fliprent

I apologize to my readers for my absence this month.  I am still struggling through this imbalance, vertigo or whatever it is.  Just as a brief update, I have not started the East Baltimore project but I hope to be able to drive again soon.  I appreciate your prayers and thoughts.

Other than this site there are lots of useful places on the net to get ideas on remodeling and rehabbing.  Forums are a great place to bounce ideas off of professionals and others in the business.   House flipping is basically remodeling on steroids, especially for rehabbers. 

One such site that I like to visit is the zillow.com forum.

The remodeling and repair category usually has useful information and some of the visitors seem to know a thing or two.

Another site that I like to visit is doityourself.com. 

This forum not only has valuable information about home projects but you can find tips on other subjects such as automobiles and purchasing land.  On the site itself you will also find lots of useful articles on different projects.  The users in the forum seem to ask good questions they usually get some really decent answers.  Heck you might even find me out there asking and answering some of them.

I still believe that this is the best time to get into the real estate investing business.  However, the strategy used in this market may be the key to your success.  I’m not so sure that all of the creative strategies taught buy the self proclaimed gurus will work in this current market.  The differences in the strategies can make or break you as an investor.  For example, if you are looking for short term investments in which you control or own the property for less than 4 months, i.e. house flipping, this market should scare you some.  No one knows where the bottom is, including the gurus and even at a 20 percent discount (in today’s market) you could still be over priced in three months.  Wholesaling (house flipping on speed) may be a safer route to take since in most cases, you only control the property for a very short time frame.  The down side is you run the risk of not finding a buyer and potentially loosing deposits or down payments.  Don’t get me wrong I am still a proponent of house flipping, however only as one car in your freight train to wealth.

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As a house flipper a lot of your profit goes into real estate agent fees.  Finding a good real agent is a huge advantage in this business for several reasons.  First you want an agent that is constantly building relationships.  These relationships should be with buyers, sellers, other agents/brokers, investors, etc.  They should be full time real estate agents and willing to work for a lower commission.  Any agent that specializes in working with real estate investors will negotiate their commission.  Many of them are offering 3 percent to investors and I’ve even come across a few that offer the same to any seller, although I doubt that the latter will last after the market rebounds. 

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August is my favorite month of the year although it can also be the hottest.  The main reason is because football season is back.  With the Summer Olympics starting on the 8th, this month will be great for sports.   My oldest son will be playing Pop Warner football this year which is also very exciting. 

On a real estate note, I plan to start on the E Baltimore project Monday.  I’ve been setting up some contractors and I will make a decision early next week.   Although I have my main contractors, I still have a few others that I use depending on the project.  This project is really a small one and shouldn’t present any surprises.  

The thing that kept me from starting this week is this dizziness that I’m still feeling.  Bloodtest and CAT scan were all normal so the doctor told me to see an ENT.   I have had this feeling one other time after a one week cruise.  It took about a week for my equilibrium to balance itself out.  No more roller coasters for me!  

The Old E Baltimore house is now officially mine.  After close to three months the sale has been finalized and now I’m ready to get going.  The house has quite a bit of work already done by the previous investor.  I’m setting a semi aggressive schedule to get this one done is 3 weeks.  I initially planned on starting today but my body is not cooperating. 

On a side note: I now know that I can no longer ride 5 different roller coasters that spin, flip, loop and jerk me around until I’m dizzy.  Who knew!

As soon as I recover from this feeling that I’m about to fall flat on my face (which has now lasted about three days), I will get going.  As usual, I will start with some before images and take more pictures as the project progresses.  Stay tuned and stay away from roller coasters! 

Windows are an area that should not be overlooked when remodeling a house.  Does your house flipping project have old rotted wood, steel or aluminum single-pane windows?  Do you live in an area in which the winters are very cold?  If so you will need to replace them with newer double-pane windows.  Modern windows are mostly made of plastic, wood and metal.  Double pane windows make a room more comfortable and cut down on the heating costs.  They also reduce noise, interior condensation and outside interference from some wireless devices.  Low E windows offer more comfort in the summer months since they contain a special coating to reduce radiant heat loss.  I also prefer double hung windows in my house flip projects.  

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I’m a firm believer in not placing all my eggs in one basket.  Diversification is not just another buzz word to me.  Investing in real estate has the added benefit of flexibility.  Buy and hold investors tend to have more freedom and for many, it’s really a side business.  House flipping can be a full time job itself, especially if you manage the projects or do the work yourself.   I believe that a strategy that involves both renting and flipping offer the fastest and most secure road to wealth for full time investors. 

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I’m on a short vacation…or am I.  Well, I’m actually looking at apartment buildings while taking a break to relax a little.  Investing in real estate does not require that you only look for properties in your home town you know.  In fact many apartment investors specifically look for the hot markets around the country for great deals.  Once you get your feet wet with single family homes, you may want to look into multi-units specifically mid sized apartment buildings.  This may require more homework at the beginning.  Searching outside of your local area may be the biggest challenge  but the returns can be much greater.  How will I manage my property from long distance you ask?  That’s the easy part, I say.  The answer is hire a property management company to manage your property.  They will probably do a better job of it than you will.  If they are handling the property correctly you may only go there once or twice a year.  Check out my article on working with property management companies to find out more. 

The property that I refer to as the Old East Baltimore project is finally moving forward.  The city ratified the sale and the settlement is scheduled.  I need to get a few items to the title company such as the Articles Of Organization,  Insurance Information, etc.  I was pleased to find out that the property insurance is only approx. $640/year and the taxes should be somewhere in the same ballpark.  

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