Moving from games to The Real Thing[TM]

So, I was doing some poking around this evening. I had picked up a local "Renter's Guide" in a 7-11 because the properties for rent in that magazine actually had addresses to the homes being rented, which allowed me to look up the property's current assessed value with our city property taxation department. I then took this information to some random site on the 'net that came up when I searched for "mortgage calculator 30 years" in my Google toolbar... and figured out how much it would cost per month, at that assessed rate, for the property.

It was an interesting experience. First off, there were VERY few homes listed in the renter's guide. Right now in our city, occupancy is at 97% or something like that for rental properties, so I wonder if that's part of it. (oh how I wish I had held on to a renter's guide from when I was apt-hunting back in '97!) But also, there was a wide range of profits on the properties, based on the calculations I was making. Of course, I'm sure there are people who own some of those properties outright and thus they don't have a mortgage they're trying to get the tenants to pay for them.

There were two houses that surprised me greatly - they were worth between 30-38k and the rent on them was $600-750 + utilities! From my calculation, if the house was purchased at the listed assessment price and a 30 year mortgage was taken out at 5.62%, the monthly mortgage cost would be a mere $189. I was impressed, but wonder if those houses take longer to rent out, or if that's what the market can bear in that area.

I ventured on from there and stumbled across the website of a local real estate agent. She listed the properties she was selling, and not only had the addresses on them, but the asking price and the details of the home you normally get on those sheets when you look at the home. I was shocked to see that every single one of the homes had an asking price between 20-40% above the assessed-by-the-city value of the property.

Immediately, of course, my mind reels backwards because my assumptions about the properties I was looking at in the Renter's Guide were not exactly sound (those 30k houses may very well cost 50k right now).

At any rate, I'm pretty much at the point now where playing CashFlow itself is all about the luck of the dice and not so much about recognizing a good deal... the multiplayer option, against other people is a great thing still because it gives me different people to talk to on this topic most people don't know much about... but I'm at the point where I need to get out there and take a look at some REAL real estate and learn how to ask the questions required to fill out a "Real Estate Assessment" form of some kind, like the one available for Insiders on the Rich Dad website. That form is designed to help potential investors see whether the property will be able to generate positive cash flow, or at least what will be REQUIRED to generate positive cash flow.

So, I poked around a little more online and found that in a couple of weekends there is a house auction locally, by one of the alternative realtor types in the market. Next weekend there's a "viewing" of the house, then the weekend that follows there's the auction. The address was provided so I looked up the value of the home. It lists at $108,000. I'm sure it'll go for $140-$150k.

I've emailed Joel and asked him if he wants to go to that with me. I hope he does because I'll be too cowardly without him. I'm still too timid about this whole thing once I leave the safety of my basement. I figure that will change as I get more experience and exposure, and that just requires time and continued perseverence, which I'm good at.

At any rate, that's where I'm at now!

Jill