Success In Real Estate
Charissa is a stay at home mom who got into real estate investing and found her own strategies. In first year generated over $2million. Join her on her latest buying tour in Atlanta.
Want to know the inside secrets of a successful real estate investor. The excerpt is from an interview with a very succesful USA investor, Charrissa Cawley, who started out with nothing and earnt $2million in her first year.Charissas success in real estate is based in one of the key principles of success in any field. Figured out a true system. Pick one way and run with in. Trying to do everything, know everything and do things too many ways is overwhelming and leads to stagnation by procrastination.
Real Estate Investment System
If you have a successful formula - embrace it and run with it. You only need to focus on a few pieces of specific key knowledge, then apply it.
Success is a series of processes and using the same system over and over again.
Charissa has developed her own 10 Step System. This is what she does on a day to day basis.
90% of property investment can be done on the Web. And interraction with other parties - use Fax / Email / Phone. This makes it a great working at home business.
Usually puts around 5-10 hours per deal.
Develop An Investment Team
Getting together a team of professionals in remote areas means you can confidently buy deals sight unseen - the team becomes your eyes and ears in each market, and you just run the numbers and make the deals.
It's much beetter to have a piece of a very large pie, that an entire small pie. And much more fun. You team very much becomes your social contact, as many property investors work a long day.
Once you have your system in place - use an action board to mark items off. This keeps the discipline in the process.
Tempted not to use a team - be cautioned - you just cant do it all by yourself. You will not make it on your own.
And besides, you make a lot more money using a team. So free up your life to do the things you want and pay for services that can best be done by others.
Property Management only costs 8 -10% per month - and they manage all the property and tenant related tasks such as letting, rehab, repair, and inspection. The good ones have their own contact list of trades people with whom they know they get a good job and a good deal. That's peope leverage. Get one good manager and they bring a whole team with them.
Other members of your team include:
You may have to go through 3 contractors to find the best. But it's worth it. The key is to find people with integrity. And that often means the less experienced.
Multiply Your Markets
With all the above at your fingertips you can operate in any market you like - and that means any country. You can expect to take a good six months to really get to know a new market and set up your team, but once you have them, it can all be run from your home.
As a guide, Clarissa is currently working in 10 markets and is buying and selling everyday. She has around 45-50 properties at any time.
Once you have researched your market and set up your team - then buy 10-20 properties. Following that, you will find the team seeks out deals that fit your profile and come to you.
Online Property Investment Resources
General Real Estate Investment Information
37 government agencies sell real estate - youdon't have to pay $100 a month to get deals.
These following have listings in each state
Value of Home
Get the real estate agent to do quarter mile comps [can do up to 2 miles but banks use ¼-1/2 mile] of all sales 6 month old or less.
Putting Deals Together
Putting deals together needs money. If you have sufficient funds you can get good deals from normal Commercial lending - banks, mortgage broker etc. Banks usually require 10% or at least closing cost.
If you are just starting out, then Hard money is a good option. Most will make you put down $5k the first time, but after your first deal, most hard money lenders will give you 500K line of credit.
No money down deal - is not really putting no money into the deal, it just means no money is changing hands.
You may be paying higher interest with Hard Money Lenders, but it's not about the cost of the money its more about availability of the money. Try
Once you have done a few deals using hard money, you will have a good credit score, and will get much better rates from bank.
Analysing The Deal
Numbers do not lie in real estate investment. They are the only constant in RE investing. The key numbers are:
CAP = NOI / Total Cash Invested
Use Rent Per month. Annualise by 12. If don't know the net yet, but use ballpark - use 65% [includes 7.5% vacancy factor and 7.5% rehab factor]
Use Cap Rates 15 and over as absolute investments
Cap rates of 10 - 15 are good deals.
Leverage all deals 10:1
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