question about investing in real estate, any info is greatly appreciated

Discussion in 'The Okie Corral' started by Glen Rose, Feb 6, 2010.

  1. Glen Rose

    Glen Rose

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    Hello,
    I'm looking to invest in real estate in Texas, Florida, Nevada or Arizona. I want an investment property, either a house or condo, and I want to spend about 100k to 150k. My first choice would be a two bedroom condo, but I could accept a one bedroom condo or a small house. I want to get something in a city that isn't too small, one with jobs that will continue to attract people. Or at the least, I want to invest in a city that won't be losing too many more jobs in the future. I'm hoping for a state that doesn't have too high property taxes, but I'm willing to accept one if there are other good reasons to invest there. Do you think now is a good time to invest, or will prices continue to fall? Where do you suggest I invest? I plan on putting down up to fifty percent down payment and my credit is fine, so it shouldn't be very hard to get a loan, hopefully. If you are an agent, please give me your contact information, also let me know if you know a great agent. I'll thanky you in advance for any information you can give me.
     
    Last edited: Feb 6, 2010
  2. silentpoet

    silentpoet

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  3. Hines57

    Hines57 Simple Member

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    I was in Cape Coral Fl over Christmas where my mom has a house. 4 yrs ago it was valued at $312k, this year it was $88k. At the time there was something in the NYT about Cape Coral being the hardest hit area in the country. I went and looked at a 1400 sqft house built in 2006 that was on short sale for $76k.
     
  4. G33

    G33 Frisky! CLM Millennium Member

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    Land is good.
    Developed land not so much.
    I do not see a real turn-around until late 2011.
    Can you hold on to the debt that long?
    :supergrin:
     
  5. jpa

    jpa CLM

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    Generally condos suck as investments. Annoying associations, stupid rules you're on the hook for even if you don't live there, and plus if someone's going to rent basically an apartment, they'll do it from a management company rather than an individual.

    I would stay away from Nevada/Las Vegas for the immediate future. Our unemployment numbers keep climbing, we keep losing employers, local businesses are closing left and right and the class of people who rent property here are not what you'd want living in your place. As a matter of fact, the only reason our unemployment numbers here dipped slightly in December was because 3000 people MOVED OUT OF STATE. Rents are dropping an average of 8% year over year, there's a huge phantom inventory of REO properties waiting to burst on the market and there are a lot of banks that are very gun shy about mortgaging a house here, especially an investment property owned by an out of town investor. I've heard a lot of the same about the population centers of AZ and FL as well.
     
  6. Gallium

    Gallium CLM

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    If you are looking into RE investment, you have three basic choices in the non-commercial realm.

    Anyways, you and every 3rd investor thinks he/she can beat the market. The absolute best thing would be to choose where YOU WANT TO LIVE for the next 15-20 years, and get that property for as little as possible. My 1st place in the USA (which I still have ) listed at $77.5k (an apartment). I purchased it for approx $28k with no closing costs (a foreclosure)...this was almost 2 decades ago, it's been paid off for about a decade, and I still have it.

    Last, you have 10 posts on GT. No significant contribution here. Who are you? If we had any tips or tricks or shortcuts, what would be our motivation for "helping" you?

    'Drew
     
  7. GreenDrake

    GreenDrake Rip Lips

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    Man there are some screaming deals out there right now. Did you know 70% of foreclosed properties never even attempt a short sale? If I had the capital I would be most definitely buying up properties these days, but then I am a Realtor, so times have been tough the last few years. I changed my game plan and this year will probably be my best year ever. I just saw a property come on the market this week, beautiful 4000sf home, six years old, with a huge heated shop on over five acres in a great spot, priced at $239k... crazy deal. Referred it to a buddy who bought it. The short sales process is also getting quicker, banks suck butt I tell ya, they have no interest in helping a short sale to fruition, which is why most of them fall out. If you have capital and patience, you can make some serious moves right now.
     
  8. kestrou

    kestrou Pin Member #4

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    If you want to invest in real estate - don't do it in residential of any kind - WAY more hassle.

    I invest in commercial-office - lots lower maintenance than high-traffic commercial-retail (plus tenants want to take care of their "office", where they live for 8+ hours every day) - and the tenants seem to be longer term.

    Good luck and, as NYC Drew said, drop by and contribute more if you'd like more information. :)

    kestrou
     
  9. paynter2

    paynter2 It ain't over Millennium Member

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    Well - that answers the "did everybody get laid last night?" question! :whistling:
     
  10. pac201

    pac201

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    Bwaaahahahaha!!!!!:rofl:
     
  11. Big Bird

    Big Bird NRA Life Member

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    Historically, real estate has produced about a 5% return. After taxes and inflation you roughly break even. Certainly SOME real estate in SOME places will do better and you might be able to buy into a really great deal. However, don't expect you will buy in at today's low prices and in a year or two the market will be back to the salad days of house flippers back before 2007. Mostly values will move from where they presently sit. Keep in mind that finance and closing costs will eat up 2-4% of the value of the property. Plus you have to pay property taxes on the land every year. Also, if you rent you'll need to declare the rent as income and this will also eat up 20-45% of the cash flow depending on how you structure you business. Finally, you will have to set aside maintenance money for upkeep/repairs. Last thing is the banks aren't loaning to people without very good credit right now. If your credit score isn't 650 or above and you can't prove cash flow and have the proper debt to income ratio in your personal situation the banks won't even consider you for a PRIMARY residence. Underwriting requirements for an investment property are MUCH tighter.

    Also, remember, you can loose money in real estate. I can't tell you how many people were on boards like this 3 years ago crowing about real estate investing and how real estate never goes down blah blah blah. We might be the bottom right now but then again we might not. So be prepared for a long term investment.
     
  12. Glen Rose

    Glen Rose

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    Hello,
    sorry if I pissed anyone off by not contributing more to the site. I've lived in China for many years, where I'm a teacher. If anyone has any questions about China or doing business here, please feel free to ask.
     
  13. Glock30 Guy

    Glock30 Guy XD40

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    I bought 2 condos in SC 5 years ago for $135K brand new and they went up to $210 within a year. I have had them rented the whole time so I've never had to make a payment on them out of my pocket. Of course now they are worth about $150K so I keep asking myself why I didn't sell. Associations can be a pain in the neck too. Lots of rules. If I did it again, I'd buy a house to rent out.
     
  14. Glen Rose

    Glen Rose

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    Hello,
    I wanted to start a new thread but was unable to in the lounge. I then started one in the "glock" section and asked that someone move it to this section. It was removed but not moved. In that threat, I apologized if I offended anyone by asking questions without contributing enough to the forum. I also mentioned that I live and work in China, so if you have any questions about life in China or investing here, please feel free to ask.:cool:
     
  15. Rabbi

    Rabbi The Bombdiggity Lifetime Member

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    If you are trying to pick a STATE to land in and start investing in real estate with 150K....The only valid advise you will get is....you have no business investing in real estate. It really is that simple.

    Unless you are one of the big boys, the way you make money in real estate is knowing your market like the back of your hand.
     
  16. ChiefWPD

    ChiefWPD

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    Big Bird is spot on in regard calculating actual costs of property ownership. Before you put your money down do a spreadsheet on all costs and possible upsides. If you are honest with your numbers I think you will find that buying residential real estate for the average guy is little more then speculation.

    Please note, I'm not talking about a primairy residence, but an "investment" property. The only folks who seem to make money on those deals are the realtors, banks and attornies involved.

    Best of luck.
     
  17. blackjack

    blackjack

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    And another reader of Rich Dad, Poor Dad shows up...and, as usual, Rabbi hits it out of the park.
     
  18. kestrou

    kestrou Pin Member #4

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    I bought three copies of that book as Christmas presents for my three daughters (ages 16, 13 & 11) - some of whom are a little young to understand the finer details now, but I promise to bring it back up and reinforce it as they get older and it's never too young to start teaching kids about money! :)

    kestrou
     
  19. 2952

    2952

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    I find it amazing that somehow well respected people on this forum come and say that a person needs some unofficial length of time to participate here.

    I have lived most of my adult life licensed as a Real Estate Broker and General contractor with business' in several States involved in thousands of brokerage deals and buying, selling, developing, building and renting many properties.

    Real Estate is a Commodity that goes up and down in price. Every ten years or so the value drops but usually regains its value and overall continues to go up in value. Once you buy you can only make or lose imaginary paper money until you sell.

    There are only two ways to make money in real estate. 1. Buy low and sell high. 2. Buy a property and rent it out for the "Positive" cash flow. Both carry considerable risks.

    A novice should always buy close to home until they learn the various risks that come with different types of real estate. You also need to learn your own risk tolerance level and what you like or do not like to do as far as maintenance and management requirements.

    Rules:
    1. Decide which of the two ways do you want to concentrate on.
    2. Always be on the lookout for a deal that makes sense in the secondary
    choice.
    3. Learn your market by getting out and doing the research yourself.
    4. Refinance only if you can lower your payments.
    5. If you are holding property as a rental, let your equity build until you can
    use it to 1031 exchange it for a larger property. Never sell just
    exchange until you are ready to get out of the business.
    6. Most real estate is a long term investment.
    7. There are no agents that are any good that will guide you to a good
    deal. If they are any good they have money and will already have
    bought the good deal.
    8. You make your money when you buy the property with the right terms
    and financing.
    9. Remember - friends, brother in laws, people on forums, attorneys, CPA's
    are all deal killers.They never can be found wrong if they advise you not
    to do something.
    10. Have fun in everything you do.
     
  20. armorplated

    armorplated

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    And after you guys dispense your collective real estate wisdom, I need the winning number for the lottery too.