How to Know the Best Time to Buy A Property: Darrell’s Secret
Darrell bought his first real estate property immediately after a hurricane…
…Luckily for Darrell, he’d already done his research and knew it was the perfect time to jump in!
Although he struggled to find contractors to work on his project, he feels better equipped now to take on even more deals.
He’s learned a lot in a short time and gave great advice on financing AND how to know exactly the right time to get into real estate investing—especially if you’ve been thinking about it for a while.
Listen to our conversation with Darrell to hear more about his investing experiences, the deal he found on MyHouseDeals and his tips for new investors plus…
- How to manage a ‘flip-project’ from a different state
- Managing properties after a hurricane
- How to raise seed capital for projects
NOTE: Darrell is a premium member, he received a FULL refund of his upfront membership fee for simply doing a deal! Find out more about our premium membership here.
Tell me a little about yourself…
What made you interested in real estate investing?
I’ve wanted to do it for a long time, and I finally decided to get started this year.
I like the fact that it allows me more time for my family and in the long run, gives financial freedom: those are my goals.
How many deals have you done so far?
This is my first deal. It has been exciting and also nerve-racking.
Have there been any challenges so far?
I am in the middle of the most stressful part which is the rehab. And with the hurricane, it has been difficult getting a contractor to commit to the project. Every contractor in the city seems busy.
I also have pressures from my lenders.
Do you have a full-time job?
Yeah. I have a full-time job. I work in the healthcare field. I also own a business as a handyman and I have a family.
How are you managing your time between all these projects?
I am off work during the week. My job allows me to work Friday, Saturday, Sunday, and have off the rest of the week.
I started the second job (handyman) to raise seed money to do real estate.
How did you educate yourself on the real estate investing process?
Internet, books, and forums. For about 15 years, I researched and watched the market change. I knew this was the right time to get in.
I’ve had two chances to do this earlier. But those weren’t the best times because I was naive and second, my wife and I were still building our family.
We have things stabilized now. The kids are in grade school and I have some free time during the week. So, we reevaluated and decided the time was ripe to get into real estate investing.
What other factors motivated you?
I’m getting older. I’m 44. It was one of those things where it’s like now or never. My wife and I are glad we started and we haven’t regretted it since.
How did you find this deal?
I signed up with ‘Bigger Pockets’ about a year and a half ago. I saw a couple of people commenting on the threads about My House Deals.
When I checked it, I saw that the pricing on MyHouseDeals seemed to be better, so I went with it.
There were many deals on MyHouseDeals, but you’ve to be on it every day. As soon as one comes up you have to be ready to jump.
The ARV numbers of the deals made sense. I didn’t even bother arguing. I paid the full asking price because the numbers worked.
How have you managed to rehab a property in a different state?
I built a network. I have an awesome realtor that is also doubling as a property manager.
I’m trying to build a construction crew. I have had a couple of contractors go there, but it has not been easy to get one for the project. The hurricane affected a lot of things.
How did the hurricane affect the market?
In August, there weren’t many deals. But from September, things got better. At the moment, there seem to be a lot of deals.
What lessons have you learned so far in the process?
I am having a lot of trouble getting a contractor to commit to my job. So, I will suggest not to be in a hurry to buy after a hurricane.
I am still new into this. But in the long run, I will have a construction crew.
How did you finance the deal?
I used hard money lending through ‘Do Hard Money’. It has not been the best experience for me so far because the forum has a lot of demands and policies.
It is a learning curve for me.
They will provide funds for five months. As long as the deal is strong enough, they will do 100% of the deal. If the deal is not strong enough, you will pull money from the other sources. You are also going to bring some money towards closing.
There are benefits, though, but I may not use them next time.
How will you finance your next deal?
I will use the proceeds from this deal as seed money and look for lenders.
Again, I will check different forums to see what other options I have. I like numbers, so if the numbers are good and everything works out, then I will use that option.
What advice do you have for new investors?
If you can find a mentor that’s not going to take advantage of you, that would be my best advice. Not everyone would want to learn by making mistakes.
Invest in yourself. Don’t be afraid to make mistakes. Have the courage to believe in yourself. Nothing happens if you sit by the sideline.
Darrell wanted more family time and financial freedom. Consequently, he decided to become a real estate investor.
After many years of research and planning, he felt the time was right to finally dive in. He made the decision with his family.
As this is his first deal, it took him a while to find one where the numbers work. He has less consideration for the area, as long as the numbers work.
Darrel checks listings to be the first to see a deal, jump on it, make an offer and close the deal.
He is very entrepreneurial and that has helped him succeed. He believes that if you are willing to work hard to get something done, the results will pay off in the long run.
Last, he advised that buying a house after the hurricane may not be the best idea. Unless you have contractors and a project team in place.