All Forum Posts by: Dan Norton

I second (actually, third) that suggestion to drop your price -- you bought a home for 10k, put as much into it again to rehab... and you're panicky because you can't sell it for $62,000? Just take a fair profit and move on, even if you sell it for 40k you've still made a tidy profit, right? (unless you put more money into the home than you've let on)

I do have to wonder though... it's costing you just $400 a month to carry this home? Two things -- if it's a tough market in that area, I'm sure you could rent it to get rid of your cash flow problem... but if it's not an option, and 400 bucks a month for total carrying costs is drowning you -- perhaps owning more properties isn't a good idea until you're in a better situation finacially. If REI is for you, you may want to consider sticking to wholesaling for a while.

Either way, it sounds like you'll be fine and have many options with such a low-cost property; hang in there, you'll figure out the right thing to do.

(personally, I'd have two plans -- First, find a buyer at a modest price for an acceptable profit... Second, the above rent-to-own suggestion is a good one, in a poor part of town where buyers can't qualify for 50k, it looks like a better rental area where you may find someone to pay a small bit more rent for the future purchase rights)

I know there are REI clubs in Kansas City area, but that's not really *Kansas*. I'm speaking more specifically about the East Central area, like Fort Riley/Manhattan area.

I know there's growth in that area with the military driving the Junction City/Fort Riley market upwards... but haven't found anyone or any groups who do that market.

...anyone here have experience there, or know of groups?

no need to apologize, Jay... we've all been there, I'm not far ahead of you. :lol:

anyway, although I'm not a mortgage expert (and perhaps someone can speak up on this subject), I'd also avoid ARMs now. With the subprime meltdown, the tighter money policies taken effect, and the way the market has gone from high-appreciation to nearly no-appreciation for the time being, and interest-only loan won't help you much...
Think of it this way -- if you buy a home for $200k and pay maybe 1200 or so a month for interest (plus taxes, insurance, etc), how much do you owe in three years? The same amount. A few yrs ago this was ok, because your home would've grown to be worth $250, or 300k or more. But now you're not getting that appreciation anymore, and you're still running the risk of having your rate reset to an unmanagably high number in a few years, if you decide to sell it.

In comparison, a fixed rate is good forever, will pay down some principal (not much, but more than an ARM!), is not too much different from an ARM ratewise (last time i checked), and is just much less risky at this point in the market. The time where everyone wanted an ARM has passed...

To give you a VERY simple answer to a complex question -- buy a distressed single-family home [or duplex/triplex and live in/rent out] where you can get a nice equity position going in (20% or more). Then you can choose to sell it at a profit in three years, or keep it if Melbourne grows as some predict, and continue to rent it or lease-option at that point.

Either way, it sounds like buying something... ANYthing... would be your ideal choice. Even a condo would be better investment than renting, so it depends on what level of commitment you want to the property.

allcash, you're right that the property tax situation is 'in flux' at the moment here in Florida, but it has some very promising potential for priary homeowners. There is a special session in place this week, working overtime in the capitol on tax reform, and they have passed 'part one' of a two-step process that would cut taxes... the second part would be voted on in a referendum later this year, and that's the part that will make the substantial difference, by super-sizing the Homestead Exemption allowance. It won't impact long-time owners much, but those who buy new homes (or have recently done so) would have their taxes cut dramatically. So we'll see how that works out.

As for the original question, it's got a lot of variables, but I would say rent if the timeframe was shorter, but for '3 to 5 years' with potential that it may change, I'd look to buy now at a discount, depending on the budget Jay is looking at.

[Jay, where are u located, and what price range are you thinking about?]

...and keep in mind, if they DO reject your offer, talk to the person in charge and see if there's any wiggle room (ie, if they can't meet your price, might they offer terms in lieu of a slightly higher price... banks CAN be flexible on these things, most people just don't expect it). And if not, follow up on that rejected offer a month or two later.

If you think it's worth 10-15% less than they're asking, and they're holding it for month with no income, they'll be more likely to reconsider that offer as time passes.

Hi Minna,

one possibility could be to search the county tax appraiser's website and look at properties one by one, where you will see the address where the tax bill is sent --> the owners' address of record.

It's not a simple 'put in the parameters and create a list' method, but if you are targeting a certain community, for example, you can identify the owners' locations that way. I did this for a certain community I was marketing for a builder... I hopped online and searched the subdivision for the out-of-state owners of pre-existing homes in the community, and sent letters promoting our new homes in the same area.

this way also works if you have found specific properties that appear vacant...

The drawback to this, of course, is if you have no direction for *which area* you're looking, and are only looking for absentee owners. (that would take you forever to look at every home's tax records in your county!!)

I'm sure there are other methods, but I know of this one from personal experience, so I thought I'd share.

Dan

Well, I'd have to guess that I'm like many people --> somewhere between Jorge and Wakefield. :shock: I run occasionally and tend to go on running streaks, then stop for a while. A few years back, however, I ran at least a few days a week for 4-5 miles each. (I never was a distance runner, only a sprinter, so that's quite the accomplishment for me!) The cool part of it was the location: it was during my job on cruise ships, so I'd step off the ship wherever I was and go running through the grid of Key West, along Grand Cayman's 7-mile beach, through a fishing village near Mahajual in the Yucatan Peninsula... Cool stuff, and the scenery made it Soooo easy to just keep running, and forget about the distance!

I've always had a low heart rate, and during that period I got down to 40-something beats per minute as a normal resting rate. :superman: Problem was, I also lost about 10 pounds [which i don't need to do], so I would love to do it again but have a better balance between running and weight training.

Now that's a shame... I wasn't a fan of his, but he was certainly better than the Montelongo group from TX. I think most of us realize the reality of a 'Reality TV' show where certain aspects may be staged, like a conversation about what would work and what wouldn't, and the 'deadlines' they miraculously pull off everytime... But hearing how blatantly false the entire thing was is a downer.

However, I know they're not the only ones who do this. I was nearly on Property Ladder early last year, and know a home inspector who actually *was* on an episode here in Orlando... but he was actually used as a potential 'buyer' pointing a couple of flaws as he walked through the home.

Maybe they could try a disclaimer before and after the shows: "Statistics, Balance Sheets, and Profits may appear closer to ideal than reality. Flipping homes may or may not cause your financial ruin. Good luck duplicating these results." :wink: