Ok folks, so I mentioned in a previous post that we are now taking the path of least resistance to real estate investing.
In our local paper, they mentioned that the average sales price went from 169k to 190k in 3 months! Looks like California's wave finally hit the old pueblo.. In this type of market conditions, are my systems still going to work? (You should be asking yourself this as well)
The answer is no. I'm real big on "buy and hold", my goals are to own 15 properties free and clear and take in the cash flow every month when I'm staying at my hunting cabin miles away from anybody!! If you have to offer 3 times that amount of offers that you did last year to get one accepted, is it worth it? Probably not..
Unfortunately, the market conditions are interrupting that type of strategy. Bottomline, rent market is horrible , resell market is strong.. So, its tough to buy a house and make it cash flow. I WILL NOT TAKE A PROPERTY WITH NEGATIVE CASHFLOW.
That strategy right now has the highest resistance.
I think I'll post my personal opinions on what type of techniques would work in this hot real estate market..
Now, everybody knows I like preforeclosures, so here's my new strategy..
In the preforeclosure market, we are going to add a new buying program that I think will help increase the number of houses we buy. What if I say to a seller, " How about I pay off your debts, eliminate the risk of foreclosure, build your credit, STAY IN YOUR HOUSE ( keep your kids in the same schools), and keep most of YOUR EQUITY that you've worked so hard for, do you think you would be interested in me helping you??"
You betcha! I would be taking the property over with the option for the seller to buy it back via a lease option. Essentially, I would be getting the future appreciation (maybe a little of the existing equity) as profit. And as always, I'll be in control.
It's a little complicated for those who don't have a solid understanding of subto and l/o's, but it's a solid plan that can work if the seller is willing to work at it. I am not going to get into details on this strategy, but I will log the amount of interest and deals that I make from it.