All Forum Posts by: Kama Ward

It seems the general ladder that people here work on is:
wholesale/other job/realtor to
rehabber to
low end single family to
nice single family/multi family/commercial.

This all ends at buy and hold.

Is there some other fully mature way to use real estate to build/preserve wealth?

I'm asking because I'm biased against being a landlord. I saw how hard it can be watching my father manage a few single families when I was growing up. Plus, it just doesn't seem exciting enough to babysit either a tenant or a property manager for x amount of hundreds of dollars per month per property. Maybe this is my immaturity showing! I'm willing to do it, be tough, and manage renters well if I have to-- but I'm hoping to find better/different options.

This topic may have been covered before- I've searched several times and not been able to find it. Point me in the right direction if it has.

What's your end game strategy?

How has your strategy changed over time?

Being from NC, I've had several glimpses inside the workings at BofA headquarters (not literally). My relative worked at another large bank (also crappily run) in Charlotte. Charlotte banking is a small world... everyone knows lots of people at the other banks. People try to keep their heads down and keep their jobs. The BofA is a total basket case! Shabby.. the cliches you imagine from the worst of corporate america are all alive and well there.

My friend's brother worked there on contract for the IT dept. It was his most hated job ever. He was getting paid lots of money but had no computer to work on for almost a month... on a six month contract.. he just had to show up and sit in an empty cubicle. Then when he did get to work, 98% of the other IT workers were on B1 or H1B visas (ie. foreign workers here temporarily at the will of BofA usually from south asia) So they were afraid to say anything and were treated badly and dared not suggest better ways of doing the work- let alone asking for better treatment.

I think the people who say "What's wrong with the big banks? I've been treated fine." are like people saying "I love my health insurance!" But they've never used it for anything but a sniffle. It's when the chips are down that you find out the quality of the organization.

Our small bank charged us a $10 fee last month that was technically within their right to charge. I thought it was cheesy though and asked for it to be removed. They removed it no problem, and said they would change their procedure in the future! If there had been a bigger conflict, we're only two layers away from the bank president! This is the service I want.

I will not knowingly give any large banks my business.

Raleigh is a good solid place to be, for the stable job reasons you mentioned. I can't see appreciation doing anything but keeping up with inflation though.

I grew up in the area, went to college there, and later owned a house there. (also my father owns sfrs nearby) I bought in a 'good' area meaning houses in suburbia, not that old and mostly or all owner occupied. I sold 2-2.5 years later for the same price. This was during the dot.com run up. It's just too easy to build more- although they are way built up compared to the old days- Raleigh is nowhere near ATL or even Charlotte. If you buy in the old city neighborhoods, you might get better appreciation since they are not building more of those and the trend is still back to the city.

You originally mentioned townhomes. These could have HOAs that would make owning them expensive and a pain. See some threads on owning condos vs. sf. It is easy to obtain single families in Raleigh, so why not do that?

If your rents are $1400 a month, you will end up keeping $700 a month on a paid off house (using the typical rule of thumb on this forum). Will this be enough of a return for you?

It seems that your limiting factor here is you do not want to worry about repairs/fixing. But you are going to have to worry about these things eventually anyway. Why not bite the bullet and go for a distressed/fixer properties, and 'make the money when you buy' as the old cliche goes. If you have a partner in town or will be moving there, you will have the on the ground eyes that you need for this.

Or why not try one of your in shape townhomes and one fixer and see what comes of it? I would not suggest this to everyone, but you seem to have plenty of buffer.

I'm not sure why this is in innovative strategies. Getting nicer rentals seems to be a classic endgame for many.

Hi Joseph- I'll say welcome as another new member from NC. You said you will not be getting a full time job when you start investing. Do you have enough to do a cash deal? Having a job allows you to have access to more types of financing (not that it's absolutely required). Or maybe it would be good to become a licensed realtor, which could provide extra income as well as a lot of insight for a beginning investor. There are a ton of thread about the pluses and minuses of that. Persistence is key! Good Luck!

Thanks Jackie.
Our local market is pretty good below 200K. It drops off quickly once you get near 300K. Asheville has dropped a bit more than 25% since the peak, and is still drifting slowly downward- or bumping along the bottom depending on who you talk to.

Other parts on NC were less affected by the downturn. Our market is affected by 'lifestyle' pricing (my term- not sure if there's a real term)- pricing not supported by wages- because it's cool to live here. We still have new construction (even tear downs) going on in the city, so it can't be all that bad.

I've had a two story moved but only to a different part of the same property. It cost about 3k. No problems for my job. The standard minimum for a one story in my area is 5k for move of a few miles (say less than five) in a rural area. The movers handle the contact with the authorities. Semi- common around here and I have not heard any horror stories.

There are two categories I'd look into: technical and market (sorry if this is overly basic- it's what I did though and it seemed to work).
It seems you are asking about technical stuff-- which often limits what you can do in a certain market.

To learn about technical issues I see three ways:

1. The Research Nerd way: all your ordinances etc. should be online. Or at least downtown or at the county seat! Read them. It takes a while, leaves you with more questions than answers sometimes, but it is very valuable to see what's written down. If there is a dispute, this is what it often comes down to. Sometimes even the officials in the planning office will say something contradicting what's written down.

Plus know your state laws! For example, in NC you can divide tracts without having to create a subdivision as long as the end products are larger than 10 acres.

2. The Good Ole' Boy way: Talk to your local good quality surveyors, excavators, well guys etc. They know the soft edges of what can and can't be done, and can clear up some questions that reading the ordinances bring up. Realize that they have a slight bias to do things, rather than not. In my case, my surveyor called planning and got something through I might not have been able to. He had a good reputation with the decision maker. Always listen to your good contractors and subs! Of course not everything they say is golden-- but they have gems that will save or make you $$ on this deal or the next. Visit successful and failed projects and talk to the neighbors. (of course this is good for knowing your market too)

Talking to your land/real estate atty straddles the good ole boy way and the next way.

3. The Upstanding Citizen way: Talk to your attorney. Get the dope from him/her. Ask all kinds of questions, yes like Ryan said even ones that sound crazy at first! Get recommendations for good surveyor etc.--- ie the ones with the fewest lawsuits on their tails.

Call planning, ask general questions that may apply to your project (not mentioning a specific piece of land). I'd tread lightly on this one until you have a good rep. and are one of the good ole' boys yourself!

For the market I'll be brief: Know it well. On the ground, not just by computer. Is there a need/want that you can fill that other places can't/won't? Women make most housing decisions (probably less so for lots), what do they want? Paint the picture for them.

Yay! Thanks for the welcome James and Jon.

The reason I'd be happy with 2 million is that my end goals are freedom and security, not necessarily the best return on my money. I understand that getting good returns are essential to building wealth, but I don't need to eke out every last penny 'til death do I part. I call that income LBIP (least pain in the butt). It might be mostly in real estate. Or I if could get 5% on a totally passive investment that'd be 100k. Or I could not earn a dime and spend 100k for twenty years before I ran out. The point of the 2 mil is I feel confident we could make it work for the rest of our lives.
Or 100k a year, whichever comes first. So if I can figure a way to consistently get 20% with out it being a full time job (which seems tricky but possible), I'd only need 500K invested. Or 10% on 1mil (seems relatively easyish). That's my range.

Jon- I'll head over to that other thread and give it my best shot!

What did I do wrong on this introduction? Too much info? Too few questions?

I'll try again. I love Biggerpockets- especially posts by Rich, Jon Holdman, J Scott, Aaron in ATL, Bryan in Charlotte.

I'm coming to Denver for the REI summit. I look forward to seeing/hearing/meeting lots of you!

I'm finishing up one rehab now and I just put a 65k offer on a sf where the arv is just under 200k. Yee Haa!

Hi,
I've been enjoying this site for months now and finally signed up. I love real estate- it's not like learning, it's like breathing! I have been involved in real estate casually for several years, always as a side thing as related to our family goals at the time. Now that my kids are older, I want to be professional about it, have fun(meet challenges), and use it as a way to achieve financial independence.

I'm hoping to figure out a realistic, repeatable method and then set up the best structure to get it done. There are so many ways to make money! I think the wisdom and practicality at biggerpockets will help me define the best way to go forward- not to mention the questions and details that come up when executing the plan. Right now my goal is to have 2mil liquid or 100k yr pretax in today's money. I want to get to this in 10-15 yrs.

I've rehabbed a few older houses (newest was built 1915) , owned a duplex, sfr, done a 1031 straight swap, made and sold a small subdivision, and sold almost all my properties myself (for better or worse)... I've gotten good deals, made mistakes and been screwed over a few times too. But mostly made money and learned a bunch. So anyway- I hope I can contribute a bit to the forums as well.

Right now I'm leaning toward rehabbing and then moving into hard money lending, but what the heck do I know? I haven't thought of myself as being "in the business" until now. My new motto is "this time-it's not personal"! Ha. What cold hard numbers will most quickly get me to my goals? I got tickets to the conference because I'm betting that we will get out more than the $1500 we will spend on it!

Thanks!