Back in the Saddle

You'll remember that a year ago I put on my first CA open bid sale.

And, while it didn't go as planned (plan being that i make another sweet 5 figure paycheck,) we were able to secure a buyer for the property and I eventually got some $$ (4 figure paycheck) for my efforts.

Still a big fan of the open bid sale concept.

Another year gone and as it turns out, exactly 1 year to the weekend from my last open bid sale...

http://www.postlets.com/res/2989512

It's a nice little condo/townhome in Grover Beach with views of the Pismo Beach hills and some nice amenities.

As another little reminder of how much things can change in a year, I'm licensed and running this open bid sale as an agent! No chance of 5 fig paycheck this time, however... I am hoping to make up in volume for what each potential sale lacks in potential profit compared to an investor deal.

Lots and lots and lots going on in my little real estate world right now.

• I've started a consulting project for a company that works with real estate investors as a success advisor, which allows me to spend more time at home and less weekend nights working at the restaurant (which is nice.)

• Plus, I have two buyers in escrow and the condo listing. Not bad.

• I just finished a submission for a free quarterly newspaper that will be mailed out to every household in town in about 3 weeks. Should be a nice little promo piece.

• I partnered with one of my investment property buyers in Virginia Beach (she bought Jeanne St in VB. Remember that one from May 08?), and we are going to update and re-vamp 11daysale.com and 11daysale.net. She'll help build the site and we'll both submit 'free special reports' and videos. And, if leads come in from different areas in the country, I'll be able to use my connections from my RE consulting gig to get them taken care of and hopefully make a little referral $$.

California fall weather is just spectacular and we are LOVING it here. Thanks to my wife's family for support on that one. I will say that it is truly refreshing to have your in-laws be your biggest fan/support. Not everybody can say that.

I hope to post more often, but as you can imagine, my days are full and I love being busy.

Pray for a quick sale and 2 quick escrows!

More next week.

All the best,
Taylor

Buying REO's - Market for the Insane

First off, thanks to TampaSteph and also Shae for the following video.

Are you thinking about getting into the REO market? Maybe you don't like dealing directly with homeowners and think that it would be much easier to buy directly from banks?

It isn't my favorite method of doing real estate, and the following video has a familiar ring to it if you've ever dealt with a bank 0wned or short-sale property.
http://www.youtube.com/watch?v=SM7oWKgCVo4&feature=player_embedded

Enjoy & good luck with your own REO adventures...

Blog Post #100! Hawaii in 2009

I've got a lot of things going in real estate land, but first,

Thanks to everyone that made my most recent trip to Hawaii possible!
My brother got married Saturday and his bride is from Japan, so the most convenient place for everyone to meet was... Hawaii!! So we took the kids out of school for 4 days and flew to Oahu.







4 Days in Oahu/Waikiki for sun, sand, surf and crowds.














I took my oldest son (13) surfing at Canoes/Waikiki (which, incidentally was the same place I learned how to surf @ age 14.) It was a very rewarding experience

North Shore on Friday and the quality of surfing literally blew my mind. In fact, the sheer number of great surf spots and corresponding high quality surfing re-adjusted my surf quality meter. Here's my surf confession: I'm a chump and my spots here in CA are crap. I admit it. Hawaii kicks serious surf booty.
Beautiful sunsets,













Awesome views,













And Delicious Food. (We ate the whole thing already?!)

Sales Mastery Resource: Option ARM Reset Schedule Update

I subscribe to Clusterstock.com and their 'chart of the day. I've been sharing a similar chart with sellers from Deutsch Bank that shows a wave of resets hitting in 09-11. Looks like banks have updated their plans and extended the pain out for a few more years...

Here's what Clusterstock says of their chart:

CHART OF THE DAY: The Option ARM Armageddon

John Carney and Kamelia Angelova|Sep. 21, 2009, 6:04 PM |

Tags: Chart Of The Day, Mortgages

"The Option Arm Armageddon was supposed to strike in the spring of 2009. Across the country, option adjustable-rate mortgages (ARMs) were set to detonate and start a new wave of foreclosures.

But it never happened. We made it well past when this chart from Credit Suisse showed the option ARMs were supposed to begin to hit. And the crisis didn't come.

Why not? Well, when interest rates dropped to historically low levels as the Fed fought the financial crisis, the wave of resets was held off. Unfortunately, low interest rates won't last forever -- they'll now likely strike next year and continue well into 2011. Many borrowers who now have the option of making payments so low that they don't even cover the interest are seeing their original loan balance grow, even as their home values continue to fall or remain flat.

The chart below shows that the option ARM reset problem is comparable to the subprime problem, and will likely last for quite some time. Armageddon may have been forestalled but it hasn't been overcome."

So what does this have to do with Sales Mastery? Well, one of our main tenets is: Foreclosures up=Inventory up=Prices DOWN.

Sellers need to know this info so they can plan what the best move is for them. Sitting tight? Better have a comfy seat... This looks like the best time to sell for the next few years...

Subscribe to the Chart of the Day.

Cheers,

Taylor

Resiliance

Funny story.

You know I work as a waiter at a local italian restaurant a few nights a week to keep cash coming in (and also pick up a few real estate leads...)

Last night was excruciatingly slow so I was excited when a table of 9 got sat in my section. I was out on the patio so any night mid-week is a total crap shoot when it comes to getting tables.

I got a drink order and loaded up the largest cocktail tray we had with 3 cokes, 2 iced teas, 2 pints and a lemonade. I didn't have room for the raspberry martini so i decided to hand-carry it with my right hand and deliver that drink first when I got to the table.

I approached the table and went to set down his raspberry-tini, saying, "here's your raspberry-tini sir..."

He says to me, "no, I ordered raspberry tea."

Whoops. No big deal. In fact, I had an extra tea on my tray so that would work out fine. (Internal dialogue: now what to do with this drink in my hand so I can unload this heavy tray of drinks?)

So I stopped setting down his drink and stood back up, moving my right hand slowly so as to not spill the fruity martini. All my focus was on the martini. I was rolling through the possible temporary resting sites for the drink so I could unload the tray in my left hand.

At this point, my left arm (unbeknown to me) was reaching its limit with the super-loaded tray and made just a slight twitch. First drink to go was one of the 3 cokes. It rolled off the tray and I laser-tracked it with my eyes and caught it between my knees as it fell. Amazingly... Whew!

Martini? check
Glass between the knees? check
Tray on left? . . .

It was all super-slow-motion from here on, but as I stood next to my table of 9, in the doorway by the bar, I and the rest of the people on the patio and those within sight-line from the bar, watched as one by one, the drinks toppled off my tray and into my lap. (remember, i'm squatting, ever-so-slightly due to the drink between my knees...)

Seriously, I'm standing with a cocktail in my right hand and a soda glass between my knees. What the heck could I do at this point? NADA...

As I watched the beers begin to topple, I reflexively made a "cover the ball" motion to keep my patrons from getting soaked and collapsed the entire tray into my body.

Only 2 glasses broke! And, I still had a full martini in my right hand as everything came to a stop.

Soaked to the bone, and embarrassed as I could be, I smiled and curtsey'd to the clapping guys in the bar, and started cleaning up broken glass.

My shoes were squishing with beer and soda all night.

And to top it all off, the table shorted the payment on their bill and I had to use the gratuity to pay the remaining bill! I made $6.37 on the table.

Smile and move on... Prove how resiliant you can be.

:)
Taylor

Seller Motivation Theory 1.0

The real challenge these days is seller motivation. I'm developing a theory and watching the market and am getting more firm on my idea, but here's what I have so far...

Seller Motivation Theory ver 1.0
In every market you have a range of motivation. Try to draw a mental picture with it as a pendulum where the far left represents very low motivation to sell and the far right represents virtual desperation to sell. The left half of the pendulum are those with internal motivation to sell. As the pendulum swings up to the right, external motivators come into play (foreclosure, job change/transfer etc...) and add to the motivation level.

As investors, especially in the recent past, merely talking to motivated sellers was the key to success.

The Success Equation went like this:

• Get your mailer/postcard/letter/advertising/yard sign in front of enough motivated people and you were bound to buy/wholesale/flip some houses.
  
• And assuming you could estimate repairs with moderate accuracy and perform basic math in the MAO* (*MAO= Maximum Allowable Offer. MAO=(After Repaired Value x 65%)-repairs-profit) calculation, you would make money.

Late night infomercials and internet real estate gurus sold (and continue to sell) the idea of making money this way.

But... remember that as investors, we need EQUITY to be able to get involved and make money. So, with the relatively quick run-up of home prices from 2001-2006, the moderate-strongly motivated real estate owners had equity to spare and due to their motivating circumstances, were willing to part with a portion of that equity for a quick sale and all the other benefits that we, as investors, could provide.

The true challenge in a declining market is to take those folks on the left half of the motivation pendulum, those with less urgency/motivation, but who have equity and get past the financial motivation to the real reason for selling. It takes time and some real finesse to pull off these types of deals (I've learned this the hard way...)

Downward moving markets strip equity out of many motivated seller deals and traditional investor strategies quickly become out-dated (since most investor pricing models require at least 35% equity to even get started...). Leaving Short-sales, REO's and high equity deals as the remaining ways to make any money as an investor.

But that's another post all together.

Nice to have you stop by. I've missed posting my happenings. Lots of things going on, I'll have to post again this week and we'll get caught up then...

Cheers,
Taylor

A Birthday Gift for My Bride

My lovely bride's birthday is this week. (Happy birthday honey!) The top thing on her birthday list is for yours truly to get his Real Estate License so we can get on with making some money already!

I log on to the DRE website every day to check my license status...

Nothing.

So, with a little coaxing via phone this morning, I was able to get someone to pull my file and see that everything they needed was in the file, fingerprints done, fees paid, test passed, proof of citizenship, yadda, yadda, yadda... and that in fact they were ready to issue the license. Her words were "it should post today prior to 5pm mr Taylor."

As of 2pm... no license.
As of 3pm... no license.
As of 4:09pm... bing!












Happy birthday baby, we're back in business.

More tomorrow!
-Taylor