2018-08-04 at 8:34 PM UTC
Is this a viable option?
How does one get into this?
Should I like, save up $10,000 then go buy dozens of properties out in bum-fuck Indiana and resale them in a decade or so for hundreds of thousands?
Should I keep some properties and hand them down to my children (assuming I don't settle down with a robot).
Does anyone here do this?
2018-08-04 at 8:49 PM UTC
I live in bumfuck nowhere and I'll admit that I know very little about real estate/suburban property price trends. I'd like to know as well.
If you're looking for a very reliable property you should look into a small acreage, they hold and increase in value well regardless of housing trends.
You aren't going to be able to buy small amounts of farm land however, only large amounts.
2018-08-04 at 9:11 PM UTC
You need to invest money in the property to increase value or you can wait all you want.
2018-08-04 at 11:04 PM UTC
Cootehill
African Astronaut
[my unsymmetrically blurry oregano]
Invest money in rising markets, like Poland, Estonia, Ukraine. Places like that.
Even Venezuela.
You probably need to move there to watch over your property. Your property is only yours as a result of group consensus.
When things get better there prices rise. Easy money.
2018-08-05 at 5:45 AM UTC
Yeah but 10000 isn't going to get you hardly anywhere.
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2018-08-05 at 5:49 AM UTC
aldra
JIDF Controlled Opposition
you can buy a run-down property in a nice area and renovate it to resell
or
you can buy a property and hold it for a few years, hoping to resell it at a profit. you'll need to find an area that currently isn't in demand but will be in a few years time - nearby interconnecting highways or industrial/commercial centres under construction are good places to start
if you're a jedi
2018-08-05 at 10:56 AM UTC
IMO: Buy and hold for cash-flow (and principal pay-down, to some extent) and don't count on appreciation- consider it icing on the cake if it grows in value faster than inflation. If you want to play speculator with hundred thousand dollar bets to start out I think you're nuts.
Look at FHA loans, with good credit they will finance a single family, duplex, triplex, or fourplex at a good rate, with as little as 3% down, so yes 10k could be enough in most markets. Yes they will make you pay PMI but that's why you buy a place that's going to cash flow anyway, then it doesn't really matter anyway because your tenants are paying it through their rents. You are expected to occupy it for 1 year, then you could rent the whole thing out. And if you planned it correctly, you could qualify for another FHA loan to do it again.
The cool thing about real estate investing is leverage, the idea that your miniscule 3-10% down payment is going to allow you near total control and eventual ownership of 100% of the asset. Hard to do that with owning and operating a McDonald's, playing stock gambler, etc.
Keep in mind that most people seem to try this casually, overpay for their property, poorly screen tenants, then end up with a huge expensive headache and tell everyone that RE investing sucks. Meanwhile the ( more rare )guy who gets good deals, and knows how to manage them controls millions in real estate and keeps a delicious slice of the rents collected for himself
2018-08-05 at 2:52 PM UTC
FHA has minimum standard the property must meet for their regular loan. For a rehab loan 203K the reqs and paperwork is a nightmare.
Standard FHA 203K guidelines
Eligible Properties
1-4 family primary residence
HUD owned properties (single family only) are allowed
For properties recently built, must have Certificate of Occupancy for at least one year.
Condominiums, PUDs and Manufactured home are NOT eligible
Eligible Improvements
Repair/replace:
roofs & gutters
heating and a/c units
plumbing and electrical systems
flooring
appliances
windows, doors & siding
septic systems
wells
exterior and interior paint
I pay cash for my properties and say F**k Y*u to the bank. Renovate the building and rent at market price. Make good money this way.
Oh yes after renovation the property has appreciated in value a lot!
2018-08-05 at 4:48 PM UTC
rent seeking is the lowest, the most abhorrent form of capitalism.
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2018-08-05 at 5:24 PM UTC
You can start off with mobile homes relatively cheap. Clean it up just enough to be sanitary. Sell it by owner for 1K down with the stipulation that all payments made become "rent" instead of payments and the 1K down becomes a deposit in the event they default. You will probably "sell" it many times over before you actually get one sold completely. And you don't have to abide by landlord/tenant regulations. Mobile homes aren't considered real estate except on craigslist.
2018-08-10 at 1:03 AM UTC
Rob how many properties do you have? Do you manage them yourself?
2018-08-10 at 4:38 AM UTC
I use Realtor.com to find my properties. I only look for 2 family units that have separate utilities and heating system furnace or boiler plus off street parking. Prefer them to have a garage to store lawn mower and snow blower. Yes my tenants do their own snow removal and lawn care per lease agreement. Space heaters are illegal as a heat source here per code.
1% or 2% rules is a guess estimate of what you should charge for rent. Rules that I use is what the market will bear and the KISS principle - Keep It Stupid Simple.
