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Discussion Starter #1
I've been looking at getting into real estate investing lately. Does anyone here have any experience doing this? What would be some good resources for me to look into?

I'm interested in some calculations I could use to figure out rent and profit.

I've heard that you can take the price of the home (fair market value) and times it by .007 and get what the monthly rent would be.
So, if that is true that would mean: $100,000 home X .007 = $700 /month rent.
Does this make sense?
Also, what % of the rent would you put aside for management/maintenance fees?

Thanks!
-Nathan
 

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Seems like a bad time to start to get in. Market value for homes and properties a so OVER valued, at least around here, it may take quite a while longer to get a return on any investment.
If you can get a house for a good price it will probably need at least some renovation. If you can do all of it yourself you can take advantage of a fixer-upper.
Where I am a fixer-upper would cost maybe $30,000-$40,000 five years ago. Now the cheapest POS that needs total reno can cost $120,000. I know of city people buying second homes here which should cost $100,000, but they give $220,000. They have the money and to them, compared to let's say the Hamptons, it's still a bargain. On top of this they will renovate and put on additions.

Sorry, I don't have any numbers to quote for you as to rent and return. I do have friends who still are buying up houses to renovate and either sell for profit or rent. You will need a decant amount of equity or capital to get started.
 

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Seriously buy the "no money down" by Carleton Sheets.

A friend of mine bought it and gave it to me. The "no money down" is a half way hoax but he gives good tips for actual real estate investing.

Real Estate investing is something I see in my future. I currently own one condo, which I plan to hold onto. I'm trying to get my brother to go in with me to buy another condo in my building, and rent it out. I crunched the numbers and we'd actually profit $50 a month. The real profit will come when we sell the property.

Even thought prices are sky rocketed all across the country we all know they are not going to go down. If your looking for cheap property you will need to study census reports and see what areas are moving up. In chicago poor neighborhoods hit rock bottom, developers buy up everything and the yuppies all move in. There is millions to be made in gentrification.

Anyways that's my advice. His tapes really have good advice, plus his workbook also has some helpful info.
 

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Oh another thing that is popular where I live, is to buy an old house with good zoning. Tear the old house down and build a semi-custom home. As soon as the roof and brick are up, the house goes on the market. I work for a few guys sho do this, and they make 200k per house and do a few houses per year.
 

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Discussion Starter #6
Everyone thinks that because the stock market was over inflated that the housing market is too.
I don't think that home prices will continue to rise as fast as they have been but I don't think they will drop anytime soon.
Stocks were a piece of paper to most people and they didn't understand what they were buying. They were given access to trading through the Internet and they bought and sold stocks like they were playing a video game.
Real Estate is an asset that everyone understands and is driven by supply and demand. I don't see demand going away any time soon.

-Nathan
 

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Discussion Starter #7
Grumpy said:
Oh another thing that is popular where I live, is to buy an old house with good zoning. Tear the old house down and build a semi-custom home. As soon as the roof and brick are up, the house goes on the market. I work for a few guys sho do this, and they make 200k per house and do a few houses per year.
I knew a guy who did something similar to this in the DC area. He bought good land and would build one or two homes on it. These were nice homes running in the $700K-$800 range.
Once he was done he would sell them and make around $200K per house. He built about 5 homes per year.
It was a nice system he had. He knew what people liked and what would sell and thats what he built. But since he didn't sell them until after he was done he didnt' have to deal but the homeowners during the building phase.
It worked well in the DC area where people have a lot of money and don't have a lot of time to wait for their custom dream home to be built.
But its also very risky and you need to have a lot of cash to burn. If you can't sell the home its yours!

-Nathan
 

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nwingate said:
Everyone thinks that because the stock market was over inflated that the housing market is too.
I don't think that home prices will continue to rise as fast as they have been but I don't think they will drop anytime soon.
Stocks were a piece of paper to most people and they didn't understand what they were buying. They were given access to trading through the Internet and they bought and sold stocks like they were playing a video game.
Real Estate is an asset that everyone understands and is driven by supply and demand. I don't see demand going away any time soon.

-Nathan
I don't think the housing market is over-inflated, I KNOW it. I see it every day. I hear it every day when friends in the same age bracket as me can't even afford a house in their own home town because the market has sky rocketed so fast. The medain home price in my town is double what it was 10 years ago. Speculation is the rise will continue for at least 5 more years. My town was in Smart Money magazine and listed as one of the 5 best places to own a <i>second</i> home in the COUNTRY. :rolleyes: It was also listed as #1 in under rated property values.
While this sounds good the cost of living is going up for artificial reasons. Taxes are shooting up and people still make what they would have in a normal economy. Homes are valued much higher which should be good but if you sell you still have to buy something else. Fine if you are moving out.
So of course the only people who benefit are the rich.
 

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I think real estate pricing is over inflated but it balances out with the interest rates. Didn't anyone notice as rates were dropping prices were boosting?

I've been watching the rise, and houses may continue to rise for 5 years. I can't argue about that. I do know the rise has decreased to a manageable rate of increase and while the property values will continue to rise, they won't rise as fast.

The further you move from a metropolitan area the cheaper the houses are. I can go buy a 5000 sqft house brand new 50 miles from Chicago for less than 300k. If I try to buy a house that size 10 miles out of Chicago I will pay a mil or more.
 
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