The Comprehensive Guide to Real Estate Investing: Real Estate Strategies and Techniques Uncovered

By Donnel Roberts

Real Estate Investing is one of the most tried and true paths to creating wealth, however most people just don't know what to do or exactly how to get started. This "How to" real estate investing books covers a variety of topics. You'll get step by step practical information about how to invest in single family homes, apartment complexes, tax deed auctions, short term vacation rentals and so much more. You learn strategies on how to purchase properties with little or no money down, as well as where to get the money quickly for properties that require it. This is a great book for anyone interested in real estate investing but not sure of the first steps they should be taking. It covers practical information on how to earn money quickly, and how to build long term sustainable wealth. This book will even include word for word scripts so that you can remove any guesswork when using these techniques to acquire real estate. This book will also help seasoned investors take their real estate investing business to the next level.

• Language: English
• Publisher: BookBaby
• Release date: Jan 1, 1900
• ISBN: 9781667894188

Book preview

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The Comprehensive Guide to Real Estate Investing

Real Estate Strategies and Techniques Unconvered

This publication is designed to provide accurate and authoritative information with regard to the subject matter covered. It is sold with the understanding that the publisher is not engaged in rendering legal, accounting, or other professional service. If legal advice or other expert assistance is required, the services of a competent professional person should be sought.

Copyright © 2023 by Donnel Roberts. All rights reserved.

Hardcover ISBN 979-8-218-09870-4

Paperback ISBN 979-8-218-09871-1

No part of this book may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying, recording, or by any information storage and retrieval system, without the written permission from the publisher. Please direct any inquiries to: realestateandwealthcoaching.com

Table of Contents

Introduction

Why Real Estate?

Residual Income

Leverage

Tax Benefits

Hedge Against Inflation

High Priority for Consumers

Equity

Recap

Wholesaling

How This Process Looks

Alternative to the Assignment

Assignment vs Double Close

How to Calculate Offer Amount to Seller

How to Estimate Repairs

How to Find Sellers/Properties

How to Find Cash Buyers

My Story

Recap

Script

Lease Option

Sandwich Lease Option

How to Find Houses to Lease Option

How to Find Buyers for Lease Option

My Story

Recap

Script

Contract for Deed

Conversations with Sellers

Getting Contracts Signed

My Story

Recap

Script

Owner Finance

Benefits to the Seller

Discussing the Terms

My Story

Recap

Script

Subject To

Different Ways a Subject To Deal Can be Structured

Integrity Is Key

Reasons for Investors to do Subject To Deals

Reasons for Sellers to Sell Subject To

Gaining the Seller’s Trust

Pre-foreclosures and Foreclosures

My Story

Recap

Script

Private Lending

Why Would Someone be Interested in Lending You Money?

Private Money Lending versus Hard Money Lending

Where Do You Find People for Private Lending?

My Story

Recap

Elevator Speech

Buy, Fix, and Flip

Finding Deals

Funding the Deals

Run the Numbers

Should I Get My Real Estate License?

Experience Is a Plus

My Story

Recap

Script

Tax Lien Certificates and Tax Deeds

Tax Lien Certificates

Tax Deeds

Which One Does Your State Do?

My Story

Recap

Credit

Credit Report

How to Raise Your Credit Score

Revolving Debt vs Installment Debt

Good Debt vs Bad Debt

Emergency Savings

My Story

Recap

Buy and Hold

Benefits of Buy and Hold

Financial Independence First

Wealth Building

House Hacking

How to Analyze Rental Property

My Story

Recap

Apartment Investing

How to Locate Apartment Complexes for Sale

The Process of Purchasing

Let’s Look at the Numbers

My Story

Recap

Property Management

Pros of Using a Property Management Company

Cons of Using a Property Management Company

Self-managing

Recordkeeping

My Story

Recap

Airbnb and Vacation Rentals

How to Get a Home Airbnb Ready

Upload Your Listing

Your First Booking

My Story

Recap

Putting Your Team Together

Team Members

How to Find Them

My Story

Recap

Time to Get Started

Book Smarts vs Street Smarts

Action Steps

Here’s the Difficult Part

Break Your Goals Down to Daily

100-Day Challenge

Success Is Yours

Introduction

Real estate investing has crossed many people’s minds at one point or another. They ponder the lifestyle they could have or the freedom it could bring. However, sadly for many individuals, the seemingly lofty venture doesn’t go any further than a vivid imagination. A few may take a step forward by doing some preliminary research, but even after gathering information, they remain unsure of the initial steps they should be taking. In this book, you will not just learn theoretical concepts about real estate investing, but you also will get an enormous amount of practical information that you can utilize right away. We will cover where to get the money for purchasing properties as well as strategies to acquire real estate with very little or even no money. We will discuss details about investing in rental houses and apartment complexes . We’ll also cover ways for you to take advantage of tax sale auctions, Airbnb investing, and much more. In addition to serving as a guide for those new to real estate, this book will provide valuable information for seasoned investors as well. Real estate investing gives you the opportunity to generate cash flow fairly quickly and build long-term wealth, if that’s your goal. I pray that you learn a great deal from this book, but more importantly, that you take action and put this information into practice immediately.

Chapter 1

Why Real Estate?

Let me start by emphasizing that owning a business in general is one of the best paths to take in order to achieve financial success. I am a strong proponent of business ownership and would encourage individuals to pursue whatever goal or dream they may have. With that being said, I’ll explain why, as a business venture, I still favor real estate.

Residual Income

Residual income (or passive income) continues to flow in after the work that generated the income has been completed. Examples of residual income could be when an artist creates a song, when a vending machine is placed in an establishment, when an insurance agent sells a policy, or when a rental property is leased. Again, with all of these, the income continues after the initial action. Residual income is a major reason many people gravitate towards real estate investing, when looking to start a business.

Leverage

Leverage in real estate is when you’re able to use a little to control a lot. When you use a 10K down payment to purchase a 100K property, you now have control of the entire asset. You have the full usage of that asset, with all the benefits and rights that come with it, but you don’t need to have the entire 100K upfront. Since you’re able to use a small amount to obtain something worth much more, that allows you to reach your goals a lot faster. Leverage is the main reason wealth can be accumulated so quickly in real estate.

Tax Benefits

The tax benefits that real estate investors receive are numerous. Some of the expenses that are tax deductible include property taxes, insurance, maintenance, mortgage interest, travel expenses, and many more. Another notable tax benefit for real estate investors is depreciation. The IRS allows a tax deduction over time with your investment property. This deduction is to account for any depreciation your rental property may have, even though real estate typically appreciates over time. With a residential rental property, the depreciation deduction is spread evenly over 27.5 years. A brief example of how this looks would be if your home is worth 150K (excluding the land value) and you divide that by 27.5 years; that’s $5,454 per year that you get as a tax deduction simply for owning the property. In addition, if you do happen to sell a property, you have the option to defer capital gains taxes from that sale. Typically when you sell a property, the profit is subject to capital gains tax. However, the IRS allows you to do what’s called a 1031 exchange. This is when you sell an investment property and use the proceeds to invest in another rental property of equal or greater value. If you do this then you avoid or defer paying taxes on that profit. I could continue on with other tax benefits, but I’ll conclude with the fact that rental property income is also not subject to payroll or FICA tax because it’s not classified as earned income.

Hedge Against Inflation

Real estate is a phenomenal hedge against inflation for investors, because as the cost of goods and services rise, rents on income properties rise as well. In addition, the value of real estate usually appreciates over time, to keep pace with or even beat inflation. On the other hand, if your money is parked somewhere that isn’t at least keeping pace with inflation then you’re in essence losing money.

High Priority for Consumers

Whenever the economy is in a downward spiral, which happens from time to time, certain items or activities tend to get cut out of the typical household budget. Families may pull the purse strings a little tighter and not go out to eat at restaurants as much. They may decide to cut back on the cable package to lower the cable bill. This is when people start canceling their gym memberships. Most people will tend to do less shopping in general. As a result, several businesses take a big hit, and if the lag in the economy lasts long enough, some businesses may even have to close their doors permanently. However, real estate is a need, not a want, because it’s essential for people to have a place to live. Mortgage and rent remain a high priority in most everyone’s budget, no matter how tight things get. So when evaluating a business to become involved in, it’s usually better to select one that has something people will need to continue to utilize, no matter the state of the economy.

Equity

As rents come in month after month, and mortgages are paid down on your investment properties, your equity grows. Your equity is simply what your property is worth minus what you owe on it. If you choose, you can use your equity to purchase additional investment properties. Reinvesting equity is how many people grow their investment portfolio.

Real estate investing is one of the most tried and true ways to generate cash flow and ultimately build wealth.

Recap

Benefits of investing in real estate:

Residual income

Leverage

Tax benefits

Hedge against inflation

High priority for consumers

Equity

"90% of all millionaires become so

through owning real estate."

–Andrew Carnegie

Chapter 2

Wholesaling

Real estate investing offers various ways for a person to become involved. Wholesaling is an excellent option as a point of entry that requires little or none of your own money. This strategy can generate cash fairly quickly and the concept is pretty simple. Wholesaling is when you locate a property and put it under contract with a seller (at a discounted price) and then you assign the rights to that contract to a cash buyer for a fee. Now even though simply signing a contract with the seller doesn’t make you the owner of the property, you still have contractual rights. Once the purchase and sale agreement is signed, you are now a principal party in that transaction. You do own the rights to the contract, which you can transfer to someone else for a fee. Wholesalers typically charge an assignment fee of between 5K and 10K per deal. Sometimes the fee may be higher depending on the price range of the deal.

How This Process Looks

The first step in this process is to find a property that you can acquire for a price that is below market value. Usually this only happens if you find a distressed property that needs to be renovated or a homeowner that needs help out of a situation. When you find a property that fits the criteria, you make the appropriate offer to the seller. If you and the seller come to a satisfactory agreement then you both sign a purchase and sale agreement. It is customary to give earnest money. If it’s a private seller, $10 or $20 will usually be sufficient.