$120,000 challenge

[Markmcg]

Hello Everyone,

I've spent many hours reading the forums and have to say they are fantastic!  The level of knowlegde here is second to none.

Here's the situation:
     Cash to begin:  $20,000
     Time to work:    Full-time 24/7
     
The goal is to create $10,000 average profit per month.  My challenge to all of you is what specific plan would you use to meet this goal as quickly as possible?

I plan on documenting my actual deals both good and bad on the road to accomplishing this goal and will gladly share the results with everyone to show it can be done.

So, there you have it...$20,000 cash and 24/7 hours per week to work at it!

How would you do it?  Any takers?

Mark

[reoconsultants]

So I have seen people do it in 30 days! It can be done!

[Jeff Pitcrew]

Certainly not a $20,000 Ron LeGrand boot camp.

[jpstephens]

Haha i'm in the same boat.  Only thing is once again, we're wished luck. I'm starting to think the actual plan itself we have to come up with. Ive settled with just knowin gall the steps taht go into reaching my goal.

[Markmcg]

Hey JP,

Are you just getting started in RE investing?  I posted this challenge in hopes of stimulating some good debate from people who would approach this in different ways.  I'm not asking for their secrets, just what their general plan of action for this situation would be.  I'm confident they will rise to the occasion.

Would love to chat with you about investing in general and how I am approaching this.

Mark

[jpstephens]

Yea I am , looking to get my first house within the next couple weeks. Have been workin on hard on educating myself though thats for sure. Id love to chat.

PM me for details on how to get in touch.

[Valgolas]

Hello, Mark!

The great thing about real estate investing is the variety of ways to make money at it.  Everyone has their favorite way or two.  Different strokes for different folks.

I almost always advise people to start off with bird-dogging for other investors first to really learn the ropes and the local market.  Think of it as an apprenticeship where you earn while you learn.  The investors will tell you what they are looking for.  All you have to do is find it for them.

Then move into wholesaling as soon as you feel comfortable with your ability to find the good deals and get them under contract.  You can come up to speed with this really fast if you apply yourself.

Neither one of these steps requires you to use much of your cash.  It's a low risk way to learn the business and make money at the same time.  Some people I know only do wholesale deals, and they make more money than most doctors earn.

After you get good at wholesaling, you can do "Subject-to" deals and other more creative types of deals.  You'll know what areas you like by then.  Also consider adding long term keeper properties to build wealth.

Until then, don't put a lot of your money into real estate deals.  Use a little of it to get some education to get you started, and a little more for marketing to find the deals.  This doesn't take all that much.  Guard your cash.

[tedjr]

Howdy Mark:

Find a 30 unit building that is vacant and boarded up and buy it for 5K per unit. Get a hard money loan to buy it and fix it and then sell it to an investor for a $120K profit. This can be done in 6 months. Then find a 30,000 SF building for $5 per foot and fix it up and sell it for $300K profit for the balance of the year and do about 4 times your goal. I am on part two and trying to close next week on the office warehouse. My next project will be even bigger and hopefully better or two at a time like the previous ones. Set the goal and then take the actions necessary to achieve with a burning desire and a knowingness that you can achieve it and you will.

[luaprenraw]

how bout going to medical school and starting a medical practice????  

i'm sure what you're attempting to do can be done. good luck with it.

[Propertygirl]

Great Post Ted,

I thought the same thing only on a smaller level.
Find single family homes, use hard money if needed to purchase and fix up, then flip.......
Repeat these steps with larger property each time.

You will make it!

As I stated in a previous post of favorite quotes.....
"Those who stick will achieve"
                          Vince Lombardi

[Roger J]

As I've stated before, what someone else is/would/be willing to do is not as important as what YOU are/would be/willing to do.

Your goals (which you've stated), yourself (desire, knowledge, creditscore, etc.) and your local market will all affect HOW you need to go about making your $120K a year.  Do you want to do rentals or resells or what?

However, if you want a blanket idea, then I'd suggest that you put your $20K in the bank, use other people's money (OPM) to finance your deals, and now you only need $100K a year!

Raj

[Markmcg]

Thanks for the advice guys...some interesting suggestions.  I have built new homes and done rehabs, but prefer the rental/passive income approach to generate the $10,000/month goal.

Just found the first deal...see what you think:
6 unit apartment bldg. price...$90,000  appraised value is $150,000...rental income of 2400/month...Seller offering lease/option of 900 down and 900/mo.  Any suggestions?

Mark

[Roger J]

Numbers looks good.  If everything else looks good, I'd jump on it!

Raj

[Baloo]

I have always wondered what would be the motivation be for someone to want to sell a performing investement that pays for itself?

Landlording is definately not my forte', but that has always just bugged me

[jtmoniii]

Where do you live to find a deal like that?  Why would the seller be willing to sell for that price noting its cash flow.