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Real Estate Business Tips – The Big Picture to the Real Estate Investing Business
April 29, 2009 · Filed Under Real Estate Business Management Tips
In this week’s edition of Real Estate Business Tips, I would like to share with you the Big Picture when determining your investment strategy.
Pretty Houses vs. Ugly Houses
1. The Pretty House Business:
- These are houses that you want to purchase by having the seller finance (be the bank) for you.
- You may also attempt to purchase the home “Subject To” where the seller stays on the mortgage, deeds you the house and you make their mortgage payment.
- You can also get an “option to purchase” contract on a property for a certain price and then look for a new buyer to purchase from you for more that what your option to purchase is for.
- Pretty houses come in all price ranges and should need less than $5,000 to be considered a pretty house. With these deals you won’t be doing major rehabs.
- Your primary exit strategy here is to get ownership or control of the property and then sell on a lease option or seller financing or cash out to an end user buyer quickly.
2. The Ugly House Business:
- These are houses that will likely require you to raise funds to purchase and fix up, and typically more than $5,000 in repair work.
- The uglier the house the better deal you should be able to get on it.
- Your focus here is to get a lot of equity when buying at a deep discount because the house is ugly.
- Your primary exit strategy here is to “flip” wholesale the property to another investor for a small profit or to manage the rehab yourself and sell to an end user buyer for a bigger payday.
Your overall plan should be to create income as quickly as possible to take care of today’s cash flow needs. Once your business is systemized enough to duplicate every month you should then focus on building wealth for the future.
If you found this information beneficial then let me know by posting your comments below!
To your Real Estate Investing Success,
Brian Evans
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Brian:
Thank you for the differences in Pretty Houses versus Ugly houses. I also reviewed the private money videos which were good tips also.
The weekly bites of information are greatly appreciated !
Elizabeth