{"id":1544,"date":"2018-03-18T15:29:55","date_gmt":"2018-03-18T15:29:55","guid":{"rendered":"https:\/\/frankbuysphilly.com\/these-are-the-real-estate-deals-you-should-absolutely-avoid\/"},"modified":"2018-03-18T15:29:55","modified_gmt":"2018-03-18T15:29:55","slug":"these-are-the-real-estate-deals-you-should-absolutely-avoid","status":"publish","type":"post","link":"https:\/\/frankbuysphilly.com\/these-are-the-real-estate-deals-you-should-absolutely-avoid\/","title":{"rendered":"These Are the Real Estate Deals You Should Absolutely Avoid"},"content":{"rendered":"<p> <br \/>\n<\/p>\n<div itemprop=\"articleBody\">\n<p><span style=\"font-weight: 400;\">Today I\u2019m talking to you guys about the real estate deals you should stay away from.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">I want to start by sharing a bit of background with you. I started my journey with American real estate about six years ago. I believe I bought my first property in\u00a02011. I completely lost my butt in upstate New York because I bought a turnkey property from the wrong provider. They passed me onto property management, nickel and dimed me to death, and I lost around $20,000. Whatever. That\u2019s where I started my journey.<\/span><\/p>\n<h2>Start Small<\/h2>\n<p><span style=\"font-weight: 400;\">One thing I still believe to this day is when you\u2019re looking at investing in real estate (or a particular market or region), start small. This is something I tell my investors every single day. I have a lot of investors who come to me wanting to invest large amounts of capital. And I say, \u201cNo. Start off small. Get your feet wet. Get to know the market. Get to know me and my company\u2014and I want to get to know you before we can expand on our relationship.\u201d<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Today I own a bit of real estate in the Bahamas; I just bought a condo in Japan; I\u2019m looking at some properties in Italy and Cuba because I want to own real estate worldwide. But I still want to invest the least amount of money possible, which equals the least amount of risk. The lower the amount, the lower the risk. That is my philosophy. It\u2019s something that I have practiced and I am not going to change this particular method. Even if it means buying the crappiest property in the crappiest area\u2014a D-class property\u2014renovating it, and breaking even on it, I don\u2019t care. I want to learn the process and the market. I want to learn who is who in that particular region. I want to build trust and relationships with people, because then I will start getting exclusive access to amazing opportunities. Once people see that I\u2019m a player, that I\u2019m doing deals, that I\u2019m willing to take risks, that I\u2019m on the ball, in your face, and getting it done, then they will want to work with me. So that is kind of my method. It\u2019s what I do and how I started. Then once you get your feet wet, guys, the door opens. When people know that you\u2019re doing business there, they start presenting you with all these opportunities. You kind of become one of them, and that is exactly what you want to do in a market.<\/span><\/p>\n<p><iframe loading=\"lazy\" src=\"https:\/\/www.youtube.com\/embed\/Xdlpd9gm2ao\" width=\"560\" height=\"315\" frameborder=\"0\" allowfullscreen=\"allowfullscreen\"><\/iframe><\/p>\n<p><em><strong>Related:<\/strong>\u00a0<a href=\"http:\/\/www.biggerpockets.com\/renewsblog\/avoid-renovation-mistakes-rentals\/\">How to Avoid Renovation Mistakes on Your Rental Properties<\/a><\/em><\/p>\n<h2>Keep it Simple<\/h2>\n<p><span style=\"font-weight: 400;\">Now, fast forward to what this blog post is actually about, and trust me this makes sense with what I just mentioned. The properties you should run away from and absolutely never buy are the ones that need a ton of work structural rehabs. I\u2019m talking about properties that don\u2019t have any margins in them unless you start doing all kind of development\u2014those are a no. You start by extending the porch or extending on the backyard or completely revamping the entire floor plan. Or maybe you\u2019re subdividing that land and building another property on the subdivided lot. Guys, these things are a recipe for disaster\u2014particularly for all of you newbies out there because you can\u2019t control the outcome. As much as you want to say, \u201cYes; I\u2019m the master of my fate; I\u2019m the captain of my soul; I call all the shots,\u201d you don\u2019t. Sorry, <em>you don\u2019t.<\/em> You have to run everything you want to carry out past the city. You have to get an architect involved, and the city has to approve it. We all know the city has its own agenda and its own timeline for how it wants to go about things. It\u2019s not in your control. Do not do that.<\/span><\/p>\n<p><em><strong>Related:<\/strong>\u00a0<a href=\"http:\/\/www.biggerpockets.com\/renewsblog\/2013\/12\/26\/worst-real-estate-deal\/\" target=\"_blank\" rel=\"noopener\">The Worst Real Estate Deal I\u2019ve Ever Done (And How You Can Avoid the Same Mess)<\/a><\/em><\/p>\n<h2>Keep Your Cash<\/h2>\n<p><span style=\"font-weight: 400;\">Guys, invest the least amount of money possible in a particular deal. Just like when you are getting your feet wet, when you are actually starting in real estate or you are actually looking at expanding into a new market. I don\u2019t care if you break even\u2014learn the process, meet the team, get to know who\u2019s who in that particular market, and then expand and build on that. That\u2019s when you\u2019ll start getting some amazing deals. <\/span><\/p>\n<p><span style=\"font-weight: 400;\">I would run away from anything that needs structural work, approval from someone else, or has a big mortgage attached to it. Buy properties that need a cosmetic rehab, spend the least amount of money possible, renovate as quickly as you can, sell it for whatever you can, cash out, and do the next deal. Learn the team, the people, and who\u2019s who. Get to know the market, then you can always expand on that. <\/span><\/p>\n<p><span style=\"font-weight: 400;\">So that\u2019s kind of my two cents for you. This is something that I do. It\u2019s something I recommend you guys to do. I wish you much success with it.<\/span><\/p>\n<p><a href=\"https:\/\/www.biggerpockets.com\/real-estate-investment-calculator?utm_source=renewsblog\" target=\"_blank\" rel=\"noopener\"><img loading=\"lazy\" decoding=\"async\" class=\"alignnone size-full wp-image-91220\" src=\"https:\/\/www.biggerpockets.com\/renewsblog\/wp-content\/uploads\/2017\/08\/blog_ads-02.jpg\" alt=\"\" width=\"700\" height=\"85\" srcset=\"https:\/\/www.biggerpockets.com\/renewsblog\/wp-content\/uploads\/2017\/08\/blog_ads-02.jpg 700w, https:\/\/www.biggerpockets.com\/renewsblog\/wp-content\/uploads\/2017\/08\/blog_ads-02-300x36.jpg 300w\" sizes=\"(max-width: 700px) 100vw, 700px\"\/><\/a><\/p>\n<p><em>Do you have any questions about this method?<\/em><\/p>\n<p><strong>Do you agree or disagree? Share your thoughts below!<\/strong><\/p>\n<\/div>\n<p><script>\n    !function(f,b,e,v,n,t,s)\n    {if(f.fbq)return;n=f.fbq=function(){n.callMethod?\n      n.callMethod.apply(n,arguments):n.queue.push(arguments)};\n      if(!f._fbq)f._fbq=n;n.push=n;n.loaded=!0;n.version='2.0';\n      n.queue=[];t=b.createElement(e);t.async=!0;\n      t.src=v;s=b.getElementsByTagName(e)[0];\n      s.parentNode.insertBefore(t,s)}(window,document,'script',\n      'https:\/\/connect.facebook.net\/en_US\/fbevents.js');\n    fbq('init', '1030393550311340');\n    fbq('track', 'PageView');\n  <\/script><script>(function(d, s, id) {\n  var js, fjs = d.getElementsByTagName(s)[0];\n  if (d.getElementById(id)) return;\n  js = d.createElement(s); js.id = id;\n  js.src = \"http:\/\/connect.facebook.net\/en_GB\/sdk.js#xfbml=1&version=v2.8&appId=266643395017\";\n  fjs.parentNode.insertBefore(js, fjs);\n}(document, 'script', 'facebook-jssdk'));<\/script><script>(function(d, s, id) {\n  var js, fjs = d.getElementsByTagName(s)[0];\n  if (d.getElementById(id)) return;\n  js = d.createElement(s); js.id = id;\n  js.src = \"http:\/\/connect.facebook.net\/en_US\/sdk.js#xfbml=1&appId=266643395017&version=v2.0\";\n  fjs.parentNode.insertBefore(js, fjs);\n}(document, 'script', 'facebook-jssdk'));<\/script><br \/>\n<br \/><br \/>\n<br \/><a href=\"https:\/\/www.biggerpockets.com\/renewsblog\/the-real-estate-deals-you-should-avoid\/\">Source link <\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Today I\u2019m talking to you guys about the real estate deals you should stay away from.\u00a0 I want to start by sharing a bit of background with you. I started my journey with American real estate about six years ago. I believe I bought my first property in\u00a02011. I completely lost my butt in upstate [&hellip;]<\/p>\n","protected":false},"author":2,"featured_media":1545,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[33,1],"tags":[],"_links":{"self":[{"href":"https:\/\/frankbuysphilly.com\/wp-json\/wp\/v2\/posts\/1544"}],"collection":[{"href":"https:\/\/frankbuysphilly.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/frankbuysphilly.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/frankbuysphilly.com\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/frankbuysphilly.com\/wp-json\/wp\/v2\/comments?post=1544"}],"version-history":[{"count":0,"href":"https:\/\/frankbuysphilly.com\/wp-json\/wp\/v2\/posts\/1544\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/frankbuysphilly.com\/wp-json\/wp\/v2\/media\/1545"}],"wp:attachment":[{"href":"https:\/\/frankbuysphilly.com\/wp-json\/wp\/v2\/media?parent=1544"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/frankbuysphilly.com\/wp-json\/wp\/v2\/categories?post=1544"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/frankbuysphilly.com\/wp-json\/wp\/v2\/tags?post=1544"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}