I discovered BiggerPockets April 3, 2014, and I was totally amazed at how much real estate information was available. I started with the free version, uploaded my information, but quickly realized the value and upgraded to the pro version. It has been a bumpy ride since I’ve been removed from the forum post several times for minor violations of their policy. I have hopefully learned what not to say or ask and this will not happen in the future.
I noticed that there were many young investors, in my local area, that were looking for answers about how to invest in real estate. This was an opportunity for me, a 40+ year veteran, to answer some of those questions. I will be turning 65 next year and retired when I was 48 from my 9 to 5 job all due to my real estate investing.
What started out with a request to meet and have a cup of coffee with an investor blossomed into me meeting over 300 local BiggerPockets members. The majorities meet me at my local Starbucks and pick my brain for about an hour. The topics range from I have never done anything in real estate, to take a look at this flip that I’m doing and give me your thoughts.
I meet with investors from 18 to 65+, from beginners to experts, all of whom are searching for their real estate niche. This all begins with a cup of coffee which is really a test. I have actually had 98% of these investors buy me a cup of coffee. This tells me a lot about their character, their willingness to learn something, and know that life is not free. However, this is all that I require for one hour or more of my time. My focus is to “give back” to my real estate community that has treated me so well for these past 40+ years.
So who are the people that I meet with? I met with an 18-year-old young man about a year ago who was interested in getting started in real estate. We met for the initial hour at Starbucks and talked about what he wanted to accomplish. Like many investors from BiggerPockets I hear the same things over and over again. They are, “I would like to buy a multi-family unit or I would like to house hack.” In reality, living in California, it is very difficult to buy a multi-family and not much better house hacking. California has always been a state that has its booms and busts. It is always best to make your investment purchases when the real estate market busts. Get your hands on as many “buy and holds” as you can and basically hold onto them for the rest of your life. When the cash flow turns negative, in California, and the numbers don’t pencil out it’s time to start flipping properties. Making quick profits going in and out of properties is the best strategy right now in California.
This 18-year-old young man decided to begin his real estate career by educating himself and getting a real estate license. Now licensed at 19 he’s learning how to flip properties. He’s learning how to evaluate properties, establish how to determine the ARV “after repair value,” doing a cost analysis on the rehab, and then determining how much his profit will be at the end of the day. Flipping is just a numbers game and once you have the formula down it’s just a matter of putting your team together. I like to duplicate this process as much as I can down to the same paint and flooring on each of my flips. He is currently the project manager of one of my flips and is doing a great job. Once the confidence is there it’s “off to the races” for him.
I have another young lady who is a very successful full time Realtor that wanted to stop representing buyers and wanted to learn how to flip and make money for herself. She caught on very quickly and soon had her financing in place. She decided to do a joint venture with a money partner who is supplying the money and she is supplying the expertise. She purchased her first flip and closed escrow last month on a small condo in senior community. The purchase price was around $220,000 (Yes we are in California still), rehab is around $70,000 and the ARV will be around $405,000. The profit potential on this deal is around $100,000. This is a fully permitted project and lots of hoops to jump through by the HOA and city. She told me the other day that “its lots of work, but I love every minute of it.”
