Jeannie Niles Real Estate Investment
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How to Lose Money in Real Estate: 2006-2008
Have zero or minimal cash reserves.
Don’t be prepared for those “unexpected” expenses like a flood in your unit, a lengthy eviction, or a substantial repair.
Continue to expect 2006 - 2008 will be just like 2004 - 2006.
Real Estate goes up double digits every year. I can make huge profits without doing anything!!!!
Listen to most people in the real estate industry.
Real Estate Trade Groups, Associations, Mortgage Brokers, Title people, Agents, Brokers telling you “it’s going to pick up soon…I’m seeing an up tick in the market already.” (This is called wishful thinking).
Borrow more money.
This is especially for people that have followed #1 of this memo. Okay…so we are a little short on cash. From what I hear in #3 above, the market rebounding is just around the corner, so I’ll borrow a second Trust deed at 12% for six months to tide me over, further reducing my equity.
Refuse to Sell for Less than what you could have gotten in June 2005.
Don’t even think of issuing a counter offer or responding to the all cash offer you have received that is 85% of what you could have obtained sixteen months ago. It’s ridiculous to ever take less than what the maximum price was in the market. The broker that wrote this offer is just trying to make a commission. It’s irrelevant that this offer is three times what you paid for this property 8 years ago.
Think in the Short Term.
The market is crashing. Prices are going to fall 50%. Get out as quickly as you can no matter what it costs.
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Income property has once again become “Income property”.
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There are many small income properties available in the area. Prices here have declined over 50% since the peak of the market late 2005/early 2007.
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It’s possible to obtain some great apartment financing. 25% down payment and interest rates at 6% or slightly below.
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Cap Rate is an investment tool for analysis that enables an investor to compare one investment to another.
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Cap Rate is the best tool for determining the value of an income property.
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Some of the most outrageous episodes in property ownership that the owners lived to tell about.
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Only 5% sales agents or brokers actually own investment property, and only 10% actually sell a property.
Every investor's situation is unique, and I have over 25 years experience solving problems. Use the form below to ask me about your unique needs.
Jeannie Niles Real Estate Investment
P.O. Box 317
Palm Desert, CA 92261
P: (760) 360-4020
F: (760) 340-9069
E: jniles@realestate-investment.com
