So, what’s your target house size and sales price for your flip project?This is the destination you should formulate from your first review of the property, even before you commit to the project. What to buy, what to avoid – this is how it works – and how it doesn’t!   How do you determine the direction for your project size and eventual asking / closing price?   In a nutshell – focus on the average local market price and size of a finished move-in-ready house, in the market today. Build an addition onto your flip project only to the Read more…

You need to know that that no matter how sexy flipping for hefty profits sounds to the new investor, at the core it is a grinder’s game. The flipper who is not actively working the market and rehabbing a project is not earning anything. The flipper is far more exposed to unexpected events, from sudden market downturns to unanticipated problems with a project.   By contrast, a landlord has abundant quiet time to walk to the mailbox to pick up checks (figuratively speaking), for as long as she or he wishes to keep and maintain the property.So long as the Read more…

A discussion of capital gains and passive income may sound as exciting as drying paint, but this is one of the most important areas of real estate investing to understand. It’s so important I’m devoting these next two blog posts to it. I’ll do what I can to make it clear, and even interesting! A quick start-at-the-beginning to be sure no one is left behind – skip this section if you already know these definitions: Capital gains are the profits on the sale of an investment such as real estate, including property flips. The profit is the price at which Read more…

This blog post title might sound like a discussion an older responsible relative wants to have with you about what a gamble house flipping is – a relative that knows nothing about flipping! Professional flipping is NOT gambling – if it seems so to you, either you have more to learn, or else flipping is not the right investment strategy for you. My definition of “amateur flipping” – aka “gambling”, as I see it – is buying a property in a rising local market in hopes the property will go up in price to sell for a profit, regardless of Read more…

No one ever enters into a business partnership thinking “this isn’t going to work!” (OK, almost never.) Of course, all parties beginning a partnership believe in sunshine, daisies, and a beautiful waterfall of profits flowing in at just the best timing. What could possibly go wrong?   Savvy investors know only too well there is an endless list of grim possibilities that destroy harmonious relationships, problems no one believes will happen– but sometimes they do. Disagreements over the terms, or over project decisions, or even a clash of personalities may finally come to a head.   In addition, sometimes only Read more…

What makes interest rates such a key factor in the real estate investing market?  How do interest rates signal investors about opportunities in today’s market?   Mortgage interest makes up a significant part of a home buyer’s monthly payment.  Lower interest rates mean lower payments, and that makes a higher-value home more affordable to a buyer.  Without any change in the sales price, an interest rate movement of fractions of a point can mean a buyer does or doesn’t qualify for a loan, based on the monthly payment.   When interest rates are as low as they are today, real Read more…

The fun of real estate, for me, is being out in the field, getting dust on my shoes, tramping along driveways, and prowling through distressed properties. I like being with the sub-contractors in a hot, grimy building, surrounded by old, shattered cabinets and stacks of new floor covering. But as much as I relish a passion for this business, keeping notes of every great idea, organizing mountains of documents, and getting necessary photos to the right people – these could be overwhelming without a great online tool that handles and organizes everything: Evernote and Evernote Business.   Evernote is an Read more…

Great real estate investing partnerships combine the expertise and skills needed from the partners, along with the financial backing and the leadership to find projects and get them done – profitably.  The best partners share values of integrity and commitment, people you can rely on.  What are the top 3 ways to build great real estate partnerships?   Make sure your partners include expertise in all the skills you intend for partners to contribute.  Don’t ever take on a partner (give up equity) that you could instead hire. One of the best partnerships is one where someone with money and Read more…

I’ve chosen “How to Build a Real Estate Empire” by Marcel Arsenault, John Hamilton, Ben Leeds and Gerald Marcil to include in my essential reading list because it is grounded in practical, real-world advice, from 4 men who did everything in real estate investing that they write about. Arsenault, et al, write from their own personal experience, and includes their own stories of building real estate portfolios to values of hundreds of millions of dollars. All describe the pitfalls and triumphs, and the methods and strategies for achieving enormous success in real estate.   The book is not written for Read more…

What a stroke of good fortune to find ourselves in a unique moment in financial history to take advantage of profit opportunities which are rarely as strong as they are right now!  Are you waiting on certain economic signals to step into real estate investing?  Here are 3 compelling signs that NOW is the time to get in!   Low interest rates are bringing buyers into the market now.  Interest rates are one of the most powerful forces in any housing market.  Because mortgage payment amounts are partly determined by interest rates, low or high rates make a home more Read more…