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One thing I get asked about a lot is comps. Many investors just simply don't know how to read them. Take these items into consideration:
- What part of the year are you looking at?
- Are you really looking apples to apples?
- Did you drive the neighborhood?
- Is seasonality at play? (IE: your six month window is fall and winter months)
- Are the comparables rehabbed, as-is, or “well maintained”?
- Are there major streets, or other geographical barriers, that might impact the comparability?
- Are there any “White Elephant” issues? (IE: High tension power lines, graffiti, burglar bars, three pit bulls next door)
I will be teaching a class in April about this subject. It is:
Real Estate Intelligence: Making Sense of the Data
If you would like more information, please fill out the form below:
I hope you have seen the new layout of the website. It should make things easier to find. It is hard when there are over 1,200 pages of real estate investment information.
This is about the question, why wholesale. I had someone ask me that today via private message. I thought I might explain why people wholesale real estate, and why some never do.
There are a couple of categories these items will fall into:
I will explain:
- Capital: Some people simply lack the capital to purchase and renovate property. When you factor in carry costs, closing costs, down payments, and the many other expenses it takes to properly execute a rehab, it is typically about a 10% -20% out of pocket experience.
- Capability: Some investors don't have the credit, or time to execute a rehab. What many new investors don't realize, is it takes a large time commitment to advertise, receive calls, evaluate property, and the market to sell. Adding rehab management and sales management into the fold, can make one lost.
- Competency: Quite simply, some people just aren't good at it. They over spend, over rehab, and end up making less than the “rehabber” would.
- Consistency. You will always be twice as successful at things you do consistently versus things you do one off. Many investors simply lack the ability or desire to consistently renovate property.
- Concentration: Have you ever heard the phrase, “most people don't plan to fail, they fail to plan?”. I love it! Don't forget, “jack of all trades, master of none”. I highly recommend you build your team and focus around your primary exit strategy.
That is all for now. I have to go look at houses!
See you around.
PS: I have an exciting training, coaching, and mentoring program we are getting ready to debut. Make sure you sign up at www.FlipThatContract.com!