Making $115K From a Nightmare First Deal (Cops, Evictions, and Break-Ins!)

Key Takeaways:

– The fear of “what if?” should not stop you from investing in real estate.
– Mitch Krotz had a nightmare first deal with many worst-case scenarios, but still made a profit.
– Mitch’s first deal involved evicting tenants, dealing with a grow house in the basement, and being hospitalized during renovations.
– Mitch’s persistence paid off with a $115,000 profit.
– Lessons learned from Mitch’s first deal include managing real estate like a real business, investing in systems and organization, and allowing room for error.
– Building an all-star team is important for running a successful real estate business.
– Knowing when to DIY home improvement projects and when to outsource is crucial.
– Dealing with troublesome tenants and navigating the eviction process is a challenge.
– Mitch has identified an up-and-coming market for short-term rentals.

BiggerPockets:

Is the fear of “what if?” stopping you from investing in real estate? You could learn a thing or two from today’s guest. Despite a “nightmare” first deal involving every worst-case scenario imaginable, he still managed to come away with an enormous profit!

Mitch Krotz had always wanted to buy a rental property, so when a great deal fell in his lap, it was a no-brainer! But then, seemingly everything that could go wrong did go wrong. Shortly after closing, Mitch was already evicting tenants and wading through trash in his heavily damaged unit. But that’s not all. Police showed up and discovered a grow house in the basement right before Mitch’s ex-tenants broke into the property. To cap things off, Mitch was hospitalized for meningitis during his DIY home renovations. While he had every reason to give up on real estate investing, his persistence paid off to the tune of $115,000 in profit.

If Mitch can do it, you can too! Stay tuned as he shares some of the most valuable lessons learned during his painful first deal. For one, if you’re going to take real estate seriously, you need to manage it like a real business. Invest in systems, organization, bookkeeping, and other tools that will set you up for success!

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In This Episode We Cover:

  • Mitch’s biggest lessons learned from a painful first real estate deal
  • How to build an all-star team to help run your real estate business
  • When to DIY home improvement projects (and when to outsource them instead!)
  • Dealing with troublesome tenants and navigating the eviction process
  • Why you NEED to allow room for error in your margins
  • The “secret” up-and-coming market Mitch has identified for short-term rentals
  • And So Much More!

Links from the Show

Book Mentioned in the Show

Connect with Mitch

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Note By BiggerPockets: These are opinions written by the author and do not necessarily represent the opinions of BiggerPockets.

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Property Chomp’s Take:

Is the fear of “what if?” stopping you from investing in real estate? If so, you could learn a thing or two from today’s guest, Mitch Krotz. Despite experiencing a “nightmare” first deal that involved every worst-case scenario imaginable, Mitch managed to come away with an enormous profit.

Mitch had always wanted to buy a rental property, so when a great deal fell into his lap, it was a no-brainer for him. However, shortly after closing, everything that could go wrong did go wrong. He found himself evicting tenants and wading through trash in his heavily damaged unit. But that was just the beginning. Police showed up and discovered a grow house in the basement, right before Mitch’s ex-tenants broke into the property. To top it all off, Mitch was hospitalized for meningitis during his DIY home renovations.

Despite all of these setbacks, Mitch’s persistence paid off, and he ended up making a profit of $115,000. If Mitch can do it, so can you! Here are some valuable lessons that Mitch learned during his painful first deal.

Firstly, if you’re going to take real estate seriously, you need to manage it like a real business. This means investing in systems, organization, bookkeeping, and other tools that will set you up for success. Real estate is not a hobby; it’s a business, and you need to treat it as such.

Secondly, building an all-star team is crucial for running a successful real estate business. Surround yourself with professionals who can help you navigate the complexities of the market. This includes real estate agents, contractors, property managers, and other experts who can provide guidance and support.

Next, knowing when to DIY home improvement projects and when to outsource them is essential. While it can be tempting to save money by doing everything yourself, sometimes it’s best to leave certain tasks to the professionals. Evaluate your skills and time availability before deciding whether to tackle a project on your own or hire someone else to do it.

Dealing with troublesome tenants and navigating the eviction process is also a reality of real estate investing. It’s important to know your rights as a landlord and to follow the proper legal procedures when dealing with difficult tenants. Educate yourself on landlord-tenant laws and consult with an attorney if necessary.

Another lesson learned from Mitch’s experience is the importance of allowing room for error in your margins. Unexpected expenses and setbacks are bound to happen in real estate, so it’s crucial to factor them into your budget. Don’t assume that everything will go smoothly; always have a contingency plan and financial buffer.

Lastly, Mitch has identified an up-and-coming market for short-term rentals that he believes holds great potential. Stay tuned to learn more about this “secret” market and how you can take advantage of it.

In conclusion, Mitch’s story is a testament to the fact that even the most challenging real estate deals can turn a profit if you persevere. Don’t let the fear of “what if?” hold you back from pursuing your real estate investment dreams. Learn from Mitch’s lessons and take action towards building your own successful real estate business.

To hear more about Mitch’s journey and his valuable insights, listen to the podcast episode and read the transcript provided. You can also watch the episode on YouTube. Additionally, make sure to leave a rating and review on iTunes to help the podcast reach new listeners.

Remember, these are opinions written by the author and do not necessarily represent the opinions of BiggerPockets. Take these insights as valuable advice and inspiration, but always do your own research and make informed decisions. Good luck on your real estate investing journey!

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