Why Land is the #1 Overlooked Real Estate Investment

Vacant land is one of the best, and most under-appreciated, real estate investments in the world. And yet, so few investors specialize in it.

Why? Most investors view land as a weak investment because it just sits there, doing nothing. It’s a common thought, but a totally flawed one. Vacant land can absolutely be a cash flowing investment, if you know what to do with it.

Land is simple, and we love that about it. Why do we love investing in land so much?

1. No repairs necessary
You don’t have to do anything to it. No construction, no rehab, no headaches. The only thing you really need to know is, Can someone, someday, build something on this land? As long as the answer’s yes, the rest is easy.

2. Hands off Investment
Vacant land doesn’t have tenants, toilets, or really any person vying for your time and energy. There are so many issues that come with owning built structures, land doesn’t come with any of them.

3. Highly Motivated Sellers
Vacant land owners are always absentee owners, and we all know how motivation to sell can skyrocket with an absentee owner. In most cases people are willing to cut a great deal because to them, that land is nothing but a tax bill at the end of the year.

4. Good for the Long Term
Land is both a very inexpensive and high peace of mind long term investment. Think, when you buy land right, there are not mortgage payments, it doesn’t depreciate, and nothing can get broken or devastated. If you want to park you cash somewhere, we really can’t think of a better place to do it.

5. They’re Not Making More of It
This one’s obvious, but seriously, they aren’t making any more land. It’s a valuable finite resource, and when you purchase land right (especially in the path of growth) you’re sitting in control of a hot commodity.

You may or may not be a land convert by now, but we assure you, since we started investing in land, it’s been nothing but an upward spiral. Contact us today to chat about your land buying needs, we’re nuts for dirt.

Chat Soon, 

Jeremy 

Goals

Hey!  There are many opinions on goals. What I’m here to say is that regardless of your opinion; most agree that you have to decide on what your goals are…. You have to write them down… And you have to constantly think about and review them.  I would add that you should reverse engineer them and create weekly mini goals. 

For example; if your goal is to make $100,000 your first year flipping houses…. Here’s what I would do.  -Tip- First add 20%.  This will help you mentally.  We humans, myself included, tend to lack the final push to do things 100% when they are stretched out over a long period of time.  Similar to a construction project being so difficult at the very end…. The last 10% feels like it’s way more than it really is.  This is common and I personally think it’s a mental tiredness or possibly entitlement that we feel when we’re soooo close to the end that we start to coast.  Goals are similar in that we work so hard for so long that we often start coasting near the end.  Enough on the 20% markup… just do it, you’ll thank me. 

The goal is to make $120k in the next 12 months.  In order to reverse engineer the goal we need to break the goal down into measurable chunks and eventually measurable tasks.  That’s an average of $10k/month.  If we know (or hear from others) that we should average $25k per flip, we now know that we need to do 5 flips in the next 12 months.  We also know (or have heard) that deals typically take ~4 months from purchase to sale… then we know that we need to get our butts in gear.  This means that we’d need to buy the 5th deal no later than 8 months from now.  This means that in the first 8 months of the year that you’ll have to complete 4 flips and have them sold by month 12.  We should also consider that a deal takes 4 months from purchase to sale, this doesn’t include the time to find and buy the property. So since some deals can take many months to find and buy we’ll use 2 months (30 days to find, 30 days to close). 

Goal Breakdown  

$120k in 12 months 

$25k/deal = 5 deals total

6 months total deal duration (including finding and buying the deal) 

Now you need to break the goal down into measurable tasks.  How many deals do you look at before you buy one?  Let’s use 10 for this example.  This means that you’ll look at 50 properties this year and buy 5.  And since you need to find and buy the property well before the 12 month time period you should really understand that you need to look at 50 deals in the next 6 months.  This will allow 2 months to seek it out and purchase it before you start the project, which takes 4 months.  That is 8.3 deals per month or 2 per week (50deals/6months = 8.3deals/month). 

Now it’s pretty easy to wrap your head around.  You need to make sure that you look at a minimum of 2 deals per week if you want to buy and sell 5 in the next 12 months.   

How can you assure that you’ll have 2 deals per week to look at?  Are you well networked with several agents who get deals off of mls?  Are you well connected to all of the wholesalers in town?  If not, it’s time to put your dancing shoes on and get out there and mingle.   

If you want to make $120k in the next 12 months you know that you have to look at 2 deals per week, so making sure that this happens is your most important and measurable daily task. Now go out there and set some goals and start purchasing some properties! 

 “Without a known destination how will you know where you’re going or if you’ve gotten there?” 

Chat Soon, 

Jeremy

What to Look for When Rehabbing a Property!

 Happy Monday!

Real estate investment can be a vehicle for short or long term investing. You may choose to purchase, refurbish and flip a property or buy, rent and hold.

Regardless of your investment strategy, to realize any profits, you'll have to make sure each property you purchase is a moneymaker. Knowing what to look for will save you from making costly mistakes.

Here are some tips for new home buyers or real estate investors looking to buy a home for less than market value:

* Compare prices. After finding a potential investment property, you'll need to determine if it is priced right. This can be done by searching for comparable homes, which have sold in the past three months. A list can be obtained through a real estate agency or real estate investor.

* Determine how motivated the homeowner is to sell the property. If the home is entering or in foreclosure, the homeowner is likely to be anxious to sell. If the homeowner is current on his mortgage or has no mortgage, in a down market, they too will be motivated.

* Choose you top-dollar price. Remember the listing price is the "asking price". It is not set in stone. You can negotiate to get the property for less than listed.

* Inspect the home. Look for telltale signs of major repairs. This includes curling shingles, cracks near the foundation, pools with cracks, sinking ceilings and dead insects.

* Work with a real estate investor. This is not only ideal for those new to real estate investment, it is extensively beneficial for any investor. Not only will a knowledgeable real estate investor know the ins and outs of the market, pooling your money may give you a better return on investment.

With these tips in mind, you can find an investment property that will make money.

If you are looking for the best deals view our listings for deeply discounted wholesale properties. Simply fill out the form under the 'Take Action' button and you will be added to our list to start receiving updates on the best properties around. 

Chat Soon,

Jeremy

Real estate investor’s checklist: What to look for in a property.

Hello, Investors!  

When investors look at properties with an eye to profitable turn-arounds, not personal taste. To invest successfully, you need to consider how each aspect of the property might impact your bottom line. Your ideal property is usually a structurally sound property in a good location with cheaply fixable cosmetic flaws. 

To decide whether a property is a worthwhile investment, go through the following checklist:

Macro-Location: Is the general area going up or down in price? Is the area convenient to current or planned public transportation or driving routes? What is the quality of local schools? Is there shopping nearby?

Micro-Location: Look around the block. Are the houses well maintained or are several empty or for sale? Do people have nice clean cars or rusted out junkers? Are there any downsides to the specific lot, such as backing on to a freeway?

Comparables: Check prices and time-on-market of comparable houses in the neighborhood. If time-on-market is over a month or two and the property is not at least 20% less expensive than comparables which have actually sold, it's probably not a good investment.

Crime: Check police reports. High crime neighborhoods are bad investments.

Structural soundness: Is the foundation sound? Is there any evidence of water damage? Are there termites? Is there city sewage or a well-maintained septic tank? Are the basic electrical and plumbing systems installed correctly? These are all red flag issues -- they may be so expensive to fix that you can't make a profit on the house.

Cosmetics: Paint, flooring, fixtures, minor repairs, and landscaping are easy to change, especially if you have good do-it-yourself skills. 

Decision Point: Add the price of the house to the costs of upgrades and if the total is 15-20% below the price of comparables, you have a potential investment.

I'm happy to help guide you through the process of finding your next investment property, and let you access our listings of wholes properties. 

Chat Soon,

Jeremy

Fund All of YOUR Dreams!

Hey!  Investing in real estate has become a household name.  HGTV, DIY, A&E, and others have had hit TV shows explaining the ins and outs of how to be a rip roaring real estate investor.  50 years ago real estate investing was reserved for the wealthy.  Now a days, along with many other industries, anyone can become a real estate investor.  

People will always need a roof over their heads, that's a statement that I've heard many times before...  And it seems that there's truth to this and with that truth comes opportunity for you.

The amount of opportunity out there is mind-boggling.  The difference is what is in you.  If you want it, go get it.  Make a move.  Don't let someone else take your spot in line of becoming who you want to be!

If you are working on your first, fiftieth or five hundredth deal; my team and I are committed to finding ways to boost your business to the next level.  Give us a call at 612-999-CASH (2274), or shoot us a text or email ([email protected])... we're here and will do our best to help you with your real estate investing needs.

Chat Soon,
Jeremy

Are You Better Off Renting?

Hey!  True, the American Dream sells home ownership as the ultimate benchmark of success, but it’s not true for everyone.

Often times, it makes more sense to rent your home than to buy.

What makes renting a better option?

Renting, especially in today’s rocky housing market, guarantees:

  • Flexibility – Leases usually run no longer than 1 year, while mortgages lock you down for 30 years
  • Affordability – Buying a house demands a lot of cash upfront, while renting only requires a small deposit and first month’s rent.
  • No Surprise Expenses – As a homeowner you’re financially responsible for all maintenance and repairs. As a renter, your landlord covers those.
  • No Property Taxes and Insurance Premiums – Property taxes and insurance on a home you own are no joke, they can run you thousands each year. As a renter you have the option of renter’s insurance, but even that’s not required.
  • Freedom – With the rise and fall of the housing market, you might find yourself unable to sell your house. As a renter, you can always

 The best thing you can do is ask yourself, what are my needs?

Knowing the answer to these questions will help clarify if rentingis for you.

Ask yourself:

  •  Do I need flexibility, might I be moving soon?
  •  Do I want to do the smart thing and test out an area first before thinking about buying?
  •  Do I want to save money for something else?
  •  Do I want to be responsible for the home maintenance?
  •  Do I want to pay the insurance and taxes?
  •  Do I want the freedom to easily leave?

We know that finding the perfect rental can be a nightmare – endless hunting, and hoping you’ve found the right spot, only to discover that it’s the size of a small closet, under a freeway, missing a roof, or comes with terrible rental terms.  

I'd love the opportunity to help you in any way I can, drop me a line and I will see how I can help! 

Chat Soon,

Jeremy

How to Evaluate a Real Estate Investment Deal in Minneapolis.

Hey!  Myself and my team talk with lots of people looking to buy real estate investment properties in Minneapolis and surrounding areas.  Some of them know what they’re doing… and some of them are still in the learning process.

But, since our entire business is finding great deals… and often passing those deals onto real estate investors like you, I thought it would be a great idea to share with you some resources on how to effectively evaluate a real estate investment deal.  This works in any market! 

When you really boil it down… evaluating a real estate deal is a pretty simple process.  If you’re looking to buy real estate as an investment, wholesale properties, hold them for rent… whatever, one of the most important parts is buying it right. 

So lets dive in.

How To Evaluate A Real Estate Deal – (for single family houses)

There are just a few main elements when you’re evaluating a deal.

  • Cost of repairs needed to get it back up to good condition
  • The after repair market value of the property (what it’s worth and can sell for today once it’s fixed up)
  • If you’re going to buy and hold for a rental… you need to know what you can rent it out for and what your “debt service” (mortgage payment) will be.  Knowing this makes sure you’re buying so the property cash-flows each month

There are other things you can (and should) look at too… but those 3 are the main important things to look at first.

Cost of Repairs

One of the things you should do when you are looking at a property is find out how much it’ll cost you to fix it up to a point where it’s in great shape.  In other words, the cost of repairs. This could be a new roof if it needs it, carpet, paint, a new kitchen, yard, maybe even more.

To find a good estimate of cost of repairs, the best advice we have is to get to know a contractor or two in your area and have them walk through the properties with you the first few times… have them quote out the repair cost… and build that into your offer.

After Repair Market Value

This is simple, but many investors get stuck on this part. This is essentially what you could sell the property for today… after you repaired it and brought it up to a great condition. This is found by finding out what other similar houses in the same area are actually selling for. NOTE: Don’t look at the “Listing” price… look at what houses similar to yours have actually sold for in the past 3 months. This helps you determine how much you could actually sell that house for if you had to… right now. You never want to over pay to a point where you can’t sell it for a profit in the next 3 months.

How do you find this?  There are services out there that can help you with this… but often times the best way to find out the true value of a house is to talk to a Realtor that you know… or an appraiser.  Heck, if you don’t know one… call up a few today… tell them you have a property that you’re potentially going to sell in the near future… and ask them what they think it should sell for.

Buy And Hold For Rental

So, you’re going to buy and hold for rental? Great! You don’t need to worry about what it’ll sell for right away. What you need to know is if it’ll pencil out on a month to month basis. You know… cash flow.

So, talk to a mortgage broker (or a private lender) and find out what the monthly mortgage payment will be for that specific property.  We have an amazing lender so if you're looking for someone, please drop me a line so I can connect you up with Kim.  She is the best! 

Then find out what you can rent the place out for on a monthly basis.

Then, you work backwards… and find out at what purchase price your mortgage payment will be low enough so you can make the monthly cash flow you need to make on the property. Be sure to figure in other expenses too like property taxes, maintenance expenses, property management fees, and keeping money in reserves for future repairs.

So, your offer price here should be:

Monthly Mortgage – Monthly Rents – Operating Expenses – Taxes / Insurance – Monthly Cash Flow = Offer

Simple enough right?

The cool thing is, the more you’re bringing into the deal in cash… the lower your mortgage is.

Making An Offer

We’ve been talking about how to look at the numbers and analyze a real estate deal.

From there, just make an offer.  Many times the properties we let you know about will already be so deeply discounted that we get multiple offers… often above our asking price.

So, if you really want a property… find out what is the bare max you could buy the property at… and offer that. Otherwise you may lose the deal because someone else is likely making an offer too.

With that said, the golden rule in real estate is to never over pay for a property.  That’s why our own deal analyzing criteria is so darn strict… and why our buyers (like you) get such great deals.

I hope this little tutorial has helped you sharpen up your real estate deal analyzing skills… and we really look forward to working with you in the near future.

If you have any questions at all… don’t hesitate to contact me for anything.

Happy investing!

Chat Soon, 

Jeremy

Do you want to sell your house?

Hey!  

This is not an ideal time to sell a house, but if you're willing to be flexible you can still manage it. Even though fewer people are purchasing homes for themselves, the unpredictability of the stock market has led many investors to look for real estate bargains. Selling to investors isn't like selling to people looking for homes, though. Personal home buyers are looking for lifestyle features while investors are seeking profitability. Investors are likely to be more financially sophisticated than the average personal home buyer as well and more open to creative arrangements.

Tips for Selling to Investors:

Trading vs. Selling: Are you looking for a new home? Investors often have properties to sell and are very open to trades. 

Sell to Rent: If you like your home but are having trouble with your mortgage, consider selling the property to an investor who is willing to rent it to you for the short or long term.

Labor/Remodeling: Investors often remodel properties. If you can do repair work the investor wants on your own property, you may be able to get a better financial deal. 

Creative Financing: Investors are focused on money. Offer creative financing options to make your property more attractive, but consult a professional real estate lawyer first.

Price Flexibility: Be flexible on price. Investors may make low-ball bids, but might take a house "as is", or let you live in your house or other properties they own for a few months.

Cosmetics: Investors want a clean house in good repair, but they are less concerned about cosmetics or staging than personal home buyers. 

Promotion: Promote your property on websites and in trade magazines that cater to the investment community. Sites like Trulia.com and Zillow.com. 

Real Estate Agents: Agents may be useful, but most investors prefer to buy directly from owners.

If you'd like to shortcut the process of selling your home, I can help.

I can make you an offer on your home. If we decide on a fair price, I could pay cash and close quickly. 

If you interested in a no-obligation offer please contact me. 

Chat Soon,

Jeremy 

How to sell a second home, or a home you no longer want.

Hey!

Owning more than one home might sound like a dream to some, but in today's economy it is more of a nightmare for many. The simple maintenance and upkeep of two homes is an expensive prospect. You might find that you cannot afford to keep up both homes, and that one home goes by the wayside. Owning two homes is more of a burden than a pleasure. Whether you own the second home and use it as a vacation home or a rental property, you might consider selling it. Selling your second home puts money in your pocket and reduces the hassles that you face. 

Selling a home in this economy is a pain. House prices are constantly dropping every year. Homes that sold quickly just a few years ago sit on the market for months or even years without a nibble. Even celebrities are experiencing the same problems because the market for multi-million dollar houses is significantly down. When your home sits on the market, you are still responsible for its maintenance and upkeep. If you want to sell your second home quickly, consider working with a real estate investor. 

A real estate investor is a person or company that purchases a home for resale. The investor buys houses, makes changes to those houses and puts the houses back on the market. Some refer to investors as house flippers because they essentially flip the house for a profit. Many homeowners do not realize that the investors put thousands of dollars into the home before selling it. When you work with a real estate investor, you do not need to focus on doing any repairs or improvements yourself. Most investors buy the property as-is, and make any changes needed. 

Owning a second home is expensive. You must pay two mortgages if you have not paid off one home, and you must pay for any maintenance on both properties. With today's rocky economy you never know when you might need money quickly or when you mist lose your job. Selling your second home through a real estate agent is risky because the agent might not find a buyer for the property. Working with a real estate investor is a far better choice. With the investor, you know that you have a buyer ready. The investor purchases the property and takes over ownership quickly, leaving you free to focus on your primary residence.

We're seasoned real estate professionals aligned with a nationwide network of experts. If you need help in your decision to sell, we're qualified and ready to help you. Any question or if you want me to make an offer you on your please feel free to contact me at the information below.

Remember, you have options and you shouldn't compromise when it comes to selling!

If there is anything I can do for you, please don't hesitate to reach out.

Chat Soon,

Jeremy