As I write this, it’s coming up on the end of 2012. The real estate market is still crazy, and there are a lot of questions in people’s heads as to what the market is going to do.  What else is new?

Ever since I first got in to real estate investing, back in 1996 (wow!), the market has ALWAYS been changing.  So that’s NO excuse not to get involved & do some deals.  The KEY is to just recognize WHAT the best strategies are to use at the moment, then learn all you can about them, and – most important of all – ACT on what you learn!

Winners with tiger blood running through their veins will tell you that CHANGE (and chaos!) just creates more opportunity, and the real estate market right now is certainly no exception. It used to be that the hot things in real estate were: Wholesaling, Short Sales, Rehabbing, and of course, the related “Get the Deed” system, where you take over existing houses ‘Subject To’ the existing mortgage.

While those methods still certainly work, they’ve definitely changed.

One example of how those changes have happened is: Who would want to get the deed on a property that’s declining in value – or is underwater in value (owed more than the house is worth)?  Not me, that’s for sure!  I doubt your would, either.  But wait a minute! There IS a way to still help people in those situations – and still make money!  Keep reading…

Wholesaling is still a good business model. But how many junkers can you deal with? And how many are there in your area? Who’s still buying them right now?

Then you have your Rehab deals. I don’t know about you, but I’d rather dance “Gangham Style” for 5 hours straight than do another rehab.  Dealing with contractors, retail buyers, and BANKS (not to mention title companies, appraisers, etc.) almost made me quit real estate completely a few years ago. I’m not kidding.  Of course, YOU might like to do rehabs. If so, more power to you. 

And then there are Short Sales.  Lord knows I’ve done more than my fair share.  Got pretty good at ‘em, too!  Believe me, there was nothing like sticking it to the banks by negotiating a super discount on a property, then getting a huge, fat check when the deal closed by selling it to a buyer!  But while that scenario is still possible, our so-called leadership in Washington, D.C. has changed a crapload of laws that pretty much make it a crime in some states to help people in certain situations.  I used to live in Maryland, and that was one of the first to screw us investors over, all because of a handful of idiots that messed it all up for us.  There’s a bunch of other things that make doing short sales extremely challenging in today’s financial environment.  And there’s a LOT of hoops to jump through.

So the big question remains: What do we do NOW to make money in real estate?  If all those other kinds of deals basically suck these days, what type of deals should we focus on? (Again, if those are the types of deals you’re doing now & they’re working for you, then stop reading now & keep doing what you’re doing. Nothing to see here, folks!)

Let me get right to it.  I believe that the best types of deals to focus on for the foreseeable future is:

WHOLESALING PRETTY HOUSES!  That’s right.  But what the heck does that mean, and HOW do you wholesale a PRETTY House, right? 

So let me explain…

Wholesaling pretty houses is very similar to our ol’ fashioned, tried & true method of wholesaling ugly houses, with a few noticeable differences.

Wholesaling PRETTY Houses vs. UGLY Houses:

Wholesaling PRETTY Houses:	Wholesaling UGLY Houses:
Buyer: Tenant Buyer (Who Will Live in House)	Buyer: Investor (Who Rehabs House)
NO Repairs Needed!	Repairs Needed. Your Buyer Will Do These.
HUGE Market Available Now.	Small Market. You’re Limited.
Medium-Sized Checks. Easy to do.	Medium-Sized Checks. Easy to do.
LOTS of Sellers Now. Relatively Easy to Negotiate.	Not Many Sellers. Must Negotiate Low Price.
HUGE Field of Potential Buyers!	Very Limited Buying Pool. Investors w/ Cash.

And the list goes on & on.  Believe me, those are just a few of the differences.

Here’s what it means to wholesale a pretty house: Get a house under contract. Find a tenant-buyer who will live in the house. Get your money from the tenant-buyer & assign the deal.  Done.

Let’s break that down.  You find a motivated seller, typically one who doesn’t have much equity, or is even underwater.  If you’re familiar with ‘Subject To,’ or ‘Get The Deed’ deals, this should sound very familiar.  But here’s where it gets a little bit different…

You explain to them that you can help them get their house sold with minimal hassle and without having to come out of pocket (pay) much, if anything at all, to help them get the peace of mind they crave.  How will you do this? By finding a lease-purchase tenant buyer to live in their house & make the payments until such time as the property value goes back up and/or they are in the position to secure new financing and buy.  You further explain to the seller that this is their best situation, because it solves their problem while at the same time providing an opportunity to someone who desperately wants it that everyone else is ignoring.

Of course, not everyone will go for it. But many will, trust me. What are their other options? Short sale, foreclosure, cash for keys, or do nothing & ride it out.  So you explain their options to them, and the advantages & disadvantages to each one.  Then you show them what you can do for them, and how it makes sense, and get the deal done! 

Hey, we’re just getting warmed up!  I didn’t realize that this article was going to run so long, so MAKE SURE you join us next month for Part Two of this article: “The Best Deals to do in 2013 & Beyond”
We’ll cover a few of the important details you’ll need to know, such as how & where to close your deals; How to Sell these types of Deals; How to get PAID; WHEN to DO these deals; and when NOT to do these deals… and much more!

So won’t you join me next month to read Part Two?  It’ll be worth your while, I guarantee!

Until Then,

Tony Pearl