The real estate blog.

From my experience (my own is no exception), one of the most difficult parts of investing in real estate successfully is determining if it is a deal or not.

I mean really… it may seem like a good deal… but how do you break it down to a science to give you a definite answer whether it is a deal or not?

Even better… how would you like to create a process that you follow each and every time that ensures you a nice profit.

Well, this is easier than you think.

When I first started out in real estate I would agonize over each property I looked at. I would look at the numbers, say “Well, this looks decent and if I can sell it for $X… I’ll make some money”.

I can tell you from experience that this is the wrong way to go about buying real estate. You don’t want to go into a real estate deal on emotion or a “feeling” that it will be profitable…
… you want to KNOW that it will be profitable…

… and even further, you want to have a formula that you should follow each and every time that will tell you for sure whether you should buy the property or not.

Of course, each investor has different goals… but that just means that you need to find a formula and tweak it to fit your goals.

For instance, here’s a quick and easy formula to follow for wholesaleing properties. I can tell you that this formula will save you a ton of time… and a ton of bucks. You simply plug in your numbers, see what comes out the other end… and you have a cut and dry result that says whether or not you should purchase it.

Heres the wholesaleing formula that many successful investors use:

Step 1: Find the ARV (After repair value) of the property.
You’ll need to find comps and/or work with a Realtor who knows the market. This is very important.

Step 2: Use the formula -
ARV x .7 (minus) repair costs (minus) your profits
= YOUR TOP OFFER

This basically says you take repair costs and your
profits away from 70% of the ARV… boom! thats your
offer!

Step 3: Put the property under contract for no more than your
top offer as determined with the formula above.

Step 4: Find a buyer who can come in w/ cash (professional
investor)

Step 5: Assign contract over to buyer and have the buyer pay
you the difference between his purchase price and
your purchase price.

Thats it!

Of course there are a lot of other “secrets” (I hate that word!) that are involved in the wholesaleing process, such as clauses that you should include in your offers, how to find these cash buyers, etc.

Well, thats a formula that you can put to work today and guarantee yourself profits everytime with little to no risk at all.

There are many other formulas you can use, several for each type of property. Find a formula and stick to it… I assure you that everything will be a whole lot easier for you and
you’ll be much more profitable.

Anyhow, I hope that little rant helped you out a bit.

If you have any questions shoot them my way. We’re here to help you out in your journey.

Also, this week I’m doing a bit of research to find out what people need to know when getting started in investing. Obviously since you are reading this you don’t know everything
yet (and never will)… WHAT DO YOU NEED TO KNOW that if you learn it, you believe you will be successful much faster?

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