Where's the COLLAPSE??? Where's the RIOTING???

[fdjake]

Funny isn't it????

ALL the GARBAGE, all the DOOMS DAY scare tactics....What did it get YOU???

Did the HERD succeed in SCARING you out of the greatest real estate investment opportunity in GENERATIONS???

Did you buy GUNS when you should have been buying FORD STOCK?

How's all that canned FOOD stored in the BOMB SHELTER taste?

The point here isn't to make fun of anyone....The point is to LEARN from the experience.
Doing the OPPOSITE of what the TV is showing you every night is usually very profitable.

At some point in the future these boards will be, once again, LOADED with quick money real estate "investors"......REMEMBER THIS and SELL TO THEM!!!!!  Don't worry, if the herd comes back 15 or 20 years from now (and they WILL) you can BUY BACK all your old property after they BUST OUT!!

Same circus, different clowns!

[Hoosier4life2005]

I agree with you to a point.  I do find it funny that people were saying back in 2008 that by 2011 things were going to be really really bad.  Well... its not, as you've said.

However, our countries debt and my biggest concern, inflation, in my mind, will cause pain in the future.  Not sure WHEN, but just looking at the numbers, I just dont see how we're going to come out of this with no big problems.  Inflation concerns me by far the most.

[rookieNYC]

I agree fdjake.....

Its tough to move against the grain ...Most people sell at the bottom and buy at the top...All because its out of fear...I see it in the stock market during every cycle...Thats why I got involved in the Florida RE market...It got KILLED....%70 drops all around and in some areas MORE...I said this is the time to start nibbling here..I thought of something Warren Buffet said during the economic collapse...He said "this is what people with money do during times like this"....Another story that lit my fire was a Wall St powerhouse named David Tepper (Appaloosa Fund)...David Tepper bought alot of the banking and financial stocks during the bloodiest moment...He put a call in to a specialist to start buying certain stocks in massive blocks..The specialist replied to Mr.Tepper "you are the only buyer today"..Just in case people here don't know how his move turned out...He made $4 BILLION on the trades...And he is still making $$$$...You can bet he will start selling to buyers when the upgrades on these stocks come through...

Sell when you can NOT when you have to.....
Buy when there is blood in the streets....
Buy em when they hate em.....
Sell em when they love em.....

[fdjake]

Hoosier,

There is absolutely not doubt in my mind that inflation will be something that we will face in the future.

BUT........My parents purchased their first home in the 1970's and paid 13% interest on their mortgage like everyone else who purchased a home during those years.  Builders built homes, investors made money, property was rehabbed and resold......AND......SOME people SAT on the sidelines and WORRIED about the inflation that ran rampant through the country.....OTHERS went out and made MONEY!!

Pick what side you want to be on.

Rookie,

Those Florida investments you've made and continue to make, will be seen by the HERD as MIND BOGGLING, BRILLIANT investments when you recount your purchase prices years from now.
They'll look at what you're doing and immediately think....."He had inside info, he's connected, he's a Pro."....The Sad part is very few will SEE what is so obvious to people with experience.  That is.......These opportunities present themselves all the time, in every economic cycle....The part they MISS in the THOUGHT PROCESS that allows you to see what others ignor.

It IS learnable.....You just have to THROW OUT virtually EVERYTHING society believes about investing. 

[Hoosier4life2005]

Jake, dont want to get off topic, just one little question though.  Rookie you might have a opinion on this too, just open to suggestions.

Ive ordered some business cards like you suggested already.  I begin my job next monday, and will be bringing home some pretty good money.  My question for you is...  should I just put my cash in a bank account while getting a SMALL interest rate (1-2% i think), or what?  Im not really confident in gold because I have a gut feeling its on a bubble right now, and its going to bust.

I know exactly what to do with my money once I get to where I want to be (20-30K), but I dont know really waht do to with it until I get to that point.  I would hate to be saving and inflation hit really hard and knock out 20% of my savings or something.

Ive asked this before and never really gotten a clear answer from somebody besides (just put it in the bank).  Ill be making about 900 a week BEFORE taxes, which is really good cash for around the midwest (especialyl for my age) and I would really just like some input.  Im going to save everything I make except the cost of putting gas in my car.

[fdjake]

OK.....Let's REALLY run the numbers here and then YOU decide what to do....

Let's say you are an absolute SAVING ANIMAL over the next year, stay living with your folks (HUGE!) and put $400-$500 per week in a savings account.  In 3 months you'll have say $6000.....OR you can have $2000 if your "investing" goes bad.

Let's say you BEAT THE ODDS and 90% of professional Wall St investors and pull a 10% return in 3 months on your money????

At that point you have RISKED $6000 for a $600 return.

Do you see where I'M going with this.
I
PUT IT IN THE BANK KID and spend your TIME looking for your first PROPERTY...It is completely possible for you to find a  GEM that can easily turn $10,000 into $20K ESPECIALLY in the area of the country your in.

Remember this.....

SAVING at the RATE your talking about here is NOT SUSTAINABLE....Even if you're SUPER DISCIPLINED, at some point your going to want to enjoy a few things in life.  The KEY for you RIGHT NOW is to NOT SCREW UP!!!

I can't think of an EASIER WAY for you to screw up than trying to INVEST in GOLD, STOCKS or other financial instruments with NO EXPERIENCE.

Your biggest fear right now should be LOSING what you've saved. 

Again....Even if you had the entire $30k invested and received that 10%.....We're talking about $3000 here....Is $3000 going to MAKE YOU????  Or will LOSING $20,000 of that $30K BREAK YOU????

THINK!!

[rookieNYC]

Your biggest fear right now should be LOSING what you've saved

I agree...But scared money never wins...Consult with people that are in the know of the business venture you are embarking on *BEFORE* laying out a single dime...Use the free knowledge that comes from this place...Dont be a cowboy...

You are young,time is on your side...

[christopher w]

Hoosier,

In our conversation yesterday I told you to start looking for a duplex property in your hometown that you can steal. Rates are so low right you could get into a 50-60K house for less than $2000 out of pocket and your payment would be around $350 a month!! Just make sure your buying it at the right price. Jake can help you more with finding the right deal but once you do I will be happy to advise you on your financing free of charge. I am not licensed in Indiana but I can point you in the right direction as far as what type of loan to do and make sure that you don't get ripped off by your LO. Plus I know a ton of programs and grants for first time home buyers.

The point is get going!!

Utilizing FHA financing all you need is one pay-stub with 30 days of earnings on it to get approved (that and your down payment).

Heck you may be able to qualify for USDA financing and get 100% financing with NO MONTHLY MI!! Or get an FHA 203K loan that will allow you to finance repairs on the home. It can be your first rehab.

Seriously.

[Hoosier4life2005]

Ok, thanks for the responses Jake, Rookie, and Chris Chris (playa playa).  Sounds like a good plan, was just interested if there was a LOW-risk investment that will help me vs inflation.

[REIER]

At some point in the future these boards will be, once again, LOADED with quick money real estate "investors"......REMEMBER THIS and SELL TO THEM!!!!!  Don't worry, if the herd comes back 15 or 20 years from now (and they WILL) you can BUY BACK all your old property after they BUST OUT!!

Yep, and this is the time to learn your market, learn how to  market for buyers and sellers, learn values, learn how to estimate repairs and learn what houses not to touch with a 10 ft pole. There is little pressure to try and snap up every deal that comes along because there will be others that will come down the pipeline. Trying to learn this business during the "crazy" times will be more challenging because you will need to move super fast on deals or those sellers will go out and sell to other investors. This is the time to learn, make money and get ready for when the herd does come back looking to "invest" so you can be ready to sell them the deals you find and even teach them how to inve$$$t. 

[REIER]

Hoosier,

I'm with Jake on this, put that cash in the bank and save, save, save. You will be more confident having that backup cash when it comes to making decisions. What if you end up hating your place of work and you need to go find another job? Having that cash will allow you to feel much more confident in your choice to sack that place and go look for another job. Also, sacrificing to save up will make you much more wiser when it comes to spending. Every time you have to pull that cash out, you will remember how much you sacrificed to save it and will be looking for the best value for your money.

[allagash]

great post.....keep it coming....

been working so freakin' hard....don't even have the energy to post a halfway coherent response.

with all due respect for Mike in Ohio....I think he saw a good "out" when he had one.....(the political clamp down).

wasn't gonna be no USA doomsday....

I've done very well this past year.....2 properties that fit into my "plan" for focusing on equities.....with size and leverage....a steady, disciplined approach.

First and foremost....I'm here to learn....like a sponge.

Always fun.....learning from the best....those that don't lift a finger...(just the phone....or keyboard).

 


16 bagger for Ford.

-Mike

[InvstrPaul]

Hey Hooiser,

I'm kind of in the same boat as your right now, except I'm making less money, and I'll tell you what I've done.  I pretty much have my finances completely automated so I don't have to worry about savings, retirement, emergency fund, housing, etc.  What you do is have your check direct deposited to your checking account.  From there you send it to ING savings accounts and you can automate this especially since you'll probably get paid the same each check whereas I get commission so my pay changes.

So 1st and 15th (or whatever paydays) check is direct deposited into my credit union checking account.  From there I send the vast majority of it to my ING savings account(s).  When you sign up for an ING savings account you can keep creating more accounts so you'll have sub-accounts. So I have my Main Savings, Housing, Retirement, Emergency, Wedding, and Car accounts.  So I put 20% into retirement, 30% housing, 30% emergency, etc.  Since I'm paid commission I have to calculate these numbers but lets say you are paid $1800 each check then you can automatically have $540 (30%) put into your housing fund on the 4th and/or 17th a couple days after you get your direct deposit.

So by doing this you can pretty much completely automate your savings and your bill payments.  This creates great peace of mind and one of the best parts is...after all of your savings and bills are paid whatever leftover is guilt free spending money.  You want to go see a movie? Go see that movie and enjoy it because you already know your sh*t has been taken care of.  This way you never have to really ponder over whether you should or shouldn't.  You want to know what my guilt free money is spent on? Maybe one movie, an ice cream, and then I usually use at least 1/2 of it on more savings or my emergency fund.

Anyways, automate your savings and investments as much as possible because the others weren't lying when they said it's not sustainable.  Hardcore savings is like a diet...sure anyone can do it for a month but you'll eventually fall off the wagon.  If the wagon is on autopilot with REALISTIC GOALS then you have your pit stops and cheat days built in.

[brockovich]

I love this market. In the midwest I don't get quite the returns FDJake is seeing but I bought amd closed on a property here in Ohio for 45K on Sept 13th. 1400 sq ft. 16 x 32 ft inground pool, Outbuilding enough for 4 cars. Attached one car garage. 1.25 acres just outside the city limits. Put 25K in it, Listed it for $109,900 on a a Friday a couple weeks ago. That Sunday there was an open house, had multiple offers to consider on Monday and had an accepted contract after closing concessions of 108K. Am going to closing this Friday. After brokerage fees and my portion of the closing costs I should net right around 99-100K. So in nine weeks I take home 28-30K. The key is I can fund with all cash. Get it quickly, be the most competitively priced in the market after rehab and create excitement around the property. This December I will have been in real estate 13 years and I have been doing flips for about 4 years now. This house was my 19th one so I am doing 4-5 per year. The last three I have had accepted contract offers within a week of listing them. It can be done consistently. Pay attention here and you will get very valuable advice for free.

[rookieNYC]

Brockovich....

Nice one !!....Congrats...ty for the update...