All Forum Posts by: Edward Briley

"Nitty gritty: You will probably need to get it from credit card to checking account and then wire the funds to title from there."

The problem doing it that way is that I have to take a cash advance, which throws a wrench in the deal.  Cash advances are handled different than purchases on credit cards.  I know in larger cities purchasing a property with a credit card is not that big of a deal for real estate companies. I have went to a car lot and purchased a car with a credit card before, really for more money than what I will pay for this, and only had to pay the credit card interest.  I have paid contractors more than this for flipping houses in the past. 

The owner of the property owns it outright, other than it is in a family trust, which is not my problem. I will give a check for the EMD.

 I re-read what you said, printing out my credit card balance is not a problem.   The only problem I have is that, is the agent going to know how to process, or is able to process the payment?  I guess I will not know until I try? 

Don't need a line of home equality credit.   I don't want to put up any of my owned real estate.  Why should I?  Matter of fact, why should I use my cash? 

I have an opportunity to buy a piece of commercial real estate in the downtown area of a small town.  Now I may be able to get a loan on the property, or other ways to buy the property, however, both of them will require closing cost.  By using a credit card I can provide a fast closing and actually save money on the property. 

I have enough credit on a single credit card to buy the property.  I also have enough credit to flip the property and make a profit on it, rather I decide to mortgage it or not it, lease it at a later date, or both.  Or maybe sell it for the right price.

The question I have for the forum is that the property is in a small town, and I am not sure the real estate agent that is handling the property will know how to do this?  Matter of fact I am pretty much positive of that.   How do I get the agent (in which I have not tried) to accept my credit card offer on the property? Has anyone done this? 

The way I look at it is that I can flip the property within 60 days, and save the closing cost on the property, and will most likely have it leased within 90 days, and a mortgage within 180 days on the property if I decide to keep it. Total mortgage on the property I estimate will be $100,000 with a PITI of $800 +/- after it is flipped. Total leased income on the property will be $2000 or more per month, plus another small additional income the property offers ($100 to $200 per month).

My wife and I have thought about buying a vacation home or homes in places throughout the US.  Now we are not people with a lot of money, and the dead end has been property taxes on the homes.  We own a timeshare in which has been a very good investment for us, mainly again due to property taxes.  Now we may have an advantage that most investors do not have due to our knowledge of flipping homes.  We know how to do them very cheaply and to local building codes.  Again our problem with buying vacation properties is real estate taxes.  Places we would like to buy a vacation home in local real estate taxes are 1500 to 5000 dollars a year.   Back again to the time share option.  Now many of you are going to tell me to rent it when we are not using it.   I do not want to be a landlord, and the upkeep of the properties with tenants occupying them is not an option.  The real shame is that there are properties that can be obtained very cheaply, but the property taxes do not make them worth buying. 

If it was possible to buy vacation properties with zero property taxes, I would own many of them.   People I am  telling you that the real estate market would really boom, if local real estate taxes were less than 500 dollars a year.  Now a friend of mine gave me a suggestion, but I am not sure that is something I would not want to get involved in. He suggested that we buy 2 properties side by side, rent one of them for the cost of the real estate taxes that cover both properties, and have the tenants of the single home to mow the grass and do the upkeep of the other.   This would work, but again, I don't want the hassle of the tenants, with them knowing that my vacation home is vacant more than occupied. 

I also want to tell you that last year I flipped a beautiful property I paid less than 25,000 for, and sold it for $85,000.  Not much profit in that property, but the problem was finding someone getting the financing for the property.  The shame in that is that they could qualify for just the mortgage, but after adding another 150 a month for real estate taxes, and another 75 a month for insurance they could not qualify.  I can see a further decline in home ownership because of these.  I can tell you now all, that the problem with real estate sales is mainly because of local real estate taxes being so high, and there is no escape from these.  So, for now, until things change, the only option for  vacation homes for most people like me are timeshares.   In closing just to let you all know that I found a perfect place to use is a vacation home. The home on the property is 1500 Sqft, and is on 9.6 acres of land, with a canal that has direct access to the Atlantic ocean.  Well, septic, included and even able to get cable television and high speed internet.  Cost of the property is $47,000. Problem, property taxes are about 5,000 per year.  Splitting up the property or leasing part of it is not an option in this case. 

Any suggestions? 

 Well seeing how I have been deemed wrong by a moderator at "Bigger Pockets" I have decided to leave Bigger Pockets.  I am someone that is very opinionated I know, however, I like discussion rather than being bashed at every turn.   I am an investor in real estate among other things.  I have made money in real estate and I guess it is time I no longer declare myself is in investor in real estate.   (At least in Bigger Pockets terms).  I am going peacefully, and I appreciate the discussions and the information I have gained from here in the past.   I hope I have provided some information and advice they can use in the future.  

 Wow, we truly have some disagreement here.  First of all my wife and I sold a home in Richmond that was valued at over $400,000 in 2007.  We sold the property for $165,000 in 2009.  There were some 40 homes in the area for sale in that area at the time for a little over $200,000, so to afford mothers nursing home, we had to sell it cheaply to pay for her stay.  

Now, about interest rates.   Let me shed some light on this.  In 1985 I bought my first home, I paid a 13.5% interest rate on the loan to get the house.  That was the rate.   I sold the home on an assumption 3 years later for a profit.  Interest rates did not hurt home values.   Now, today, I can see an increase helping the real estate market rather than hurting it.   The reason is because of assumptions and savings.  I believe, that an interest bump of just a half percent will persuade renters to buy now, or suffer later.   The higher the interest rates go, the more people will be selling their homes through assumptions as well, to buy bigger and better properties.  Just a little more.  

In 1985 that first home I bought was a 2 bedroom 1 bath 1500sqft home, I paid $52,000 for.  Today it remains the same, and now is valued at more than $220,000.  Somehow that home was shielded from the highs and lows of interest rates, a housing bubble, a hurting economy etc...  The value continues to increase, and I for one cannot figure out why?  Many houses near it have been though foreclosures etc...  It is not in the best school district, and within a few blocks from it, is a very high crime area, yet the house continues to rise in value.   The longest it ever sat on the market was a little less than 60 days, according to the neighbors I know there.  It has had 4 owners since I sold it.  The house was built in 1935 and has a slate roof aluminum siding and oil heat - making it nothing really special.  Sometime in the late 1990's an owner did put in in-ground pool in the backyard.  - Maybe that is why?  I am sure if it was placed on the market today, it would sell for more than $250,000.  

 I can agree with you, like some have stated.  Real estate (like anything else) is only worth what someone will pay. 

 Basically my real estate tax is only a little more than $2500 this year.  Next year I am sure it will increase again.  Seeing how the insurance companies have a relationship with God on Hurricanes that my home owners insurance seems to be high.  I don't need or have flood insurance even though I am within a block of the harbor here.  However, at the same time my home will not likely sell for what the city has it assessed for.  I know this is going on in most areas. The city did reduce the assessment of housing here a few years back, but now it is back to full steam ahead.  Matter of fact they increased the tax rate to make up for the assessment loss.  Some saved, while others got the short end of the stick.   We also have something that is called the Chesapeake Bay Foundation here as well.  Along with my 100 dollar water bill every two months, I also get a separate bill for sewage that is around 25 to 35 dollars.  This is due to the cleaning the sewage twice.   The city keeps raising the taxes, and the citizens get nothing in return.  Only the high city officials get the raises. 

Now I will also tell you that the area I am in, is about the same is J. Scotts'.  We did not really get hit hard by the down turn in real estate.  The reason is because of Government influence, and Government salaries.  However, decreasing the size of the Armed forces has made a difference here already, and will continue to do so.  In no way I am saying that it has hurt home prices or home sales, matter of fact this summer was good for realtors.   I can say this:  The flippers are still making some money, but not like before, I am sure.  What the banks want are getting higher by the day, while the condition of the properties are getting much worst. 

Now I am someone that looks around the east coast nearly everyday looking for deals,  few are to be found now.  Sure you can pick up a home that should be appraised for 250 thousand, but when you look at the sales data in that area, you will see the comparable's are selling for much less.   Matter of fact the biggest problems here real estate agents have faced is that the bank agrees to a short sale, and the appraiser, appraises the home for full price.   It is either that, or houses that should be appraised for much more are appraised for less than they should be.   

I agree with J. Scott on the selling of homes in the last few years as well.  The thing is, that home sales are up, but not really.   Many homes are being sold for less money than should be.  Matter of fact you can pick up an existing home for a whole lot less than a new home.  It would cost twice is much to build the home than what an existing home is selling for. And that is at full price.  

I have bought a home that was built in 1979 that is over 2200 sqft, with a two car attached garage on an acre of land.   In the same area it would cost $338,000 to build the house today.  I paid well under $100,000 for it.  The house will be in brand new condition when I finish with it, and I still will be well under $100,000 for the house and the land.   I am flipping it and moving in, and putting my home up for rent.  I can assure you this, that it will be much easier to rent my home than sell it in this market, even though the rent will be higher than the payment.  I see this everyday here.  It does not make sense to me, but that is the way it is.  People with high credit scores are renting rather than buying.  Did the housing market crash scare them that bad?

Just to let you know, I saw a house sell here on waterfront for $179,000, and that included an attached garage and a 3 car detached garage in one of the better school districts.  The home was built in 1983 and is 1800sqft.  You also were able to put in a boat dock across the street on the land that was with the home.  And that property did not require flood insurance either.   I don't know what the new owner is going to do with the property, but I believe I will see it for rent soon.  Here, about $20,000 is about all you can plan to make on a flip at present.  I am seeing houses sitting on the market for years now in the 5 to 6 hundred thousand dollar and above price ranges. I believe in my area homes that are selling between 150 to 200 thousand mark is the sweet spot. - However, it had better be a show place to sell for that, because the city is funding developers to build new houses in that price range.  And just to let J. Scott know, they are doing the same in Baltimore and many other cities as well.  I would not be surprised if Chicago is doing the same? 

So the bottom line of what I am seeing, that yes homes are selling ok.  However, I cannot see this continuing.   How can anyone compete with subsidized housing, especially when their taxes are paying the bill for them?  How long will be people pay their mortgage on these homes, and how long will it be before you see them on the foreclosure list?  Yes the housing market is doomed and will continue to be that way until the Government gets their hands out of it.