How to add value

Question

hello everyone, my name is Jeremy Preston. I have been learning as much as I can on bp as soon as my rich dad (best friends father) introduce the site to me. My goal is to become as knowledgable as I can so that I can add value to my real estate business and as well to other investors that i wish to network with. My question is what do other investors out there think is most important to becoming successful in this business, and what can i start doing today to begin to make myself valuable. Thanks everyone!

Account Closed · Answer

Out in the central valley California it seems that if a house is just good enough to qualify for an FHA loan it's priced the same as a top notch house by the square foot and beds/baths.

Here in California you have to look for really rough homes that no one wants to make money and then you need to keep repair costs in check.

Curt Smith · Answer

In keeping with Rolanda's path, reflecting on our own path as well, initially beginners feel safe following the crowd.  Join all the local REIAs, hook up with experts.  I agree with the fellow re decide a path first, but that comment doesn't even make sense when you are first "born".  :)

We initially followed the crowd in 2010 buying cheap SFRs, then the hedge funds came to town.  The best thing that happened to our company.  It forced us to think strategically.  How can we survive even thrive with competition.  We now do the opposite of the crowd, what they do and where they do it, which is what we don't do.  We follow Warren Buffet, buy what's hated.  (Literally).  Figure out what's hated in your local area.  Figure out how to make lemonaid of that hated real estate thing and become the expert.  Dodd Frank is creating a few new nitches that didn't exist before, demographics is moving toward the cheaper end of the market, that's fairly hated right now (vs flipping high end houses).

Become the queen of ugly houses because everyone is chasing pretty houses.. Or something unique like that.

Tangentially: it's a very interesting read to study the age group population count demographics!!!!   There's MUCH fewer kids to buy all those McMansions the parents will be selling off in the next decade.  Investors will be amazed looking back 5 yrs from now at how all those nice houses have now become surplus with fewer kids to buy them.  Study this!  Northern cities are especially at risk to this (departure cities) vs Southern cities still being destination cities for migration.  Add departure migration to demographics, student debt etc and we might have problem in the pretty neighborhoods!  This will be slow moving though.

Apartments and mobile home parks are the next thing.  Apartments for 2 yrs now.  Mobile home parks just starting to heat up.

Walt Payne · Answer

First step is to not take any steps at all until you decide on a direction. You need to figure out where you want to go before you look for a way to get there. Otherwise you will be wasting your time and the time of anyone trying to help you. Once you know that, then map out goals. Short term and long term goals. Then figure out how you can make those goals happen. But as anyone here with any experience will tell you, it isn't as easy as it looks. It is still the easiest path to slowly build wealth, but don't expect the easy road, or the express lane to be open.

Jeremy Preston · Answer

thanks both of you for your replies! Yes my rich dad is still buying properties. He has bought over a couple dozen family homes over his carrier which he has held and been quite successful. After he sales his mobile home park in Arizona he will be out of the rat race, and be able to do real estate full time. I believe both of you are right, as I should learn how to wholesale so i can be of value. I am sure as i prove myself of value he will continue to teach me invaluable lessons. Thanks once again!

Christopher Hunter · Answer

@Jeremy Preston Welcome to BP.  Knowledge and networking.  Gain the knowledge that is going to useful to other investors in your area and put that to good use.  Network with those same investors and ask how can you help them and what type of properties are they looking for.

Curt Smith · Answer

Account Closed   To my eyes, you just gave away a million dollar tip!!!!  Great strategy!  Know the FHA minimum standard for a given area.  Do you hob knob with appraisers?  How does one figure out the bare minimum?

Brandon Turner · Answer

Hey @Jeremy Preston thanks for jumping in and introducing yourself! If you haven't yet- be sure to setup some "Keyword Alerts."

See you around the site!

Rolanda Eldridge · Answer

Take action!!..Learn, network, make offers, view properties...find a niche and keep perfecting it!!!..When I started, I bought 3 retail properties, because it was safe.  After, I stepped out of my comfort zone and purchased a "junker"..The best discovery in my business model...Good luck!

Katharine Chartrand · Answer

You have to start researching the opportunities in your area and running the numbers. And he opportunities and the markets are local.  So you have to research your market.

Track it in a spreadsheet like a model stock portfolio.  See how you do with different strategies and scenarios.  Is your investment strategy sustainable, after you do one deal where are the resources to do the next?  What does success look like... to you.

Try putting very low offers on deals, just so that you have a right to find out how things turned out.  Figure out the best way to track rents in your area.

Michael Lemieux · Answer

Welcome @Jeremy Preston . I think taking the first step and being here is a great one. Is you rich dad still buying properties? Ask him what he's looking for. Study marketing and wholesaling here, and help him find his next deal. As you help him, I'm sure he will continue to help you. Look forward to hearing more about your REI adventures.

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