Post: #1

Can anyone please enlighten a newbie to the Game on the real estate business?

I will leave my 9-5 corporate and I just wanted some advice.

I know the market is down and has been for years now. I am looking for more day to day practical advice. what's the typical real estate brokers day like?

That said any advice is welcome. Thanks in advance...

Post: #2

Are you looking to sell/buy real estate for others or for yourself?

http://www.biggerpockets.com/

This is probably the best resource I've found on the net, for anything related to real estate.

http://forumserver.twoplustwo.com/30/bus...ing-99351/

A great discussion on real estate investing.

http://www.city-data.com/

Great for analyzing local markets.

Finally, know your market, know what kind of deals you want to make, have the strategy in place and network with those in your area (business clubs, chamber, REIA etc)

Post: #3

(06-25-2014 01:04 AM)ash Wrote:  Can anyone please enlighten a newbie to the Game on the real estate business?

I will leave my 9-5 corporate and I just wanted some advice.

I know the market is down and has been for years now. I am looking for more day to day practical advice. what's the typical real estate brokers day like?

That said any advice is welcome. Thanks in advance...

I have closed a few RealEstate deals in my day and i would say the following are my biggest lessons to share.

1. Starting out its not about owning , Controlling is more important.

2. OPM ...Other Peoples Money. Find and network with investors with cash. Go to the Auction at your local courthouse every month and get email adresses of the guys bidding, they have cash.

3. ABC- Always be closing , this is all about maintaining a solid pipeline of deals. If you have the good deal the money will always follow. Kind of like field of dreams . If you find the deal and control it , the INvestors will come!

4. The first deal you ever close will be the hardest one of your career.

5. Last and most important "Fake it till you make it."

In RealEstate I specialize in wholesaling. Basicly controlling property through contract and selling the contract. Its more difficult now than it was pre 2008. But there is still money to be made.

I have never held a realestate licence but i have closed deals that netted me over 150k within a week using nothing but $1,000 in earnest money and "sweat Equity". This game is not for the week of heart.

-SeaWolf

Post: #4

I´ve been working as a lawyer heavily in real estate the last 4 years.

Some advice:

1 - You are easy to cut. This means real estate agents are easily bipassed. This is actually the term they use when they cut another professional from the deal: bypassing. By cutting I mean excluded from a deal. Let´s say you find a house. You put it on market. Owner will need to pay a comission to you. After some research you also find a buyer or have another real estate agent which presents you a buyer (and normally you share comission with the buyer real estate agent).
There are many ways to make you excluded from the deal:
i) If you don´t have exclusivity how can you proove that the deal was intermediate by you. Your witnesses are the buyer and seller.
ii) If you in fact have exclusivity then to cut you off I would advise the seller and buyer to make a promissory contract and the final public deed of purchase to happen after the exclusivity and intermediation contract to end. Of course the promissory contract would never show up.

An example: You have the buyer. He visits the house with you. In the end he says. I don´t want to buy it. Next day he shows up at the doorstep of the seller.

But your worst enemy isn´t exactly the buyer or seller but in fact your colleagues. Your leads normally come from other leads which are also called a channel. One of the best channels are doormans. Deliver your business cards to doormans. That doorman will become your channel if you share your comission with him. He will bring you homes. I saw in a movie divorce lawyers also leave business cards with doormans. You must protect that channel. But to do this you must become increasingly psychotpatic. In real estate brokerage everything you say will be used against you. I´ve seen so many bypasses.

2 - Always have emails, written contacts, witnesses, etc, to back up your claim for the payment of your comission.

3- Real estate is not rational it´s emotional. The decision to buy a house is not a rational one. People will buy a house because of the garden, kitchen. Some stupid bitch will love the tiles. The house next door has different color tiles, and paying 300bucks you could replace them but she will rather pay more 10k´s and buy that one. This is not rational.
The click happens. But you have to be present when it happens. This means you need to be always available. You cannot leave for the afternoon. When she wants to make the second and third visit be there, may it be on a sunday or a holiday.

4 - Get the comission on the promissory contract. Don´t wait until the deed. The other day I was buying a house as investment. The agent was pushing me to sign a promissory contract, saying it was a better solution, etc, etc. My repply was: please indulge me and explain me how the fuck if I will pay cash without the need of credit a promissory makes sense to me. I kew she was protecting her comission.

Post: #5

(06-25-2014 11:17 AM)Pepini Wrote:  I´ve been working as a lawyer heavily in real estate the last 4 years.

Some advice:

1 - You are easy to cut. This means real estate agents are easily bipassed. This is actually the term they use when they cut another professional from the deal: bypassing. By cutting I mean excluded from a deal.

This depends on the jurisdiction. In Canada for example, at least in the province where I live, everything goes through the MLS (Multiple Listing Service) and you need to have a real estate agent list for you on MLS. You can't be a real estate agent here without being licensed etc. So, it is a lot more regulated than Europe. And situations that you mentioned don't normally occur.

Post: #6

(06-25-2014 11:17 AM)Pepini Wrote:  I´ve been working as a lawyer heavily in real estate the last 4 years.

Some advice:

1 - You are easy to cut. This means real estate agents are easily bipassed. This is actually the term they use when they cut another professional from the deal: bypassing. By cutting I mean excluded from a deal. Let´s say you find a house. You put it on market. Owner will need to pay a comission to you. After some research you also find a buyer or have another real estate agent which presents you a buyer (and normally you share comission with the buyer real estate agent).
There are many ways to make you excluded from the deal:
i) If you don´t have exclusivity how can you proove that the deal was intermediate by you. Your witnesses are the buyer and seller.
ii) If you in fact have exclusivity then to cut you off I would advise the seller and buyer to make a promissory contract and the final public deed of purchase to happen after the exclusivity and intermediation contract to end. Of course the promissory contract would never show up.

An example: You have the buyer. He visits the house with you. In the end he says. I don´t want to buy it. Next day he shows up at the doorstep of the seller.

But your worst enemy isn´t exactly the buyer or seller but in fact your colleagues. Your leads normally come from other leads which are also called a channel. One of the best channels are doormans. Deliver your business cards to doormans. That doorman will become your channel if you share your comission with him. He will bring you homes. I saw in a movie divorce lawyers also leave business cards with doormans. You must protect that channel. But to do this you must become increasingly psychotpatic. In real estate brokerage everything you say will be used against you. I´ve seen so many bypasses.

2 - Always have emails, written contacts, witnesses, etc, to back up your claim for the payment of your comission.

3- Real estate is not rational it´s emotional. The decision to buy a house is not a rational one. People will buy a house because of the garden, kitchen. Some stupid bitch will love the tiles. The house next door has different color tiles, and paying 300bucks you could replace them but she will rather pay more 10k´s and buy that one. This is not rational.
The click happens. But you have to be present when it happens. This means you need to be always available. You cannot leave for the afternoon. When she wants to make the second and third visit be there, may it be on a sunday or a holiday.

4 - Get the comission on the promissory contract. Don´t wait until the deed. The other day I was buying a house as investment. The agent was pushing me to sign a promissory contract, saying it was a better solution, etc, etc. My repply was: please indulge me and explain me how the fuck if I will pay cash without the need of credit a promissory makes sense to me. I kew she was protecting her comission.

This is good advice, ive seen Brokers/ Agents fucked on their commisions on a regular basis. Thats why the most important thing is control. Dont play this game as a broker or an agent, consider yourself an investor using OPM (other peoples money). Dont try to retail ,fuck dealing with those people, focus on wholesaling to other investors so you dont have to deal with stupid bitches but rational men. Take contract to purchase on property in pre-foreclosure. Stipulate the contract to close on or before the Auction date, give atleast $10 earnest money to make the contract legal then record it at your county courthouse. You now have an exclusive right to purchase said property until the bank owns it. Sell "interest " in contract" via an assignment of contract. Since your not selling the realestate but your interest as an investor you will never need a licence.

Focus on finding deals and networking with investors while you learn the game. You need to build a list of cash investors you will meet at the auctions .

Take contract to property 70% or less of FMV and then wholesale at 75-80% pulling the spread of what you negotiated instead of a % of sales price like brokers/Agents do.

Example: Single Family House FMV 100k, you bang on door of pre-foreclosure cut deal with owner at 70K take contract till scheduled auction day. Then market to your investor list at 80K . Netting 10k .

You can buy "pre-screened credit data" which includes phone numbers of homeowners with delinquent loans.

This business is not for the faint of heart. You must have a killer instinct and ice-water in your veigns. If you dont have these deal with the housewives picking curtains.....

-Sea Wolf

Post: #7

(06-25-2014 05:50 PM)seawolf007 Wrote:  Take contract to property 70% or less of FMV and then wholesale at 75-80% pulling the spread of what you negotiated instead of a % of sales price like brokers/Agents do.

Example: Single Family House FMV 100k, you bang on door of pre-foreclosure cut deal with owner at 70K take contract till scheduled auction day. Then market to your investor list at 80K . Netting 10k .
-Sea Wolf

Is this possible in a hot market? The market where I live is on fire right now, with a lot of overseas investors dumping money into it. The average price of a detached single family home is close to a $1 Million. Wouldn't the owner just be better off listing the property? Single family homes here sell in a week, with multiple offers and sometimes way over list price.

Post: #8

(06-25-2014 05:50 PM)seawolf007 Wrote:  contract to purchase on property in pre-foreclosure. Stipulate the contract to close on or before the Auction date, give atleast $10 earnest money to make the contract legal then record it at your county courthouse.

Did you mean 10$ or 10k? if 10$ why do the seller sign said contract?

If 10k you risk that money if you don´t find a buyer

(06-25-2014 05:50 PM)seawolf007 Wrote:  have an exclusive right to purchase said property until the bank owns it. Sell "interest " in contract" via an assignment of contract. Since your not selling the realestate but your interest as an investor you will never need a licence.

This exclusivity lasts until the auction? What´s the minimum time span between this two events.

(06-25-2014 05:50 PM)seawolf007 Wrote:  contract to property 70% or less of FMV and then wholesale at 75-80% pulling the spread of what you negotiated instead of a % of sales price like brokers/Agents do.

You don´t pay taxes in any of this. Your selling your position.

(06-25-2014 05:50 PM)seawolf007 Wrote:  Single Family House FMV 100k, you bang on door of pre-foreclosure cut deal with owner at 70K take contract till scheduled auction day. Then market to your investor list at 80K . Netting 10k .

When do you receive the 10K?

Post: #9

(06-25-2014 06:39 PM)ManAbout Wrote:  

(06-25-2014 05:50 PM)seawolf007 Wrote:  Take contract to property 70% or less of FMV and then wholesale at 75-80% pulling the spread of what you negotiated instead of a % of sales price like brokers/Agents do.

Example: Single Family House FMV 100k, you bang on door of pre-foreclosure cut deal with owner at 70K take contract till scheduled auction day. Then market to your investor list at 80K . Netting 10k .
-Sea Wolf

Is this possible in a hot market? The market where I live is on fire right now, with a lot of overseas investors dumping money into it. The average price of a detached single family home is close to a $1 Million. Wouldn't the owner just be better off listing the property? Single family homes here sell in a week, with multiple offers and sometimes way over list price.

It works best in a hot market. The MLS is for Retail buyers using financing, you want to deal with sellers who need cash or they lose it all which is why you need cash investors. You just have to work harder to find the deals . Which geographic market are you referring too? Let me guess.....Alberta?

-Seawolf

Post: #10

(06-25-2014 07:04 PM)Pepini Wrote:  

(06-25-2014 05:50 PM)seawolf007 Wrote:  contract to purchase on property in pre-foreclosure. Stipulate the contract to close on or before the Auction date, give atleast $10 earnest money to make the contract legal then record it at your county courthouse.

"Did you mean 10$ or 10k? if 10$ why do the seller sign said contract?"

I meant what i said , atleast $10 so it is legal and binding in the eyes of the law. You and the seller will negotiate from there. Ive taken control of property for $10 and made over $75k in a week...i bullshit you not!

"If 10k you risk that money if you don´t find a buyer"

True, aint nothing free in this world.

(06-25-2014 05:50 PM)seawolf007 Wrote:  have an exclusive right to purchase said property until the bank owns it. Sell "interest " in contract" via an assignment of contract. Since your not selling the realestate but your interest as an investor you will never need a licence.

This exclusivity lasts until the auction? What´s the minimum time span between this two events.

(06-25-2014 05:50 PM)seawolf007 Wrote:  contract to property 70% or less of FMV and then wholesale at 75-80% pulling the spread of what you negotiated instead of a % of sales price like brokers/Agents do.

You don´t pay taxes in any of this. Your selling your position.

Your selling a contract. "Beneficial Interest"

(06-25-2014 05:50 PM)seawolf007 Wrote:  Single Family House FMV 100k, you bang on door of pre-foreclosure cut deal with owner at 70K take contract till scheduled auction day. Then market to your investor list at 80K . Netting 10k .

When do you receive the 10K?

This is sometimes the tricky part . The short answer is before closing, on the HUD, or after (its negotiable) But i will share a lesson i learned a long time ago...."He who controls escrow , controls everything" ....you need a closing attorney you can trust! This is Key.

-Sea Wolf

Post: #11

(06-25-2014 12:08 PM)ManAbout Wrote:  

(06-25-2014 11:17 AM)Pepini Wrote:  I´ve been working as a lawyer heavily in real estate the last 4 years.

Some advice:

1 - You are easy to cut. This means real estate agents are easily bipassed. This is actually the term they use when they cut another professional from the deal: bypassing. By cutting I mean excluded from a deal.

This depends on the jurisdiction. In Canada for example, at least in the province where I live, everything goes through the MLS (Multiple Listing Service) and you need to have a real estate agent list for you on MLS. You can't be a real estate agent here without being licensed etc. So, it is a lot more regulated than Europe. And situations that you mentioned don't normally occur.

So are you saying there are no Private FSBO's in canada?

-SeaWolf

Post: #12

(06-25-2014 07:35 PM)seawolf007 Wrote:  It works best in a hot market. The MLS is for Retail buyers using financing, you want to deal with sellers who need cash or they lose it all which is why you need cash investors. You just have to work harder to find the deals . Which geographic market are you referring too? Let me guess.....Alberta?

-Seawolf

I'm in Ontario. I am just wondering how I would go about doing this if I am not an agent.

(06-25-2014 07:51 PM)seawolf007 Wrote:  So are you saying there are no Private FSBO's in canada?

-SeaWolf

Yes, there are. There is nothing stopping you from advertising your house on craigslist and trying to find buyers and conducting a private sale. However, you will have a hard time selling. Everybody here buys through an agent. I would estimate that 95% of retail transactions happen that way. Most homeowners aren't savvy enough to go the FSBO route. Almost everything goes through MLS.

Post: #13

(06-26-2014 09:17 AM)ManAbout Wrote:  

(06-25-2014 07:35 PM)seawolf007 Wrote:  It works best in a hot market. The MLS is for Retail buyers using financing, you want to deal with sellers who need cash or they lose it all which is why you need cash investors. You just have to work harder to find the deals . Which geographic market are you referring too? Let me guess.....Alberta?

-Seawolf

I'm in Ontario. I am just wondering how I would go about doing this if I am not an agent.

(06-25-2014 07:51 PM)seawolf007 Wrote:  So are you saying there are no Private FSBO's in canada?

-SeaWolf

Yes, there are. There is nothing stopping you from advertising your house on craigslist and trying to find buyers and conducting a private sale. However, you will have a hard time selling. Everybody here buys through an agent. I would estimate that 95% of retail transactions happen that way. Most homeowners aren't savvy enough to go the FSBO route. Almost everything goes through MLS.

One thing that has worked for me in the past is to cross reference MLS Data with Pre-screened credit data of 90 day late mortgages. You need to find a listing service that posts property scheduled for auction. And you need access to the MLS, you will have to pay broker fees if you do this. You can also discover the properties that ARE NOT listed in this fasion and then go bang on the door and try to cut a deal with the owner. I am interested in that market . I do other types business in Canada and have often considered the realestate there. When the market is HOT you can work on smaller margins ie. closer to fair market value on the wholesale level.

-SeaWolf

Post: #14

(06-25-2014 12:08 PM)ManAbout Wrote:  

(06-25-2014 11:17 AM)Pepini Wrote:  I´ve been working as a lawyer heavily in real estate the last 4 years.

Some advice:

1 - You are easy to cut. This means real estate agents are easily bipassed. This is actually the term they use when they cut another professional from the deal: bypassing. By cutting I mean excluded from a deal.

This depends on the jurisdiction. In Canada for example, at least in the province where I live, everything goes through the MLS (Multiple Listing Service) and you need to have a real estate agent list for you on MLS. You can't be a real estate agent here without being licensed etc. So, it is a lot more regulated than Europe. And situations that you mentioned don't normally occur.

Dont fall into realtor propaganda. I guarantee you the biggest deals in real estate happen under the table without realtors. Doesn't matter what province you are in you can do the same kind of deals. It is simply buying an option on a property and selling the option to another investor.

If you want to get involved you have to hang out with the right kind of people. Most people do not know about this side of real estate so of course they will tell you that it can't be done.

You do not want to buy a house on the MLS. You want private deals. If you buy a house under value and it is on the MLS the bank will look at it decide that is the new value of the neighborhood. So in fact your " great deal" just reset the price of the whole neighborhood lower.

Post: #15

Thanks JimmyJohns, the links are very helpful.

Thank you Seawolf 007 for the tips - although for some reason you appear banned.

Pepini, thanks for the free legal advice - it is very helpful.

More advice is always welcome.

Post: #16

I think a great first venture into real estate, especially for young guys is just buying your first home at a young age and renting rooms to friends. I did this and it worked out awesome. I bought a 3 bed 2 bat duplex, had a number of friends live with me over the years, always had one roomate at times two roomates. They basically paid all my expenses so my mortgage and utilities were paid by them every month, I could either stash my money I would have been paying for rent or double up on my mortage.

This gave me a less risky very easy venture into home ownership, real estate, etc. I wound up then renting out my house when my parents moved, to help them out rented my place and moved into theirs. Have had my place rented out for about two years now looking to buy my next rental property.