All Forum Posts by: Peter Sanchez

I thought that about the original poster too...

Welcome @Deshawn Lewis !  There are lots of local REIAs in the DMV, that might be a good place to start meeting other investors and getting recommendations for contractors etc. which you will need if you are going to flip.

Since interest rates are so low now, have you thought about buying and holding? 

Looks like all the hard work paid off!  $5 million is more than a lot of overpaid CEOs get, so congrats! 

@Dennis Williams Wow, that was a lot of work for $8,900!  But it would've been a LOT worse if you did all that work and the deal fell though and you ended up with nothing but a funny story.  Congrats on powering through to the end.  The last mile is always the hardest.

@Alex Applebee congrats on the successful flip.  If you can make $19k on your first flip with no experience, then you'll probably do a lot better on future flips now that you have some experience at it from start to finish!  It's like you went to real estate school and got paid when you graduated.

This is from 2010, but it's a slide deck from Bill Ackman (billionaire hedge fund manager) talking about Real Estate. In it, he goes through the numbers regarding housing prices, population, supply etc. to make the case for real estate as a great long-term strategy.

http://dealbreaker.com/uploads/2010/12/Pershing-Sq.-pres-on-housing-11-3-10.pdf

Because he's someone who eats his own cooking, he started a REIT (Howard Hughes Corp) to invest in property development.

The slides are an interesting read.  Enjoy. 

This is one of my favorites too!  I also like how he talks about knowing your circle of competence and where it ends.  He said "I would much rather deal with someone whose IQ is 140 but thinks it's 120 than someone whose IQ is 180 and thinks it's 200.  The second guy will get you killed." 

His partner Charlie Munger is also a good person to learn from (but he's more of a curmudgeon). Someone asked him once to recommend a good business book, and he gave the guy the name of a book he just read.  He said "if you don't like the book, give it to someone more intelligent than you are, and i'm sure they'll love it." 

Well, I'm a lawyer and when I did rent, I was probably the best tenant you ever saw.  I make good money, pay on time, and am not home enough to wear anything out. 

The problem is

1) that he's a convicted felon, not that he's a lawyer.  If he was a mechanic that was convicted of fraud, you wouldn't have rent to him.

2) You live in a state that is very tenant friendly.  You can evict someone in a month in most parts of florida, it might take you more than a year in NYC.  Which is why I wouldn't want to be landlord in NYC.  My dad was a landlord in NYC and all his grey hairs are from that. I live in DC now, which is also super tenant friendly.  When I'm ready to move, I'm going to sell my house, not rent it out.  More money is nice, but you can't pay enough to take on more headaches.  

I really hope you weather the storm and get this guy out.  It is a sh1tty lesson to go through, but it will make you a better landlord forever because now you will have your checklist for tenants and you won't budge on anything.   Good luck.

It's easy to fall down the rabbit hole with education.  If you're unsure, start small, but take some action.  If you're uncomfortable taking on a lot of risk, buy something smaller, or do it with a partner so your exposure is cut in 1/2. 

You can solve problems on the fly as they happen and learn that way, but you'll never be able to learn enough to anticipate every possible problem, so start doing and shift your learning from "just in case" to "just in time". 

Congrats! You did well by refusing to overpay and being willing to walk away.  Some people get fixating on wanting a particular house or "getting in the game" and lose their heads.  As billionaire T Boone Pickens said "if you want a deal bad enough, you will make a bad deal."  So it's good that you got one where the numbers made sense to you.