When you dive head first into real estate investing you’ll see and experience things that you may never have expected. In this episode, Bill shares some of his personal “not so great” experiences that, although may be painful, are, nonetheless, an important part of every investors education.
Greetings fellow old dogs! And, just a point of reference here… sometimes when I refer to you as an “old dawg” I’m not speaking literally. I’m hoping you aren’t offended cause I know you aren’t really an old dawg… well, I am but it doesn’t mean you are. And it doesn’t have anything to do with age or attitude (well, I’m hoping it has a little with attitude… I’m hoping you tenacious, stubborn and dedicated to your goals and all…)
Anyway, I’m using the term “Old Dawg” endearingly or more like the name of a team — like we’re all part of a team (and we kinda are… afterall, it is called the Old Dawgs REI “Network,” It’s like say we were called “The Wolverines” kinda like the movie “Red Dawn” did you ever see that? Geat movie! Anyway, I’ve worn that to the ground… just wanted to clear that up.
Well, that’s a little primer for today’s episode.
I wanted to share a few things regarding the reality of real estate investing. Specifically, three areas… Today I’m going to talk about
As much as I’m not generally a big fan of turnkey investing, I have to admit, I faired OK in the long run. My first 4 properties were turnkey properties. I purchased:
And the properties have faired pretty well it’s just the other “operational” issues. The drawbacks were:
But, for the most part, the properties themselves faired pretty well. Now, a BIG part of the problem was me – in that I didn’t do the proper due diligence. Today, I say, do ALL the same due diligence on a turnkey property that you would do on any property, including a property inspection. I just took way too much for granted and didn’t do that. A key area I missed, for example, was checking local school ratings:
Currently, after purchasing our 100 plus property, I am seriously considering selling the two single family homes. It will be easier and more productive to focus on fewer “properties” and more doors.
Location. Location. Location. Still reigns and will continue to reign as the most important factor regarding a property purchase. Part of buying smart is buying a property in the right location.
A significant factor in purchasing the 22 unit apartment we currently have in Indianapolis was the assessment that it is clearly in the “Path of Progress.” In other words, it is in a location where new jobs, new businesses and property values are expected to increase. On one side, where downtown is located there is the East Washington Economic Development area. On the other, the town of Irvington, which is a more upscale area that’s attractive to families and more upscale businesses – Indy’s first Starbucks!
However, what is not always real clear is how long this “transformation” will take place. When I first purchased last year, the area was a C- or C area. I think it is still a C but could soon be a C+.
We are doing all we can do to help speed up the process but we really can’t control the change. Some of the positive things we have done:
But I still have had and have some issues:
Well, that’s it for today…
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