Thread: real estate
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Old 02-04-2009, 09:18 AM
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diosdude diosdude is offline
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Default Re: real estate

I don't think the original poster was thinking about real estate commision sales, i think he was asking about real estate investing. If you have no background in real estate, i'd encourage you to sit on the sidelines for at least a year before dipping into it. The economy as a whole got into trouble from unregulated banks buying mortgage backed securities that boomed in the sub-prime market. Since the crash of that market there has been a glut of foreclosed homes, unfinished construction and unsold houses on the market. Real estate hasn't bottomed out and no one knows when it actually will, some are saying as early as 3rd q 2009, but i have my doubts. The flippers who made serious money in the early part of the decade who got caught holding onto property when the bottom fell out got severely burned. Guys who made millions lost millions. That being said, here in the US the need for housing grows by about 3.5 million homes per anum due to increasing population and immigration so eventually, that surplus will get bought. Now the boom , i would say shifts to RENTALS. Property management. Those people who own residential real estate and can't move it on the open market are desperate to get it to make any money possible to cover their mortgages and their taxes. A good property manager can make 15% monthly commission off of rental income if s/he can maintain occupancy. Another gold mine is foreclosures, specifically, the bottom end of the foreclosure market, the condemned homes. Banks are desperate to get these dogs off of their books to avoid property taxes and if it's in a depressed area, like Detroit, for example, youcan get them for pennies on the dollar. The downside is that they must, by law, be brought up to code and most need major repair in the neighborhood of $10-30k, but after the sweat equity is built up, you have a viable home to put on the market. How cheap are these homes? Potentially giveaway price, i'm talking like $1000. So a good scenario would be to research the foreclosures in your area, buy one for say $5000, spend $30000 fixing it up and getting it up to code, occupy it as your residence paying off that 35k mortgage for say less than $300/ month (way cheaper than any rent anywhere) and list it for 60-70k. If it sells this year, BAM, you just made 30 grand. Go get another one and do it all over again. That's how many flippers operated but they bought/sold more upscale homes. Those "get rich" seminars really work, but you don't have to buy the $500 "program" at the end, they're just selling knowledge that is easily obtainable. There's a ton of good books on the subject down at your local library or Amazon. Here's a great one to start out:

http://www.amazon.com/Building-Wealt...3731681&sr=8-1
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