Finding Your Real Estate Niche

Knowing what you want to do in real estate investing is important.  There are tons of great avenues to make money in real estate investing.  You can be a land lord, rehabber, wholesaler, short sale expert, focus on REO’s, deal funder, and many more.  You need to ask yourself what your goals are with real estate investing.  Do you want cash flow? Are you investing for retirement?  Maybe you want to build up your cash.  Every investing strategy is different and provides different challenges and rewards.

I truly believe that everyone should focus on one aspect of real estate investing to start off.  If you try to do them all at first you could have a mess on your hands.  If you want to be a wholesaler master that first then start adding other real estate investing weapons to your arsenal.

Becoming a Land Lord

Rental property is the best retirement anyone can have.  Let your tenants pay the mortgage and give you extra cash in your pocket every month. You also have property appreciation, tax deductions, and historically rents go up just like property values go up.  I have been around rental property all my life and know the huge benefits they can produce.  There can be problems if you get yourself over leveraged with them, so you want to always have substantial cash in the bank to cover your costs when repairs come up or when the property is empty.

Wholesaling

Wholesaling is seeking out affordable properties and putting them in the hands of other investors or buyers.   For your trouble of marketing and finding the property you get paid a nice profit that is almost like a finder’s fee.  The process of wholesaling houses is one of the most simple and straight forward investing practices out there.

Wholesaling kind of sounds like being a real estate agent but it’s different in the fact that you are putting the property under contract.  Wholesaling is what I consider the best way for a person to get started in real estate investing and build up a nice pile of cash.  It takes no money except, some marketing expenses and earnest money deposits.  Check out this article on WHOLESALING for a more detail.  The key to s successful wholesaling business is marketing.  You have to be marketing like crazy.

Rehabbing

Rehabbing is what everyone thinks of when they hear the term flipping houses.  Find a discounted home which needs some fixing up, buy it, make it beautiful, and then sell it to a happy homeowner and make a nice profit.  Rehabbing properties can produce some of the largest profits on deals.  The key to running a successful rehabbing business is having good trust worthy contractors.  If you can get contracts that do great work, do it in a timely manner and are honest you have it made.

It does take some time for the rehab project to be completed.  Usually you buy the house, it takes 2 months to rehab it, and then another 90 to 120 days to get the house sold and get your pay check.

Short Sales

When a home owner owes more on their property or around what the property is worth there is no equity in the deal for an investor to make money.  A short sale is simply negotiating with the bank to forgive some of the debt to free up some equity.  Now why would banks even consider doing this?  It’s because the home owner is going through some sort of hard ship and can no longer afford their mortgage.  The banks do not want to foreclosure but will have to if someone does not do something.  Short sales can be a great business but I will warn you they take months to complete, sometimes 6 months to a year.  I am not an expert on short sales and would rather just refer them to other investors.  I know of several people making a killing on short sales and I recommend everyone research them to see if they are the niche you want to pursue.

REO’s

An reo is a bank owned property and let me tell you banks are not in the real estate business.  Buying property from banks can be great and once you buy them you can do whatever you want with them.  Wholesale then, rehab and rent them or rehab and retail them.  Right now banks around the county have more real estate then they know what to do with.  Yes some places have less than others but there are markets out there with endless reo deals.   There are some different rules when flipping REO’s but it just takes a little research.  I know investors who are wholesaling 20 REO’s a month.  If you are in an area with a ton of REO’s I highly recommend you start flipping them.  You don’t have to deal with emotional sellers, just with real estate agents and sometimes banks.

Get the Preston Ely’s REO RockStar

Get out and Make it Happen

There are several other real estate niches that are amazing ways to make tons of money.  One is being a private investor, which is simply just lending money to other investors and getting a nice return on your money.  There are also tons of trick and tips you can use for every deal like option contracts, and subject to.  Just get out there and experiment in all avenues to find what you enjoy doing.  Some people love rehabbing and others hate fixing houses.  Some do not mind waiting the 6 months it takes for a short sale and others want to get paid now.  It all depends on your own personal style and business model.

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Finding Real Estate Deals

How to Find Real Estate Deals, the Easy Version

So you decided to buy a real estate course on late night TV, studied up about Flipping Houses and then realized that you have no idea where to find houses to buy.  Then after a month of looking you give up, it happens more than people think.  How do you find people that you can help get out of foreclosure and get on with their life?

If great deals where easy to find then everyone would be multi millionaires and Billings Montana would look more like Aspen.  Maybe the Aspenites no where we can find motivated sellers?  I don’t think so buy ill look into it and find out.

Some say that you only find deals once in a while and real deals only come around every few years.  Do you believe that?  If I did I would not be in real estate.  There are hundreds of people out there just in Billings Montana that need our help, they need to get their foreclosure stopped, get rid of an unwanted property and save their credit. If you are one of those that need help Click Here!

So what makes a seller motivated to sell at a discount?

There are many reasons divorce, death of a family member, job transfer, job loss, bills piling up, or just some serious financial distress.  These things happen to people every day.  I bet these things have happened to several of you reading this article.  Your job at as a real estate investor is to help these people and create a win-win situation.   I stress to everyone to always leave a seller better off after you help them then they were before.  If you do this people will want to work with you and in a small city like Billings word spreads when you help people.

On first place to start your looking is the paper.  It’s easy, cheap and a good place to start.  Look through all of the for sale by owners.  Most will want more that you can buy the property at but every once in a while you will find a gem.  Look for key words for fixer upper and handy man special.

Next go to the local court house and look up foreclosure listing.  The county court house has hundreds foreclosure records for Yellowstone county.  You know these people need help, so this is another great place to find leads.

Another great source is real estate agents.  Realtors are dealing with sellers every day.  Some sellers want to get full price for their home and others just go to them because that is the only thing they know.  They do not know that there are real estate investors out there who can buy their house all cash and close fast.  Contact several realtors and find one or two that will work with investors.

Place classified ads.  I have had great success placing small classified ads.  Believe me place one and the phone will be ringing with everyone wanting to sell a home.

Also you can find that other investors want to sell their rental properties.  Sometimes land lords just get fed up with dealing with bad tenants.  Network with land lords and ask around to find out who is selling off their property and tell people that you are looking to buy a few houses in the next few months.

Networking is highly under rated when finding motivated sellers.  Just start asking everyone if they know anyone who has a house they need to sell fast.  I am sure you will find a few that do know someone.

Wholesalers

Wholesalers are a great place to find deals.  Wholesalers do all the marketing for you, find the deals, deal with the seller and lay the deal out for you.  You do none of the work and still get the same deal.   Most people think that wholesalers mark up the price too much, but that is the opposite.  They can get deals lower in price than you probably can.

Remember to Get My Free 7 Day Course, I explain Several More Ways to Find Motivated Sellers.

Also Get Preston Ely’s Wholesaling E-Book Click Here

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Building Your Real Estate Team

Building an effective team can make your life as a real estate investor a lot easier.  You are only one person and cannot do everything or be an expert in every aspect of real estate investing.  Going at a project alone can become one of the most frustrating experiences you will ever encounter.  Many people have become frustrated and quite real estate investing because they try and juggle too many things.  Make sure that when putting a team together you provide everyone with win-win opportunities.   When someone knows that working with you is going to make them money they will put you as a higher priority on their list.  But you have to prove it to them that you are the real deal.

People to have on your real estate investing team include

Real Estate Agents:  Find the top agent for volume of sales in your area and other agents who work with real estate investors.  Real Estate agents can be a great source for leads and help you get your rehabbed properties sold.Real Estate appraisers: Find an appraiser that has done a few hundred jobs or more and make sure they carry errors and omissions insurance.Real estate contractors: Good rehab crews that can get the job done in a timely manner, have 3-5 crews on your speed dial and on every deal get 3 estimates done.  Ask for referrals from them and make sure they are licensed.Real estate attorneys: Every investor needs an attorney, they can help to protect your assets, make sure you find one that works with investors and knows what you are doing.A property management company: Can manage your properties and will give you leads on property they are managing that might come up for sale.Title companies: Take care of the legal process and make sure there are no liens against the property you are buying, choose one that does hundreds of closings a year.Home inspectors: Charge about $400 but will give you a great inspection and could save you thousands in the long run.Bankers/Mortgage brokers: Help you get financing for your deals and can get financing for your buyers?Bird Dogs: Every big investor has bird dogs searching every crack and crevice for vacant houses and motivated sellers.  Get some bird dogs and it will save hundreds of hours of your time.Other Investors: other investors may be experts in other investing niches. You can out source your short sales to short sale experts in your area. Wholesalers can get you some amazing deals.  You also need rehabbers to wholesale your deals to. Land lords to sell deals too. Networking with investors is one key to a successful real estate business.  Do not think of them as your competition, think of them as part of your team.And your Mentor

All of these people can help you in various aspects of real estate investing.  You might find that there are a couple others that are keys to your business but this is just a list of a few.  Everyone will also be a source for leads.  You have to let them all know what you do by proving that you keep your word and back up what you say you are going to do.  Also treat each one with respect, and act ethically or your team will turn on you.

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