966: Top Investors Reveal Their Worst Real Estate Deals (DON'T Repeat Them!)

BiggerPockets Real Estate Podcast

BiggerPockets

Education, Investing, Business

4.8 • 16.6K Ratings

🗓️ 5 June 2024

⏱️ 50 minutes

🔗️ Recording | iTunes | RSS

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Summary

Think you've got a bad real estate deal? We doubt it comes even close to what we’re about to share. Today, the experts are in to talk about bee-infested rental properties, risky flips, “wholetail” failures, and other ways that they’ve lost money with real estate deals gone wrong. Why are we sharing such horrific stories? Because we want YOU to be able to avoid the same fate on your first or next investment property. Take a seat, get some popcorn, and pray that your properties won’t turn out like this… First, Henry Washington from the On the Market podcast shares his recent luxury flip…or should we say, luxury “flop.” This property was poised to make him up to a six-figure profit, but it didn’t work out that way. One simple mistake ruined this real estate deal and forced Henry to slowly pay away all his profits to a hard money lender. Next, our own Rob Absolo talks about the dangers of NOT looking at the comps when doing a “wholetail” deal and how you could easily find yourself with a home worth less than what you put into it. Finally, the deal of all horrible deals comes out…David Greene’s deal. Where do we even start? Permit problems, mold, bee infestations, and NO way out—this short-term rental gone wrong is costing David hundreds of thousands of dollars, and with little light at the end of the tunnel, he may be forced to do something drastic. So, how do YOU avoid these nightmarish real estate deals? Stick around so you know exactly what NOT to do. In This Episode We Cover Three of the worst real estate deals our investing experts have ever done Why not knowing your neighborhood can cost you BIG on your next house flip The danger of hard money loans and the massive interest they come with Why you NEED a partner/mentor in your area to confirm a property’s worth The so-called “landlord-friendly” state that’s actively trying to ruin David Greene How nosy neighbors can end up costing you hundreds of thousands of dollars Whether or not our investing experts regret investing in real estate after this And So Much More! (00:00) Intro (01:24) A Risky Luxury Flip (06:02) Final Numbers and Exit Plans (09:19) Henry’s Mistake (11:14) An Overpriced Wholetail (15:04) Rob’s Mistake (23:23) The City Ruined My Real Estate (32:43) David Lost HOW Much!? (36:19) How to Avoid This (39:07) Do We Regret It? Check out more resources from this show on BiggerPockets.com and https://www.biggerpockets.com/blog/real-estate-966 Interested in learning more about today’s sponsors or becoming a BiggerPockets partner yourself? Email advertise@biggerpockets.com. Learn more about your ad choices. Visit megaphone.fm/adchoices

Transcript

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0:00.0	Let me ask y'all something. When you started in investing, did you assume that everyone with more experience than you knew exactly what they were doing?
0:07.0	Absolutely. I remember I sat down with an investor and I asked him to be my mentor and he
0:15.3	chuckled at me and said bro I don't know what I'm doing yet I can't help you and he was
0:20.6	wrong he helped me a ton but that's when I started to realize everybody was still just kind of figuring this thing out
0:25.3	What about you Dave? Oh, I remember the feeling when I realized wait I'm the one that everybody thinks knows more and I know how little I know this is terrible
0:32.4	And that's exactly what we're gonna be talking about on today more and I know how little I know this is terrible.
0:33.0	And that's exactly what we're going to be talking about on today's episode.
0:35.8	We're going to be airing all of our dirty, dirty laundry on deals that we've lost out on, lost money
0:41.2	on, or are still recovering from from that all happened within the last six months or so.
0:48.3	And welcome to the Bigger Pocket's Real State Podcast. You might think the
0:54.8	were the experts but on today's show let me assure you we are still
0:58.1	figuring things out ourselves. I'm your host of the podcast David Green and with me
1:02.2	today are Henry Washington and Rob Abbasolo.
1:06.1	That is right. We are each going to reveal some of the biggest investing mistakes that we've made in the last six months and
1:12.1	we're going to talk about what happened, how much it
1:15.1	cost us and what we learned so hopefully you can take away some gems so that you're not
1:20.6	in these same positions like we were.
1:22.6	Well, it's now or never, I guess.
1:24.3	All right, so we've each come prepared
1:26.3	with a recent investing mistake in the last,
1:29.0	you know, six months or so.
1:30.4	Henry, why don't you kick us off?
	...

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