My New Addiction.... "HOUSES"

[Moosie]

.........hump

SO I went on Vacation to Mexico with some friends this spring that got into the Renting / lease-to-own deals over the last 2 years. I'm like, Ohh thats cool and all..... but I could never buy something and do that. After a week of being on vacation with them I started the Process. Look up loans here, talk houses there, and I looked at a New house to buy. I thought If I can do one, I should do two so I ordered the 2 new houses through a Real good real estate friend of mine. One was rented out to my mom from the get-go that she needed a place to stay short term and the other I have jsut sitting here for the Time being.

I had a Friend that posts here "Canoe" refer a lady over that needed help buying a House and she didn't want that house so........ I bought her another one to Lease-2-own from me.

Every day I'm thinking and Figureing out ways to do stuff and Another friend asked for me to look for a place for him because he needed to get out of were he was... So, I put in another offer on a diferent place. Talked to a Realestate Friend of mine and a Lady was selling some Rentals and I looked at all of them (I think 30 total) and Picked out the top 2 and made offers and they were just accepted....

So Tonight I signed some Prelim Loan offers on 3 places, 27 pages per offer on a First and a Second Morgage. I think thats 27x2x3= like 160 Signatures....... G-sus !! My hands are sore. I should get a Stamp... Hehehe

So.... Here I sit with 7 houses "almost" to my name. A few more closing.... Not makeing a Dime more then I started with, Not knowing how anyone in their right mind would lend me a dime, not knowing chit about renting, and feeling like a Broke "Trump"... but loving the Adventure

Now I'm looking into Comercial Realestate after a Buddy jsut called me wanting to move his Buisness in a couple years and looking for a partner to buy some Office space...... so....why stop here right ?

Anyways, JB Florida who does Realestate told me when I first started to Be carefull because It's Addicting... NOW I KNOW !!!!.

So Here I am.....My New Addiction....

Anyone else Dable with trouble, not that I'm changing Hunttalk to House talk ... but...... ? ...

 

[Whiskers]

I dabbled with trouble, then I married her.

Sounds like a big gamble. On a rent to own, how much of a down payment do they need? How do you keep them from destroying the place and moving on? What is your gurantee that they won't skip, leaving you with a damaged property, and alot of repair bills.

 

[Moosie]

Thats "Dibbled" : "a small hand implement used to make holes"

And you do that NOW that you're married .......:wank:

 

[dgibson]

We talked about trying one house more than once but decided against it because of the maintenance headaches. Maybe when I grow up a little bit.

 

[TheTone]

I have a really good friend also in Boise who is kinda doing the same thing down there, except he is buying them doing some quick fix up work and turning around and selling them within about a month of the purchase. When I was down there about a month ago I couldn't believe how much the valley has filled in down there. Good luck with the new venture, lots of potential clients moving in there everyday.

 

[cjcj]

I went in with a "partner" on 3 properties.[2 yrs. ago].. but now we are seeing a slight slowdown.....We are unloading them ... they went up in price so fast its unreal... almost double...I don`t like the "rental' end of it... But the easy money is fantastic.... Be carefull... but i think it would take a total collapse for anyone to lose... if you get in early you win big.

 

[Moosie]

"Early".. What does that mean.. Isn't it always Early ? I know that if my DAD would have bought property when he was 20 by the time he was 40 it would have Doubled. At 40 to last year it would have doubled. Then I know people buying property last year that has Doubled. Wouldn't it make sense that land bought is just good.... unless it's in a Chitty Chity location ... (Soda Spring Idaho for example .. )

It slowed down from "Doubling" in 2 years ? does that mean you were only makeing 10% a year on them ??!

Some developed land around here has gone from 28k 6 years ago a 1/2 acre to 75k a 1/2 acre. Put that price on the land in 5 years and it will be a "If I only bought it 5 years ago" line.

My reason for Realestate is I can Put 20k in a savings Account and let's say on a Great year make 15% on it. So thats 3k return. in 2 years It's 6k+ right ? Sweet return !!! But lets say I buy a 100k house put 20K down on it and only make 7% on it. in the first year alone I made $7,000. If you go in on a "0" down (Except Closing). and can run the Rent as the same as your Payments and Dump in in 2 years you're making (infinity)%. $7K on nothing down is a Hellova return ?

I'm new to the "game" but I'm Likeing it thus far

cjcj, jsut curious why you put partner in "Quotes".. is there a story behind that ?

 

[JB Florida]

If you think you are addicted now, Wait 6 months and re-calculate your new worth based on your areas appreciation

I really have trouble understanding why more people dont get it.
We finally got my wifes sister to go in with us on a beach condo last year this time, My brother said no, sounds likeits pretty risky :BLEEP:

We bought at 240k and I currently have it listed for 449k and oh, did I say the rent has paid most all of the bills so far?
Do you wanna know what my brother says now |oo |oo |oo

Rock on Moosie!
The TIME value of money is getting away

 

[cjcj]

Yep Moosie.. There is another story to the partner thing....but what i am saying by "early" is loading and unloading land/ houses etc. at the right time.. for instance i almost lost everything in the 80`s on a small warehouse ... we couldn`t lease it or sell it....[ for our current payment]... we used our own money to keep from losing it.... If you can buy property and hold it long term 99.9% of the time you will make money....I see the housing market as cooling off....I its not affordable for the average family [in phx. metro] and has reached the peak [my opinion]... .. "We" are looking for a small parcel 4-10 acres.....along the i-10 corridor and will wait for the developement to catch up... then we will cash in.... but our new plan is to pay cash [its raw land] looking for a corner or nearby.....I have always had some real estate and it has always went up [long term] but all i was saying is be carefull......7 houses are great if you can hold them during a downturn.... if things continue [can they?] you will be very wealthy.



[Example]
We bought a house in Pebble Creek 2 years ago $220,000. sold it 2 months ago for $370,000.....we made a killing....The lady who bought it from California,,, is buying several houses....and its not likely she will realize the kind of profit/ equity that we did...I fact i don`t think she has rented it out yet... her latest sign says for rent no deposit... i`m starting to see lots and lots of rentals that are empty....How much can the market bear? when does it peak? Has it risen to fast ? If you get in on the end of a "boom" and there is Backlash or a correction.. it can be trouble... but i have always liked holding some kind of real estate... the 5 acres i live on cost $6,000.[1978] an acre... now its worth $ 100,000. an acre......You might want to form an L.L.C. to protect your personnel property. [just in case]

 

[dgibson]

I totally agree with the LLC concept. Wheelin' and dealin' is cool until you screw up and they take your chit.

 

[BigHornRam]

Moosie,

When the housing bubble bursts, I know of some good penny tech stocks for you to invest in.

 

[Moosie]

Lemme tell you a little story on what happened today. A builder (That I was buying 2 houses from) had a Bad thing happen. 3 months ago he sold like 15 houses for around 100k(Rough numbers) He actually only Financed the operation and Didn't "build" them actually. Anyways, His LAst draw from the bank on the houses came in around 12k over what he sold them for. He sold 15 houses and Needs to cut a Check for 220k on them. How crappy is that. He ate the cost on one of the New builds on one that I bought. I had my mom in that one as of Last weekend and Needed it. If I had the Money I would have paid the 12k Difference in a Heart beat because the house I bought 3 months ago is now 125k. I could also have been an A-hole and Told him to Eat the other 12k on my 2nd house.. A deals a deal and Ernest money and papers were signed. As "good Buisness", and since I didn't have anyone in that house yet I let him have it back. Well, For the difference of all the Closing costs and etc and time involved. I still got a 10k check. Was it a Good move ? Well, probably not in the long run money wise although it sounds good now, But I feel good about it and I have a Partner in Future stuff maybe if it ever goes there. He came out Ok on that house at least and I faired OK as well for not doing too much. If nothing else I learned alot about investing on a "SURE THING" though ...

So Now I'm down to 5 places.

Bubble Burst......? Hate to burst your bubble but Land is Here to stay and only going up. I've heard Alot about this "BUBBLE". Can someone explain it to me ? What is the Market goes Stagnant ? Who cares ? I put a Renter in the place for less then the house next to me and My payment is still payed for. Thats the Benifit of Buying a place with a Little money down. Even with a 100% finance a guy can sustain. Then I ride it ut untill the market is good for sellers again.. worst case I break even ? MAybe It's wishfull thinking..... We'll see in a Few years boys

Out of the Thousands and Thousands of realestate buyers.. Think hard on how many you've heard telling you they didn't make money...... I can think of 20+ people I personally know off the top of my head and the # = "0". Even CJCJ that says don't do it has made a Chitload. And I'm in it just for a Few extra hunting bucks

BHram, I've done stocks, I'll stick to something I can Touch,feel and Calculate out

 

[HuntnFool]

Well down here the bubble is starting to burst. A couple years ago there were only about 5K properties on the market and more than 5K home buyers looking for homes. These are rough numbers of course. But you can see that that is good for the home seller because they have people fighting over the homes. Well right now there are over 20K homes on the market and not that many buyers. So you can see that that is good for the buyer. That is sort of what the bubble bursting is. My wife started doing real estate a year ago so I have learned a lot about buying homes. I wanted to do what someone earlier posted about buying homes that need a little work and spend a few grand fixing them up and sell them in a month or two. But they make it hard to do now because of all the investors that were buying the houses up. Also a good thing to do if you can is buy a new build in the first phases and sell if once they are complete. There are people here making up to 100K for just buying a house that isn't built yet and putting a little earnest money down and selling it once it is complete and never make a mortgage payment. There sure is a ton of money to be made in real estate. I like the land side of it more. I don't want to have to deal with renters. Have heard too many horror stories.

 

[Moosie]

So on your Bubble, thats actually a good time to Buy more right ? the buyer , not the seller, has the Upper hand. In a Sellers market, the House prices go up, so If you buy on a "downturn" you're geting a Good deal, if you're buying on a "flip" market you can turn them as they come in. All I know Is I haven't got burnt yet but I'm just starting to light the Matches in this market. In the Stock market I lit tons of Matches and Watched them burn out...

I can say this, what 20k can do in this market V's what 20k can do in an Agressive stock is a Big difference. the other cool thing is You don't need money to Buy Realestate, but you do need money to make any in the stocks.

You can buy a place for sut Closing costs or let's say 5k. Put a renter in it and Flip in in a Year and if you can Sell it for a 10k profit (And right now thats verry reasonable). you can take that money andthen Buy 2 new places. Leveraging is the Key I think.

Just a question. on your Busted Bubble down there, Are people loosing money on the houses they sell ? Or is it just taking longer to sell ? I think were the Bubble kills people is if they look at it like they have to sell in a year or two and the market slows to a Buyers market and they Panic. All the deals I've worked out I'[m not in that situation. the short term ones are Lease-2-own's and the longer term ones I'm not Upside down in.

One thing for sure, I feel sorry for people just starting out. Buying a Home has gotten out of Hand in alot of places. I think this valley is just catching up but When I first got out of School looking for a place I couldn't afford a low end home and Bought a single wide. I scrimped and Saved for over 4 years and Finally got my first house. Wages for starting out hasn't gone up a Whole lot but the Difference in a Starting home 5 years ago at 79k V's 120k now is sure a big difference. Just makes it tough for the Average person starting out or anyone with a Hickup in their credit. That was one of the reasons I started the Lease-2-own deal. I can Make a little and People can get into a house too. I think it's fair all around. I will definately let you know the Ups and Downs as they come though.

Anyways, nothing made right now but alot of hours.. So all my talk is in theory... proven theory... but only theory .. I was just curious on what others were doing. Sounds like I'm not the only one playing with Bubbles.

 

[BigHornRam]

Keep it up Mooseman, you're next house is going to be a card board box!

 

[JoseCuervo]

More signs of the bubble bursting... from yesterday's Marin I-J...



"Marin's median single-family home price eased a notch in September to $899,000 - down from $920,000 in August, but more than 15 percent higher than the $777,000 median price a year ago, a real estate information service reported yesterday."

 

[cjcj]

Moosie i never said don`t do it...and didn`t mean to give you that impression... i was just saying "be carefull" concerning your "addiction"

I have made more money and more equity in real estate than my aerospace retirement [21 yrs.] i have borrowed against my T-Rowe Price accounts to invest in stocks and real estate........I have dodged [got out in time] some investments that were heading downhill.....I live on a fixed income and am confortable.. my wife has the money he,he......I think you are on to something that will make you more money than your job/retirement fund "long term"... I am just saying be carefull you don`t get in trouble... there is just no way possible that houses/land can rise at the "rapid" rate of the last 2 years... some houses have gone up 50% to 75% in the last 18 months.....buying them at this "inflated" cost could be trouble... Do you think that this will continue? I just think[my opinion] that its peaked......My motto is By low...sell high.... But i think you have to at least be in the game......nothing ventured .. nothing gained... Good luck..... hope you make $$$$$$$$$$$$........Can you "homestead" your personnel property in Idaho?

 

[Moosie]

"homestead" ? Meaning what exactly ?

On another note :

http://moneycentral.msn.com/content/Banking/Homebuyingguide/P132998.asp

Bubble and burst, defined
A housing bubble consists of a boom followed by a bust. Prices rise rapidly during the boom, and people buy homes on the assumption that prices will keep rocketing upward. The bubble bursts when home values fall. A burst bubble hurts homeowners who have to sell at a loss or who remain in their homes longer than intended, stubbornly waiting for values to return to previous levels.

Some experts believe that a national housing bubble exists. Most economists don't perceive a national bubble, but agree that some local markets could pop. The most frequently mentioned markets include San Diego; Orange County, Calif.; Los Angeles; Las Vegas; Boston; New York City and Long Island; the District of Columbia; and South Florida, from West Palm Beach to Miami.

Bubble believers maintain that low mortgage rates, combined with a mass delusion that property values will skyrocket forever, have inflated a bubble. They predict that rising interest rates will pierce the bubble, causing mass psychology to reverse: As houses take longer to sell, homeowners will put their homes on the market before the bottom falls out, panicking still more homeowners into dumping their homes on the market to limit their losses. In this scenario, potential buyers take their time, because they know prices will drop next week or next month. A deflationary spiral ensues.

 

[cjcj]

You file a "homestead" exemption paper with the state.. to make your residence "exempt' from lawsuits and such.....its to protect personnel property [you must live/reside there] your home cannot be included in a lawsuit once its homesteaded.... this is something i did over 20 years ago ....on the advise of a friend... a small filing fee ... and its good as long as you stay/own /live on the property.

 

[Moosie]

I didn't know that.... THANX man.

I'm guessing it's better to put all "assets" in some sort of Protection. I haven't been worried about it but I guess it could happen. the LLC is probably a Better way to go. Onthe HOUSE, I refi'ed it to fund the other projects and borrowed 90%/value on it so it's not like there is alot of left over. But I do have a nice piece of ground I don't live on thats in my name that I would worry about loosing. I'll look more into it. thanx.