All Forum Posts by: Timothy W.

Clubs in general are good. You meet great folks and get some nice input. There's a general rule that you become the average of the 5 people you hang out with. If you find and associate yourself with 5 successful people you will pick up on things and implement them into your life.

One serious piece of advice - trust your gut! RE clubs attract BS artists who make outrageous claims of their success and status (to sell you their "educational" products). I even had one leader of a club try to tell me he condo converted the building he lived in (and that he was worth 8, 15 and/or 22 million dollars depending on who you asked). Well - cook county recorder of deeds maintains an online database of real estate transactions and it turns out he was full of crap on the condo conversion. Remember the words of Ronald Reagan - Trust but verify!

Actually the guiding license is state by state law. Check your deparment of natural resources or department of conservation for the rules. They're good folks in every state I've hunted in and appreciate landowners that help with wildlife management.

A financial advisor is very good advice. But make sure you look for one that has created his or her own independent wealth. Are your grandparents alive? For them to set up a trust fund leads me to believe one of them certainly has some financial intelligence. Perhaps they could advise you.

When I was 26 I bought my first investment property. It was a multi unit that I lived in. I lived in 1 unit and rented the rest. For a 26 year old - that's not a bad strategy at all. You already do have a property, but you could potentially rent out that home and acquire another property. Now's a good time in life to pick up a few houses that will cash flow and a ton of equity by the time you're 36.

Funny story - one of my hobbies is blacksmithing and I was transporting one of my anvils one day and stopped at a rehab. I decided to leave the anvil there (about 125 lbs) while I drove to Chicago to take care of a few days of business. When I came back, someone had stolen the anvil - but left all the copper..... Scrapping the anvil probably got them 1/10th the amount of money in scrap iron as the copper and I know for sure it's the harder thing to remove.......

Tim

East coast! Man that's a trip.... Yeah you'd have to be there to control the construction costs as well as you'd have to visit occasionally to check on the status of the property. This whole "get a management company and sit in your easy chair" approach to management is a load of crap sold by REI educators. If you're not managing the property - you're managing your management company. Why not look in Arizona outside of Phoenix and Texas? I'm sure you can find deals like that in some of the more rural parts of those two states and you'd be a heck of a lot closer.

Adam,
I'll drop you a line on the phone tomorrow. I went through this same experience the year before last - 1 year before you did. I lost every dime I made, my credit, a ton of my income. Yep I pretty much went back to nothing. I'm on my way back from nothing and I'll be back to my pre-divorce financial level in about a year or so. I'm not going to paint a rosy picture for you though - it's a pain in the a--. It's tough work. The funny thing I'm learning though is that these anchors I feel on my legs right now aren't holding me back....they're making me stronger. Stronger for the future I have in front of me. I tell you man, knowing what I know now - when I get back to my pre-divorce financial status I'm going to kick some major butt because of what I've learned.

The construction mgmt thing is a pretty good gig. I'm working on creating that here with some people I'm teaching REI to. Another thing that would be good for you there in Florida is insurance adjusting. It's a great state to be an adjuster in and the license is only about a grand for all the training. Again, we'll talk tomorrow and I'll give you what tips I can. Take care man.

Tim

(FYI - the financial side of things suck but if I can make one recommendation different subject you're now dealing with - REI clubs are a surprisingly GREAT place to meet women. :groovy: )

Because I look so friggin' sexy.

FOLKS - Pay attention here.

Take it from a former insurance adjuster - water is not always a good thing. If water damage was reported to an insurer, it could make a property very difficult to insure. Insurance companies maintain a database of claims on a property. This database operates very similar to the credit bureau. It is maintained by a company called Choicepoint and is information reported by all insurance companies. I'm not certain how to obtain a choicepoint report on a property without owning it, but it's worth a call to them to see what kind of claims were filed on the property - even by past owners.

FYI - don't ever, ever, ever mention water damage to your agent or insurer unles you know for darn sure you are filing a claim. Even the mention of it can get it reported and it will be added to the property's Choicepoint file.

Jason,
I deal in Indiana and often see numbers like that. "Potential" rent is very seductive - especially when the realtor presents it. In a market that runs these kinds of rent numbers - half a million in rennovations is a heck of a project. Are these seperate buildings where you could get one building done, get it rented, get the next building done, get it rented, etc...? See where I'm going with this? Half a million rennovation across 60 units and you could be looking at 6 months to a year vacancy waiting for this thing to get done.

Also - who did the estimate for the rennovations? A contractor? The realtor?

In this market - you as the buyer pull the strings. If this kind of rennovation is on the market at these numbers - my guess is there's something at just a little bit higher per unit cost that needs much less work and will be a cheaper per unit price in the end...... That's just a guess though.

Here's an other funny/interesting thing. If you buy these houses right - some cashflow positively on hard money loans...lol. That's very counterintuitive to what I was taught by Chicago "experts".