Are you including all closing costs into this $3.5-4.5k or just the ones associated with the loan? Your main closing costs as the buyer should be title insurance and transfer taxes. If you're paying $3.5-4.5k in points, appraisals, etc. on that size conventional loan, you're getting ripped off. For example, I'm closing on a triplex in August and the closing costs associated with the loan are less than 0.2% of the loan value. Now, our situation is probably different because we were able to get owner occupied financing. However, another property we closed with a commercial loan with a 1/4 point and the closing costs associated with the loan were still less than 1% of loan value. Yours looks like it's in the 3% range. I would shop around some more.

And yes, include all up front, non-recurring fees into the cost of the property, and therefore COCR calc.

I just noticed your location...pffft. What a huge surprise! Trying to talk me out of my dreams because of YOUR personal failure, player hating, and having zero compassion for another fellow human beings difficulties. What a shock!

Go **** yourself.

You're spot on about me being a huge failure and having no compassion for other people, but I'm curious how you got all of that from my location. </sarcasm>

Seriously, someone posted asking for advice/pitfalls. I posted my experience with the deals they are looking to make and why I decided to move on to different investments. I hope the other guy looking at the same deals took it as it was intended, as things to look for while researching properties. I don't know why you think I'm trying to kill your dreams and I really don't care. Good luck with you investments.

Your pitfalls seems like someone making a half-ass effort to me. Making a lot of money isn't super easy. You might have to look hard and in a different city - there are a lot in the US of A.

Half-ass is being generous.

I prefer to think of it as I spent the time to find better investments that will make more money with less effort. But, you can call it half-ass if you like. I'm done with this derail.

Yea, me as well. Bitchin and complaining about others is for women. I forgot the 80/20 rule for a split second and had a moment of weakness. Lol...

"You should never complain because 80% of people dont give a **** and 20% of people are actually happy you have problems."

I hope your investments turn out fantastic sir. Best of luck and God speed.

Lets do a real estate deal if you hear of any. Peace.

I've sold my share in my business and have six figures EURs to invest, so I'm looking ways to actually put my money in good use...

I'm interested to hear what do you have to say about next plan:

I'm planning to find distressed sellers and offer them 65-70% of the market price for their real estate and I also get the ownership after paying the price in cash (no loan on my side). Now I'm granting them the right to buy back this real estate in certain date (6 months etc) for added profit (like I buy for 60 000 EUR, then I'm selling it back for like 65 500 EUR). They have the possession, pay all the taxes, continue selling through the agencies with 90k EUR or whatever price they hope to get etc.
If they are unable to meet certain deadlines (i.e. unable to sell it with their asked price), I can give them longer deadline and also with a little bit higher price, like 67 500 EUR.

If he's still unable to buy back his property, then his right to buy back will end and I'm the owner of property which I got 30% cheaper than market price.

any advice on any beforementioned steps? Like how to find distressed sellers (who are not yet advertising but have some kind of hardship paying loan and need quick money but want to retain the right to sell it for their asked price), what's the right price to offer (% of market value) and what would be sensible profit to add for not looking like a robber (ie price for buying back from me).
And, I'm in Scandinavia and prices aren't dropping in our country, but steadily rising...

Also, my idea is not to be real estate owner so much but to make pure profit...if I'm getting the ownership I'm covering my ass

ty very much!
bman

Post from 2/18/08. OP is a boss.

Hi Everyone! I know that I haven't been very active on this thread for a very long time. Maybe like 2 years?? I dunno. Honestly, I completely forgot about this thread because I kind of quit playing poker and stopped frequenting the 2+2 forums.

I logged in here for the first time in a while, and noticed that this is still by far the most popular thread in the history of the BFI forum. That's awesome, and I sincerely hope that I could add some value for some of you guys considering RE investments.

Here's an update. I haven't been able to buy much for the last few years, despite the plethora of great deals available. This is mostly because the best deals since about 2009 have been primarily in single family homes, which I'm not interested in. Commercial retail in my markets has been much less attractive as well because the properties are staying vacant longer. Plus, the financing situation has been less than ideal, which is problematic unless you have oodles of free cash to put into properties.

Normally, in this type of market the best thing to do is free up capital to invest into good deals. However, there has been a lack of strong buyers. If I can't sell anything or refinance anything, I'm stuck. So I haven't been able to buy much. Even banks that I've been doing business with for years haven't been lending.

My current sweet spot is mobile home parks. That market in particular was highly overheated back in 2009. I've been keeping up with the market across the country, and it is really looking strong for buying.

On the MHP deals, you want to look for minimum of 10 caps on current NOI with the potential of turning the park in to a 20 cap by infilling and improving management. There are tons of these available right now if you have the cash and/or relationships to make it happen. You'll need about 20%-30% down, and you'd be looking at putting a lot of cash into infilling. If you have the cash available, this market is soooo strong right now. MHPs have always been really seller-finance oriented.

The downside is that they're a goddam pain in the ass to operate. More than any other property type, MHPs need an extremely strong manager. Strong managers need to be compensated well. I'd recommend buying a property that can support a manager's salary plus rev share on NOI, plus bonuses. You want to find someone that is an entrepreneur. Someone getting started in REI that will not only be a good manager, but also be a partner for all your future properties.

Just checking back in with you guys. I don't have time right now to answer specific questions about particular investments, so please don't PM me with details.

I sincerely hope you guys are all doing well, and happy investing. I'll try to check back in with you guys soon.

Spex

You're the greatest of all time.

Keep making that money.

Huge fan of Tien. He helped me get over my cold feet in REI - I love this type of advice. I will say in REI you can analyze things 100 different ways and if you want to, you can always talk yourself out of a deal.

"He is the best man who, when making his plans, fears and reflects on everything that can happen to him, but in the moment of action is bold.”

At some point, you have to jump and you'll learn a lot along the way.

I would just like to thank OP for this.

It is threads like these which makes two plus two so great to come to.

Thanks for the thread spex. Mobile homes have been pretty good to me the last several years, which I pursued because of your advice in this thread.

One of the most important things I learned from this thread and through my own endeavors is to be extremely selective on what I buy. I've bought deals that I wasn't very excited about but thought a marginal deal was better than no deal at the moment. Most turned out to be low performers as expected. Because the marginal deals tie up capital and time, I would have been better off completely skipping those types of deals and only focused on the home runs.

Right now I'm looking at buying a mobile home park which may or may not materialize. Too early to tell but with the ground work I've laid the last few years, I feel pretty comfortable assessing the deal.

Thanks for the brief update and many thanks for the input throughout the thread. Hope to see you around here periodically.

good idea - think your best bet is to you look for your jurisdiction's foreclosure auctions and whom the state is taking action against....just make sure before you buy to make sure there's no other liens against the property or any other issues.....when backed taxes are due the state/city always is the first one to get paid back - after that the mortgagee or whomever else is due money.

Hi and thanks for the thread. It is outstanding!

I currently have around £300,000 to invest and am based in London. I own my own property outright and was thinking about getting involved in buy-to-let.

I am a little concerned about future interest rates. London may be slightly considered as a safe haven as there is usually demand here world-wide. There is currently a shortage of housing and rent exceeds the current mortgage payments. However, if interest rates rise I expect to see people struggling to pay their mortgage and house prices fall. I expect to see interest rates rise in the face of inflation due to all the money printing. Rather than turn this into an econ debate, I was wondering whether you think about this and if so, do you try and time when to buy and sell?

London might not be as bad as the rest of the UK due to the high demand for houses here, so maybe if I just limit myself to one property for now, I could pay more off in the face of rising interest rates.

Would you look to borrow as much as possible with the current low interest rates and put the minimum down? I am looking at this from a long-term point of view as I am 28 years old.

Thanks again.

Is there any info on rent to sale price ratio?
I once found a good article with data but seem to have lost it. The only recent thing I could find is:

http://info.trulia.com/index.php?s=32055&item=125286

Unfortunately it only includes a few cities.
I am in the bay area CA, so I am SOL in terms of low cost options. I bought a condo in Boise, ID for cash flow. I am wondering if I should try another city for my next purchase. I am looking for properties in the range of 45k to 100k.

Here in the US, aside from two or 3 years, we have had inflation every year for the past half century. Despite this interest rate have gone up and down. So I would not stress over macro. Finding a good deal and good terms is way more important. If you can find a good price, lock in a low rate, and avoid vacancy, you are in pretty good shape. I'd say borrow as much as you need rather than as much as you can. $470000 is a **** ton of money. And if its your first deal, its better to invest a little so that you learn/gain experience with little risk. So maybe look for a modest down payment, so that you still have plenty of cash left for more investment opportunities.

can someone explain to me what the hell this is? obv looking at it, im skeptical and think lol must be a scam of some kind or just massively overvaluing available returns.

from the info, it seems you buy the house and there are tenants already living there... so you basically just need to make the purchase and if ur buying-to-let then theres no need to find tenants/management company etc.

also why are the properties so cheap? im from the UK and assume that U.S. houses are built completely differently?

http://www.rightmove.co.uk/overseas-...-23859762.html

Not sure if I should start a new thread for this , but I'm currently interested in selling a rental property of mine

I'm renting it currently at a low price as a favor to a friend, I still go and use the place while on vacation as well

Anyway he's shipping out for the military in January and don't want to keep the place.....

I want to go about selling it in the smartest way possible, my friend will help me with the sale while I'm out of town, letting agents in, helping deal with workers making potential minor repairs etc.

Anyway I'm just so clueless
I feel like some agent is obv not gonna have my best interest in mind

I don't wanna deal with an agent at all... But living out of state currently seems like I have no choice

How do I go about not getting rizzity raped

I'm not in "need" of the $ .... So if I can't get a good price I will rent it out (easily rentable area )

But I dunno don't wanna deal with that

I really need some advice , and just flat out don't trust any agents

THAKID, Being out of state you might just have to go with a realtor (imo, realtors are the most overpaid, underworked "professionals" in the country).

I always thought the internet would destine realtors to the same fate as travel agents. Turns out I was wrong. Just a few years ago the Sunday edition of the local paper would attract buyers, now, no one buys the paper.

If you can figure out a way to market your property to likely buyers, thus avoiding paying a realtor commission, do it because that is all realtors do.

After finding a buyer, all you need is an attorney to handle the closing. There is nothing a realtor can do besides being present that you are not already paying your attorney to do.

The only upside to hiring a realtor is that since the housing crash, all the kitchen broker soccer moms have left the industry, leaving the real producers. Get a local attorney to your property and ask him/her who the best realtors are. Don't let the producer hardball you into taking a lowball offer, be firm on your price if it is realistic.

I've been buying and selling since '95, my attorney used to call me an ******* for paying him $2500 for a closing when a soccer mom realtor was in the corner of the conference room...every...single...closing, waiting for her commission which was always at least double his pay.

Best decision I ever made was hiring a hot, professional looking girl to market all my sales (she's a full-time school teacher). She handles everything from marketing to open houses. Once a legit offer is made I take over. I way overpay her for what she does, but it is still less than half I'd pay a realtor. Oh, and I don't offer co-broke.

BTW, sell it as is...and empty.

Sell it as is and empty huh
Afraid of that

Sounds like ur doing it smart

Real estate agents really are a joke

The industry is a joke