Five years ago today (08/28/2006) I purchased 2035 Western ave for $200,000. I purchased this property from a wholesaler. I don't remember what his wholesale fee was, but I believe it was $5,000. I used an equity line of credit and paid cash for the property. I spent about $5,000 on rehab (I had no idea what I was doing!). To find a rehabber, I asked one of the other investors I knew if he could refer me to someone. The guy did a great job on this property even though he turned out to be a total tool on the next deal.
Western ave is a 2 Bed 1 Bath in a not so great area of San Bernardino. It is hard to believe I paid $200K for a 2 bedroom house in a not so great neighborhood, but the numbers made perfect sense back then. I sold it on 11/16/2006 for $272,000 and made about $25,000. The funny thing about this deal is how little I knew what I was doing.
Even though I was a licensed real estate broker, I had no idea how to sell a property. (They don't actually teach you that when you are studying for your license.) I didn't know what disclosure were required or how to even negotiate a counter. I was totally clueless! I was able to list the property in the MLS. It took me a few tries to get all the required data in there. Once I got an offer, I called up a neighbor who has her license and asked her to handle the transaction for me. I think I paid her about $2,000. I got copies of all the disclosures and kept them in a file.
The point (moral?) of this story is I was determined to succeed as an investor. I might have jumped into the pool headfirst without checking to see if there was water in there first, but I knew the integrity of the wholesaler I was buying from and every thing worked out well.
I had a lot of problems (lessons?) dealing with that property from homeless people sleeping in the garage, disposing of an old RV and an extremely old rusty car, to someone breaking in, and having to evict the woman the wholesaler purchased the house from. It was a fantastic learning experience for me. Unfortunately, after this deal, I got into 2 or 3 even worse situations, but I am all the better for it now.
These days I own quite a few houses and several small apartment bldgs. The cash flow is doing very well and I mainly focus on wholesaling properties.
How long ago did you start, and where are you at today?