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Hi, do any of you invest your money into property? I used to have a freind that would buy property for a low price, fix it all up, and then sell it again. I am not sure how this would work, but I would like to find out. With the money he made, my freind was able to move into one of the cities most swanky neighborhoods and even had two BMWs. It seems that this business makes lots of money. So, anyone know anything about how to do this? I have heard that some people invest in property and get wealthy off of it. How do you do this?
Wow. Where have you been for the last 5 years? Seriously, I don't mean to poke fun, but "House flipping" was the subject of about 10 different TV shows in the past few years, it's been so hot.
If you're serious... you need to buy an "undervalued" property, fix it yourself so it can be sold for a premium. It's as simple as that. Just from your question, I highly doubt you should go into this venture. The RE market does not support this kind of venture at this moment in time, unless you're VERY savvy with a lot of experience doing this.
You've got to be able to buy a house undervalued enough that after you factor in all of the costs of the rehab, you can still sell slightly below market price, so that you don't have to hold onto the property for an extended period of time. When values were increasing, it allowed for some margin of error, but if markets are declining that room for error dissappears. It can still be done, but you better be damn sure that you made your profit going in (when you purchased).
Personally, I think this is a buy and hold market now. It's a good time to have cash on hand and want to be a landlord, because the demand for rentals is increasing... at least in my local market.
Also... just out of curiosity, did your friend pay cash for those two BMW's or his/her home in a swanky neighborhood? I hope he/she didn't consider flipping to be steady income that allowed him/her to afford high payments. If so, there might be some good deals on a couple BMWs and a house in a swanky neighborhood coming up in the near future.
Hopefully your friend was smart and banked enough cash in the good times to help pay for the bad times. Like the stock market, it's easy to make money when the market is great... but not so fun when it turns south.
Also... just out of curiosity, did your friend pay cash for those two BMW's or his/her home in a swanky neighborhood? I hope he/she didn't consider flipping to be steady income that allowed him/her to afford high payments. If so, there might be some good deals on a couple BMWs and a house in a swanky neighborhood coming up in the near future.
The exact same thoughts ran through my mind as I read the original post...
I have heard that some people invest in property and get wealthy off of it. How do you do this?
People invest in everything and gain wealth. People also invest in everything and lose wealth. The difference between the winners and the losers (besides blind luck every once in a while) is market knowledge. You need to become an expert in your chosen field so that you're not another sheep blindly following the herd.
Also... just out of curiosity, did your friend pay cash for those two BMW's or his/her home in a swanky neighborhood? I hope he/she didn't consider flipping to be steady income that allowed him/her to afford high payments. If so, there might be some good deals on a couple BMWs and a house in a swanky neighborhood coming up in the near future.
Hopefully your friend was smart and banked enough cash in the good times to help pay for the bad times. Like the stock market, it's easy to make money when the market is great... but not so fun when it turns south.
Yes, the home is paid for. As well as the BMWs. He is still flipping houses as well.
This may sound a bit sarcastic, but it isn't really meant to.
Instead of asking a bunch of strangers online about flipping houses, why not just ask your friend? If he is a friend, he will give you pointers and tips that apply to your area and the present circumstances. It will be FAR better than anybody here could give you.
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