CHAPTER TWO OF ACCLAIMED BOOK BY REAL ESTATE INVESTOR JAMES BEST

How Not to Get Started!

Before we get started in the nitty, gritty details, I thought I should share some background information on myself with you so that you might have a better understanding of how I approach real estate investing. I used to be a CPA with a large accounting firm and hated every minute of it. Every Sunday night, I would have a pit in my stomach with the thought of having to start another work week. My job in the accounting firm was to go audit our clients’ financial statements. So every day I would go to work at companies that didn’t really want me there. I was an auditor. Nobody likes an auditor.
While auditing these companies, I started to feel like I was on the sidelines watching them make things happen. My clients’ companies were making things happen. They were in the game. I felt as if I weren’t really in the game. I was just checking the score. Who likes to sit on the sidelines? The fun is in the game.
Ever since college, I knew that real estate investing was very profitable. I kept thinking that real estate investing would be a great way to earn a living without having to sit behind a desk all day long. So, like many people, I bought one of those so-called "get rich buying real estate" systems from a TV commercial. I won’t name any names, but if you turn on your TV very late tonight, I would be willing to bet you will find a new version of the same commercial running on some channel. I read every book I could find on how to buy foreclosed homes and sell them for a profit. I can honestly say that I tried everything recommended from these books and tapes. This book has been written with my blood, sweat and tears of real estate investment. As an investor, I have learned from my own real life experiences. As a real estate broker, I have learned from countless clients that have invested in real estate using different approaches.
The approach to investing that we have moved toward over all of these years has been working so well because of the underlying philosophy, which I will explain in detail throughout this book. It took a lot of mistakes to realize why investing in real estate was so challenging. Here are some of my mistakes….

My First Try to Make Money…

I found out through the school of hard knocks that Get Rich in Your Spare Time really meant spending a whole lot of time making not so much money. One of the books that I read recommended that I go find sellers that would sell their home to me and act as the bank. So, in essence, I should buy their home and they would receive monthly payments from me over time instead of their full sales price at the time of sale. With this approach, I supposedly wouldn’t need a bank and could buy homes without having a down payment. The truth was that the only people willing to accept this arrangement had homes that were garbage. In the late 1990’s and early 2000’s mortgage interest rates became so low that there has been a huge supply of home buyers. Because there are so many buyers, home sellers can get their full sales price without having to take any risk by accepting monthly payments. The real estate market in general over the last few years has been a seller’s market. This means that in most cases the seller calls the shots. If interest rates go into the double digits again, I suspect that these techniques might be more profitable because the market will become a buyer’s market.