some strategies are BETTER !! FOR a given person, in a given mind set, with a given set of financial goals, etc, etc, etc, etc. PERIOD !
Each person you meet will have their own, proven “best strategy” for making pot roast, baking bread, maintaining a car. The list goes on and on.
NO one has the answers for you and your life, except you! Nothing will work in your life, with your situation, unless YOU MAKE IT WORK. There is nothing magical, no huge secrets (some great tips, though). Simply put: BUY LOW, SELL HIGH. Now, however you get to that end, is each investor’s path of life.
I, personally, LOVE rehabs ! (now everyone, don’t snicker) Many people wouldn’t touch them with a 10 foot pole ! But that is my fun, right now.
Posted by david macgown on April 09, 1999 at 21:10:05:
I am a new invester but I have done the necessary research through books and courses. I planned to invest in apartment buildings using the no money down techniques. However, because I have less than perfect credit I then decided to try rehabbing. Reading some of the how to articles from RON LeGrand,Claude Diamond,Joe Kaiser,among others has helped give me a clearer vision. THE LEASE OPTION seems to be the best way to invest in RE… especially if your just starting out. I recently read an article from the Washington Times on lease options. www.washtimes.com/homeguide/facts/205.htm
Do not lease/option is the way the article starts out. I was getting excited,because I thought I’d found my niche. Now Iam frustrated because I don’t know where to start! can somebody please give me some words of wisdom and help shed some light on the subject? David
Posted by Chris Schad on April 12, 1999 at 15:09:27:
What about the document we all sign at closing which prevents us from sub-leasing the home? My friend is sold on this Lease/Option idea. Mortgage companies are all too familiar with this concept or they wouldn’t require the “you can’t sub-lease” document. If your ever forced to litigate it could be messy.
After having worked as an account executive for a large newspaper for quite some time, I must reinforce something to you. Remember that behind those ads and articles, are regular people. People that often fall into that “25” rule (25 years old, making $25k, giving you 25 reasons why you should or shouldn’t do something).
Don’t ever let anyone’s OPINION shatter your dreams…ESPECIALLY from the media!
Never forget the difference between fact, and opinion.
>>No. 29: Do not lease/option. So many times what happens in a lease/option is that the renter learns all the little problems with the house and in the end doesn’t want to buy it. At the same time you will be, most likely, paying more than market rent and thus throwing your money away. Chances are if the owner is willing to sell you the house in the beginning, he would take an offer from you any time during the period that you occupy the house for rent.
So if you eventually may want to buy the house, rent it and make an offer at a later date. That will avoid the pitfall of possibly paying the extra $100 or so a month into an escrow account that you may lose. If the owner won’t lease to you unless you give him a lease/option agreement, it sounds as if the owner is just trying to get some extra money ($1,200 savings or $100 a month for a year on a one-year lease-option).<<
The ‘logic’ of this article is mind boggling. Don’t pay ‘extra’ rent, because ‘something’ may be wrong.
That ‘extra’ rent (assuming some rent credit) will build equity faster than if one bought the house with a loan, and will certainly build equity faster than if you rent the house.
Also, after you’ve rented for a year, do you think that the price that you will pay will be higher or lower than the price you can negotiate today? If you think it will be lower, by all means, rent.
Posted by Jim Kennedy on April 09, 1999 at 23:15:50:
David,
Let me make sure I understand why you are frustrated. Is it because, after having read the Washington Times article, you now believe that you did not make a wise decision when you chose to pursue lease/options? If that is the case, you are going to have a VERY difficult time as a real estate investor.
You will remain in a state of constant frustration if your focus can be diverted every time you encounter a different point of view. Read the posts on this news group for a couple of days and you will find that it is not the least bit uncommon for experienced real estate investors to advocate widely differing points of view about many of the topics discussed here. I have learned quite a lot by reading the debates that occasionally arise over a particular topic. What I do is read the different opinions, evaluate the value of what I read, conduct additional research on my own if I deem it necessary, and then arrive at an informed conclusion based on as much information as possible.
As for the Washington Times article, keep in mind that the author is writing to an audience composed primarily of owner occupant buyers, NOT real estate investors. The author presents some valid points but none that would deter me from utilizing lease/options as a viable strategy. In fact, some of the reasons that the author cites as justification to recommend against the use of a lease/option for an owner occupant, are precisely the reasons that the lease/option works to my benefit as an investor.
You indicated that you have done the necessary research through books and courses. GOOD!! Keep reading and learning everything you can about your chosen field. In addition to the “how to” articles, this site also offers some excellent home study materials. Personally, I think you made a very prudent decision to start with lease/options. Your thought process seemed extremely logical. (Let me suggest that you also consider wholesaling fix-r-uppers to rehabbers as another vehicle for a new investor with less than perfect credit.)
I hope this helps reinforce your decision to use lease/options for your real estate investing.
Visit this site often for Knowledge and Motivation.
Posted by dave macgown on April 09, 1999 at 23:48:22:
thank you Jim for your words of encouragement. I should learn to trust my gut more;rather than allowing
the media to missinform me and deter me from my goals.
It can get confusing at times when one guru says a strategy is better than another,and another takes an opposing view. But we are human. we won’t all share the same opinions. All we can do is follow the best investers. Walk in their footsteps and apply what you learn and what best fits your style. David
