Hey, welcome back friends.
Today, I'm going to be talking about the worst way to buy real estate.
You're going to want to watch this.
And at the end of the video, I'm going to share with you some alternative practices
that will actually be the best way to buy real estate.
As you can imagine, I get emails and messages, phone calls that I've talk with people all
over the world about their real estate experience.
And I've been collecting some of the best worst ways of doing real estate.
In fact, just last night, my producer, Nate Woodbury forwarded me an email from couple
that lives in Bali.
They moved there from, what's that down under place?
Australia.
And they told me that they some gather life savings into high end real estate that they're
going to rent out in Bali and they ran out of money and they don't know how to get money
and they're stuck, right?
Well, that not the worst way to do real estate.
But I just want you to know like, people get stuck in real estate.
You might be watching this because you had a deal go bad and you're trying to learn from
your mistakes or learn from my mistakes or learn from other people's mistakes.
Well, today when we talk about the worst way to get in real estate.
So, this is the way that the story goes.
You catch the real estate bug.
You go to some seminar.
Maybe you watch this video and you're like, "I've been looking for a way to become financially
free."
Maybe you know someone has made money in real estate and just like me, you catch the bug.
And just like, boom!
You're bit.
And you know that real estate is how you're going to financially get where you want to
go in life.
So, all of a sudden you're thinking, "I need a home.
Every investor has a home.
I need to buy something."
And what you do is you find a property and usually a single family home.
It could be a duplex or something like that.
But it usually just a really basic entry-level home and you're thinking, "I'm going to buy
this and I'm going to rent this and I'm going to be an investor.
Because you think that that's the goal.
You're wrong.
So, you take your life savings, your 401k, your I-R-A and you buy a home and you think,
"I need to put and get renters in there.
So I'm going to lease it online and going to put a rent sign and you find renters.
And before you know it, the house is rented out.
Now, you're problems begin.
The first thing happen is you realize you don't have that much cash flow.
And with renters, something breaks and all of a sudden they want that extra cash flow
plus sum to fix the dishwasher or the toilet broke or the lighting thing.Or you end up
picking a, you know, because you're inexperienced.
So you picked a renter that is like crazy pick you.
You're like, "This person is going to totally take care of this house."
No, you just found someone that's going to be your worst nightmare.
That is going to be nitpick you to death.
And every single time like, somethings doesn't work exactly the way it should.
Guess who guess to fix it?
You.
You go the opposite.
You actually find someone that really can't afford it.
And from day one they're giving you excuses/ "Hey, I get my paycheck late and I got this
one thing happening and I took my daughter to the E.R.
Can I pay my rent late?"
And all you did is give them permission to be late.
I promise you, every single month.
Because in life, when people financially struggle, they look for which bills are flexible.
And because you're brand new to real estate, you're likely not a bulldog.
And you're probably the really nice person.
And you're like, "I can be flexible.
Look, I'm the cool real estate investor."
Loser!
I'm just saying, you're going to lose bad.
That's what loser means.
So, you start making the basic mistakes.
So, now you don't have a cash flow and you're running out the property to someone that's
maybe not taking the best care of it.
Or they're being really finicky and they just keep asking what turns into is, write me a
check, write me a check, write me a check.
"Fix this thing or I'm not giving you money as fast as you need.
It's to cover your mortgage."
And that's how you become a "Don't-wanter."
Because you've thought that the goal was to own a property.
That is not the goal.
Okay.
So, check out the house right here, right?
It looks adorable.
It's cute.
It's got a basic 2-garage bay.
It has a little bay window upfront.
It has a little cute porch.
And when you're the brand new investor, you're thinking, "It's a house, I need a house."
I can't tell you how many idiotic investors are out there like, "To be an investor, you
have to buy a house."
A house is for sale so I just bought it."
They're not thinking.
Does it have equity?
They're not thinking.
Does it have cash flow?
And you have to have those thoughts.
You got to be thinking.
You know, what ends up happening for the newbees is they fall in love with the house instead
of the numbers.
You got to understand there's a difference between a home and a house.
When you're brand new in the investing game you're thinking, "Well, I like this home.
This is a house that I would live for my family."
You can't think that way.
There's people of different socio- economic statuses.
There's people at different financial levels.
You can't be thinking about you.
If you're thinking about you, you're going to be thinking, "Does it have granite?
Has the flooring been upgraded?
I don't know if I like this pink colors."
And frankly, those are not the thoughts that you should be thinking about.
In fact, house like this that you think is cute and adorable is the house that turns
into your nightmare if you haven't crunched the numbers and done at the right way.
Is there equity?
Is there cash flow?
Now, I did promise you as a little bit of a bonus how to actually to do real estate
the right way.
So, I want you to listen really carefully, write this down.
Number 1, do a lease option instead of a rental.
A lease option gives you 2 or 3 hundred dollars more a month of cash flow of higher rent.
Number 2, they'll give you non-refundable down payment.
$3,000, $5,000, $10,000 that you get no matter what.
So, instead of refundable deposit and minimum cash flow, you actually get a big, you get
to keep a down payment and a really awesome cash flow.
The third thing that a lease option is going to do is it puts the responsibility to people
in the house to actually take care of it and when they don't like something, they fix it.
These people will also, because they want to eventually buy it, they'll also sometimes
repaint or buy carpet and make improvements to the house.
Now, with that strategy, you got to do it the right way.
But what I am talking about, I call it specifically compassionate financing because there's a
way that fund the right families and put them in these homes but this is 250% more profitable.
It means 2 and a half times more profitable than just doing a straight across the board
rental.
I got another video at the end of this that I'll queue for you that will actually show
you how that systems works and how to do it.
And if you already own a home right now or you been thinking of moving and you own a
single family home, I am going to tell you right now, you need to get your hands on my
exact strategy.
Because i'll show you how to instead become a Don't-wanter like we talked about ealier.
I am going to show you such a profitable strategy that you're going to say, "How do we get another
property as quick and fast as possible?"
Hey, thanks for watching today's video.
I hope this was helpful.
I hope this will help you avoid common mistakes that people definitely make in the world of
real estate.
And check out some of the other videos here that will show you how to do it in the most
profitable ways.
If you're a little bit like me, a little bit impulsive and say, "I don't want to wait.
I am ready to take my risk, Kris.
And I want to know how to get into real estate as fast as possible and start really making
that good money then I want you to actually head on my website.
Click the link in the description below and you can actually speak with a member of my
team.
The website will tell you a little bit of how we are going to get you started and then
someone on my team is going to reach out to you, someone that I personally trained.
Show you how you can get mentorship from me.
How you and I can work together to help you accomplish in real estate what I have.
Take care.