How To Buy A House Like A Real Estate Investor: Part 1 – Introduction and Getting Ready To Buy

by John Hoff on April 28, 2008

Real Estate Bubble I really tried. I did, really.

I tried to fit this topic all into one post. But as soon as I stared down that blank digital canvas I said, no way.

I live in one of the riskiest markets around in the US these days, Las Vegas, Nevada. Foreclosure rate is high and job growth has slowed.

People are afraid to buy a house here because they are afraid they will lose money and in no time at all be upside down on their house. They feel buying a house right now is too risky. And the uninformed ones are right, it is too risky – for them.

Informed investors, on the other hand, know there are investing techniques for every kind of market; slow, medium, hot – it doesn’t matter to them. They understand that good house buying techniques go beyond simply getting a low price.

In this how to buy a house series, we will take a look at my mentality when it comes to buying a house in today’s slow market. We’ll take a look at such things as:

  • Getting yourself prepared to buy
  • Ways to cover your closing costs
  • Ways to cover your down payment
  • Hiring the right Realtor
  • What to look for and beware of
  • The different options you have to buy real estate
  • Understanding the difference between getting good terms vs. low price
  • Becoming a problem solver for sellers to get what you both want
  • The offer and getting what you want through the use of contingencies and addendums
  • Buying and dealing with a bank’s foreclosed fixer
  • Do you need an inspection?
  • What is escrow?
  • My take on the future of real estate and the best investment there is

I am a part-time investor and like any good entrepreneur should do, I have spent years studying and applying good investing techniques. There is no one set of rules to follow when it comes to buying a house. What there is, however, is information.

So let’s get you informed, shall we?

Getting Prepared To Buy A House

The first thing you need to do is examine what you can afford, what a bank will give you, and your credit. You do have a budget, don’t you? Until my next post and if you’re interested in the house buying process, here’s a little homework for you to read:

  1. Getting Qualified For A Mortgage – an article I wrote on my old real estate website showing you how lenders view you and what they think you can afford (Update: sorry, I removed this site a while back)
  2. Budgeting 101 – an article I wrote outlining a good budgeting plan to follow to keep you safe
  3. Repairing your credit – a great article by the guys over at Intellibiz showing you how to get your credit report into shape

I promise the rest of this series will not be links for you to read and will be written from things I’ve learned and actual experience I’ve had. In this case, I have already written these 3 articles and it would be pointless for me to write them all here again. If you haven’t read these already, they don’t take long to read and are important to understand as they are the foundation of buying a house and creating wealth through real estate.

Perhaps if this series goes well, I will write another from the opposite angle – selling your home.

For those interested, let me know in the comments.

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