My dream is to become a realestate investor by means of Fixing out dated homes and selling them. I plan to take real estate classes and also get a small buisness degree. Is there anyone out there with wise advice for a girl who wants to make her dream come true? I live in Michigan and the housing market is as low as its been in 35 years so I plan on waiting to start this until the market begians to recover. I have already invested in a home for my family Getting a great deal due to the market. The house appriased at 125,000. I bought it for 90,000 on a land contract 4% interest. I am going to pay $500 a month toward princable for 5 years leaving me with about 60,000 owed. I paln on using the equity to begian investing in other propreties. Good Idea or bad?
2006-11-06 13:03:06 · 6 answers · asked by Shell 4 in Business & Finance ➔ Renting & Real Estate
I want to wait until the market begians to recover because I dont want to be stuck with a house I cant sell. I dont want to have to make 2 mortage payments
2006-11-06 13:10:15 · update #1
That is a great idea.....Many RE investor's start this way....If you go into this business, you must have SOME capital....And if you sell your home in two years, you can reinvest that money into another home....If you do that every two years, in 6 years, you will have cash to buy a home....And enough capital to really launch your business.....Best of luck to you! You sound like you have a good sense of how the market works....
2006-11-06 16:39:34 · answer #1 · answered by Anonymous · 0⤊ 0⤋
Your plan is a good one. The key thing is that you're planning to add real value to the properties by fixing them up, you're not just going to wait for the market to make a profit for you. The latter can be a very unreliable way to make money. If I were you, I would make sure to learn as much as possible about the actual repair part of the business. The more you can do yourself, the better. At the very least, the more you know about what the work should cost, the better you will be at getting good quotes.
You should also consider owning rental property. If you know how to make repairs, or have access to good contractors, owning rental property can pay off in the long run. If you buy the property right and manage it aggressively and carefully, the rents you collect will pay for the mortgage and the operating expenses. Over the years, you will be paying down your mortgage with the rents and building up equity. It's a good long-term strategy for making money in real estate.
Finally, don't wait for the market to recover completely. The best deals will come when the market is at the bottom. That's when you want to buy. Good luck!
2006-11-06 13:14:55 · answer #2 · answered by matthew s 2 · 0⤊ 0⤋
Although buying your own house as your first investment is a good idea, some of the things you said can already get you in trouble. NEVER borrow and use your equity. You will always be fully finaced and lendors don't like it when you go to buy other properties if they see that you are always refinacing to pull out quick cash. This in my opinion is a SCHEME taught by television get rick quick real estate investors that want to get peoples attention in buying their programs. Another reason to this is when you sell there will not be any cash coming out from the property to pay your capital gains taxes and you will have to recapture all of that depreciation wriiten off over the years. If you're serious about RE investing, I would check out John T. reed (www.johntreed.com). This guy rates the RE investor gurus and has produced some excellent books, especially one of which is the best that deals with taxes. Good luck!
2006-11-06 14:46:56 · answer #3 · answered by lefty 2 · 0⤊ 0⤋
Seriously only need to do 3 things
1 Take real estate apprasial classes
2 hang out at lowes or home depot for 6 months and take all the classes and learn prices
3 ALWAYS find the highest priced house in the market and try to make youres better and 2-5 % cheaper and still profit
YES ITS THAT EASY
2006-11-06 17:59:42 · answer #4 · answered by jim n 1 · 0⤊ 0⤋
Why wait until the market begins to recover? You want to buy low, sell high.
2006-11-06 13:07:12 · answer #5 · answered by Brooke22365 4 · 0⤊ 0⤋
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2016-09-01 08:22:51 · answer #6 · answered by mcguinn 4 · 0⤊ 0⤋