Whether we say it ourselves or hear it amongst the crowds of real estate investors, the common thread is the same. Most often we hear that there is no money available to make solid real estate investments for either ‘rehab to sell retail’ (short-term) or ‘rentals’ (long-term). Yes -the real estate market is more precarious these days and filled with uncertainty that the froth of a bubble cannot hide. This is a time to fine tune your real estate business (and investment) operations to survive in today’s economic climate. As a private/hard money lender in Charlotte, NC, I will tell you that there is money. That is not the problem.
Do you realize that during the real estate boom that at least 80% of those attending real estate investment association group meetings made all the same negative statements that we hear today?
So back to the money!
Everybody is complaining about not being able to obtain funds to make a real estate deal. Here is the thing. Have you noticed that certain real estate investors are doing deals? Yes. Miraculously they are obtaining the funds too. Want to know why? They are finding what we call ‘no-brainers’ (or a real deal) and implementing a business plan rather than winging it off the top of their head or random scribbles on note book paper. How many successful businesses truely operate like yourself? If your facing headwinds, perhaps it’s a good time to examine what those whom are having success do. Don’t gloss over the wow of some big rehab project. Look at the little things, such as organization, daily to-do’s, method of handling phone calls, marketing programs, and processes of actual implementation.
But back to the money!
It occurred to me the other day that there are many many real estate investors out there that have openned Self Directed IRA’s over the years. Many have it simply sitting in cash doing nothing. The greatest problem of the past was that the dollar amounts most had in these accounts were perhaps: $5,000, $15,000, $25,000, etc,. Back in the boom years, this amount couldn’t secure most cookie-cutter real estate transactions. However, today the real estate markets are rampant with homes selling for $12,000, $20,ooo, $30,000, etc. It is absolutely phenomenal. No we’re not just talking war zones here. I’m talking low income stable, working class, and even transitional neighborhoods too.
As of this morning, there are 89 homes (listed under $40,000) available for sale in our Charlotte, North Carolina Multiple Listing Service that Realtors use available for sale in just 6 zones of the 13 main zones that cover our city.
What do you think the odds are that out of those 89:
- 25 will pique my curiosity
- 8 will be worthy of viewing
- 4 will be on the target list to make an offer
- 1 will be bought
I know what you might be thinking… There are not homes at that price in my area, or locations that I’m comfortable in. Those houses require major renovations (let alone structural issues). What good will it do? I can’t get the money.
Now. I have got to ask you: Are you part of the 80% that watch others do it or are you going to be part of the 20% that actually do it!?!
Ok so what do we do?
Start networking with your fellow real estate investors. Let them know of your business plan. Let them know that your targeting lower priced homes with demand and that you maybe able to help them create an income stream with little chunks of cash sitting in Self Directed IRA’s that are doing absolutely nothing.
As you know, there is alot more involved than that. They idea is to provide some idea’s of how to take positive forward actions in your real estate business that maybe getting overlooked. Don’t forget life is a journey. Constantly educate yourself by networking, going to real estate meetings not to mention reading books and coarses.
The opportunities are out there. There is more than one way to do a deal. Focus on 1 or 2. Just do it!