I know this is a lengthy build up to my three questions at the end, but I have a situation that I would love to hear from current investors, especially from those who are investing in 1-4 unit properties.
Here we go.
Imagine for a minute that you have journeyman level skills and a decade of experience as a carpenter (rough and finish) and you also have advanced apprentice level experience in other trades like plumbing, electrical and concrete work. You gained these skills and knowledge in your teens and early adulthood working with a renovation contractor so you “did it all” from demo to roofing, and nearly everything in between. In fact, you even spent your summer while in high school installing below-grade swimming pools!...and insulating houses, :(
As time passed you joined the military and operated heavy equipment like dozers, graders, loaders, and backhoes. Once out of the military you continued to advance your circle of knowledge and skills by investing in some architectural drafting classes that led to several years of residential design work on the side while you worked full-time. Soon you went to the university and obtained a professional degree in architecture, but you never were able to get your license.
After you graduated with your BArch degree, you worked in architecture firms for a few years and eventually took a federal job as an architect. Your primary role for almost a decade was in the position of design manager for projects in areas of recreation, housing, tenant improvement, exterior painting, re-roofing, and even some civil repair projects. Prior to leaving that career, you held a federal position for a year as a construction manager on projects ranging from a few hundred thousand up to $17-Million-dollar military construction projects.
All during this time, you advanced your skills with CAD software that now allows you to produce high-quality drawings consistently and accurately, culminating from your experience of 30 years in the residential design and construction industry. You also have advanced skills in office software like excel and word, along with skills using project management software. You also have decades of experience with processing building permits in the jurisdiction where you hope to invest.
You are making some money here and there with design projects but these are inconsistent at best. Your wife is working and between the two of you, you are just getting by. You have a lot of equity and you may or may not be able to refi your home if the right deal made sense but without a job or income to report finding a lender is going to have challenges of its own.
You feel stuck but you know that with your skills, confidence, and time now to approach real estate investing with a serious long-term approach. You know you should have done more with real estate investing years ago when you earned enough on your first flip to fund your move to Hawaii and purchase there, where you now live. But that was in 2005, and with the move and the real estate debacle in 2008, you gave up on that idea.
But the idea and the desire has never really left you. Fortunately, as you approach 60, your health is excellent, in great shape, you have a supportive spouse (she is still with you after living in your first flip while it was in progress).
You love improving properties, and neighborhoods, and creating value where little existed before.
With all this going for you, you know your skills are transferable and you feel that you're an ideal fit for real estate investing. You have the idea that you want to approach it with a cash flow and equity growth model but starting out you think you need to do some fix and flips first in order to generate some cash but eventually get to a position where you can begin holding and leasing or renting. You'd probably establish a real estate trust as your equity and net worth grows over time. You're willing to do this with no illusion of it being easy or that you would be retiring anytime soon, at least not in the typical sense of the word, I mean, after all, you already live in Hawaii.
So here are my questions, and BTW, thank you for reading this far.
Assuming that refinancing your home is not an option at this time how would you answer any one of these three questions?
Question #1:
What would you do if you were me?
Question #2:
What do you know that I need to know in order for me to move forward as a real estate investor?
Question #3:
Of the skills and experience listed, what are some creative ways you could apply them towards working a deal with another more experienced investor?
