In this series I'm featuring a few hand-picked real estate investors whom I know personally, that started from scratch and built, (or are currently building), wildly successful real estate investing businesses.
These folks are ordinary men and women who began life without the benefit of parents or family who handed them an existing business. They began with nothing, had no special advantages, and have become successful on their own. The last names have been omitted to protect their privacy, as most of the REAL real estate investors are not selling seminars and prefer to keep their activities private for the most part. If you have not read part one, you can access that article here.
Image courtesy of cali.org via flickr.com
Investor Number 3 ' Andrew
Andrew worked for many years at a corporate job. While working he spent much of his commute time listening to educational CD's recorded by well known real estate investors, as a way to educate himself about the business of real estate investing. Andrew was also a regular attendee at many of my own investing classes at a local investor association as well. While working a full-time job, he spent all of his free time studying, listening and reading books on various investing topics. In short, he did everything he could do to educate himself about investing.
About 3 years ago, the corporation that Andrew worked for announced that they would be laying off some people in response to the recession. Andrew saw this as his opportunity to escape the corporate grind, and start really getting involved in real estate full-time. He went to his boss and volunteered to give up his job. The boss obliged and Andrew set out to become a real estate investor. He had saved some cash and had several thousand dollars to work with when he left his job, and a few months severance pay to keep his bills paid. But he had to hustle and get something going as quickly as possible.
Since Andrew did not have a track record, he could not go out and borrow money from a bank when he began. So, he decided that he would focus initially on buying cheap mobile homes which he could fix up and resell with owner financing. Andrew is also handy with tools and has a strong work ethic. He soon found his first mobile home and bought it. It needed lots of work, but he stuck with it until he got all of the repairs finished, marketing the property for sale while he did the repairs. By the time the repairs were completed, just a few weeks later, he had it sold for more than double the price he paid for it. He also took back a note for the financing, earning additional income from the interest on the note.
In just three years time Andrew, who also studied to become a skilled negotiator, had bought and sold quite a few mobile homes and had built up a nice cash flow. Of course there have been some bumps and bruises along the way. One of his mobile home buyers sold the carport cover to get money to make his payment. Andrew had to inform the buyer that selling the place in pieces in order to make the payment would not be allowed! And he's had a repo here and there, which he has resold to other buyers. That is all part of the business. But Andrew worked hard and quickly established himself in his local area.
Today Andrew has built up a track record and has been able to establish himself with several local banks. As a result, he has recently completed the purchase of his first major commercial property, financed with a bank loan, and has seen his income and net worth grow well beyond what it was when he was working his corporate job. He now owns a variety of residential properties and is developing a strong presence in commercial investing as well. And he's done all of this in just a little over 3 years, right in the middle of a recession.
Investor Number 4 ' Bruce
Bruce is the kind of guy who is so laid back and non-assuming that you'd never know he is a true real estate guru unless you knew him personally. There are no suits, no limos, and no ego. But Bruce knows his stuff when it comes to real estate investing.
Bruce has a very simple but very successful investing business. He finds great deals on nicer homes in the better parts of town, rehabs them as needed, updating appliances and fixtures to make the properties highly desirable, and resells them to owner occupant buyers who get a new loan. This means that Bruce collects a nice cash profit at closing. He is usually in and out of a deal in just a few months, realizing a profit in the range of $30K to $50K per property, on average, depending on the price range of the home.
Occasionally Bruce finds an extra good deal, such as the time he found a brand new home that was part of a builder foreclosure. The home had 1800 square feet of living space, granite counter tops and had never been lived in, as the builder had gone under before the home could be sold to an owner occupant buyer. Bruce bought the home from the bank for $20,000 cash. Since it was located a good distance from his home, Bruce elected to flip it for some quick cash. He sold the home to another investor just a few days later, and picked up a ten grand net profit for what amounted to just a few hours work. He could have made more, but Bruce also likes to leave money on the table for his investor buyers.
Each of the investors I have featured in parts one and two of this series has worked hard to learn their business, found niches in the business that work best for them. They all have developed their expertise over time. These folks are familiar with a wide range of investing strategies, but they tend to focus on one or two that fit their skills and lifestyle best. They only do deals that make sense, they know how to 'run their numbers', and they keep it legal. As a result, all four of them have become wildly successful real estate investors.
Donna S. Robinson is a real estate investor, author, and investing coach located in Atlanta, GA. Follow her on twitter at donnaconsults, Facebook.com/realtybizconsulting Her latest book, Basics Of Real Estate Investing is now available on Amazon.com for the Kindle reader.
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