What? Todd, you were being given a home and you didn’t take it? Yep, you read that correctly! I was given the same test as my mentor and coach and I failed! You see, an investor down in Florida was giving away a condo, I thought “GREAT! A perfect investment property”
That is when my friend, coach and mentor pointed out some very hard math that I didn’t consider. The first was I couldn’t sell it if I took it, because the banks wouldn’t lend on it because it hasn’t been finished and 80% of the building has been foreclosed on.
The second was the rent in the building. If I could find a renter it would have been only about $1400 a month, but the taxes, insurance and the HOA dues would have come to close to $1800 a month. My free property, even if I had a renter, would have been costing me $400 a month. (How is this a good deal?)
So, I learned a valuable lesson about investing in areas that I don’t know very well. Ask questions! Because if a deal sounds too good to be true, it probably is… Free isn’t always as great as it sounds!
If you are thinking of buying an investment property anywhere in the United States, make sure you run it through my property analyzer before you put any money down or pay for any inspections.
Todd Clark - Broker / Sales Coach
Palazzo Realty Group
Phone: (503)524-9494
Fax: (503)622-8739
©2009 Todd Clark - I was almost given a home in Florida, thank goodness I didn’t take it!
Todd Clark and the Friendly Home Team
Knipe Realty
Todd@IFoundYourNewHome.com
Phone: (503)524-9494
Fax: (503)746-9573
I am a licensed Realtor who specializes in Washington County, Oregon and also work in both Clackamas and Multnomah Counties including the cities of Aloha, Beaverton, Canby, Clackamas, Gladstone, Gresham, Happy Valley, Hillsboro, Milwaukie, Oregon City, Sherwood and Tigard. All information contained in these posts are copyrighted and cannot be used without prior written approval authorization from the author me Todd Clark. If you are looking for an outstanding agent please give me a call I would love to help you with all your real estate needs.
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Great advice. Never know until you run the numbers and consider the area.
Ah Todd, Florida real estate has taught thousands many hard lessons, including myself. Glad you made the right choice!
Todd
If it sounds too good to bee true....I got an invitation to invest in a project in Spain. That's great until I realized I could not get correct title. Scary world we live in.
there are some deals and some "free" things that are best not taken advantage of.
Todd - For a time, everyone wanted to be a real estate investor. Often, inexperienced investors didn't run the numbers or have an exit plan. Guess what happened to these investors and their properties?
Great example, Todd, it just shows how important it is to have full knowledge of ALL the facts before making a decision...especially for something like this that seems "too good to be true". :)
I guess it just goes to show ya, when somebody offers you somethin' for nuthin', you'd better be askin':
What's in it for him?"
Todd, In Florida you also have mold issues. If that building was not finished and not running AC, I think at any price...it would be a disaster. You are right, don't buy in an area that you know nothing about. Good post.
Perfect example of when FREE is not FREE!! Invest locally OR hire a professional property manager....
Todd,
Think about the folks who aren't as savvy as you are. Free is going to cost them big time!
Hi Todd...you make some great points, Free always has a string attached, Investigate is the Optimum word of action.
Todd --- Thanks goodness you didn't accept that condo in Florida, especially with the economy situation.. Your post has a valuable lesson there.
Mama Liz
Hmm... well thank goodness you did the math before jumping right in. That would be a horrible lesson to learn 'after the fact'.
Oh, and if you don't know a lot about the area, it might not be a fabulous idea!
The word FREE really gets everyones attention, doesn't it? I learned long ago that there is no such a thing and you just proved it again! Thanks Todd!