August 5, 2006 at 12:49 PM #7104DanielParticipant
For Piggington addicts, I can recommend another interesting forum: it is that of the SDCIA (San Diego Creative Investors Association). There are serious investors there, there are flippers, and (sadly) folks who showed up late at the RE party, just in time to pick up the check. I’m posting here the start of a popular thread. It is called “Sufficiently traumatized in San Diego”. I suggest that we shouldn’t gloat about this person’s misfortune, but learn from it. Here it is:
“Beginner investor here. I was so excited to get started after the seminar in January of this year. As many of you know we purchased our first flip in March, a preforeclosure. A 3/2 in Clairemont. Comps at the time on that street sold for 580-$610K. We felt we had a decently discounted ppty when we bought it at $465K. Most investors and real estate professionals we spoke with thought we got a decent deal. Yup, you may know which one. The one where the inspector missed the tree-rooty drains and the mold and asbestos tile layer beneath the carpet that I discovered later. The one where the seller (who is in jail now for something else) purposely failed to disclose all that &*(_ *.
Long story short we’ve spent 77K+ in repair and modest upgrades to the entire house, and continuing mortgage/holding costs. We put it (the ppty) on the market asking $598K FSBO. Not one bite despite all the pretty pictures and craigslist, backpage, etc marketing I attempted. After 4 weeks of FSBO and being laughed at by real estate agents we signed on with an agent. If/when it’s sold we’ll have paid the buyer/seller agents 4.5 – 5.5% altogether depending on who brings/represents the buyer. Yes the numbers are red and nasty. But the property is problem free and ready to live in and in a very sought after family-oriented neighborhood.
What next? Lease or Rent?
We’ve accepted the fact that we will not even break even. We do not need any shoulda-coulda lectures. We are looking for present and future tense suggestions or solutions. To those who are tempted to send “LOL” or other types of ridiculing messages please realize they will be ignored, we have a family with 4 kids and we started out in real estate investing to improve our financial lot and this experience in the market we are in has devastated our financial situation further. By the grace of God we are barely holding things together.
Any suggestions on what to do next with the property?
M.”August 5, 2006 at 12:58 PM #30822powaysellerParticipant
Suggestion: lower it 5-10% below the most recent comp, and pray.August 5, 2006 at 1:06 PM #30827August 5, 2006 at 1:16 PM #30829SD RealtorParticipant
I would agree with Powayseller…. Price it correctly then every 30 days correct the pricing as needed.August 5, 2006 at 2:05 PM #30833barnaby33Participant
Funny thing about people looking for miracles, they seldom get them. Whenever someone inserts, “by the grace of god,” you should replace it with, “Suzanne researched this.” Either that or the person saying it is about to royally screw someone else. This applies to life in general not just RE.
This thread is interesting only because it has been so widely publicized by the RE bear community. Its been hacked to death on housingbubbleblog.com There is alot more of this to come and when I read his reasoning for why he became an investor I took a step back.
My first question is, why does he have four kids? With a planet full of people that in itself is a bigger mistake than losing some money in the RE market. Second is, if you are going to be an investor you need to learn about due diligence, otherwise its gambling.
Ultimately I feel some sorrow for the guy, but not enough to hope he gets out from under it. Unless alot more people like him feel alot of RE denominated pain, I ain’t ever going to be able to afford a home.
JoshAugust 5, 2006 at 3:51 PM #30845BugsParticipant
Isn’t this the same property/thread we were discussing a couple weeks ago?August 5, 2006 at 4:04 PM #30847waiting hawkParticipant
I posted this flip few months ago and now I just posted that cry for help. Thread is called “Clairmont Mesa Flipper”August 5, 2006 at 4:05 PM #30848waiting hawkParticipant
I posted this flip few months ago and now I just posted that cry for help. Thread is called “Clairmont Mesa Flipper” It’s also the first home listed on my “proof” link on website.August 5, 2006 at 4:08 PM #30849
I feel sorry for the guy too however, I would NEVER criticize him for having four kids!!!!!!!!!!!! Were you a mistake too? I’m number 3 of 4 and my husband is also number 3 of 4. We have two kids and we’d like to have 6! Go ahead and gasp! When out in public, do you observe other families and think to yourself,”Oh my gosh, they have 3 kids! The third one is a huge mistake for humankind!” I sure hope not.
I love my children dearly. My sister in law can’t have children so I’ll have 2 more to keep the population the same. Okay, that adds up to 4. Since there are so many homosexuals nowadays, I might as well have 2 more children to also keep the population the same.
Don’t worry, my family is a contributing family to society. Maybe my kids will find a cure to AIDS or cancer. Maybe they will just be good people that make a diffence in someone else’s life. Having a big family can also help kids learn not to be so selfish. They may have to share a bedroom (oh no!). I’d rather them share a bedroom and learn tolerance than to grow up spoiled with lots of “things.” My husband and I share a bedroom of course and I’m glad I learned how to put up with someone else snoring and making noise at night!
Maybe someday when you have chilren, you will be awed at how amazing they really are.
Whenever I hear the argument that people can’t afford to have children, I realize its not that they can’t afford them – they don’t want to have to give up their personal time and money or expand upon their education so they can give their children more. What inspired my husband to finish college? A wife and children. Without the kids, he admits he may not have been as motivated.
Shame on you for calling four kids a “bigger mistake.”
You may think my comments are strong but don’t mess with me because I raise my kids and they are our world’s future.August 5, 2006 at 4:13 PM #30850Diego MamaniParticipant
Yes, it is the same property. The flipper should just cut her losses, price the property right, and get out before it gets uglier. It’s interesting how the novice “investor” started her post stating that she got into this after attending a seminar.
It surprises me how people still believe in these get-rich-quick schemes and seminars. Isn’t it obvious? If the scammer, er… sorry, if the “instructor” really had a system to make millions by investing in RE, do you think he’ll waste his time giving these seminars? It’s plainly clear to me that the fool-proof system to make money consists in giving these seminars and charging attendees.
The really shrewd “instructors” offer these seminars for free. Of course, once the suckers, er… prospective investors, come in, they use high pressure sales tactics to get them to “invest” in real estate. Done properly, these “free” seminars yield higher profits than charging for attendance.
I’m 40 years old, but sometimes I feel super old every time I read or hear of people falling for the same old schemes. Nihil novi sub sole my ancestors would have said.August 5, 2006 at 4:18 PM #30852Diego MamaniParticipant
Since there are so many homosexuals nowadays…
What? Dear Native, with all due respect, I think that as our society becomes less ignorant and more tolerant, more gay people choose to get out of the closet. To the extent that homosexuality is determined by biology and birth, its incidence shouldn’t go up or down over time.
I agree with you about family size: that’s up to every family to decide. My wife and I are happily childless, but I wouldn’t even think of imposing my views or standards on others.August 5, 2006 at 4:33 PM #30854PerryChaseParticipant
I’m going to take Barnaby’s side on kids. I believe that he meant that they buyer should not be speculating on real estate when they have 4 kids whom they have to care for.
I feel, in many cases, people have kids for their own well being and not for the kids. Why bring more kids into the world when we can’t even provide for the ones who are already here? Why do people need others (kids, wife, husband, parents, girlfriend…) to make them happy or motivate them? Wouldn’t it be easier to find happiness and motivation from within?
The main reason people have kids is “to be happy.” That’s the wrong way to be happy. People go shopping to be happy but at least purchases can be returned.
Once children are born, they are not mistakes. They should be cherished and cared for. However, it’s better for them not to be here in the first place. Notice that I said better for them, but not necessarily for the would be parents.August 5, 2006 at 4:41 PM #30859
It was more of a rebuttal to his “bigger mistake” comment. However, I’m not ashamed of my family values. I also don’t believe that homosexuality is determined by biology. I have a relative who is and he says that he chose it. I recognize that they are people and have their own rights however it is significantly harder to reproduce when one makes that choice.
I feel strongly that children are our future and not a burden.
If it is okay for him to state his opinion (rather strongly), its okay for me to state mine as well.August 5, 2006 at 4:52 PM #30861
Maybe he thought he could have a better future for his family if he invested in real estate. Its really sad and I’m glad that I didn’t do what he did but I can see how it happened. Some people are suckers. Some of us can see through the smoke and mirrors. Too bad he didn’t.
PerryChase, I do believe that it is hard work to be parents and I see people that don’t really realize how hard it is until they are thrust into it. Its something I never questioned though. Maybe thats why I feel strongly. I do take good care of my kids but when I had my daycare license, I saw many kids whose parents didn’t bathe them and provide them with clean clothes or stay home with them when they were ill. That was heartbreaking. Many people need to grow up before they have kids.
Sorry if I’ve offended anyone.August 5, 2006 at 6:41 PM #30869barnaby33Participant
Congrats on your commitment! If only it were your commitment and yours alone. As you know it takes a village to raise a child, therefore it takes the commitment of a society to raise children. They are our asset, and our liability. If we don’t raise and educate them with good values they simply replicate the problems of their parents ad infinitum. A good example would be homophobia.
This forum isn’t really the sort of place that I would have this type of discussion (its very emotional as your response indicates.) However since I opened the door, I will say this. Your decision to have a child, or multiple involves me just as my parents decision involved a large chunk of society albeit indirectly. What right have YOU or anyone else to declare that you are SO important that your genes need to be spread that much. If you are THAT important then by all means spread away. Just know that you should bear the FULL cost of doing so. Since in todays society you don’t, society deserves a veto.
You have divined correctly that I do not have children. I am not against people having children in the least, I am actually for it. I just feel that it is an even larger financial decision than buying a house and yet most people give it even less thought.
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