http://www.JoeCrump.com/youtube Real estate investment expert, Joe Crump, teaches zero down investing techniques. Learn foreclosures, short sales, subject to, land contracts, multi-mortgage and other creative real estate financing structures. Free newsletter teaches you how: http://www.JoeCrump.com Six Month Mentor Program http://www.zerodowninvesting.com Read Joe Crump's Blog: http://JoeCrumpBlog.com/ Joe Crump's website: http://JoeCrump.com Read the transcript: Joe: Hey, it's Joe again. We've been talking a lot about how to analyze deals. We've been talking about specific deals and specific questions that I've gotten from you guys. And what I thought might make a little more sense than going into more deals that are sent to me specifically from you guys (because I've gotten so many of them and I appreciate you sending them) is to let me go through a series of videos that show you what does make sense. Rather than saying, 'Does this make sense?' let's show what does make sense; what is possible. Joe: And then, you can extrapolate from there -- does my deal fit into what makes sense? And why do these make sense? These next few videos that I'm going to show you are going to be the different types of deals that you can make money with. And remember, it always goes back to those two things that I tell you about all the time: there's only two types of deals that are going to make you money. One is properties that you can dramatically under market value for cash. The other is properties that you can buy at market value or below that you can buy on terms. With either one of those ways, you can almost always make money as an investor. And you can do it different ways. Joe: Let's start though, with cash deals. Properties that you can buy dramatically under market value -- dramatically under market value is one of those variable sort of numbers. 5 years ago, 20% under market value was considered dramatically under market value, especially in some markets that were shooting up 40% or 50% a year in value. If you could buy something 20% under market value currently and knew that it was going to up another 50% the following year because the market was going so crazy, that could be a pretty interesting deal. Joe: By the way, that's how I started in real estate investing -- I bought a property at market value. It was being built. It took 4 months to build it and by the time it was built it had gone up 20% in value. And I'm thinking, 'Wow, this is cool.' And this was in 1986 when the market was going crazy. Don't do that, by the way -- don't buy properties based on appreciation. That was a stupid thing to do. I was just lucky -- I got in at the right time at the right place and I didn't lose money; I started making money immediately. Joe: A lot of you, your first experience in real estate investing is where you lose money, and that's a shame -- because it usually knocks you out of the game and it keeps you from doing it again. I was lucky. I got a taste of it and I started thinking, 'Well, what if I actually bought a property UNDER market value?' What a light bulb that was! So I started buying properties from HUD and from VA foreclosures, and I'd fix them up and then we'd turn around and sell them, plus they had the appreciation that was going on in the market nationally at that time. And I was able to buy properties at 15-20% under market value and that would be considered dramatically under market value at that time. Joe: Right now in this market environment, 20% under market value is not dramatic. You're seeing properties all the time at 30-50% under market value. And I'm talking about real market value, not somebody's perceived idea of what the real value is. Because a lot of people will tell you, 'Oh, that property is worth $500,000 when it's worth $250,000 because that's what it was worth 3 or 4 years ago, so don't necessarily believe the values that you're told. And even if you do comps, don't necessarily believe that those values are accurate, either. I honestly don't know the value of some of my properties simply because the area is so variable -- there are so many different comps in the same area that are for identical properties so how do you really extrapolate from that? What you do is hold onto those properties and let the market stabilize itself which will happen over the next 3-5 years. So always have exit strategies that give you multiple options, especially if you're buying for cash. ... To read the rest of the transcript, click here: http://joecrumpblog.com/deadly-mistakes-cash-investors-make-how-to-invest-safely-video-17/
Visibility: 2535
Duration: 9m 58s
Rating: 9