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You Should’ve Been Listening in Creative Real Estate Class
By Tracy Caywood | July 17, 2008
I truly love to hear from our fans and followers, not only from the Rollin’ Real Estate Tour, but customers of mine from Yellow Letters Complete and Real Life Wholesaling. There are always a few out of the pack that just don’t get it. They feel compelled to send me emails and tell me how ridiculous we are and how dried up the market is. So for those of you who are mad because you had to quit real estate and get a job (and you know who you are) this message is especially for YOU!!
I don’t watch much TV, but I do know that the real estate market is in a slump, there is no denying that. But that doesn’t mean that real estate is non-existent. No matter what state the economy is in, people still need somewhere to live and the dream of homeownership never dies. our society will continue to have more children, retire, downsize, need a bigger house, relocate, and simply need a place to live. And there is only one solution to any of these situations: HOUSING.
As a creative real estate investor (a.k.a. Transaction Engineer) you have to make adjustments in your business to survive. The days of rehabbing houses and flipping them for a quick profit is a thing of the past. It just don’t work like that any more. That was when the market was “hot” and every swinging John was rushing off to a REIA meeting to learn how to “flip that house”. These days, you have to use your head more, structuring deals that require little to no bank financing. I’m not talking about new techniques. I’m talking about methods that have been around for hundreds of years - Owner Financing, Lease Options, Land Contracts, Installment Agreements, and Wrap Around Mortgages. These are and always have been some of favorite techniques for buying houses (which I teach some of them in my “Real Life” Wholesaling Training Program. They allow all parties involved to get what they want, without ever having to go to the bank to borrow money. That is a total sin in my book (borrowing money from a bank).
Even as a wholesaler, I can structure deals with the sellers, allowing for creative terms and flexibility, and then sell my contract off to another investor for a quick profit. Being able to offer investors terms like the ones we create is something that hardly anyone can offer. Too many “Creative” real estate investors in this business just don’t know how to be creative, and that’s just sad. There is more to this business than paying cash or borrowing money from lenders to buy houses.
Yes, we do still structure all cash transactions with sellers since that is sometimes the only solution. But when we do, we buy them so ridiculously cheap, that it doesn’t much matter. The deal is smoking lava hot and any savvy investor will jump on the opportunity of a 20% CAP RATE! I just spoke with a guy last night in Columbus OH (what a coincidence) that is building a portfolio of 100 rental properties right now and paying cash for every one of them. He owns 60 right now and has 40 more to go . So don’t tell me that there isn’t money to be made in the real estate business.
There is one thing that if you don’t know about me, you’ll learn right now. I’m determined to reach my goals and overcome any obstacles that get in my way, no matter what the outside world is telling me. Society does not play a factor in my success, only I do. I do not tolerate negativity from others, and I will quickly smash you out of my life if you try to rain on my parade. We’re not on this mission for anyone other than ourselves, and if you choose to follow us on our journey, then we welcome you! But please, if you have negative comments or are sitting behind a desk mad at us because we might make $3k on a deal, then type something different into your browser.
Some people love my attitude, others hate it. I’m not changing it for either one.
REAL ESTATE IS NOT DEAD
Topics: Random Thoughts |
July 17th, 2008 at 11:32 am
Very Well Said..
July 24th, 2008 at 11:20 pm
It’s one of the smallest states in the country, but Delaware has a wealth of real estate opportunities. Bronson Jewelry