OfflineSo you don't know anything about rehab? No problem. You don't even know anything about painting? No problem. Anyone can do a deal like this. I found a home on the MLS 2 months ago. It was advertised for $46,000. Just 15 months earlier it sold for $62,000. It was a foreclosure and the people who lived there cleaned everything up when they left. It needed zero rehab. Carpet and paint were all good to go. All of the majors had been replaced. I made an offer for $38,000 which the bank promptly turned down. We finally settled on $42,000. It had been on the market only about a week. I immediately started looking for renters as soon as I locked up the deal. I ended up closing at 8:00am on a Friday morning and my new tenants moved in at 10:00am the same moring. Here are the numbers.
Mortgage= $311 per month
Taxes and Ins.= $120 per month
Management=$40 per month
Total expenses=$471 per month
Monthly Rent= $575 per month
Tenant pays all utilities
Monthly cashflow= $104 per month
Not bad for an estimated 1.5 hours work. Comparables are selling for $55,000 to $65,000 right now just 2 months later. I have bought the majority of my homes in January because in the midwest it gets really cold and the real estate market shuts off in December and January. By the way, in my area the real estate market was actually up in 2007.
This type of deal won't make you rich by itself but, anyone could have done it. Maybe in a year when their lease is up I will sell it. By then it will eligible for a 1031 exchange. Or maybe I will keep it forever.
Good luck!
You've got to find your obstacles and call them out! Unsheath the sword, and do battle with whatever it is that holds you back!
I saw a house that was showing a 'For Sale by Owner' posted on the front lawn. The owner is asking for $200,000 even though Zillow showed significantly less. Currently, nobody lives there and has been for the last 4 months. The owner moved up north. I called him almost a month ago to get him seller finance the house. Bascially he wants me to get a loan from the lender (traditional way).
Here's is my goal:
I have no down payment and want the house lock-in buy seller-financed and find tenants to pay for the mortgage itself without using any of my money.
What you are looking for exists. Keep looking and you will find it.
You've got to find your obstacles and call them out! Unsheath the sword, and do battle with whatever it is that holds you back!
Im new to real estate investing. how did you go about finding renters?
These renters were brought to me by a friend that told me that a family had just lost their home in a fire. Since rental property is scarce in this small town, they were living with friends while they were trying to find a place to live. This sparked my interest for 4 reasons. One-they were homeowners that lost their home to a fire, meaning they had a homeowner mindset, which is a plus. Two-in a fire the insurance company pays for everything-guaranteed money. Three- they came recommended by a friend that I trusted. Four-It made me feel good to help someone in need. Other ways to find renters it to place a ghost ad. Put an ad in the paper stating you have a home for rent. List it as 3 bedrooms and the price. See how many calls you get and take names. If they ask to see the house just let them know that the home isn't in your possesion yet but you are creating a list of qualified buyers. Good luck!
You've got to find your obstacles and call them out! Unsheath the sword, and do battle with whatever it is that holds you back!
The renters that were living in the house just moved out because their home just got finished being rehabed due to the fire. Rentals rates are on the rise so this time I ended up renting out the house for $650/month! That is over a 10 percent increase in 7 months. Now my cashflow is sitting around $175 per month.
You've got to find your obstacles and call them out! Unsheath the sword, and do battle with whatever it is that holds you back!