Real Estate

[Closer68]

My understanding is that, in real estate, "you make money when you buy." Have any of you ever gotten a really good deal on a piece of property? If so, how did you do it? I'm not talking about buying a damaged or outdated property and putting sweat equity into fixing it. I'm talking about negotiating a really good deal, perhaps 25-30% under market value, on something that is just fine as it is.

 

[red]

The question is hilarious. You're basically asking us to tell you how to get rich quick. Let me ask you a fundamental question - would YOU be willing to give-up your house for 25% to 30% under market value? I thought you wouldn't. Now, ask yourself how many others are willing to do the same thing!!!! These things ain't easy to find.

There are a few ways of trying to find them - people who facing some sort of distress in their lives (death, divorce, job loss, family strife, moving, etc...). However, the circumstances have to be pretty incredible to part with that much money!! If the average house in Toronto is $400,000 a 25% reduction is $100,000 for a house that is in good condition. One thing you could do is offer CASH, thus avoiding banks on your part and giving them a cheque in hand, without having to go to their lawyer. You could also advertise that you buy houses quickly. I know people who have done this, and they can be somewhat successful at it - but you still have to know what you are doing.

don't listen to 4tees, he is one of those lefties.


to buy real estate undermarket, you have spend time and energy and follow these simples steps:

1. learn hypnosis. Sellers will sell at what ever price you suggest.
2. buying from orphans. when you hear of the death of parents in a traffic accident or plane crash. hurry as fast as you can to get their orphaned children to sign sale agreements. I always keep a few with me just in case. remember when trolling through the childrens hospitals- wear a stehoscope- so the kids think you are their doctor
3. slip lsd into sellers drink. they will sign anything then.
4. forgery. learn the basics of forging signatures at my clinic. we also provide you with fake notary seals.

 

[mrsCALoki]

don't listen to 4tees, he is one of those lefties.


to buy real estate undermarket, you have spend time and energy and follow these simples steps:

1. learn hypnosis. Sellers will sell at what ever price you suggest.
2. buying from orphans. when you hear of the death of parents in a traffic accident or plane crash. hurry as fast as you can to get their orphaned children to sign sale agreements. I always keep a few with me just in case. remember when trolling through the childrens hospitals- wear a stehoscope- so the kids think you are their doctor
3. slip lsd into sellers drink. they will sign anything then.
4. forgery. learn the basics of forging signatures at my clinic. we also provide you with fake notary seals.

Hire ghosts to move into likely properties?

 

[oldjones]

What a hard crowd. 1) Determine the market value for the area. 2) Find a house in it selling for less 3) Persuade them to consider an even lower offer from you: Ready cash, fast closing, no conditions are some possibilities. 4) Live in it long enough to avoid capital gains 5) Sell and reap profit, but before you do, repeat with 1).

Otherwise or in addition to, buy the worst house in the best neighbourhood that your money can manage, then make it look—appearance being everything—like it isn't the worst. Enter the pattern above at 4)

 

[red]

Hire ghosts to move into likely properties?

thanks thelma

 

[mrsCALoki]

Issues with above:

1) There are so many "areas", you are best to specialize in one particular area, which means that you missing a swath of areas. Developing a system of property birddogs is a better, but not perfect way.

2) "Finding" a house selling for less. How exactly should this be done? If you suggest using MLS, ALL the listings on there have real estate agents who are selling the house. There is no way that you will be able to negotiate a lower price with a listing that has an agent. You may wish to try FSBO sites, but those individuals tend to have time on their hands and will not be in truly desperate situations.

3) Fast closings and no conditions mean that you take a lot of risk - is the owner who they say they are? Have they represented themselves correctly? What would a house inspection reveal? Are there any liens on the house? Fast closes also mean not using lawyers, and they are there to ensure that these questions are answered. Professional investors do waive conditions, but they know how to mitigate all of these circumstances.

4) No issue there

5) If one's money is tied-up in the existing house, how will they get money for a second one, or a second mortgage?

As to buying the worst house in the best neighbourhood, the OP stated that he wanted "something just fine as it is" and something that didn't require work

Translation: You need a lot of experience and a large support team to not loose money?

 

[Joey123]

What a hard crowd. 1) Determine the market value for the area. 2) Find a house in it selling for less 3) Persuade them to consider an even lower offer from you: Ready cash, fast closing, no conditions are some possibilities. 4) Live in it long enough to avoid capital gains 5) Sell and reap profit, but before you do, repeat with 1).

Otherwise or in addition to, buy the worst house in the best neighbourhood that your money can manage, then make it look—appearance being everything—like it isn't the worst. Enter the pattern above at 4)

I Concur!!

 

[TeasePlease]

What a hard crowd. 1) Determine the market value for the area. 2) Find a house in it selling for less 3) Persuade them to consider an even lower offer from you: Ready cash, fast closing, no conditions are some possibilities. 4) Live in it long enough to avoid capital gains 5) Sell and reap profit, but before you do, repeat with 1).

Otherwise or in addition to, buy the worst house in the best neighbourhood that your money can manage, then make it look—appearance being everything—like it isn't the worst. Enter the pattern above at 4)

Bingo! The only sure way to make money on an investment is to be in the money on the buy. If you're counting on a profit when you sell, you're just gambling.

I got my house for 150K below market because the seller listed it on a long weekend. I put in a bully offer with a short expiration, no conditions and a big deposit.

I bought a beachfront property down south this summer. It had been on the market for 270 days. The seller just dropped the price (again). Again, I went in over a long-weekend. The traffic was so light. I put in a slightly low bid but agreed to absorb a few transaction costs. I also agreed to a 20 day close (guy needed cash flow). I got it for 20% below market, and cheap enough that I'm not overly concerned whether it's rented out or of I just let friends/family use it.

 

[Rockslinger]

I watch Ann Rohmer and the real estate guys on CP 24 sometimes. They say there is never a bad time to buy real estate. When prices are going down it is a good time to buy because prices are lower. When prices are going up they say it is a good time to buy because, well, because prices are going up.

 

[TeasePlease]

I watch Ann Rohmer and the real estate guys on CP 24 sometimes. They say there is never a bad time to buy real estate. When prices are going down it is a good time to buy because prices are lower. When prices are going up they say it is a good time to buy because, well, because prices are going up.

Tell that to the guy I bought by the beach home from. He paid 2.5X what I got it for.

 

[Rockslinger]

Speaking of real estate, what do you guys think of the proposed 3 80 storey condos planned for the Princess of Wales Theatre?

There was an article in Toronto Life recently which said that Toronto condos are overpriced and shoddily built (hence glass windows are falling down among other problems).

 

[Nate1]

My understanding is that, in real estate, "you make money when you buy." Have any of you ever gotten a really good deal on a piece of property? If so, how did you do it? I'm not talking about buying a damaged or outdated property and putting sweat equity into fixing it. I'm talking about negotiating a really good deal, perhaps 25-30% under market value, on something that is just fine as it is.

I'm suspect of the wisdom of under valued real estate investments.

As stated above there is increased risk required to the deal. Risk in investments is OK, but it has to be a risk you can afford to take and at the current GTA average prices you are accepting a $500,000 liability (in the unlikely event of total loss).

The way I have done best buying low is by not trying to put a square peg in a round hole. During the course of our lifetimes there are some nearly obvious opportunities to win in all the marketplaces.

The most recent event I took advantage of was the BP oil spill in the Gulf. There stock dropped by half almost overnight. It has risen by about 60% off its low and paid 4 -5% dividend too. Before that Ford dropped to $1 yet it was most likely they would survive. I bough at $2 and sold at $10.

This can happen in any market. One guy mentioned southern property. Not a bad plan if you use the place and don't need anything back short term.

The point is keep an eye for the deal wait for it to come to you and don't try and force your will on a deal.

 

[Rockslinger]

The most recent event I took advantage of was the BP oil spill in the Gulf. There stock dropped by half almost overnight. It has risen by about 60% off its low and paid 4 -5% dividend too. Before that Ford dropped to $1 yet it was most likely they would survive. I bough at $2 and sold at $10.

I actually prefer stocks to real estate because low maintenance and your downside can't be more than 100% of your purchase price. Don't you hate it when your tenant calls you at 3AM to say that the basement is flooding or the roof blew away?

Old Irish proverb: "Never buy property where you don't live." Locals know all the skeletons, strangers don't.

 

[peter4025]

Bingo! The only sure way to make money on an investment is to be in the money on the buy. If you're counting on a profit when you sell, you're just gambling.

I got my house for 150K below market because the seller listed it on a long weekend. I put in a bully offer with a short expiration, no conditions and a big deposit.

I bought a beachfront property down south this summer. It had been on the market for 270 days. The seller just dropped the price (again). Again, I went in over a long-weekend. The traffic was so light. I put in a slightly low bid but agreed to absorb a few transaction costs. I also agreed to a 20 day close (guy needed cash flow). I got it for 20% below market, and cheap enough that I'm not overly concerned whether it's rented out or of I just let friends/family use it.

Agree with this. I bought my house 20% below asking price. Agent put it on sale on a long weekend. I put and offer with expiration time in four hours no other conditions.
Make sure that you are preamp prove for mortgage if you will finance it and take with you somebody that can do a quick home inspection.

 

[mrsCALoki]

I'm suspect of the wisdom of under valued real estate investments.

As stated above there is increased risk required to the deal. Risk in investments is OK, but it has to be a risk you can afford to take and at the current GTA average prices you are accepting a $500,000 liability (in the unlikely event of total loss).

The way I have done best buying low is by not trying to put a square peg in a round hole. During the course of our lifetimes there are some nearly obvious opportunities to win in all the marketplaces.

The most recent event I took advantage of was the BP oil spill in the Gulf. There stock dropped by half almost overnight. It has risen by about 60% off its low and paid 4 -5% dividend too. Before that Ford dropped to $1 yet it was most likely they would survive. I bough at $2 and sold at $10.

This can happen in any market. One guy mentioned southern property. Not a bad plan if you use the place and don't need anything back short term.

The point is keep an eye for the deal wait for it to come to you and don't try and force your will on a deal.

And be ready to risk 1/2 million if you are thinking short term

 

[Rockslinger]

It seems to me that almost all (almost but not all) every real estate speculator eventually goes bust. The Reichmans were once one of Canada's top 3 richest families, nobody talks about them anymore. The guy who built Place Ville Marie in Montreal went bust. Donald Trump went bust in the 1990's.

 

[Nate1]

It seems to me that almost all (almost but not all) every real estate speculator eventually goes bust. The Reichmans were once one of Canada's top 3 richest families, nobody talks about them anymore. The guy who built Place Ville Marie in Montreal went bust. Donald Trump went bust in the 1990's.

Yes, not enough diversification. With real estate and the desire for increasingly larger deals you end up with all eggs in one basket.

 

[Rockslinger]

Yes, not enough diversification. With real estate and the desire for increasingly larger deals you end up with all eggs in one basket.

Old Irish proverb:"1/3 in real estate, 1/3 in bonds, 1/3 in stocks and 1/3 in cash."

 

[Nate1]

Old Irish proverb:"1/3 in real estate, 1/3 in bonds, 1/3 in stocks and 1/3 in cash."

The rest in Shelagh?

 

[Closer68]

Bingo! The only sure way to make money on an investment is to be in the money on the buy. If you're counting on a profit when you sell, you're just gambling.

I got my house for 150K below market because the seller listed it on a long weekend. I put in a bully offer with a short expiration, no conditions and a big deposit.

I bought a beachfront property down south this summer. It had been on the market for 270 days. The seller just dropped the price (again). Again, I went in over a long-weekend. The traffic was so light. I put in a slightly low bid but agreed to absorb a few transaction costs. I also agreed to a 20 day close (guy needed cash flow). I got it for 20% below market, and cheap enough that I'm not overly concerned whether it's rented out or of I just let friends/family use it.

Fucking EPIC!!