All Forum Posts by: Robert Taylor

I have a bachelor's in Business Administration with accounting as my major and I qualified to take the CPA exam (which now requires basically a masters to do because they figured they were cramming too much info into a 4 year degree) but I didn't take it because I knew for sure that I would never want to work in public accounting. I did happen to take one real estate elective course in college, not because I had a for sure plan to get into real estate investing, but just because I had always been interested in real estate.

Even though I really haven't used my degree much at all, I'm still very glad that I got it! Now, I also went to a state school (in my state) so my tuition was downright cheap compared to friends who went to private or out-of-state schools, so I graduated with ZERO college debt!

I'd say that it also depends on how you name your accounts, for me, "holding costs" are more of a category with several sub-categories or individual accounts. There are a LOT of different costs you will incur during the time you own the property, I lump nearly everything not related to the work going on as a holding cost. As Gene mentioned too, don't forget about how much you are paying to borrow whatever money you are using for the project, which usually ends up being a major part of holding costs.

Oh Emma, PLEASE slow down with things here and don't make any quick decisions with any large amount of the money you inherited-especially not ALL of it!!! No matter what, you inherited a large amount of money and depending on how you spend money, it could keep you happy and financially secure for a long, long time. Now, this pub purchase MAY (or may not!) end up being a great purchase for someone else, but no matter how good it looks to you or any of us, don't do it! Trust me, if you look hard enough, a deal that's just "too good to pass up" will come along over and over again, there will be many more like this. Rehabbing a property isn't as easy as it might seem from first glance or from the shows on TV, and usually it ends up costing a LOT more than you had planned, no matter how much effort you put into the planning.

My advice that I am 100% sure about, would be to not make ANY big purchases yet, not even a car for example, let this all sink in for a while and take time to really decide what you want to do with this wonderful gift. At the same time, you should immediately start looking for some sort of financial advisor, but take your time with this and really do your research! With financial advisors, there are good, bad and ugly ones out there, make sure you find a good one who's job would be to handle how your new money is invested, whether its in the bank, in the stock market, real estate, or wherever, not just someone who wants to sell you a bunch of different stocks, for example. Then, once you know that your money is safely invested where it will continue to grow for you, take all the time you need to decide what your real goals are in life. Maybe after all of that, you will come back to basically the same plan with the pub, maybe not but you will then go into that deal the right way!

I'm also interested in an update on how things are going with your listing. Now, I'm up here in WI, where its COLD this time of year, which seems to slow everything down for all businesses, so our market may be quite different than in Orlando, where I'd assume its the busy season for a lot of businesses. Our market also pretty much dies after Thanksgiving through the holidays and then slowly begins to come back to life after Jan 1st, although Jan and Feb are usually pretty slow as well. Being a realtor as well as a rehabber, my advice after 11 DOM would certainly be to hold steady on your asking price, especially if you feel its fairly priced AND you've had several showings, at least people are interested enough to take a look! I'd be interested in an update as to what has happened so far.

Besides being a rehabber, I'm a RE Broker too and sometimes when I'm researching comps for a house I'm doing, I will see all of the reo's in the area that have recently sold and they are often all over the place as far as what they sell for as opposed to what the asking price is. Some sell right around list, some over, some under, even some way under. DOM isn't always a clue either, I've seen some that went under or way under list at only 30 DOM! From what I've seen so far, I would be hard pressed to make any conclusions as to what the banks are thinking when selling their REO's. (or what the asset managers are thinking, either)

So, if you are looking for a steal of a deal and have the time to waste, lowballing REO's might be worth a shot to try at least for a while, you might find one. Now, whether or not you have a realtor that wants to sit there and submit a bunch of offers that will likely be ignored or countered at a much higher number is another question. Maybe you could find a new realtor that's very hungry for any work that wouldn't mind doing so for you.

I have never bought a deal from a wholesaler, but I'm not opposed to do so either, it just hasn't happened yet. As a rehabber for the most part (as well as a landlord and RE broker) I think there certainly is a place for wholesalers, but for me it would have to be one that I could trust 100%, both in their honesty and that they know what they are selling me as far as their numbers go. I know that there are a lot of homeowners out there who for a wide variety of reasons, would be ready and willing to let a property go for a price at which I as a rehabber could make a good profit if I were to fix it and resell it. Problem is that I don't have time to go out and find these deals because I'm too busy as it is with what I have going on right now, so there's where there is room for the wholesaler.

Now, having said that, I would only deal with someone I'd trust to bring me accurate numbers, mainly on the cost of the rehab, which is not easy at all! My experience has taught me that the ONLY way someone can become an accurate estimator of what it will actually cost to rehab an entire house is from experience, and lots of it! That's why I always chuckle at the guru's selling their wholesaler courses, because you just cannot teach knowing what rehabs will cost, certainly not in a 12 hour course or whatever it is.

I will also put a strong vote for the door knock vs the letter. If you are really serious about trying this, go to the door and knock. As Wayne mentioned, you get a good feel for where the owner is at and I would look at any rejections as just being good practice for the next time you try it. I'm sure they are getting all sorts of letters that they don't even look twice at, let alone open up and read.