait too long to sell a flip.  So, I decided to build my business around finding discounted deals for those investors who continued to buy through the pandemic.  It took A LOT of reading, learning, and talking to others in the community to do this.  In my opinion, I have come a long way in just a short time.  If I can do it, so can you!

Good luck!

My first advice is to complete your profile.  Add a pic and let everyone know who you are.  I know I take people who ask for advice more seriously if they take these forums more seriously.

And, how serious are you about investing?  Is it just one house you and your friends want to flip?  Or, is flipping houses something you want to do full time?  What about rentals?  Do you want to build up a portfolio of rentals that produce monthly cashflows?  Maybe you want to do both?  Investing is an ongoing process.  It isn't just buying a few properties every once in a while.  It is a business and should be worked like a business.

With all that said, you will need to buy a property at a large discount if you plan to earn any profit from it. Especially, if you are rehabbing it and are splitting it up between friends. A $30k profit after expenses, for example, will only leave $10k between 3 friends. So, buying a home through a realtor is out of the question. You will need access to off-market deals or connections with wholesalers. And, where do you plan to get the money to purchase the property and fund a rehab? Cash is great, but there are hard-money lenders out there that will give you up to 85% of the ARV and sometimes 100% of the rehabbing costs. This is something to look into.

If you didn't know already, I hope I made it clear how complex real estate investing can be.  And, it's actually more complex!  But, if you are serious about investing in real estate and taking it seriously, you can make a lot of money.  I suggest you read, read, read everything you can about it before you purchase your first property.  A great place to start is reading the Bigger Pockets forums and watching their webinars.  Sign up with them to know when the webinars are.  Good luck! 

It sounds to me like you and your family really want to keep this house, and why not?  If your estimate is correct your mom has 50% equity in the house.  It's in Florida and near the beach, which will make a great short-term rental and source of cash flow.  Plus, the family can use it like you mentioned.  These are all positive reasons why investing in the home is a great idea.  Honestly, without knowing anything else about the home and where it is at, I don't see any reasons not to invest in it.

You might consider placing this home in a revocable Trust or LLC, especially if you plan to short-term rent it out. A revocable Trust will help avoid the costly probate process while giving the Trustee full control of the assets, like the home. And, an LLC separates your personal assets from your business assets and protects you in legal disputes. If you leave the home in your mother's name, I suggest you look into the family Trust, or revocable Trust. If you plan to take over the deed of the home, then I suggest you look into placing it into an LLC.

As far as investing in the home, you will definitely want a reliable general contractor.  You want someone with the knowledge and experience to tackle the projects you mentioned the home needing.  And, there seems to be room in the home's equity to allow for a comprehensive rehab.  But, since you plan to short-term rent it out and use for family use, it really doesn't matter how much equity is left after a rehab in the short-term, does it?  You want this house more for sentimental value, right?  Luckily, you can keep the home for sentimental value and let it pay for itself as a short-term rental.

Moving forward, however, you need to approach buying investment properties from a business point of view. Either the numbers work, or they don't. I suggest you contact a realtor or someone with access to MLS and run comps on properties similar to your mom's in the immediate neighborhood, which have sold in the last 3-6 months to get a more accurate marketable value. Don't rely on Zestimates. Then, I would reach out to a general contractor to give you an estimate of what it would cost to rehab the home. Get a range estimate--from bare minimum/rental ready to full-scale remodel. You can find these people in your local real estate investing clubs and organizations.

Lastly, work the numbers and decide how you are going to fund the project. And, do you plan to purchase the home from your mother? Talk to private-money lenders who specialize in real estate investments and ask what they have to offer. You shouldn't have any problems finding a private-money lender to loan you 85% of the homes ARV, which in this case may cover more than the balance owed on the mortgage. Some lenders will even fund 100% of the rehab up to the maximum amount they will loan you.

You have a lot to think about and a lot of work before you.  I wish you luck!

Hi Daniel!  I learned a great deal about real estate investing from Bigger Pockets.  Brandon Turner had a lot of great podcasts and articles for newbies and there is a wealth of information by other investors in the forums.

Rich Dad/Poor Dad has motivated a lot of people to investing in real estate.  For me, it was just wanting to get out of construction and focusing on doing something else for the next 20 years before retirement.  I decided on investing in real estate, because there is practically no startup costs or overhead costs!  And, the return on investment is HUGE!  I don't even care if I'm not a millionaire.  I'm happy to generate enough income to match what I was making in construction, buy good, quality family insurance, and match what I was investing in my 401k.  Of course, the potential for more is always there!

Today, I'm wholesaling, but it wasn't how I started out the first of this year. I wanted to buy discounted properties and flip/hold them, but COVID hit. So, I changed strategies. These last 7 months have been a HUGE learning process! I have learned so much from research, reading, and meeting other investors. If you haven't already, create an account on meetup.com and join several local REI clubs, like, North Houston REI, 713 Houston Area REI, and Wholesale Nation. Then, befriend them and others on Facebook. Good luck! And, I hope to see you around!

Hey Wesley, join the club!  I have only been in this business since January, but have built my business around wholesaling.  I suggest you learn what it is and why it is key to finding your investment deals.

Aside from that, I highly suggest you read, read, read everything you can about real estate investing (REI), e.g., wholesaling, ARV, ROI, hard-money (private money) lending, notes, owner/seller financing, and anything else related. Also, learn about the different off-market leads: pre-foreclosures, probates, vacant homes, absentee owner, distressed homes, etc. And, read articles by the many different experts on BP's forums, for starters.

Another important tip is to create an account with meetup.org and join several of the different REI clubs. I suggest North Houston REI, 713 Houston Area REI, and Wholesale Nation as a start. They often have virtual meetups on Facebook or Zoom where you can learn a lot about real estate investing. Look for these groups on Facebook, too.

Lastly, consider your first investment from a distressed home you found driving through different neighborhoods.  This is called Driving 4 Dollars.  Essentially, you drive around a neighborhood looking for homes that look or are vacant, or don't look like anyone is taking care of it; e.g., grass not cut, collection of mail or newspapers, gutters falling down, etc.  This suggests that the home could belong to the heirs of a deceased owner, or it is a rental owned by someone not showing an interest in it, or various other reasons.  When you find one, you write down the address take a photo of it and research the owner's name and contact info.  A great APP to download on your phone for this is called Deal Machine.  Afterwards, you have two choices: 1) contact the owner and offer to buy the house, then rehab it, and sell it for a profit, or 2) contact the owner and offer to buy the house, then 'assign' the house to a buyer for a higher price than the owner agreed to buy it from you (called wholesaling).  Another idea is to make an offer with the owner, buy it, move in and rehab it, then rent out a room or garage to collect rent (called house hacking).

There are numerous ways to get into real estate investing.  Reaching out on this forum was a good start.  Keep it up!

@Brian Mittelstadt I don't know if the urban sprawl will go as far north as Huntsville, but Conroe has grown a lot and continues to grow.  With the Grand Parkway completed between HWY 290 and HWY 59, there will continue to be opportunities to invest.  Another focus might be between HWY 59 and I-10 East as they work on completing the Grand Parkway through New Caney and Huffman.  There is a lot of land out there!  We bought 10 acres in Huffman in 2005 for $85k and sold it for $250k in 2014!

@Brian Mittelstadt Originally, I was going to Flip/Hold properties, but when COVID hit, I decided to wholesale.  I didn’t want to get stuck financing one or more properties if buyers were waiting the pandemic out.  But, it seems greater Houston is faring pretty well and home sales and rent was up in June.  I’m glad I changed strategies, however, because now I have a wholesaling segment of my business that can produce more steady income.

Search Kane Griffin in Bigger Pockets.  He recently posted about being a local general contractor and wanting to get into real estate investing.  His business is Gulf Coast Contractors.

The Woodlands is a great place to live.  It’s beautiful with a lot of amenities, food, shopping, and conveniences unlike other places in the greater Houston area.  And, it’s a great place to raise a family. 

With that said, the Houston Heights and Mid-town area is awesome in its own right. It’s, of course, more eclectic and an urban-style of living.  It’s not as kid-friendly, because it isn’t as safe to let your children roam around freely at an early age, but that doesn’t mean they couldn’t live a fun life, either.

In regards to where you want to live, you have to ask yourself what type of lifestyle do you want.  Do you want a laid-back lifestyle, like the Woodlands?  Or, do you want more of a night-life lifestyle like in the Heights and Mid-town?  Plus, if you are not used to driving in Houston traffic, you must take the 1-hour commute into consideration.

Also, you can live anywhere as a real estate investor.  And, you don’t have to house-hack.  You can rent an apartment and still buy/hold homes to rent while collecting cash flows.  You can live in one city and buy/own properties all across the country.  So, don’t let your investing dictate where you live.  Decide what area will best suite your personal needs and desires.