Pseudo Investors – Do Not Waste My Time

I work with many successful out of state investment property investors in my San Antonio investment property business.

But I also have come across many unsuccessful ‘investors’ who typically never make any money in real estate cash flow investing in under market value properties.

I call them pseudo investors.

When I say ‘pseudo investors,’ I am referring to people who flatter themselves as investors but either rarely or never do a real estate investment deal.

Here are the most typical types of pseudo investors i deal with in under market value properties:

  • The ‘investor’ with zero capital. There are ways to invest in under market value San Antonio investment properties without cash of your own, but most of those methods suck as far as making cash flow each month. The best option you have is to borrow capital from friends or family at a ‘friend rate’ of 7-8%. At that rate, you can buy a $50k house and produce monthly positive cash flow. But if you don’t have capital of your own, I don’t want you to call me yet. You need to go find that capital from a private investor first. I deal ONLY in investors with cash.
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Five investors passed on this deal. ‘Too ugly and run down.’ I sold it AS IS with owner financing and $5000 down myself and will enjoy 14% ROI on it. Pseudo investors.
  • The ‘investor’ with capital but incapable of making an informed decision. I have ‘investors’ on my list with $500,000 or more to invest who never do a single real estate deal. They are simply constitutionally incapable of making decisions. If I send you a below market value deal, I expect a yay or nay in 24 hours. MAX. When I see a hot deal, I make an offer in minutes. Bottom line – if you have cash but are incapable of making decisions, don’t call me please.’
  • The ‘investor’ with capital and can make decisions but is too picky. ‘Oh that neighborhood is too risky, oh that house only has two bedrooms, that property has a cracked foundation…..” Look folks: I have made MILLIONS of dollars on under market value San Antonio investment properties that look like crap with every problem in the book – roof, foundation, too small you name it. Every deal that a pseudo investor turns down – EVERY ONE – I buy it myself with my own cash and make $5000-$15,000. I already have my own cash and portfolio. I really don’t need it. But if you are foolish, fine, I’ll make the money.
  • The ‘investor’ with capital and can make decisions but has absurd expectations and is greedy. I have made a fortune on 10-15% ROI buy and hold deals in San Antonio. But this type of ‘investor’ is never happy with a certain return, they always want more.  Listen, this is San Antonio TX. It has many advantages – real estate is dirt cheap here, we have a great population of blue collar buyers, the economy is stable and taxes are low. But my typical deal is $50,000 and my profit might be $10,000 or $15,000. If that sounds like pennies to you, please don’t call me. I do 50 or 100  of these deals per year. That’s at least $500,000 i my pocket. That’s real money in San Antonio. You might get big profits in San Francisco investment property, but you have to have millions to invest. Here in San Antonio investment property, you can get rolling with $100,000. Have realistic expectations of $10,000 on a quick flip to another investor, or 12-15% per year on a buy and hold.
  • The ‘investor’ from out of state who questions my rehab cost, comps and ARV. Please. Don’t let the door hit you.

If you call me, I expect you to have proof of funds of at least $50,000 liquid or more, with expectations of making $10,000 max on a deal in 60 days or less. Or, 12-15% ROI on a long term buy and hold with owner financing or renting, if you prefer the latter.

Right now, I am seeking private investors – such as a former San Francisco investment property investor – who will buy a $50,000 3 BR 1 bath fixer upper. I do all the work – finding the house, doing the rehab, which you pay for. When the house sells, we split the profits on the San Antonio investment property down the middle.

Remember, I am not interested in a pseudo investor. Only a real investors with cash who can make decisions. Former San Francisco investment property investors especially welcome.

Let me know. Thanks.

 

How to Recognize Value in Junk Homes

Now in Inman News

I have made a good career in San Antonio real estate investing by buying and selling under-market-value properties (“junk” houses) that most investors would never touch. Then, I owner finance them for maintenance-free cash flow, which has the added benefit of giving a hardworking family a chance to own their own home.

Sure, the under-market-value houses that I buy are ugly at first glance, but the smart investor needs to look underneath that ugliness and see the value of the home and the area around it.

Last week, I had yet another junk house success story that I wanted to share with you. Last year, I bought this junk house:

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It sat vacant for several years, and I bought it in an estate sale in September 2015. No question that this house was ugly and run down:

Kitchen

However, this under-market-value property is located in a booming area a few miles west of downtown San Antonio. The Bexar County government has invested millions of dollars in this area with new running trails, parks, shopping plazas, green space and more. Just two miles from this junk property is the San Antonio Riverwalk, a tourist mecca.

Also, this distressed property has nice, owner-occupied homes right next to it worth $100,000:

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So I snatched up the house and resold it to my out-of-state investor for $25,000 late last year. The regular investor cannot see past the temporary ugliness of the under-market-value house, but I can.

After my investor purchased the home, I did $27,000 in rehab:

  • Electrical update
  • New flooring (float new floor over that minor foundation issue after it’s repaired)
  • Clean out
  • Update bath and kitchen with tile and granite
  • New light fixtures
  • Paint — interior and exterior
  • Finish second bedroom

Now the under-market-value property looks like this:

The ARV on this distressed property is $89,000, and we completed the rehab in mid-January. By the end of January, we already had an owner-finance buyer for it with these terms:

  • $89,000 purchase price
  • $5,000 down
  • $800 per month
  • 10 percent interest
  • 30-year note

So, the investor bought this out of state investment property for a total of $52,000, and is now earning 15 percent per year in real estate cash flow on a property that he will never have to repair. The buyer of the home will take care of it, and eventually, hopefully, pay off the investor and own the home.

That is the type of under market value property investing that you can do — if you have some cash and if you can see beyond surface ugliness in San Antonio investment property.

How to Invest in Under Market Value Real Estate for Retirement

I have always invested in my San Antonio investment properties in cash, but more and more of my out of state investment property investors are buying my houses with their IRAs and 401ks.

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Investing in under market value properties can be an excellent way to invest with your IRA or 401k.

If you are interested in investing in under market value properties for retirement, one of your options is a self-directed IRA. A self directed IRA allows you to make your own investment decisions and to invest in real estate, precious metals and almost anything, with some restrictions of course.

With your self directed IRA, you need to have a qualified trustee or custodian managing it. Usually, the trustee will provide a variety of administrative functions, such as keeping records of contributions and investment purchases. Also, they will file IRS reports, issue statements to you and so on.

Self-directed IRAs allow for a much higher diversification of assets than a traditional IRA or work based 401k. Note that not all IRA custodians will allow you to invest in real estate, so you need to make sure you open a self-directed IRA with the right company.

Also, remember, your custodian will not vet whether or not your investment complies with regulatory requirements, so you need to do your homework on anything that you invest in, real estate or otherwise.

Remember that you cannot engage in self-dealing. This is where you buy a property in your IRA where you will live or do business in. The self-directed IRA also cannot purchase property owned where you or some family members have a part of the ownership.

A nice part of investing with a self-directed IRA is that you usually have checkbook control. This is where you can write checks on behalf of your IRA. These transactions occur through an LLC that the IRA owns. Setting up an LLC to do your investing with your self-directed IRA will give you more control over your assets and cut down on fees.

In short, investing in under market value real estate with your self-directed IRA or 401k can make a lot of sense, if you are investing in real estate that produces excellent real estate cash flow and has low risk.

Many of my investors used to buy California investment property and San Francisco investment property with their IRA or 401k, but this year, I have several new out of state investment property buyers who are using their retirement accounts to buy my properties.

The way I work is very simple: I put a San Antonio investment property under market value under contract. I sell it to you the investor, and do about $10,000 in rehab. Then, I resell it for you with owner financing at 10% interest, 30 year note, and about $800 per month. Below is an excellent example of what I do.

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    • Address: 820 South San Manuel St., San Antonio TX
    • Year Built: 1950
    • Description: Under market value investment property, three bedroom, one bath that has 928 square feet. Beautiful home with TWO exterior storage units – this is a MAJOR selling point for the end buyer; most buyers are blue collar contractors, and they need their tools to be completely secure.
    • Max After Repair Value: $89,000.
    • Cash Price: $59,000.
    • Exit Strategy: Owner finance this out of state investment property with positive cash flow with only $10,000 in repairs completed in 30 days – $900 per month, $5000 down, 30 year note, 10% interest. This San Antonio investment property offers passive cash flow with no maintenance.
    • Notes: We recommend that you owner finance this out of state investment property because you will have no maintenance expenses. ROI will be ~13.7%.

This San Antonio investment property is an excellent vehicle for real estate cash flow and investing with an IRA or 401k. Let me know if you have questions.

5 Common Problems With Buying Rental Properties (Which Is Why I Don’t!)

Are you a wanna-be real estate investor? Many people do indeed dream of owning under market value rental properties and someday earning positive real estate cash flow from them.

However, before you consider buying under market value investment properties, you really should think about what you are getting into. Being a part time landlord is usually a lot more hassle than many realize.

I am a full time real estate investor in San Antonio investment properties. At one time, I owned more than 100 San Antonio rental properties. I have deal with rental property problems many times and I have since stopped renting out properties and now I make real estate cash flow in another way without maintenance…..

But I am getting ahead of myself! Here are the common issues I’ve seen with rental investment properties:

  • Repair costs: If you are going to rent out your California investment property or Texas investment property (or wherever it is), you will most likely need to spend a good deal of money to make it ready to rent. Any damage to the roof, plumbing, foundation or electrical systems could cost a lot to repair.

This can especially trip up the part time landlord who has a full time job and has bought rental properties for real estate cash flow. Odds are you are not an expert in rehabs and you could easily overspend on fixing up the house.

Depending on which state you are buying your investment properties, you could have landlord and tenant laws that mandate that you add safety features to the house, such as handrails, peephole in the front door, adding a firewall, and a lot more.

  • Getting repairs done: As a rental property investor, you are going to have repairs that have to be done fast. Back when I was a landlord 10 years ago, I had water heaters go bad. Sometimes the house got flooded and I had to spend a couple thousand dollars to clean it up. Of course, the after hours plumber can cost you $100 per hour or more.
  • Collecting your rent: If you are lucky, you will have good tenants who always pay on time. But oftentimes, you have tenants who are late. This is an especially big problem if you buy your rental properties with mortgages. I never buy my under market value properties with mortgages, only cash.
  • Dealing with pain in the neck tenants: Eventually you are going to have to deal with tenants who damage your house or cause problems with other tenants. I once had a tenant who almost burned the house down. Of course, you will also have to deal with evictions at times, which can be problematic depending upon your state. In some states, the tenant can stay in the house 60 days or more without paying rent!
  • Keeping the property safe: If you rent out properties, you could be at risk of being sued if someone is injured on your property. You must keep the home maintained so that there are not potential accidents.

The bottom line on rental properties for me is to not invest in rental properties. There is simply too much hassle involved in them to make it worth my time. Been there, done that!

How I Invest in Below Market Value Properties Without Repairs

The way that I invest in San Antonio investment properties today is to buy my under market value property in cash, do $10,000 or so in rehab, and then seller finance it. This type of investing has four big advantages:

  • I have no mortgage. Yay!
  • My occupant is buying the house on terms from me. That means they maintain the property and do all of the repairs. Double yay! If they choose to not repair it, that isn’t my problem. I merely hold the note on the house.
  • I enjoy pure real estate cash flow in my under market value San Antonio properties. No expenses! Is this cool or what?
  • Because I buy investment property in Texas, foreclosing is very easy. I get the house back in 60 days and resell it again. I have resold the same house three times before: $5000 down, $800 per month.

Of course, this type of real estate investing takes CASH. But if you have an IRA or a 401k, you can often invest in these under market value houses.

Below is a great example of the type of investing my out of state investment property investors and I do.

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The house above in on West Poplar Ave. in 78207 in San Antonio. It is a newly completed San Antonio investment property that was bought the the California investor for $44,000 in October 2015.

We conducted $10,000 of rehab on the property and put it on the market in December 2015. Total cost to investor was $54,000. It was resold in late January 2016 with the following terms:

  • $83,000 sales price
  • $5000 down
  • $627.61 per month ($800 per month PITI)
  • 9% interest
  • 30 year note

Total return for out of state property investor is 14% ROI. If you are interested in out of state investment property that earns 10-15% ROI with no maintenance, please contact us.

Below are more rehab pictures:

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Based upon this 14% ROI return, I think you can understand why many of my investors from out of state USED to buy San Francisco investment property, San Diego investment property, Seattle investment property, and Los Angeles investment property. Now they mostly buy San Antonio investment property.

Guidelines for Out of State Property Investors

Thanks for coming by. Here’s what you need to know about me right now: I’m a financially retired real estate investor in San Antonio TX who is dedicated to transforming the city into all homeowners.

expert

I tell you this not to show off, but to make this point: I am a serious, very accomplished and wealthy investor.  I’m not an amateur. So, if I say a house will sell for such and such, or the rehab will cost such and such, you need to believe me and not question me. I do deals in my San Antonio neighborhoods every week, and I know what things cost.

You wouldn’t question your brain surgeon about the type of craniotomy he is going to do on you, right? So please don’t question my expertise on San Antonio investment property.

I know what you may want to ask:

If you’re such a big shot, why are you still working huh?

🙂 The reason is that while I have my own portfolio and am set for life, I still have ambitions and a Mission: I want to transform the entire city of San Antonio TX into home owners.

And to do that, I need  serious out of state property investors to buy 10+ under market value houses in the next 10 years.  So, I want to keep you happy with high cash flow San Antonio houses that have accurate ARVs, accurate rehab numbers, and quick resale time. It does me no good if you buy 1 deal and are unhappy and leave.

If you are going to do 10+ deals here, I need you to understand a few things about how I work. Whether you are a rookie or an experienced investor, I do things a certain way and want us to be on the same wavelength from the start.

So without further ado……

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  • $50,000 capital required. You need to have capital or the ability to obtain capital to talk to me. $50,000 is a good starter – ideally in a bank account but 401k and IRA money works too. I simply do not have time with my schedule to talk to people with no money. If you do not have capital, that’s fine. Hey, I’ve been there! But I raised money from private investors to get rolling. You need to find private sources of capital at reasonable rates so that you can make monthly cash flow on my deals of $200 to $300, and pay those guys off in 1-2 years.
  • Reread the above please. This is an advanced investing system in under market value San Antonio properties. IT TAKES CASH. This is not an investing system for the house hacking, 3.5% down rental property investor on Biggerpockets.com who is  just starting out.

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  • Zillow values are crap – PLEASE don’t bring them up. Nothing screams ‘clueless amateur’ more than using Zillow property values to evaluate my deals. Honestly, it’s annoying when an out of state investor who knows nothing about San Antonio challenges my ARVs. Look: I have completed nearly 1000 deals involving thousands of houses in San Antonio TX. I have done hundreds of rehabs. If anyone knows the ARVs of these under market value properties, it’s me.

Zillow will always lowball what my houses resell for. If you are going to look up property values in Zillow and challenge my ARVs, please find someone else to work with. It’s amateur hour to question an expert investor about resale values; serious investors understand a 15 year real estate expert in one specific city knows 1000 times more about local ARVs than a freaking national real estate database.

  • My owner finance deals are off market. My under market value deals are usually sold with owner financing, which means they are off market, which means that Zillow and other public websites are totally worthless for evaluating my deals.
  • My ARVs are accurate. I didn’t get to where I am in life by overestimating what houses will resell for – to scam you into buying 1 house. If you don’t trust my numbers, try Detroit. We need to trust each other to work together.
  • Pseudo investorsdo not apply.
  • 10 houses! Remember: My goal is to transform San Antonio entirely into property owners. I do not need you to buy 1 house so I can make a small commission. I need you to buy 10+ under market value deals from me so I can transform this city. That won’t happen if your first deal sells for less than what I stated. BTW, finding a single cash buyer these days is a LOT of work. Does it make sense for us to overestimate a house’s resale value, piss you off, and you walk after 1 lousy deal? Heck no! We want happy investors here that buy long term.
  • Cash buyer references available for serious buyers. I have many references who are cash buyers in California. I’m happy to provide those references to investors with capital who are serious about investing.
  • I own a construction company. I do rehabs at 2/3 to 1/2 the price of your typical rehabber, and I do good work. Insured, bonded, all permits included in my price. I do enough to get the house resold and more more than that. This saves you money and boosts ROI. Honestly, I make little money on my rehabs. I am totally dedicated to my Mission and to making you money. So I am willing to sacrifice rehab profits to get you to buy 10+ houses in 10 years.
  • All deals close with my real estate attorney. I have used West & West Attorney at Law for more than 10 years to close my deals. They know me well. Not a penny of your investing dollars go to me. It all goes through the title company.

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  • Patience on rehab. If you do buy an under market value property from me, I will get it rehabbed ASAP. Usual turnaround is 30-45 days. But stuff happens. The roof could need more work than I thought, or the foundation may need more work, or the weather turns bad and it rains for a week. All of this delays the project. BE PATIENT.

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  • One and done. If you call me twice per day asking me when the house is going to get finished, that will probably be the last deal we do together. No joke – on a work day, my cell phone is clogged with dozens of text messages, a dozen voice mails and 100+ emails. I cannot babysit you. Please, be patient. I will call you and email you as soon as it’s done and will send pictures.
  • Patience on resale. Once it is rehabbed, I will get it resold ASAP with the MLS and bandit signs. Please do not call every day wondering when it will sell. It’s real estate, not McDonalds. When I have a serious buyer with a contract, I will inform you immediately.

In short, I love working with out of state investors….investors who used to buy California investment property, San Francisco investment property, Seattle investment property and Los Angeles investment property. But please – reread the points above before we talk. This will make our relationship work smoother. Thanks.

What’s Happening with California Investment Property?

As late as 2014, many California investment property firms were buying up dozens of single family homes in Los Angeles, San Francisco and Seattle and then leasing them out.

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This was a true flood of cash into California investment property, and helped to push many working families out of the real estate market in California.

But as of 2015, many California investment property companies stopped buying in California, both northern and southern. These investors found that the prices had hit a ceiling and there were no more bargains to be had. In short, there were no more under market value properties; everything was over market value.

Blackstone Group, a major California investment property buyer, cut its purchases of California properties by 90% in 2015. And Oaktree Capital in Los Angeles has been trying to sell off its portfolio of 500 California investment properties.

That is a big changed from 2014, when all buyers of California properties were in bidding wars. The median home price in Los Angeles was a high $385,000, which makes buying properties that produce real estate cash flow a real challenge.

According to Blackstone, prices in California investment properties reached a point where they could not buy a home, rehab it and rent it and make any kind of return.

Among the twenty companies that buy up the most California investment property since 2012, purchases have declined more than 70% in the last year.

One of the places that I see many San Francisco investment property buyers, San Diego investment property buyers and Los Angeles investment property buyers coming is to San Antonio TX. I have several new cash buyers for real estate cash flow so far in 2016.

Here you can buy my under market value houses for $25,000 to $50,000 and make excellent real estate cash flow. Here is a great example.

A Good Example of Under Market Value, Cash Flow Property

This property was sold to my investor for only $25,000:

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No one wanted this ‘junk house’ San Antonio investment property. I did! I saw the $100,000 houses next door lived in by the owners, and all of the revitalization going on in this area of San Antonio on the near west side.

Many out of state investment property buyers looking for real estate cash flow would never buy this house. My investor did for $25k, and then I did $27k in rehab:

  • Electrical update
  • New flooring (float new floor over that minor foundation issue after it’s repaired)
  • Clean out
  • Update bath and kitchen with tile and granite
  • New light fixtures
  • Paint in and out
  • Finish second bedroom

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The ARV on this below market value property is $79,900. We just finished the rehab in the middle of January 2016. And guess what? By early February, we already had an owner finance buyer for it: $5000 down, $850 per month, $79,000 final price, 10% interest, 30 year note.

That is what you can do with San Antonio investment property in an under valued market such as San Antonio. Anyone who buys San Francisco investment property or Los Angeles investment property or Seattle investment property will never see these types of returns or prices.

SOLD – 905 Green St, Poth, TX 78147

Out of state investment property investors, this San Antonio investment property offers 15% ROI with no repairs after you do the rehab.

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    • Address: 905 Green St, Poth, TX 78147
    • Year Built: 1956
    • Description: Excellent cash flow opportunity San Antonio investment property, booming San Antonio Suburb Market, extra clean community, very popular location southeast of San Antonio, 3 beds, 1 bath, 1274 sqft, large lot: .17 acres, estimated repairs: 20K, paint in/out, new HVAC, update plumbing/electrical up to code, flooring.
    • Max After Repair Value: $89,000.
    • Cash Price: $39,000 firm.
    • Exit Strategy: Owner Finance with 20K repairs: 5-10k down, $900.00 monthly P/I, 30 year amortization, 10% interest, Price: 89K; or resell to cash investor after rehab.
    • Additional Costs: $1500 commission to me on wholesale, $2000 in closing costs, $1500 commission to me on resale, $2000 in closing costs on resale (taken out of $5000 down payment from buyer).
    • Profit Year 1 on Buy Hold : 13.6% ROI
    • Profit Subsequent Years on Buy Hold: 15.1% ROI
    • Profit on Cash Resale: $20,000 to $24,000
    • Contact us for more information or to make offer.
    • Sold and Rental Comps: sold comps 905 Green St rental comps 905 Green St
    • Why You Should Believe My Numbers

More Pictures:

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Investors, you will never see a San Francisco investment property, Los Angeles or a Seattle investment property at this price point and rate of return!

$41,000 ‘Junk’ House Now Makes Out of State Investor 14.6% ROI

It has been a very busy 2016 in our under market value investment property business in San Antonio TX! The housing market and economy here in South Texas is strong, even with the cheap oil prices.

We have just rehabbed and resold another of our out of state property investor’s distressed houses that I wanted to share with you.  This was another of those ‘junk houses’ that so many investors pass by but I always buy.

Note: I like to lovingly refer to my properties as ‘junk houses.’ I love that most investors see them as ‘junk’ and run away from them. I have made millions off of ‘junk houses’ that other investors are scared of.

The smart investor just has to look beyond the exterior ugliness and see the potential of the house and the neighborhood.

These San Antonio investment properties are a bit run down, but are in up and coming neighborhoods where there is a great deal of revitalization occurring. All they need is some rehab and they can be resold with owner financing to a hard working, blue collar family.

The under market value investment property address is 166 North San Horacio, 78207. Here are the before images of this distressed property:

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This below market value investment property is on a large lot for this part of west San Antonio with large mature trees in the front yard.

I sold this San Antonio investment property to a San Francisco investment property investor for $41,000. We then performed $10,000 of rehab on the property, which included paint in and out, minor foundation work, bathroom touch up, plumbing and electrical work, and new light fixtures.

Note that this is a seller financed property, not a rental property.

After rehab pictures:

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REHAB 3 REHAB 4 REHAB 5 REHAB!

The rehab was completed in December 2015. We got an owner finance contract on this under market value investment property in February 2016 for the following terms:

  • $76,000 price
  • $5000 down payment
  • $622 per month
  • 30 year note
  • 10% interest
  • Total ROI: 14.6%
  • Note can be resold after 1 year

This under market value investment property cost the San Francisco investment property investor $51,000 total and has an annual ROI of 14.6% – without any maintenance or repairs.

This is the type of real estate cash flow that you can make with out of state investment property in San Antonio TX! Most of my investors used to buy California investment property, San Francisco investment property, Los Angeles investment property, or San Diego investment property, and now they only buy here 🙂

How I Generate $30,000+ Per Month in Real Estate Cash Flow

I have been investing in under market value properties in San Antonio TX for more than 15 years. Unlike many real estate investors, I did not start off with much cash, nor did I have a rich aunt who would loan me money at 8%.

After I finished college, I tried to buy Boston investment property, Seattle investment property and San Francisco investment property, among others, but it was too expensive.

So I returned to Texas and started to invest in below market value properties that cost $20,000 to $30,000. I was amazed when I discovered San Antonio TX, and how one could generate substantial real estate cash flow each month on such inexpensive distressed properties.

I did make some money in the stock market, so in 2001, I was able to purchased my first under market value Texas property for only $30,000 cash. After I spend $5000 on rehab, I then made real estate cash flow of $600 per month on it as I rented it out. That was my first San Antonio investment property.

After that first under market value investment property, I didn’t have much capital left. So, I had to hunt for private money to borrow. It took a lot of phone calls, but I eventually tracked down an investor allowed me to borrow more than $1.5 million over three years to rehab and rent out under market value properties.

I would borrow $30,000 to $50,000 from my investor every few months to do a new deal, and I made about 10% in real estate cash flow on those deals.

After about five years, I was doing very well and had more than $10,000 per month in real estate cash flow, but I was getting weary of doing full rehabs and maintaining properties. That is when I started to use my current under market value investment model:

  • I buy $30,000 to $60,000 below market value San Antonio investment property for cash.
  • I do $10,000 to $30,000 in rehab (sometimes I will not repair the house at all).
  • I resell the property to a blue collar worker with a $5000 down payment and a steady job.
  • Typical terms on the below market value property are $5000 down, $800 per month PITI, $79,900 final price, 10% interest.

Investing in this way gives me real estate cash flow of 12% per year or more without doing the typical landlord repairs that most investors deal with.

I also give my end buyers the opportunity to own their own home. This type of investing has been my main method for almost 10 years. It is by buying under market value properties for cash in this way, and then owner financing them, that i have been able to generate more than $30,000 per month in real estate cash flow.

To give you a good example of how I do these types of under market value deals with San Antonio investment property, here is a great case study we just completed:

My out of state investment property investor bought this ‘junk’ house for $25,000 in November:

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It had sat empty for years and was part of an estate sale. Now this house was ugly, no question about it. But it is located in an up and coming neighborhood in 78207, where the city of San Antonio has spent millions of dollars putting in running trails, parks, shopping plazas, green space and so on. This ‘junk’ house is only 2 miles from downtown and all the tourist attractions of the city.

Yet this under market value house sat for months and no investor wanted it. I grabbed it and quickly resold it to an out of state investment property investor.

Right next door to this ‘junk’ house were these owner occupied homes:

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Those houses right next door are worth more than $100,000, but no one wants my under market value ‘junk’ house because it’s temporarily ugly:

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The conventional investor wanting real estate cash flow cannot see past the ugliness, but I saw the potential here because of the neighborhood revitalization and the nice houses around it.

So, I sold this house for $25,000 to an out of state investment property investor who did $27,000 in rehab (which I did for him in 30 days), which included:

  • Electrical update
  • New flooring (float new floor over that minor foundation issue after it’s repaired)
  • Clean out
  • Update bath and kitchen with tile and granite
  • New light fixtures
  • Paint in and out
  • Finish second bedroom

Note that I own a construction company, and my rehabs are typically 2/3 of the price of most companies’ rehabs.

Below are the after rehab pics:

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The ARV on this below market value property is $79,900. We just finished the rehab in the middle of January 2016. And, by early February, we already had an owner finance buyer for it: $5000 down, $850 per month, $79,000 final price, 10% interest, 30 year note.

The house was on the market for less than a month. So on a $52,000 investment, the out of state property investor will earn about 16% ROI with no more repairs because we owner financed the house.

This is the kind of under market value investing I do – I buy ‘junk’ houses that other investors reject and turn them into little gold mines.

This type of property is great for real estate cash flow, and is far superior to what is available to most investors looking for Seattle investment property or San Francisco investment property. That’s probably why most of my out of state investors are from Seattle and San Francisco! I also have many former buyers of California investment property generally who only buy my San Antonio investment property now.

 

 

SOLD – 820 South San Manuel St., San Antonio TX 78237

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    • Address: 820 South San Manuel St., San Antonio TX
    • Year Built: 1950
    • Description: Under market value investment property, three bedroom, one bath that has 928 square feet. Beautiful home with TWO exterior storage units – this is a MAJOR selling point for the end buyer; most buyers are blue collar contractors, and they need their tools to be completely secure.
    • Max After Repair Value: $99,000.
    • Cash Price: $65,000.
    • Exit Strategy: Owner finance this out of state investment property with positive cash flow with only $10,000 in repairs completed in 30 days – $99,000, $900 per month, $5000 down, 30 year note, 10% interest. This San Antonio investment property offers passive cash flow with no maintenance.
    • Alternative Exit Strategy: Buy at $65,000, remodel $15,000, rent $995 per month.
    • Contact us for more information or to make offer.
    • Sold and Rental Comps: Sold Comps 820 S San Manuel Rental Comps 820 S San Manuel

More Images (more photos to be added soon):

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Please contact us to make offer or ask questions.

Investors, you will never see a San Francisco investment property, Los Angeles investment property or a Seattle investment property at this price point and rate of return!