May 11, 2012

Real Estate, "A Matter of Opportunity"

I was reminded of something recently that I had learned while attending the Center for Real Estate at Massachusetts Institute of Technology. In talking with the founder of Landmark, Wayne Kiltz, I shared with him these thoughts.

"When I finished with school at M.I.T., one of the most important things I learned was that real estate business is all about taking advantage of the opportunities that we find. This means keeping your eyes open all the time for deals. It does not matter where you find them or what they are. I think you should be interested in all kind of deals from houses, apartments, duplexes, commercial,  to loaning money, hard money lending, lease options, land contracts, buying tax certificates, you name it." Imagine me, telling the founder of Landmark this.  But I have found this to be true in my experience.

There are three basic filters that you need to run each potential opportunity through.

1. Does it cash flow really well? By this I mean at least 1.5 debt coverage

2. Can you finance it easily? This is probably the most important one. If the seller will provide the financing, you should seriously consider the deal. Getting financing is one of the hardest parts of real estate investing.

3. Does it fit part of your long term investment plans? Can you see yourself owning the property for 20 years? Will you like going to check on it? Will you be proud that you own it?

If you can answer all of theses questions positively, then you should buy that piece of property. I am not kidding! Now is the time to do something. The deals are amazing!  Go for it!

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