2006 REI Year In Review

Summary: I didn;t achieve anything near what I wanted this year in regards to real estate investing. At the beginning, I had hoped to acquire at least three additional properties. I also wanted my marketing to get traction to the point that in January of 2007, I would be averaging a deal every two months. That, too, never materialized. So, here is was my 2006 REI Year in Review:

House #1 - I had fully expected the tenants to move out sometime in the beginning of the year. However, it took them a longer-than-expected time building their own house. They finally moved out at the end of October, which was a good thing for me. I immediately put it on the market as both an FSBO and FRBO. I had a few interested parties at the beginning, but nothing panned out. I eventually got a tenant in that is also wanting to buy the property at the end of his lease term (end of May/2007). Rent is $50 more than with the previous tenant, so we are making about $375/mo, between the rent and loan. Factor in taxes and insurance, though, and we are probably only making about $75/mo positive cash flow.

Marketing - I had I hopes of starting a marketing campaign that included sending post cards out to several neighborhoods. I had all the figures layed out, along with how the campaign would recycle households ona 3-4 month basis. My initial thoughts were to get 1-2 deals in the first three months. It turned out to be a MAJOR disappointment, though. I received VERY few calls, and -0- deals. After about the thrid month, I decided to shelve the project, indefinately. I had spent close to $250 in actul costs and gottent $0 in return.

I also wanted to start hitting a subset of those neighborhoods with bandit signs. Again, I had high hopes, but nothing panned out. Matter of fact, several of my bandit signs are STILL hanging in a few of those areas, and I STILL haven't gotten a single call.

I think I'll revisit both these marketing avenues again in 2007. I was using USPS to both create and mail my original postcards, but I may fork over some more moeny and have them done more professionally-looking. I also want to start a door hanger campaign. Lastly, I want to get new bandit signs specifically for those areas I target in the hopes they will draw more deals.

Time - In all fairness to what I wanted to do, but didn't, I believe a good portion of my failed goals were due to one thing: lack of time. I realized going into 2006 that my time would be limited with the twins' arrival. I never expected that my free time would be almost ZILCH, though. 2007 should be a little better, but not a whol lot, in respects to free time. The twins should slowly migrate from the almost constant holding to being a little more independent - not a lot I can assure you, but a little more. In fact, we are already witnessing it to a degree. Of course with every additional minute of free time, other factors come into play. I'm still deciding whether to get my RE sales license, and, if so, that will probably consume any free time I may acquire this coming year (and, perhaps, even a lot of non-free time).

Knowledge - I can't even begin to lst all the knowledge I acquired this year in REI. Almost all of the information I gathered was acquired through doing and not reading. Every book I've read on REI has been beneficial in getting me to where I'm at now, but even combined those books are probably a fraction of 1% of the knowledge I've gained by doing - most of which through my own trial and errors.

New Acquisitions - Even though I fell way short of my goal of acquiring at least three properties for the year, I did manage to pick up one. I bought it at about 77% FMV, which isn't bad. The bad thing was that I couldn't get the kind of financing I really wanted due to various factors, so I still may not make out like a bandit on this one. If I sell it in the next couple of months, I'll probably only make about $8,000-$10,000 after all expenses are accounted for. I could live with doing several of those each year, but they definately won't lead me on the fast track to financial independence, though.