All Forum Posts by: Fred Sebren

When is the next one?

I'll send you a message!  

Greetings.  I am looking to network with realtors who work with flippers in areas such as Conroe, The Woodlands, Montgomery, Magnolia, etc.  Even up to College Station.  We moved to The Woodlands after hurricane Laura hit our hometown of Lake Charles, LA and we are trying to learn this market.  I currently have 7 flips I'm finishing up in the Beaumont area, but I'm looking to move my operation over to this market to make it easier for my project manager.  

I agree with SETX. Out of the $73 billion in industrial expansion that Texas has captured, about $60 billion of it is coming to the SETX area. We are getting flooded houses every day from Hurricane Harvey or TS Imelda. There is a definite housing shortage with all the workers coming in. I personally have bought houses with ARV over $100k for less than $50k all in. And they are getting great rents. Not a lot of competition either...especially right now since there are very few true cash buyers.

I see a lot of you posting about Texas and the bigger cities like Houston, Austin, Dallas, etc.  I have a market that we are actually getting a ton of Houston investors buying in because of the ridiculous prices and the need for housing.  

Southeast, Texas.  The Beaumont/Golden Triangle area (about 1 hour east of Houston) is experiencing unbelievable industrial expansion.  Unfortunately, there are still many houses that were either destroyed by Hurricane Harvey or more recently Tropical Storm Imelda.  Investors are getting these houses heavily discounted, putting them back together, and 9 times out of 10 pulling significant cash back out.

Here is an example of a rental I did.  The purchase price was 30k.  Rehab was 18k.  The appraisal came back at 111k.  I was able to cash out 80k and the house is currently rented on Sec 8 for $1500 a month.  This is actually very common down here.  Oh, and by the way, it's in an opportunity zone.  

Chevron is doing a 6 billion dollar expansion and the need for housing is so great that they are buying houses themselves and rehabbing for their employees to live in.  The total expected investment in the Golden Triangle area from companies like Chevron, PNG, Quatar, and Exxon in Beaumont ( which is expected to become the biggest plant in the nation) is around $60 Billion.  

I sold my insurance agency and cashed out to go all-in on this area and I actually live about 30 miles to the east in Louisiana.  If you think you might be interested in looking at deals in this market, feel free to hit me up!  I have switched my model up recently and am only buying a handful of rentals a year that I can pay cash for and leave paid off, so I have developed quite the marketing machine in this area. 

Oh and btw, most of the investors here rely heavily on banks so right now, the competition has dried up. If you have private money or cash, it will be pretty easy to come in and dominate.  

I have been thinking about investing in the Austin area but when I did my market analysis of major cities it seemed like the number of listings for a city the size of Austin were very low.  It was quite confusing.  Other cities with 1/4 of the population had double the listings.  Any info you can share on the local market would be greatly appreciated as I am very interested in having an operation there.

I would imagine most "wholesalers" are lured in by the idea of getting into real estate with 0 money, no credit, etc.  Some are pitched programs by gurus.  Most flake out when they get a couple "deals" under contract that they can never get rid of.  

With that said, I do know some super successful wholesalers who have the capability to buy everything they come across if they wanted to.  Some just want to be in and out.  Some keep the smoking hot deals and assign the rest.  Nelson Rockefeller once said "The secret to success is to own nothing, but control everything"  As a wholesaler you control the contract.  I know wholesalers who make 6 figures a month just assigning deals because they believe in that quote so much.  In my opinion, the problem with that is you constantly have to keep producing deals instead of building passive income.  

I believe all investors should learn how to source their own deals just like a wholesaler so that they can cut the middleman out if they want to.  If you get to a point where you are doing 12 deals a year and paying a minimum of 5k in assignment fees that is 60k out of your pockets.  That same 60k could have been used to pay cash and rehab a deal that you don't have to finance.  10 years of buying cheap rentals like that and you have a nice passive income coming in.  Not to mention anything else you are brrrring, flipping, or doing the traditional buy and hold.  

But hey, that is just my two cents.  

To piggyback off this, you could actually purchase up to a 4-plex.  Live in one unit and rent out the other 3.  Test the waters for a little bit while learning and earning.  

Most will double close if the assignment fee is over a certain $$$ amount. I have heard many wholesalers say they dont want their buyers to know how much they are making on the deal but that could be figured out regardless.

I skimmed the entire 5 pages of this thread, so if it was said I apologize for missing it.  But at retirement, you can literally take 6 figures a year in income via policy loans, pay ZERO income taxes, and still qualify for food stamps and welfare if you wanted to be a jerk.  Plus your social security will not be taxed unless you are taking earned income from other sources that put you over the threshold.  

The MEC was created because the government realized if they didn't do something, then people would keep putting their money into life insurance. It's no coincidence that qualified plans (401k, IRA, etc) came about around the same time the MEC was introduced. In fact, they want to tax your money so bad they TELL you that you have to take a certain amount at a certain age out of your qualified plan.

It all starts with the 8th wonder of the world.  Compounding interest.  When you understand that, you will understand why IBC can help you.  Most people save years 1-5, and then spend, thus setting themselves back at 0 never allowing compounding to truly take place.  That is another topic for another day.

Other people get hung up on the rate of return which is irrelevant.  I can show you how you can average 25% over 4 years and not earn a single penny.  Again, another topic for another day.  

When you can have your money work for you, be liquid, and put it to work for you in other vehicles such as real estate, you can't get much better than that!  

Not only do I use my policy to purchase real estate but I also enjoy lending it for transactional funding. 

 You cant save your way to being rich!