Real Estate Investing?

Question

I used to work with a guy that said he did real estate investing on the side. I didn't really understand what he was talking about. But, it sounded like he finds the houses, other people pay for them, they flip them and everyone makes money off of it. How do you get into this? Does anyone do it and know how it really works?

Answer 1

I have been a real estate investor for over 40 years. I do not flip houses however and I do not recommend that.

I have never seen people make money consistently flipping houses.. I have seen many people go bankrupt flipping houses, however.

The costs of sale of a house are very high. Those costs eat up most of the money that you would make flipping a house.

Now is a buyer's market. It is a very good time to buy real estate because there is a huge glut of real estate on the market and relatively few buyers.

That is when you are able to get the best prices.

Answer 2

I'm sorry. Have you been living in a cave that last year or so?

The days of buying on speculation and flipping are over. Housing prices have flattened or decreased slightly and availability of easy credit has tightened.

Yes, it worked for many years, and will one day again, but not now.

Here's a real estate plan that does work:

Buy a home. Live in it for several years. When rents for similar homes rise to cover mortgage, property taxes and maintenance, buy a new home and rent the original one and let the renters pay off the mortgage from there. Then repeat when possible.

I know several people who did this every 7 - 12 years, and own several homes when they hit retirement age. The earliest ones are paid off or have been refinanced so the mortgage payments are tiny, so they provide good income.

Another real estate strategy that works: If you are good at fixing things up and actually like to do so, buy a fixer upper home. Then spend $10k - $20k in materials to fix it up, and a bunch of your labor, while living in it and paying the mortgage. Then after 2 years or more, buy another fixer upper and move into it, and then sell the newly remodeled home for a handsome profit. You want to live in it at least 2 years to get the tax exemption.

Answer 3

I would say it all depends on your situation. It sounds like you didn't get all the story. He might be an investor and puts up some cash has someone else flip it and they split the profits, but i doubt he is just finding the home and someone else taking all the risk, doing all the work, and taking just part of the money. Right now it is very hard to make a profit flipping.
However it is still possible. If you start small and are able to do the work yourself. I live in Indiana and you can by fixer uppers for around $5000. NO LOANS!!!

Answer 4

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