All Forum Posts by: Greg Carr

Sounds OK but it depends on the area. A 2003 build sounds suburban to me...you want a house with land scarcity so it appreciates.

What are the comps looking like? What is the average DOM/months of inventory in the area/subdivision? Is it located near any major roads or commercial buildings?

Arlington is pretty good, too. TCU is a very popular area for rentals.

One way to search unfamiliar areas to see if the property values are going up is to look on Google maps and look at the land. If the land is near the city but not far enough to be "suburban" (there is still land in the area to potentially be developed), then it may be a good place. Don't worry so much about the house, but more about the land, more specifically the scarcity of it. You're not necessarily buying the house but the land that it sits on when it comes to appreciation. Then look at other factors in that area: vacancy rates, MOI, DOM, and so on.

This is what makes areas like TCU so popular for buying rentals, because there is just no more land available, but DFW is growing by 100K people a year. There is a high demand and not enough supply.

A lot of experienced investors rent a house for 1 year then sell it. You cannot legally lease/option in Texas but there are other legal systems to do something similar (that are apparently better anyway). This will keep you from taking a big income-tax hit from the "flip" and only pay a 15% capital gains tax.

If you are an out-of-state buyer and looking for bigger investments, there is some serious complex appreciation going on in south Dallas. Toyota is going to bring some serious jobs and serious population growth to that area, and apartments near the city have their rent even doubling (double the rent = the property value going up like 10 times).

Anyway I'm going on a huge tangent. Whatever you do, stay away from a traditional real estate broker when looking for investment properties...that is a huge waste of time. You don't submit an "offer" on an investment property...that is a guaranteed fail. They have no idea what they are doing...ask them what the "months of inventory" are in an area (vs DOM) and if they have no idea what you're talking about then hang up the phone.

Looks like a pretty  bad deal to me. Numbers are just too narrow.

Buy a house that actually needs rehab. This thing is practically turn-key.

Simple negotiating skills. Always try to find a "win-win" when negotiating with anybody, and always try to appeal to them.

Best book ever: How to Win Friends and Influence People. Doesn't matter what you are doing, it will help a lot.

Ask them from their point of view why they think they will sell a house that needs rehab at a retail price. Ask them how they priced it, how they came to that conclusion, etc. Ask them how long they are willing to wait, when you can buy right now. Tell them they could be building equity in their next house rather than dealing with a dud. Ask them why they are paying bills on a distressed home when they are not building any equity.

Ask a lot of convincing questions from their point of view.

Try attending local meetups about real estate investing. There's loads in DFW.

You should find a reliable general contractor who is "hands off," where you can just tell him the work that needs to be done, sign a contract with a deadline and the rehab needed with a per diem for going over, and just come back in 2-3 weeks when it's done, then sell/rent it/whatever your exit strategy.

When selling a flip, consider listing it a bit low and letting the offers/bids get close enough to it, if you want to have a shorter DOM.

Make sure you buy the highest ARV you can afford to maximize your profits.

Consider leveraging your money for more security/profits.

There are all sorts of exit strategies out there. I just saw a great rental strategy, with all the documents supplied, at a meetup in Arlington. Consider attending real estate investor group meetups in Fort Worth, it's a great way to network and learn from experienced investors.

Good luck.

When in doubt, always disclose.

Give us your concerns in terms of NOT buying more first.

You are buying using a double closing? So are you buying FROM someone who is double closing, or do you want to double close with a tenant?

I'm not an expert, but here is my best explanation.

In a double close, there's a front and back-end. The front end is the first closing.

So Allen wants to buy a property From Bob and sell it to Charlie. Allen opens with Bob. Before Allen closes with Bob, he closes with Charlie. Allen can open with Bob by buying an option or with earnest money.