Posted by Preston Richard on Saturday, January 22, 2022 at 1:29 PM By Preston Richard / January 22, 2022 Comment
Anything but Bland- Skull Creek
Bland (and his son?!) take us out on the waters of Skull Creek, one of the places typical of what makes Hilton Head so unique. -- This is Anything but Bland. Each week, venerated island local Bland Kiser takes us to see the many wonders the island has to offer, in the form of its people and places, past and present. -- New episodes every Friday at 4 EST.
Here's a housing hack to get you money for your next investment property. You and I both know that's not how it works. They have dollar signs in their eyes and they want it to be easy. So as a real estate coach, this is terrible advice.
Alright so John and Preston want us to watch TikTok videos because that's the most productive thing apparently we could be doing today. Yeah. And give opinions. You told them I'm on vacation right? I know. Yeah. And this isn't a vacation for you? Watching TikTok videos. Yeah. It's not a vacation. No? No. They're making us watch these videos and then we have to give our opinion on them.
On the videos not John and Preston. Here's a housing hack to get you money for your next investment property. If you buy a fixer upper, renovate it, put in a new kitchen, new bathrooms, maybe upgrade the appliances. Go to the bank and get it reaffraised with all the new improvements and then now your home is worth much more in the bank size which means you've built equity.
How much you want to do is pull out that equity and use it as a down payment for your next investment property. Keep that cycle going and then you'll be rich before you know it. Is this going to sound really bad? You know my first impression was? Has she ever done this? I don't know. Because you and I both know that's not how it works.
Well I mean It's fine when the market's going bananas like it is now right? Yeah but no point. No bank goes okay so what appliances did you put in and now I'm going to get. Oh you're talking about the appraisal part? Yes. Yeah. So the first part I was like well you know your house went up in value regardless of what the bank is.
Exactly. What the bank says or what appliances you put it in. Yeah. But her approach is you do it to refinance and pull out all your equity to buy another property. Yeah but I'm just waiting for the person that might watch this video who might be twenty-five like her and and does it and goes to their bank and their bank's like that's not how it works.
Yeah. It's not about what appliances you put. It's about what improvements you do and what you've done to like literally you gotta give a list of here's the contractors. Here's the stuff we've did. Here's the flooring we've done. Two or three appliances that going to get you. You know she does. She doesn't talk about so so you go and you refinance right? And so your loan is bigger.
Yeah. So your payment is bigger. Yeah. Like and then who pays that? I I assume is making an assumption that you're going to rent it out or something like that and it's going to cover the cost of your payment but if you go and you take that cash to buy another one and get another loan, now you have a bigger loan on the first property, you have a loan on the second property, somebody's gotta pay those.
Yup. And that's what happened with the big crash before. It's like somebody had to pay for em and everybody was so uber leveraged that as soon as they stopped pulling equity out of their properties because prices weren't going up anymore. The music's in the market crack. She says, now you're rich at the end and that's not what wealth looks like at all clients.
Here's why you don't need to go to fancy networking or social events to meet clients. Your goal is likely to meet local clientele. So, go to places like breakfast spots in the morning early though like 78. These types of places often have regulars who come every single morning. So, if you come every single morning, you'll be able to meet them and possibly make a connection.
Obviously, right now, it's a little bit difficult to talk to people and so online is another great source. Use the following or contact list that you already have in your phone to look through and make those connections. The third tip is to walk around your neighborhood. You need to be known as the realtor of your areas. So if you see the same people over and over again, you can also make a connection there.
So as a real estate coach, this is terrible advice. The people on our team that crush it. Their objective isn't to make connections. Their objective is to serve. Like this just sounds I'm going to go out there and I'm going to do what's going to help me. Mm hmm. And the people that I know that are Uber success successful in this business are the ones that go out there and they're not trying to make a connection in terms of I want to find somebody that's ready to sell their house, they're out there looking to serve.
I love that advice and I think that if you're going to take her her tips and make them work, it would be this no different than saying go play your guitar on the corner and spin a sign that says want to talk about real estate. The the real issue is this is all about contact and not about relationship. Quantity versus quality. Liability with none of your own money.
Seller financing. Owner financing. Vender take Follow this guy to learn how.
I mean it's clever. He's definitely is entertaining. Yeah definitely entertaining.
You going to say it or should I say it? Who's going to do seller financing in this world? Who's going to. Like it's so competitive. What vendor take backs do you see in this world? The equity is going up. People have room. They're going to sell it before a vendor's going to take it back. Yeah. Uh owner financing they'd be like why would I ever now you and I see special projects and development deals if you're going to have an owner take back or I mean owner financing or carryback but not in regular purchasing not an investment property.
I feel like you read a blog and well isn't that don't you feel like you're watching an infomercial? Yeah. Like it here's what I know and if not much but if it's super simple and super easy and it's a hack it's probably bull you know what right like don't say that on the show bull **** **** **** **** right you know I say it a lot because you saw the video the other night with all the bleeps **** **** yes it's a new word yes it's here but like why are we always looking for a hack why are we always looking for the easy way trying to hack the system why don't you save money and buy a house I'm really looking to what she's going to say with that expression.
She's not saying much.
Walking to the moon.
Is this a joke? They'd be having us. Alright, next video.
How long did it take you to close your first real estate deal? Years. I mean like seriously. Deal. Still working on it 30 days. Don't worry about your license. I actually have them lined up before I got my license explosed the days after. Cool. License. Three months. Got your license. Two months. One thousand 440 hours. No I'm sorry. How long did it take you to close your first so first couple of people you you gotta wonder why are they still there I I learned the fact that it says hustle behind her I I actually love the guy that that was in the ball cap in the T shirt who said I lined them up before I was licensed was ready to go to me is somebody's getting into the business and they're they're joining a team like yours and there's a great training program a level of expectation there's no reason why they shouldn't have their first deal lined up within two months the one thing that I think is a little bit different of our market is it's a transient market so a lot of the deals that you you know somebody to lead on my team today, those people might might not come to town for a month or two, right? Right? And so, we look at it like, if we don't have a first deal in six months, we need to start talking.
There's there's something going on. You should be able to close a deal in six months. If the stars align, I think you can do it in two or three. Okay. Most of the buyers that we're working with, when we first make contact, they're not here yet. I could probably see that to be true especially when it's summertime and it's harder to get in the properties here and.
Yup. They're being rented out but when it's the peak of the market you know there's there's not a lot of rentals happening it seems like you should be able to well except for the fact that we'll get a call that goes like this hey you know I'm thinking about buying something in Hilton Head we're coming in February got it and now it's December yeah right so you gotta wait for them to get here and then start the process now you can do you know a lot of work before they get here but you know depending on how many times they visited the island you might be spending your entire first day with them showing them the area and not really showing Alright.
Yeah. Still years? Really? Yeah. Years? Oh my god. What in the how how could somebody do this? This just doesn't oh that makes sense. Oh they're making fun of Rocket Mortgage. Oh my god. What in the how? Yeah so I could definitely see that coming from an online lender. Yeah right. Happens all the time. And despite us being like hey listen you know we don't have really good experience with these type of situations.
You're better to work with a lender. We have nuances in our market like flood insurance and gated communities and having a local lender that understands the marketplace is going to put you in a huge advantage. This usually shouldn't happen, right? This there should be plenty of clues well earlier than this that are like, you know, prior to docs conditions prior to and your, if your lender is going dark before this stuff is happening, it's typically not going to happen three days before closing, you're going to know a lot on, they're not getting it done because they're not even able to get docs.
So, the the biggest thing that I want to say about this is to me, when this happens, this is a confidence issue on the part of the real estate agent. In my experience, right? You gotta be able to look somebody square in the eyes and say, do not do this. You're going to waste both of our time. You mean to the buyer earlier on.
Yes. The lenders. Like, like, listen, like, you can't, you can't use them. Let me tell you the ten things that have happened in the last year all related to this situation, right? Like and and I know you think it's going to be different from you like that Rocket Mortgage really cares about you. Mm hmm. But experience tells me this and then bringing it together so that they can understand what the pain will be.
Mm hmm. Okay, if you want to lose your $50, 000 earnest money. Yeah. Because it happens in the 11th hour after the financing contingencies up, have at it. Say they chose a lender, the local lender and an agent lacks confidence when they won't confront the lender and say, where are we at? This is where you should be and they're they're they're not wanting confrontation so they just **** and moan about the lack of any response from the lender during the process and then this kind of thing happens at the 11th hour.
Real estate by click. You have 25K saved and thinking about investing in real estate? Here's how. First, you can passively earn anywhere from 8 to 15% on that money if you invest with someone like myself or a local market expert that can walk you through the process and then you earn a rate of return that money by learning how to fix and flip or do the birth strategy.
Because home prices are rising, I advise, set up a joint venture with someone that's experienced that knows how to renovate a property or build a property. That way one, you're safe. Secondly, you get to learn the process and then thirdly, you get a great return of your money by investing in real estate. For more information about investing in real estate, email me at info at Sherrianne Homes.com and I look forward to hearing from you.
What I what I like about this dude this guy is like he's he really seems like he's genuinely like I'm here to help you. Instead of like oh I'm here to be funny. I like that. This is not a one size fits all business. Right. Right? Um we're not selling commodities. So like you can't just take $25, 000 and just go buy anything and expect to make money.
Mm hmm. It's gotta be you know it's gotta be a property that's vetted and and that you can see an upside potential to it. Twenty-five thousand isn't going to get you much in terms of a down payment in in my marketplace. What he's speaking to though is putting together several people's $25, 000 into a joint venture to do a property investment and so just my first blush response is this is this is a real low economic scale of looking at it and the guy or gal that might want to do investment properties is not necessarily bringing $25, 000 to the table like even agents that I coach that are that are wanting to like in 2022, they want to do their first investment property you're talking about thousand dollars before they even get into the game.
Mm hmm. And they're still bringing investor partners into the deal because it's going to take more to make it happen. Um your average sales price and even my average sales price which is around 400, 000 requires a lot more than. Sure. A $25, 000 investment to make it happen. He's saying that there's going to be more than one principle on the deal but I think, you know, if you add what you said to it, okay, what's the deal? Yeah.
What's the property? What's it need? What's the investing with me? If we go to, you know, dip back into work. You know. What kind of work have you done before? Have you ever renovated a property? Oh, yeah. It came in right on budget, right? Oh, no. Right? So what happens? Or right on time. Yeah exactly. So so what happens if everybody has to reach in their pocket for more money and and you know you're you're captain you're 25.
Alright so this guy's got a rubber duck under. Oh I like this one. You know why I like this one? You like ducks? Cuz it's the last one. I hear you. Your clients see you sweat. Be like that duck on the lake. Nice and calm on the surface paddling like crazy underneath. You stay calm. Your clients are calm. You lose they're going to freak out.
Remember that event duck. That's good. This is the best one. Yeah, that was really good. That's definitely an attribute I see of agents that are successful. Mm hmm. You know, there's a whole group of agents out there that just want to sit in a room and tell war stories about their deal that fell apart. Mm hmm. Like what's the point if it fell apart? Mm hmm. Uh it's the ones that in the heat of the battle, you know, they might need to vent to their peers in in our team room about what's happening but then they get focused on solutions not just on complaining about what's going on.
So, sometimes the most difficult deals are the ones that in the end are the most satisfying. I think about the work ethic of some of your team members that I've observed that show up early, get things done, smile on their face but they're working their **** off behind the scenes and the numbers, the results show it. Yup. And they don't look all disheveled when the deal closes.
I don't I can't think of a business that has the ups earning potential that this business has, right? If it was super easy, then, people wouldn't fail at this business. Mm hmm. But we know the success of this business, the success rate is so low for real estate agents. Yup. And it's because they're watching these videos about how to hack it and there's no way to hack it.
It's getting up early, working your **** off. Yup. Staying focused, not letting outside influences change the result of the transaction and pushing through. But there's a hint here about his duck analogy that it's the measure of the person like yes you gotta work hard you gotta paddle like crazy underneath the underneath the water but the the mindset of that person the perseverance of that person there's a character you just can't teach this stuff so the way somebody might carry themselves is not something necessarily walking through their first 30 days of training and they now carry themselves better that's right they're they're coming into this with that that high level of character those values that I think you're looking for I think so many people don't make it in this business because they have dollar signs in their eyes and they want it to be easy they want it to be doing this with a business card yeah and now I'm successful yeah right it has nothing to do with that and so I think if you walk in you see this is going to be hard I'm going to have to grind and oh I'm going to put this deal together got it and I'm going to be so proud of the deal that I put together but then between putting the deal together and closing we're going to have all these mini explosions and landmines that I'm going to have to navigate through and I know it going in and I know that solving each of those things takes me one step closer to the promised land closing.
Yeah. Like then you can deal with the adversity much more and you can be the conduct above the water.
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