Comments on: The Number One Mistake that Would-be Real Estate Investors Make http://wealthboy.com/the-number-one-mistake-that-would-be-real-estate-investors-make/ A blog about personal finances, peer-to-peer lending, investing, the economy, and more. Fri, 05 Sep 2008 16:14:26 +0000 http://wordpress.org/?v=2.6.1 By: TerryT2 http://wealthboy.com/the-number-one-mistake-that-would-be-real-estate-investors-make/#comment-221 TerryT2 Thu, 08 May 2008 01:31:34 +0000 http://wealthboy.com/the-number-one-mistake-that-would-be-real-estate-investors-make/#comment-221 Good post. I would add that the number two mistake is not understanding the numbers and the four ways you actually make money investing in real estate. Number 3 is not having a clear gameplan plan to either increase income or decrease expenses. I invest and write about commercial real estate investing where the NOI (Net Operating Income) driven by "Number 3" dictates the worth of a property. Good post. I would add that the number two mistake is not understanding the numbers and the four ways you actually make money investing in real estate. Number 3 is not having a clear gameplan plan to either increase income or decrease expenses. I invest and write about commercial real estate investing where the NOI (Net Operating Income) driven by “Number 3″ dictates the worth of a property.

]]> By: TerryT2 http://wealthboy.com/the-number-one-mistake-that-would-be-real-estate-investors-make/#comment-767 TerryT2 Thu, 08 May 2008 01:31:34 +0000 http://wealthboy.com/the-number-one-mistake-that-would-be-real-estate-investors-make/#comment-767 Good post. I would add that the number two mistake is not understanding the numbers and the four ways you actually make money investing in real estate. Number 3 is not having a clear gameplan plan to either increase income or decrease expenses. I invest and write about commercial real estate investing where the NOI (Net Operating Income) driven by "Number 3" dictates the worth of a property. Good post. I would add that the number two mistake is not understanding the numbers and the four ways you actually make money investing in real estate. Number 3 is not having a clear gameplan plan to either increase income or decrease expenses. I invest and write about commercial real estate investing where the NOI (Net Operating Income) driven by “Number 3″ dictates the worth of a property.

]]> By: Chrisfs http://wealthboy.com/the-number-one-mistake-that-would-be-real-estate-investors-make/#comment-197 Chrisfs Sat, 12 Apr 2008 18:07:45 +0000 http://wealthboy.com/the-number-one-mistake-that-would-be-real-estate-investors-make/#comment-197 It seems that at this point in time, it would be easier to find undervalued real estate than in the last few years. Real Estate, especially primary residences, are different from stocks because the sellers has a much greater emotional connection with his house than with his shares of Thornburg and selling stock doesn't require you to find another place to live,not are your stock losses as exposed to the whole world. Some buyers will take advantage of the sellers time limits and lack of experience in real estate (this may have been the seller's only experience in real estate ever). I believe it's tough to look people in the eye and buy something they don't want to but are forced to sell and give them a price that's lower than what they wanted. I recently read what was recommended as a classic book on the subject which despite it's name, "Make Big Money in Real Estate Foreclosures" by Ted Thomas, explains an ethical way of going about buying pre-foreclosure real estate. Chief among his policies is that at any point before the actual sale, he assures the seller that they can back out at any time, if they get a better deal or have a way to pay the back mortgage themselves. It seems that at this point in time, it would be easier to find undervalued real estate than in the last few years. Real Estate, especially primary residences, are different from stocks because the sellers has a much greater emotional connection with his house than with his shares of Thornburg and selling stock doesn’t require you to find another place to live,not are your stock losses as exposed to the whole world. Some buyers will take advantage of the sellers time limits and lack of experience in real estate (this may have been the seller’s only experience in real estate ever).
I believe it’s tough to look people in the eye and buy something they don’t want to but are forced to sell and give them a price that’s lower than what they wanted.

I recently read what was recommended as a classic book on the subject which despite it’s name, “Make Big Money in Real Estate Foreclosures” by Ted Thomas, explains an ethical way of going about buying pre-foreclosure real estate.
Chief among his policies is that at any point before the actual sale, he assures the seller that they can back out at any time, if they get a better deal or have a way to pay the back mortgage themselves.

]]> By: Chrisfs http://wealthboy.com/the-number-one-mistake-that-would-be-real-estate-investors-make/#comment-766 Chrisfs Sat, 12 Apr 2008 18:07:45 +0000 http://wealthboy.com/the-number-one-mistake-that-would-be-real-estate-investors-make/#comment-766 It seems that at this point in time, it would be easier to find undervalued real estate than in the last few years. Real Estate, especially primary residences, are different from stocks because the sellers has a much greater emotional connection with his house than with his shares of Thornburg and selling stock doesn't require you to find another place to live,not are your stock losses as exposed to the whole world. Some buyers will take advantage of the sellers time limits and lack of experience in real estate (this may have been the seller's only experience in real estate ever). <br>I believe it's tough to look people in the eye and buy something they don't want to but are forced to sell and give them a price that's lower than what they wanted. <br><br>I recently read what was recommended as a classic book on the subject which despite it's name, "Make Big Money in Real Estate Foreclosures" by Ted Thomas, explains an ethical way of going about buying pre-foreclosure real estate. <br>Chief among his policies is that at any point before the actual sale, he assures the seller that they can back out at any time, if they get a better deal or have a way to pay the back mortgage themselves. It seems that at this point in time, it would be easier to find undervalued real estate than in the last few years. Real Estate, especially primary residences, are different from stocks because the sellers has a much greater emotional connection with his house than with his shares of Thornburg and selling stock doesn't require you to find another place to live,not are your stock losses as exposed to the whole world. Some buyers will take advantage of the sellers time limits and lack of experience in real estate (this may have been the seller's only experience in real estate ever).
I believe it's tough to look people in the eye and buy something they don't want to but are forced to sell and give them a price that's lower than what they wanted.

I recently read what was recommended as a classic book on the subject which despite it's name, “Make Big Money in Real Estate Foreclosures” by Ted Thomas, explains an ethical way of going about buying pre-foreclosure real estate.
Chief among his policies is that at any point before the actual sale, he assures the seller that they can back out at any time, if they get a better deal or have a way to pay the back mortgage themselves.

]]> By: Erik http://wealthboy.com/the-number-one-mistake-that-would-be-real-estate-investors-make/#comment-125 Erik Tue, 18 Mar 2008 14:14:55 +0000 http://wealthboy.com/the-number-one-mistake-that-would-be-real-estate-investors-make/#comment-125 Good advice. I agree that you need to "steal" a property for it to be worth while as an investment property that actually makes money. Although, paying cash doesn't hurt either. I know it sounds foreign for people to think about saving up enough money to pay cash for an investment property, but I think it can be done. Good advice. I agree that you need to “steal” a property for it to be worth while as an investment property that actually makes money. Although, paying cash doesn’t hurt either. I know it sounds foreign for people to think about saving up enough money to pay cash for an investment property, but I think it can be done.

]]> By: Erik http://wealthboy.com/the-number-one-mistake-that-would-be-real-estate-investors-make/#comment-765 Erik Tue, 18 Mar 2008 14:14:55 +0000 http://wealthboy.com/the-number-one-mistake-that-would-be-real-estate-investors-make/#comment-765 Good advice. I agree that you need to "steal" a property for it to be worth while as an investment property that actually makes money. Although, paying cash doesn't hurt either. I know it sounds foreign for people to think about saving up enough money to pay cash for an investment property, but I think it can be done. Good advice. I agree that you need to “steal” a property for it to be worth while as an investment property that actually makes money. Although, paying cash doesn't hurt either. I know it sounds foreign for people to think about saving up enough money to pay cash for an investment property, but I think it can be done.

]]> By: Anh F http://wealthboy.com/the-number-one-mistake-that-would-be-real-estate-investors-make/#comment-124 Anh F Tue, 18 Mar 2008 12:59:42 +0000 http://wealthboy.com/the-number-one-mistake-that-would-be-real-estate-investors-make/#comment-124 Jorge, I think you explained our meeting very well. Your writing is very clear and concise. Glad to help another one of my husband's friend and co-worker. By being analytical, you will not be too risky and that will keep you in the game. Good luck. Anh Jorge,
I think you explained our meeting very well. Your writing is very clear and concise. Glad to help another one of my husband’s friend and co-worker. By being analytical, you will not be too risky and that will keep you in the game.

Good luck.
Anh

]]> By: Anh F http://wealthboy.com/the-number-one-mistake-that-would-be-real-estate-investors-make/#comment-764 Anh F Tue, 18 Mar 2008 12:59:42 +0000 http://wealthboy.com/the-number-one-mistake-that-would-be-real-estate-investors-make/#comment-764 Jorge,<br>I think you explained our meeting very well. Your writing is very clear and concise. Glad to help another one of my husband's friend and co-worker. By being analytical, you will not be too risky and that will keep you in the game.<br><br>Good luck.<br>Anh Jorge,
I think you explained our meeting very well. Your writing is very clear and concise. Glad to help another one of my husband's friend and co-worker. By being analytical, you will not be too risky and that will keep you in the game.

Good luck.
Anh

]]> By: Mike-TWA http://wealthboy.com/the-number-one-mistake-that-would-be-real-estate-investors-make/#comment-121 Mike-TWA Mon, 17 Mar 2008 23:17:23 +0000 http://wealthboy.com/the-number-one-mistake-that-would-be-real-estate-investors-make/#comment-121 Wealthboy, There is no question that, in real estate, you make money when you buy. Ultimately, I tend to shoot for around costs at 80% of below of improved value. My 80% figure would include rehab/improvement costs and transaction costs. Another related mistake is to consider cashflow as rents minus the mortgage payment. New investors seem to frequently forget taxes, insurance, and maintenance costs. Good article. In response to Ian's comment, I have heard this opinion often, but it seems to apply only to real estate and not other investments. I have never understood this. A stock market buyer who purchases in a down market and who resells at a profit is never deemed to be "taking advantage" of the seller. Even in the context of sales of goods, the analogy applies. To borrow from your article, WalMart has purchased at a price below what it sells those goods. WalMart is not "taking advantage of" its buyers by doing so. To the extent that any investor, real estate or otherwise, uses deceptive or unethical means in a transaction, it's wrong. To the extent they don't, it's what we call "the market." Wealthboy,

There is no question that, in real estate, you make money when you buy. Ultimately, I tend to shoot for around costs at 80% of below of improved value. My 80% figure would include rehab/improvement costs and transaction costs. Another related mistake is to consider cashflow as rents minus the mortgage payment. New investors seem to frequently forget taxes, insurance, and maintenance costs. Good article.

In response to Ian’s comment, I have heard this opinion often, but it seems to apply only to real estate and not other investments. I have never understood this. A stock market buyer who purchases in a down market and who resells at a profit is never deemed to be “taking advantage” of the seller. Even in the context of sales of goods, the analogy applies. To borrow from your article, WalMart has purchased at a price below what it sells those goods. WalMart is not “taking advantage of” its buyers by doing so.

To the extent that any investor, real estate or otherwise, uses deceptive or unethical means in a transaction, it’s wrong. To the extent they don’t, it’s what we call “the market.”

]]> By: Mike-TWA http://wealthboy.com/the-number-one-mistake-that-would-be-real-estate-investors-make/#comment-763 Mike-TWA Mon, 17 Mar 2008 23:17:23 +0000 http://wealthboy.com/the-number-one-mistake-that-would-be-real-estate-investors-make/#comment-763 Wealthboy,<br><br>There is no question that, in real estate, you make money when you buy. Ultimately, I tend to shoot for around costs at 80% of below of improved value. My 80% figure would include rehab/improvement costs and transaction costs. Another related mistake is to consider cashflow as rents minus the mortgage payment. New investors seem to frequently forget taxes, insurance, and maintenance costs. Good article.<br><br>In response to Ian's comment, I have heard this opinion often, but it seems to apply only to real estate and not other investments. I have never understood this. A stock market buyer who purchases in a down market and who resells at a profit is never deemed to be "taking advantage" of the seller. Even in the context of sales of goods, the analogy applies. To borrow from your article, WalMart has purchased at a price below what it sells those goods. WalMart is not "taking advantage of" its buyers by doing so.<br><br>To the extent that any investor, real estate or otherwise, uses deceptive or unethical means in a transaction, it's wrong. To the extent they don't, it's what we call "the market." Wealthboy,

There is no question that, in real estate, you make money when you buy. Ultimately, I tend to shoot for around costs at 80% of below of improved value. My 80% figure would include rehab/improvement costs and transaction costs. Another related mistake is to consider cashflow as rents minus the mortgage payment. New investors seem to frequently forget taxes, insurance, and maintenance costs. Good article.

In response to Ian's comment, I have heard this opinion often, but it seems to apply only to real estate and not other investments. I have never understood this. A stock market buyer who purchases in a down market and who resells at a profit is never deemed to be “taking advantage” of the seller. Even in the context of sales of goods, the analogy applies. To borrow from your article, WalMart has purchased at a price below what it sells those goods. WalMart is not “taking advantage of” its buyers by doing so.

To the extent that any investor, real estate or otherwise, uses deceptive or unethical means in a transaction, it's wrong. To the extent they don't, it's what we call “the market.”

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