Paralysis by analysis

[Alvaro Rodriguez]

Hello, I'm a newbie in Houston Texas. I have built relationships with multiple wholesalers but it looks like they always inflate the ARV. I have moved to try to buy and hold, but I haven't gotten my offers accepted on properties where rent would be at least 1% of purchase price. That took me to try a different strategy which was to get a list of a lot of houses in Houston that are tax delinquent. Also I am able you tell how much equity they have. But I don't know how to approach them after this. Also, how do I go about offering them to buy their portion if I don't have all cash. Does anyone know a friendly mortgage company. I just need some guidance on how to execute a first deal. I'm running in circles.

Thank you

[Tamara Deering]

@Alvaro Rodriguez

It seems like you are all over the map as far as your investment strategy which tells me you  have not defined what it is that you are trying to do and why.  Rules of thumb like the 1% rule and the 70% rule are there to help you quickly analyze deals and throw out the ones that make no sense.  

What is it that you are trying to accomplish with real estate investing?  Are you looking to make a career out of flipping houses?  Are you trying to build financial independence with passive income?  Are you trying to make a living wholesaling?  

You need to determine what your goal is, what numbers you want to net profit and/or income wise.  Once you know your goal you need to identify what type of property will satisfy that goal and where you are most likely to find that type of property.  After you know where the property is likely to be found direct all of your energy to finding a property in that location that meets your numbers.  While you are looking for properties you also need to put your funding strategy in place, are you going to use hard money to finance the deal or do you think you will qualify for a conventional mortgage?  

If you don't want to go to all the work to figure out what it is that you want to do my advice to you would be to purchase a live-in flip. Find a house that is livable but not desirable in a market that is likely to appreciate, get a conventional or FHA owner occupant mortgage with little or no money down, move in, fix it up while you live in the property, make your house payments and in two years you can either sell it tax free and move into your next project or rent it out. If you couple this strategy with house hacking and get tenants to pay part of your mortgage you are well on your way. The beauty of this strategy is you aren't competing with investors for properties you are competing with homeowners who aren't willing to make sacrifices in the short term to improve their long term lives.

I'm sorry if this sounds like a lecture.  Connect with me directly if you would like help putting together a step by step plan or follow @Craig Curelop and get going.