If I Were to Start My Real Estate Investing Over Again Today

MemphisBuyandHold

If I were to start my real estate investing over again today, knowing what I know now, what I would do differently is: (in no particular order of importance)

    1. Accept how difficult it was going to be. I’d never owned a business before. We knew this venture would be tough because it was just us – no one else to be responsible for anything. No longer could we go home at night or on the weekends and just veg-out. This was like having a baby – 24 hours a day, 7 days a week of complete responsibility. And, like having a baby, unless you’ve experienced it, you don’t understand what it means. Mental understanding is nothing like real-life-experience understanding. I expected it to be difficult – I had no idea how far from accurate my expectations were.
    2. Know how rewarding it would become. We had goals and a business plan. We had a big “why” when we started out that we used regularly to keep ourselves from getting off track or giving up with what we were trying to accomplish. However, as big as we stretched our goals, as detailed as our business plan was, as important as our reasons to succeed truly were, I had no idea the size of the reward we would be reaping if we refused to be deterred. I cannot stress enough how large the obstacles are that get thrown in front of you over and over, and ever changing. The temptation to say, “this is too hard – I’ll try something else instead,” is HUGE. Every time you give up on your dream and start toward a new one, you are starting over. The challenges may be different, but they will still be there. To win big, you have to grow big. To grow big takes overcoming big challenges. We did, but they would have been far less daunting if I’d had any idea the enormity of the rewards waiting further down the line.
    3. Know that true wealth was going to take longer than all the gurus said it would. “Just buy my product / follow my system and you will see big results.” I have yet to personally meet anyone who is wealthy following the process laid out by a program they purchased. Everyone I know of true wealth followed the experience of a coach/mentor as they blazed their own trail. It looks easy on TV; it sounds easy at a seminar; it is hard work and it takes longer than you think it will. Know that starting out so you’re not disappointed or distracted.
    4. Know how hard working with my spouse would be. Who’s the boss? Yeah, right. And that’s only one problem. Who’s right? Who knows more? Who’s point of view is best? Who has the final decision? It’s one thing if you have a business partner who lives in a different house – way different. In very little time, the business is the only thing you talk about. After all, what else is there? Exactly…
    5. Pay less for private money. Starting out, we offered too much out of fear we wouldn’t get it. Turns out, people are happy to place their money safely in an investment that is collateralized by real estate. Years later, we took profits to pay off the original “expensive” money when we gained the knowledge and expertise necessary to offer less return. Most of those lenders were so happy with the regularity of their returns that they chose to stay with us even when offered lower interest rates. Take care of your private money lenders and they will stay with you forever. (And, they encourage their friends, family, and co-workers to invest, as well.)
    6. Sell more properties instead of holding everything (even though it did make us learn how to be lean and clean without waste). In the beginning, we had a long term picture that involved holding properties to get there. Naturally, the larger our portfolio, the sooner we could get to that end goal. Because of our tenacity, we refused to sell anything for about five years. During that time, we created quite a hefty portfolio. Looking back, holding everything was probably not necessary and having chunks of cash now and then would have allowed us to breathe better and make some different investing decisions.

If I were to start my real estate investing over again today, knowing what I know now, what I would do the same:

    1. Pay for good coaching. From the beginning. And your coaches change over time. There are lots of investors who know more than you do, especially when you’re first starting out. You want to constantly be following someone who is successfully doing way more than you are and who is actively doing it. The economics and legalities of what we do change at lightning speed and it’s important to be mentored by someone who is actively engaged in the business you want to be learning. Far better to walk through a mine field in the footsteps of someone who’s already crossed it successfully.
    2. Get involved in a mastermind group to share ideas of what works and what doesn’t. If two heads are better than one, how about six or seven? Not only can they help guide you and point out things you would never think of on your own, they also hold you accountable. When you meet monthly and say, “this is what I’m going to accomplish in the next thirty days,” within thirty days you’ll get it done. After all, you don’t want to go back and tell them you weren’t successful!
    3. Enter into this business with my spouse. As difficult a this was (can you say “counseling”), it turned out to be the best partner I could ask for. For a number of reasons including the fact that no one else cares nearly so much whether or not each deal makes a profit. No one will ever look out for your business more than the person who gets 100% of the profit or loss that you get. No one will ever care as much about how every decision affects you and your family for the long term as your spouse. Yes, it’s tough, but two eyes and two brains watching out for and learning about everything that needs to be done turns out to be a big advantage. Get outside help to guide you on how to make decisions together, divide the responsibilities, and keep your marriage as well as your business in tact. One thing a lot of our students say is, “you’re so lucky your spouse is in this with you to help you and understand all that’s involved.” I have to agree.
    4. Focus on the long term rather than short term results. Disappointments in the short term happen often and the results can trip up your enthusiasm and stamina. Always have those long term reasons and goals in front of you to keep you putting one foot in front of the other, especially when overcoming the big obstacles. We use lots of projection calculators to see where we’ll be in 5, 10, 20, 30 years. Today may be lean but, boy, retirement looks amazing!!
    5. Refuse to be stopped – no matter what the media says, the banks do, the legislators change, tenants throw your way, private money lenders require, attorneys ask for, on and on and on and on and on and on. Tackle bite sized pieces – one day at a time – one project at a time – one document at a time. Keep overcoming. That’s what this business requires.
    6. Hold as many properties as we could. It made life in the short term tough, but the long term rewards are worth it.
    7. Continue to do business plans as often as possible. These keep you on track. Business plans make you aware of where you’ve been and where you are. They’re the only way to plot progress or distractions and for years they’ve kept us on the One True North toward our goals.
    8. Build a team and staff. Real estate investing is not a solo business. Our first hire was a bookkeeper. Bookkeeping is essential but not something we wanted to spend our time on; it’s not something that generates income. Find out your pain points and hire others to do what you don’t want to do or can’t do. Your job is to generate income. One of the best ways to do that is sitting in front of sellers negotiating deals. Work that can be hired out and handled by others, hire out and let others handle.
    9. Surround ourselves with like-minded people. We all need peer groups. A group of other investors doing what you’re doing will help you make decisions, point out alternative solutions, keep you motivated, offer support when you struggle, and hold you accountable to your own goals and timeline.
    10. Keep both a real estate and business coach. For years we had real estate coaches. Once we had real estate investing somewhat mastered, our next struggle became owning and operating a business – another new frontier. So we found someone who was successful at doing exactly what we wanted to do. Our holding company was operating in the red at that time. We were confident it would turn around as the economy recovered and property values began to rise. Our business coach looked over our companies, made some tweaks to our operations, and within a matter of months that same company was six figures in the black. I can’t stress strongly enough that you don’t know what you don’t know. You can’t ask the right questions when you don’t know what they are. Find someone in every area of your business who has been there/done that and will point out what you don’t know today.
    11. Always stretch beyond what we believe possible. This business requires a lot of stretching. There are so many moving parts and a lot of them are frightening – dealing with mortgage companies, private lenders, hard money lenders, attorneys, title companies, insurance companies, local/state legislation and the IRS, just to name a few. You must be willing to function outside your comfort zone and go where you’ve never gone before. Those who constantly retreat back into the safety of what they already know are never truly successful.
    12. Have a clear vision of where we are headed and stick to it. That vision allowed us to sacrifice for the business even when it was painful. We always had our big picture plan emblazoned in front of us.
    13. Create goals. It’s so true that if you don’t know where you’re going, you don’t know how to get there or even if you arrive. But, it’s actually much more than that. The first time we wrote down goals, we wrote our one, three, five, ten, and fifteen year goals. Who knows what in the world will happen in fifteen years? I wrote “retired”. What was fascinating was that we accomplished our one, three, and five year goals all in the first six months! A couple of things about that: (1) we’d never written or tracked goals before so we had no idea how much we could accomplish in a specific time period (2) we were moving way too fast! The next year, we hit our one year goals in 8 months. The third year, we hit our one year goals in 10 months. We can now predict, with a fair amount of accuracy, just what we can accomplish in 12 months. Every year, our goals are much larger for the year ahead than they were the year before. And, every year our businesses have grown exponentially. Coincidence? I believe the amazing growth is because we pay attention to the details. The fun part is when you review those goals to see if/when you hit them, and the next fun part is being able to stretch them. Without goals, you have no frame of reference and no scorecard. Without a scorecard, you have no idea how you’re playing the game so you can’t correct and improve. And, by the way, you can’t celebrate unknown victories!
    14. ALWAYS have contracts with contractors including pay schedules and deadlines. There are not enough pages to write out the importance of this.
    15. Never depend on banks. Ever. We started our business in January 2005 and didn’t want to depend on banks. In 2008, we were glad we hadn’t. We have a neighbor who had all of his commercial loans with one lender. Unfortunately, his private residence was tied to them. Without warning, this lender decided to no longer offer commercial loans so they stopped renewing the ones on their books. Our neighbor was caught in this trap and unable to find alternate commercial financing quickly enough. He lost not only his commercial properties, but his personal residence, also. Banks can change/create the rules without your approval. And they do.
    16. Build good solid honest relationships. This takes time.
    17. Keep your word no matter what – even if you don’t eat.

Article Source: http://EzineArticles.com/9770940


Memphis Buy And Hold is specializing in locating, purchasing, renovating and managing single-family and multi-unit properties and possesses over 12 years of experience in real estate investing and property management in the Memphis and Nashville markets… Learn More…… www.memphisbuyandhold.com

 

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Why Do People Want to Start Buying Nationally When it Comes to Real Estate?

Why-Do-People-Want-to-Start-Buying-Nationally-When-it-Comes-to-Real-Estate

There are a lot of people that are buying nationally when it comes to real estate. There are many reasons why so many people decide to buy real estate nationally. If you are thinking about buying real estate in another country or area, then you need to know what these reasons are. This article is going to tell you what some of the reasons are that people are deciding to buy in other areas.

  1. One of the main reasons why people are buying nationally is so they can move to that area and live. A lot of people want to get away from their current location, so they decide that they want to live in another country or another area entirely from where they have always lived. So, the main reason people buy real estate nationally is to live in an entirely different area.
  2. Two: Another reason for buying nationally is so they can have a home to go to when they visit that area on vacation. Having a vacation home can save you a lot of money each time you visit that area. People are starting to realize this and are deciding that they want to buy real estate nationally so they can always a have place to go when they need to get away from the stresses of life.
  3. Making money is another reason that people buy real estate nationally. You can buy a home and then rent it out to others to live when you are not using it. If this doesn’t make you money, then it will at least help you meet the payment for that home every month. You can also make money when buying nationally because you can buy the home, fix up any problems there are and then resell it for a higher price. Money is always a big motivator for buying property nationally.

These are not all of the reasons that people are choosing to buy real estate nationally. There are many others that you can learn about with just a little research. One thing that you need to do before you decide to start buying nationally is to determine if this would be a smart decision for your family. Not everyone can afford to do this, but if you can then you definitely should look into because real estate is always a good investment. Just don’t rush your decision.
Article Source: http://EzineArticles.com/2147575


Memphis Buy And Hold is specializing in locating, purchasing, renovating and managing single-family and multi-unit properties and possesses over 8 years of experience in real estate investing and property management in the Memphis and Nashville markets… Learn More…… www.memphisbuyandhold.com

Understanding Turn Key Sales When Building a Home

Understanding-Turn-Key-Sales-When-Building-a-Home

You would think that understanding real estate terms might be a bit easier than prepping for the country’s largest spelling bee. Yet seemingly basic realty terms can have widely diverse meanings depending on geographic location and even within the housing industry itself.

The language of turnkey

Take the term, turnkey, as applied to owning, selling, or building a home. In general realty terms, turnkey usually means “move-in ready”. But there is move-in ready, and there is move-in ready. In the eastern part of the United States a home may be described as turnkey if it requires no significant or immediate repair work. Some real estate ads will declare that a home is, “turnkey ready!” if all the electrical outlets and water sources function properly. Or it has a fresh coat of paint.

One eastern area realtor describes a turnkey home as one that is ready for the new owner to turn the key in the front door, walk in, and unpack the clothes and toothbrush: everything else – including furnishings, appliances, even linens – is already in place. All the new owner needs to do is plug in the recharge base for the toothbrush.

An agent in the southeastern United States defined turnkey as, “… investment properties that are already rented with property management in place.”

Owning, buying, building turnkey

Some people purchase a second home for use as a turnkey property, usually rented on a short-term basis such as for vacations. Turnkey in this context often means that the owner’s furnishings and items remain in place. This usage provides income and convenience to the home owner and vacation usability for both owner and renter. Either way, the house remains ready to use.

The building aspect of turnkey has its own variations. A home buyer may contract with a builder to have a home built to specification, including all finishing details of flooring, lighting, cabinets, hardware, etc. Some buyers will even work with the contractor and design team to completely furnish the new home down to the tea pot and flatware. This might be considered the ultimate in turnkey ready.

Building within a new housing development also offers opportunity for turnkey readiness, minus (usually) the furnishings. Construction begins within the development when the individual house is purchased – prior to building. The owner will meet with the sales/developer team to select colors, flooring, and all finishing details.

Not to be left out of building to turnkey level housing are prefabricated or manufactured houses. Pre-fab and manufactured homes are no longer code words for double-wide mobile homes. Modern manufactured homes are opportunities for buyers who want more control over the construction and details of a home, often to be situated on a property of choice. Turnkey can refer to the basics of finished interior/exterior, or can include fully customized and furnished homes.

When in doubt, ask to talk “turnkey”

If you are unsure about what turnkey means, ASK! Don’t assume your understanding of the term will be the same as the agent’s. Get a clear understanding from the realtor, developer, or other representing agent what is meant when the property or building is described as turnkey.

And if that person’s definition of turnkey wasn’t included in any of the descriptions mentioned above, add the new definition to the list.

Article Source: http://EzineArticles.com/8546501


Memphis Buy And Hold is specializing in locating, purchasing, renovating and managing single-family and multi-unit properties and possesses over 8 years of experience in real estate investing and property management in the Memphis and Nashville markets… Learn More…… www.memphisbuyandhold.com

How To Profit From Your Rental Properties

How To Profit From Your Rental Properties

There are lots of people who believe that harvesting huge profits from rental properties is one of the easiest businesses they can do for enjoying a luxurious life. The reason which at first instance, seems to be responsible for this myth be no tension of establishing a personal office or factory, no tension of appointing huge staff for getting different tasks accomplished on time, no concern about the sinking of funds on etc. In simple words it can be said that lots of people think that earning rent from the property given on rent doesn’t require any huge investment.

But, is it really so as it seems to be or earning profits from rental properties is complex and requires the proper involvement of the person investing his funds in the property for giving on rent. This in-fact is the matter of debate which is mainly because of the discussions which they have from their known ones who have given their property on rent. Although, this can be true, but that is possible in the case if you have rented the portion of your house to only one or two tenants. But, in case if you have two to three properties which you want to give on rent then looking after those properties could be quite messy for you, especially at the time when your tenant calls you at some odd timings.

Moreover, if you some properties for rent located in another corner of your city or is some other city then looking after those properties could be quite daunting for you. Because looking after all the properties at the same time won’t be possible for you, anyhow, even if you succeed in managing it, you might have to struggle with your tenants for rent and other issues. Anyhow, even if someone assumes that investing in property is one of the easiest methods of earning, then they do not know that it is like hitting the bullseye. So, how a novice can get rid of various issues arising from Rental Properties Adelaide for earning expected profits from his property.

An answer to this question in simple words can be hiring the services of the rental property management group which is constituted by the group of mavens having vast experience in looking after the various aspects associated with rental properties.

Why you should hire the services of rental property experts:

As referred above that most of the people consider earning money from rental properties as an easy task, agreed that it is. But, do you know how to search for the prospective tenants, how to interview the tenants and get their documents verified, what are the legal documents required to be prepared before giving any property on rent or what to do in case if your tenant refuses to pay rent on time or tries to exhibit his ownership on your property? All these questions are just illustrations of the problems which as a newbie, you might face while investing your funds in property, there might be various other issues about which you might have even not imagined could disturb you once you have given your property on the rent.

Anyhow, if you are aware about all these problems and know how to get through them, then undoubtedly nobody can stop you from becoming rich in a few years. But in case if you do not wish to face all these issues, then it would be better to at-least will think of hiring the services of the property management experts to avoid any type of critical situation in the future.

These experts will work for you and take care of your property as their own property on your behalf and will look after all issues arising from the property, starting from the hunting of the tenants to sorting out different issues which might face because of your tenants. Let us, for instance, say that, you have not allowed your tenants to park their vehicle inside your garage during your absence, but still if they do so and argue with you that as they are paying rent for your house, they are liable to use the garage also. At that time if they did not stop parking their vehicle inside the garage at that time the only option left with you will be getting your house vacated from the tenants quite early before the expiry of their agreement.

Article Source: http://EzineArticles.com/9638865


Memphis Buy And Hold is specializing in locating, purchasing, renovating and managing single-family and multi-unit properties and possesses over 8 years of experience in real estate investing and property management in the Memphis and Nashville markets… Learn More…… www.memphisbuyandhold.com

Investment Criteria of a Beginning Real Estate Investor

Investment-Criteria-of-a-Beginning-Real-Estate-Investor

Focusing on property features alone is a quick way to the grave of your real estate career. I think this is an easy concept to grasp, but it does come up, so I wanted to share how I feel about what variables an investor should focus on to make solid buying decisions. Mistakes are made all the time by investors paying too much for a piece of real estate, but I would bet there are even more mistakes made when it comes to NOT buying a property they should. The old saying is, “the only real estate deals I regretted are the ones I didn’t do.” I am not sure I totally agree, but I understand the concept.

If you limit your criteria to property features, you will miss out on fantastic buying opportunities.

When I go to networking events, I often hear investors ask each other about their investment criteria. I cringe when I hear something like, “I am looking for 3 beds, 2 baths that will rent for $1,400 a month.” If I get an answer like that I will likely respond with, “What is wrong with something that is only 2 bedrooms that will rent for $1,500?” The normal response is a look of confusion or no response at all. Obviously there is a lot more to it than the bedrooms and bathrooms and even the price. What about location, HOAs fees, or deferred maintenance? What about the investor’s risk tolerance, potential for appreciation or potential to redevelop in the future?

When looking for deals, there are two points you might want to consider.

FOCUS ON PRICE AND VALUE

If you focus on property features you might miss a neighborhood that produces the financial outcome you are aiming for. I would much rather hear an investor explain their criteria as a return on investment, price to property value, or even a value play in a certain area. This is the criteria that focus on the financials. A skill as an investor should be to be good at coming up with a value (that could be based on resell value, cash flow, or other potential) and then deciding what you are willing to pay for that value. A fix and flip is a great example and is easy to analyze because there are very few factors. Rentals can be a bit more challenging because variables like; location, potential tenants, future vacancies, maintenance, future price changes, your short term and long term financing, management, and rent amounts all play a role in your decision. There are risks with all real estate deals, so you will want to understand those as you work towards the price you are willing to pay.

CONFORM TO AREA

This is not always necessary, but in most cases you will want to conform to the neighborhood. If you are looking for a condo in a building full of 2 bedroom condos, then buying a 2 bedroom condo would make since. If you are only considering buying 3 bedrooms, but you are looking in a 2 bedroom neighborhood, you will severely limit opportunities. In many cases bedrooms add little to no resell value, but that is not always true. A big opportunity exists if you can find a 1 or 2 bedroom house in a 3 bedroom neighborhood. By converting the house with fewer bedrooms to conform to the area, you should see a big upside. You should also see upsides when adding bedrooms to rental property, because it should increase cash flow. All of these opportunities could be missed if you are not open to looking at them. A strategy that I see some investors successfully implement is to first understand a certain neighborhood and get comfortable with the values and then search for discounted properties in that neighborhood. In this case, you will be searching for price to value not property features.

With all this said, a house that does not conform to the area could still be a good investment. Remember, all real estate has value and all real estate is a good buy for the right price.

Article Source: http://EzineArticles.com/9767802


Memphis Buy And Hold is specializing in locating, purchasing, renovating and managing single-family and multi-unit properties and possesses over 8 years of experience in real estate investing and property management in the Memphis and Nashville markets… Learn More…… www.memphisbuyandhold.com

Tennessee Real Estate: Music to the Ears

Tennessee-Real-Estate

Tennessee is the state of prairies, towering mountains and country music. Inexpensive Tennessee real estate will also put a jump in your step.

Tennessee

Tennessee is a state with a little bit of everything. Parts of the states are comprised of lush, rolling fields with horse farms and agricultural. In other sections, you can find the Appalachian Mountains, which need no introduction. Of course, no mention of Tennessee would be complete without discussing the music scene. With cities such as Memphis, Tennessee is a mecca of music and, of course, the home of Elvis.

Memphis

If original music and an active nightlife are your things, Memphis is the city for you. The city is the home to vibrant blues, soul, country and rock scenes as well as numerous record labels. Historically, the economy of the city was tied to the cotton industry, but this is no longer the case in modern times. Instead, Memphis has become a modern city while maintaining its historic charm. If you are an avid Elvis fan, this is the place you will find Graceland.

Knoxville

Surrounded by no less than three mountain ranges, Knoxville is a picturesque city with a quiet atmosphere. Well, quiet so long as you don’t live next to the University of Tennessee, which is located in Knoxville. With a huge student population, the town rallies around the football team by filling Neyland Stadium with over 100,000 people per game. You have to see it to believe it.

Nashville

When you think about Nashville, you think about country music. Over five million people Nashville each year to immerse themselves in it. Home to the Grand Ole Opry, Nashville is best experience by hitting the nightlife. If you love country music, Nashville may be a great relocation spot. If you don’t, you should probably look for other locations.

Tennessee Real Estate

Despite being a physically appealing location with a hot nightlife, Tennessee real estate is very cheap. Single family homes in Memphis or Knoxville run in the $180,000 range, while the same home in Nashville is roughly $210,000.

Article Source: http://EzineArticles.com/83821

Memphis Buy And Hold is specializing in locating, purchasing, renovating and managing single-family and multi-unit properties and possesses over 8 years of experience in real estate investing and property management in the Memphis and Nashville markets… Learn More…… www.memphisbuyandhold.com

Five Basic Tips for Investing in Real Estate

Five Basic Tips for Investing in Real Estate

There are a lot of things to learn in Real Estate before you start investing. In fact, investing in Real Estate is much more complicated than the stocks investing. That is why Real Estate has become the common investing area for many people and thus have become more popular over the years. One needs to have financial and legal knowledge before investing in the Real Estate.

So, here we are providing you five basic tips which helps you to familiarize yourself with the basic concept of Real Estate.

1. Location:

Location Matters which is an old age saying perfectly suits when we think of the investing in Real Estate. The first thing you should make sure while investing in a property or proceeding forward is whether it is located in a good place or not.

If it is the best location, it can be the worst house there, but that doesn’t matter as you can just fix the issues or resell it to someone who wants a house in the best location. This is called as the Fixing and Flipping formulae by the professional Real Estate investors.

2. Wholesale properties:

Being wise is also very much important while investing. You need to follow the Warren Buffet formulae from the stock market investing which says “You need to be greedy, while everyone else is feeling fearful.” You need to look out for the wholesale properties that are being offered at great discounts and thus avoid paying full prices.

Using this technique, you can buy the property at low price and keep the selling price twice the buying price which helps you in maximizing your investment return.

3. Connect with local investors:

Hanging out with the local investors and talking with them about the local Real Estate market will help you in knowing the things better. Ask them to show their properties and take in every single bit of information they give you.

4. Reading helps a lot:

There is a tremendous amount of information available online these days. You can also gain information that you may need regarding the Property field and investing as well. Buy and read books that give you practical knowledge about buying, flipping, renting and selling the properties.

5. Find a good Realtor:

This is the best part. When you are all set and finally ready to invest in some property, then a Realtor is the person who helps you with it. And a good Realtor who understands the concept of investing returns and also have sold a number of properties can be the best choice.

Property investment can offer fabulous returns, but there are also people who are bankrupted after investing in Real Estate. It is all in your hands, so be sure and know everything involved before you invest.

Article Source: http://EzineArticles.com/9720237

Memphis Buy And Hold is specializing in locating, purchasing, renovating and managing single-family and multi-unit properties and possesses over 8 years of experience in real estate investing and property management in the Memphis and Nashville markets… Learn More…… www.memphisbuyandhold.com