Review and Research

One of the first items on your to-do list now that you are a flipper is to FIND homes that will make a good flip. Your lunch hour is a great time to do this. You can review and research new listings from your desk on on your mobile on the go. Plan out your week. Make Monday and Tuesday your days to research your farm area for those great pickings. Review listing alerts from your agent while waiting on your serve if you eat out.  Set Wednesday as the day to contact your Realtor and text her to setup showings for the ones you like. If you have time maybe drive around your area to see what the possibilities look like. Then make Thursday and Friday your visitation days.

Visiting a Property

Did you find a property on Monday during your lunch hour that piqued your interest?  Great! So set up the appointment  to visit the property with your Realtor on Thursday. Be sure to take your Property Repair Estimate Sheet with you to weed out the weak ones. Think positive and have your Realtor bring all the necessary info to write an offer. By setting up this type of system you will be sure to get the good ones out there and avoid the slim picking for flips.

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Once again investing in real estate is ranking among the top picks for millionaire investors.

A few weeks ago. Morgan Stanley released results of an in depth survey asking numerous investing questions to over 1,004 U.S. investors. The investors age 25 to 75, with $100,000 or more in investable household financial assets overwhelmingly stated investing in real estate as their top pick for an alternate to playing the stock market. A third of those interviewed had $1 million or more in household financial assets.

This isn’t the first time we have mentioned that the rich are getting richer by flipping houses. A few weeks ago we wrote about what the rich were investing in and what their reasons are in our Real Estate Investing: In the News blog. In it, we cited an article that since the economic crisis of 2008, real estate investing has  attracted many of the super rick seeking out a safe haven. Not to mention a great way to diversify your assets.
The clear indication of all this that investors all over the world are turning to real estate. Every day there are more stories about how the Chinese are buying up Detroit or how foreign investors are buying up our distressed real estate and boosting our economic development. Here are some recent news story links that show what we are talking about:

http://www.theguardian.com/commentisfree/2014/jan/24/chinese-investment-growing-us-good

http://blogs.wsj.com/moneybeat/2014/02/27/china-demand-for-u-s-property-to-boost-investment/

A recent survey released by a NYC investment bank shows that 77% of millionaires already directly own real estate and 33% plan to directly invest more during 2014. The fact that these knowledgeable investors are moving out of stocks will continue to place pressure on the more traditional investing in stocks and bonds.

And if our advice and the surveys cited above still don’t convince you, maybe you will listen to the most successful investor we know of. Warren Buffett. In his annual letter to  Berkshire-Hathaway shareholders, the legendary investor offers his wisdom on anything from his rules for investing in stocks to the US and global economies. This year he offers what he learned through 2 investment properties. One purchase, a 400 hectare farm in Nebraska, which cost him $280,000 in 1986. The other purchase, which he made with a small group of investors a few years later, was a retail property in New York. The one similarity these two tales have is that he purchased both assets after property collapses. He goes on to list 5 tips on real estate investing from his perspective.

Click here to read the full article from the March 17th issue of Fortune Magazine

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Whether you are just getting started in investing in real estate or you are a seasoned veteran, one of the basic truths to any successful businesses is knowing how to market. It would be an understatement to say that marketing is one of the most essential tools in a real estate investor’s business plan. Let’s be honest, can you really be successful if no one knows who you are? So keeping with Part-Time REI’s goal to help educate and help REI’s one of the questions we have come across a lot is “How do I market my business?” No matter what stage you’re at in your business, you must find a way to successfully market yourself in order to gain new clients and keep your name out there in the investing market.

So first question you are probably asking yourself…how do you go about building a successful marketing campaign? This question is a broad one, and there are many answers from many different sources out there. Of course the answer will differ from investor to investor. There are a few points that will help you get a basic marketing plan together though.

1. Figure out your Budget

You can’t move forward with a marketing plan until you know how much you can afford to spend. Create an outline of a loose budget first so that you can fill in any blanks later. It doesn’t have to be exact but the point is to give you an idea of how much those Facebook ads might cost.

2. Who are you trying to Reach?

Very important question for yourself here. Who do you want to be your clients? Anyone? Everyone? Just those making over 100K a year? If it is the ladder you can be sure that your black and white paper flyers are not reaching your target market. Think about the type of client you’d most like to work with, and who would most benefit from your services and want to work with someone like you. Then figure out how to single out those people and market to them directly.

3. Find your Niche

What are you branding yourself as?Maybe you focus on first time home owners or like to rehab hundred-year-old homes. Whatever specific aspect of investing you’re best at and love doing the most can be your niche. This can be as general or as broad as you want, just figure it out and focus on that. Organic word-of-mouth marketing no doubt is the best marketing that money can’t buy!

4. Make Goals

Develop some reasonable, attainable, specific marketing goals for your business. Try to make sure they are definable, and measurable. Plan out how you will effectively reach these goals, within the constraints of your budget, giving the most time, resources and money to those goals that are most time sensitive.

5. Stay Flexible

Be sure to review your plan often and revise as necessary. Your marketing plan should continue to evolve along with your business. Your goals can change, so adapt to the changing business landscape. Some parts of the plan also will work better than others, so review and revise to accommodate what you learn as you go.

Expect a learning curve as you work out what works and what needs revision. Some of the things you try at first will fail. However, with some trial and error and by educating yourself, you will find a marketing strategy that meets your needs and takes your business to the next level.

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 Investing in Real Estate Gives You Leverage

Once you get past the notorious “first flip”  money will be easier to come by. This is one of the best things about investing in real estate; you no longer have banks on your hit list. When you get a few flips under your wings, banks will be more open to lending to you as an established investor. With your properties as leverage, you can easily loan money from the bank for both personal and non-personal use.

Additional Tax Reduction Strategy

We have talked about it before. HUGE tax advantages to investing in real estate. Having one real estate property and even more makes it  easier for you to reduce your taxes. This is due to the fact that you can use personal expenses and convert them into expenses that you can deduct to the overall revenue of your property. More so, you will be able to write off some of the expenses as daily maintenance and checking in on your property, or expenses of which you required to check on the property managers or contractors you have hired.

Save For The Future

Americans are the worst savers in the world.  Unfortunately in this day and age pension plans and 401k plans are not enough money for you and your family to live comfortably after you retire. Investing in real estate can be the alternate to a lacking retirement plan and those risky stock market games.

Investing in real estate properties right now helps you save money for the future because as long as you manage it right, your property will be profitable. In fact, your future self will definitely be thanking you right now if you decided to invest in a couple of real estate properties.

Now there are plenty of entrepreneurs that have failed at the hands of flipping houses. However, much of them did so because they invested in real estate and seemed to have forgotten to make it more of a hands-on effort of making money. While real estate investment is a passive-income, this does not mean that you should be passive as well when handling it. You have to educate yourself and make sure that you are making the right decisions.

In the process of accumulating wealth, investing in real estate is definitely a huge part of that formula. Although we are not suggesting that you will become rich overnight or become rich beyond your wildest dreams, you will have enough money to make you happy, worry-free and be financially independent. Investing in real estate will help you achieve those life goals with out taking away any of that precious time from your family or time from doing the things you love.

To learn more about Part-Time REI visit us at http://part-timerei.com/

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Harvard Education- 8-10 flips

One of the things we try to do here at Part-Time REI is to help potential house flippers understand the benefits of  flipping houses part-time.  One of the best reasons to start investing in real estate is the extra cash. Not only to do the things you love like travel, or save for your retirement, but also to help the future of your children or grandchildren.

If you ask an investor to think of college savings, they automatically think of a 529 plan. While a 529 does have its pros: Such tax-advantaged plans now house $168.5 billion of our hard-won savings, as of the end of 2012. According to Boston-based research firm FRC, that ‘s up almost 17 percent in just one year, securing the 529’s status as one of the top college savings vehicle in the nation. Also there is high appeal due to state tax breaks on those funds. They subsequently grow tax-free. These accounts also have a smaller impact on a college’s financial aid formula than other kinds of investments.

But not everyone is sold on the idea that 529s are the only way to go.  We don’t want you to have to sacrifice your retirement savings in order for your children to get a good college education. Saving for your own retirement is more important than saving for college. Your children will have more sources of money for college than you will have for your golden years but why not give them a little head start?

The sooner you start saving, the better.

So the sooner you start investing in real estate the sooner you can start putting that extra income towards a college fund. Even modest savings can pack a punch if you give them enough time to grow. Investing just $100 a month for 18 years will yield $48,000, assuming an 8% average annual return. Think about the average flip can be anywhere from 5-15K and you are well on your way. Keep in mind thought that college money today will be much cheaper than money for college in a few years.

Take a look at the chart below showing an increase of tuition just 5% each year.

(Based on average tuition and fees for 2013-2014 as reported by The College Board® and assumed to increase 5% annually.)

Makes you want to start flipping houses today doesn’t it? If you are looking to get started or are a seasoned pro looking for tips on flips, check out our Flipping Houses University. Please contact us if you have any questions or comments!

For more info on college cost visit:  http://www.savingforcollege.com/tutorial101/the_real_cost_of_higher_education.php

To learn more about Part-Time REI visit us at http://part-timerei.com/

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