OfflineHave all of you read about Deans very first real estate deal? If not there is a wealth of knowledge to be learned from it! In fact there is also a great deal of profit to be had by tweeking that idea just a little to fit todays real estate market. If you remember Deans first deal it kind of went like this. He found a run down apartment house that needed cleaned up, fixed up, and the tenants evicted. He negotiated a low price and asked the seller to push the closing out a couple months while he went in and cleaned the place up and put new tenants in. Then by doing the cleaning, painting and re-renting he was able to dramatically increase the value. He then went to the bank and was able to get a 100% loan on the place so he did a no money down deal. It worked great. Now that exact format would be nearly impossible in todays market but, you can tweek it just a little and make a fortune in todays market.
Here is what you do. You find a desparate seller that has a vacant property (out of town owners, burned out landlords etc) you then negotiate a low price on the property and tell the owner that you are going to spend your time and your resources to fix up the property (basic clean and paint-the 2 best possible things you can do to a property that cost next to nothing to do) and you tell the owners that you want to lock up the property for 45 days with an option contract and that your intentions are to sell the property to someone else. If you are wrong then they will get a property back in great condition so they can't lose. Then after you quickly clean and paint you start marketing to find you buyer. Remember you bought the property cheap to begin with. Now remember most properties that need cleaned and painting don't show well and banks will disqualify the property for a home loan to a first time buyer. Now you can market the property and quickly find a buyer and do a double closing. The profits could be huge. For example: You find a property that is worth $80,000 in good condition but, because the property is a mess and the owner is desperate you buy it for $40,000 and do the cleaning and painting then you market the property as a steal for $69,900. You sell it quickly and pocket over $25,000! This is real and it works! Get it done!
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!
for reminding us, all it takes is action, on our part.
"I will NOT BE BROKE! ANYMORE!"
In the name of Allah, the Beneficent,
the Merciful.
22.He is Allah besides Whom there is no God: The Knower of the unseen and the seen; He is the Beneficent, the Merciful.
23. He is Allah besides Whom there is no God: the King, the Holy, the Author of Peace,the Granter of Security, Guardian over all, the Mighty, the Supreme, the Possessor of greatness. Glory be to Allah from that which they set up (with Him)!
24. He is Allah: the Creator, the Maker, the Fashioner: His are the most beautiful names. Whatever is in the heavens and the earth declares His glory: and He is the Mighty, the Wise.
Matt, great post. We all need to remember how Dean started out. Not to mention he started on that building when he was only 17 years old! It is amazing what happens when you work for it. Dean told me everytime a tenant would move out he would raise the rent and raise it, and it rented in a hearbeat. The deals are out there, we need to take action, find a way that works for us, and make these deals happen!!!
Jeremy
This train, Dreams will not be thwarted
This train, Faith will be rewarded
Big wheel roll through fields where sunlight streams
Meet me in the Land Of Hope And Dreams
Bruce Springsteen
This is a great post. It shows that determination and desire can lead you to do whatever it takes to find that next deal. The key is see what others don't see and soon the profit potential will appear through some sweat equity and hard work. Sometimes in real estate we can make our next opportunity come true. Believe and Achieve!
- Joe
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Thanks for sharing this. That strategy of using an extended closing is very valuable with a motivated seller.
"If you cannot do great things, do small things in a great way.”
Napoleon Hill quote
It is a great idea to be able to flip a property and create cash with little to nothing out of pocket.
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 strongly agree with you. All it takes is action on our part. Of course the right action. Just do it. If it work..thank you and id it will not get out of the situation...at least you tried it...a good idea to share with...thanks dom
Thank you! Thank you! Great reminder. Great post. Will get on this one ASAP!
What an awesome thought! I'm going back to a property I have in mind that I know is still out there, and didn't want to give a second thought to before. Why not try? This is a great idea.
Thanks again Matt!
Louisa
Current Journal on Dean's site: The Second Chapter: http://tinyurl.com/p986al3
First Journal on Dean's Site: From the Beginning: http://bit.ly/ocv10