Epic Real Estate Investing - Is This a Good Deal? | 857

Episode Date: December 5, 2019

Today, we are talking about finding real estate deals and Matt will show you how to determine whether a deal is good or not. Tune in and learn the 3 key things that will help you solve this doubt! Learn more about your ad choices. Visit megaphone.fm/adchoices

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Success in real estate has nothing to do with shiny objects. It has everything to do with mastering the basics. The three pillars of real estate investing. Attract, convert, exit. Matt Terrio has been helping real estate investors do just that for more than a decade now. If you want to make money in real estate, keep listening. If you want it faster, visit rei-aise.com. Here's Matt.

All righty, so today we're going to talk about finding real estate deals. And the main thing we're going to focus on is how do we know whether or not we have a good deal, right? Because we've got all these opportunities out there. Which ones do you choose? Which ones do you go forward with? Let's get started. All right, so when it comes to finding real estate deals, we all know we need to know the difference between a, a good one and a bad one, right?

And a huge thing that holds people back is they can't tell the difference. And I get it all the time. People are really worried about making a mistake because mistakes in real estate, they can be very expensive mistakes. So you've got to be really, really careful. And it makes sense. But here's the thing. If you're afraid of taking on a bad deal, don't be afraid.

Understand that there's no such thing. There's no such thing as a bad deal. just uneducated investors. And here's what I mean. I get a lot of email from you, but not a lot of different kinds of emails. It's kind of the same emails over and over and over again. I mean, there's a handful of different questions that I get

and they just come in over and over and over again. Like where do I find the money to invest? Or how do I get started? What's the first step? Or what's the best list to send mail to, right? What's the best list to send mail to? And I get a variation of each one of those a few times a week. but this one, this particular question,

this is the most common question that I get. And it goes something like this. Matt, will you take a look at this and tell me if it's a good deal or not? Is this a good deal? And, you know, I got three of those over the weekend for over the Thanksgiving weekend. I got two more today.

And it usually lands in my inbox with a Zillow link. Matt, is this a good deal? And there's the link to Zillow. Like, I'm supposed to click. I'm supposed to go research this for them. Or a screenshot of the Craigslist. ad and Matt, is this a good deal? Or sometimes it's just an address, right? And it's really difficult for me to stop my day and go do this for people. As much as I want to, as much as I want to help, that's a lot

of work. That's a lot of research. But, and I've certainly tried in the past, but sometimes it just gets so overwhelming. So if you've sent me emails, ask me to analyze your deal and you haven't heard a response, just understand that there's a lot of them there and I just can't get to them all. If I did that, I wouldn't get to my own deals. But with that, said, there's a bigger aspect of this that makes it absolutely impossible for me to help you with this question because you're leaving out a vital piece of information. And I'm going to share with you what that is. But before I forget, if you like this and you want to go deeper into finding good deals for yourself, you might like this new training that Ross and I, we just put

this up. It's a brand new approach to finding deals without ever having to leave your house. I know. If I didn't see it myself, I wouldn't believe it. I'm against all that type of stuff. But once I saw it, I was like, well, okay, I guess you're on to something. So if that sounds interesting, then head on over to drone flipping.com. Take a look. Dronflipping.com. And yeah, if you like what you see, then maybe it's something you want to get into.

You'll know exactly what to do when you get there. All righty. So this afternoon, I got an email, screenshot. Just like I said, screenshot of a Craigslist ad. It was a property. And it said, Matt, is this a good deal? And my immediate thought of which revolves around the, the most important piece of information that everybody leaves out. And there's no way I could ever

give you a real answer with any sort of validity, any sort of integrity if I did, if I tried to do it without this piece of information. And that is, what are you going to do with it? What's the end game, right? What's the goal here? If I don't know your goal, then I don't know if it's a good deal or not, right? I mean, for example, are you going to flip the contract? If you're going to flip the How much money do you want to make? Do you want to make 5,000 bucks or do you want to make 10,000 bucks? Or are you like, I'm not even getting out of my bed unless I'm going to make 20 grand. Everyone's going to have a different answer to that question. Or are you going to take ownership and then fix it up and then flip it?

And if you do that and you go through all that work, what's the minimum amount of money you're willing to take on that? Are you going to buy and hold as is? And if so, what's the goal behind holding the property? Is it a strong cash flow play? is it an appreciation play? If it's a strong cash flow play, how strong is strong? Are you looking for a dollar amount per month, or are you looking on for a rate of return per month or annual rate of return?

Do you expect that area to appreciate, that property to appreciate? Are you looking to just park some money and just keep it safe? Maybe that's what you're up to. Or is there a tax advantage play? Is it your first real estate investment or is this, you know, your 100th, and now it's a diversification play? Are you going to have to fix it up before you can take it? take advantage of any of those. How much time is going to be involved? How much expertise is going to be

involved? Are you going to add on to it? Are you going to change its use? Are you going to divide the lot? How are the other properties in your portfolio performing? Is this going to be better? Do you want more of the same? How is the other money in just your overall investments? How are those performing? Is this going to be a vacation rental? Are you going to divide the use? Are you going to share this with somebody? Is it something that you'll eventually want to move into? I think you're getting the point. There's a lot of questions that you have to answer, right, for someone like myself to even give you any sort of valid response to that question, is this a good deal or not? And the answers to all of those questions are going to be different for everybody, of which is going to represent a different

value to every person. So here's the deal. There are three things. There's three things that you've got to be crystal clear on to whether, to know whether or not you have a good deal. You need these three things, Okay. First thing, you have to answer for yourself, what's the minimum amount of cash that you're willing to work for? What's the minimum chunk of cash that you're willing to get out of bed and do what you got to do to earn it? You have to understand that. Will a thousand bucks for the day? Will that be good enough? Or are you like, no, I've done enough of those deals. I'm not doing anything for less than 10. So you have to answer that question for yourself. The second thing you have to answer for yourself is what's the minimum amount of cash flow you're willing to accept if you're going to hold on to the property? Right? I'm not going to hold on to a property unless it pays me at least $250 a month.

Or I need $500 a month. Or, hey, if I break even, I'm okay with that. Or is there an actual rate of return? Are you going to evaluate your cash flow performance on a ROI? You have to know that number for yourself, right? What's a good ROI? Well, it depends. It depends on you and your situation. It depends on where you're trying to go, right? So you have to answer that question for yourself, what's a good ROI for me that I'm willing to hold onto this property and take on the responsibility that comes with property ownership? What's the minimum amount or minimum ROI I'm willing to accept? And the third thing, which I think is really kind of the most important, and it'll impact the answer to all those other questions is, how long are you willing to wait for it? Right? How long are you willing to

wait for it? So how long are you willing to wait for it? For example, if you're going to flip a property and you're going to make 10 grand in a month, that might be acceptable. But if it's going to take you, four months to fix it up to take that in that 10 grand, that might be something you want to reconsider. Right? So once you've got answers to those three questions, what's my minimum cash? What's my minimum cash flow? And how long am I willing to wait? Once you have that, knowing whether or not you have a good deal, it's not going to be such a

mystery to you anymore. You're going to know. And you should know. I mean, this is your money. When you're playing with real money, making your decisions based off of other people's opinions, that's a dangerous place to operate from. You don't want to do that, right? You don't want to operate from a place of hope.

hoping that somebody else knows better than you, hoping that someone else has your best interest at heart, hope is a really bad investment strategy. So just understand that there are no bad deals, just uneducated investors. And when it comes to your money, you better get educated, right? If you want to make money and you want to have it grow and you want to maintain it. All right? So if that's all making sense to you and you like to start putting this to work into in the real world, I think you're really going to enjoy this brand new training that Ross and I

put together, head over to drone flipping.com. Check it out. All righty. So that's it for today. God bless and to your success. I'm Matt Terrio. Living the Dream. Take care. Yeah, yeah, we got the cash flow. Yeah, yeah, we got the cash flow. You didn't know home for us. We got the gas flow. This podcast is a part of the C-suite radio network. For more top business podcasts, visit c-sweetradio.com. Thank you.