How do the real estate pros buy 10-20 properties a month and were do they find... [Archive] - Real Estate Insider Forum
 
Web realestateinsider.net

View Full Version : How do the real estate pros buy 10-20 properties a month and were do they find...


chilask
07-14-2007, 06:36 PM
...them ? I intend to run my own real estate investment company and would like the following questions answered. My understanding is that the pros use hard money to fund their deals and if they dont sell the rent the property. After some analysis i realized that after rehabing the property and you decide to rent, 90% of the time the rental doesnt cover the mortagage. How long do you have to carry the negative loss assuming you have 10 properties at one time ?

David
07-18-2007, 10:48 AM
You have to cover the negative loss until you sell the property or find a tenant willing to pay enough to cover the mortgage. You are right though what a lot of investors don't understand is the cost of money (mortgage costs, rehab costs) and only look at the final numbers if you look at it this way you can end up losing money without realizing it. That's why you only buy properties where all the numbers make sense. The investors aren't buying $200,000 properties for $190,000 they are paying much less than that because if they were paying the actual value the numbers wouldn't make sense.