Way back when, before I became a Mini-Mogul, I experienced the most frustrating things as a budding real estate investor.
One time in particular comes to mind in 1986…
With two buildings under my belt, I felt ready for another acquisition. I was focused on the north side of Chicago. Real estate prices had increased sharply during the mid-1980s and little was available for under $200,000. With the help of some realtors, I combed the multiple listing ads weekly for new opportunities. But the numbers never worked out.
In the fall of 1986, after a year of searching, I found a six-unit building for sale by owner in an up-and-coming neighborhood called Roscoe Village. The seller was asking $85,000 for a frame building with two structures: a three-unit in the front of the lot and a three-unit coach house in the back. For you non-Chicagoans, a coach house was where the owner kept the coach in the old days. When coaches became passé, many coach houses were converted into residences, to bring in some extra income for the owner. Coach houses tend to be small and cozy.
This one, however, was exceptional. The first-floor unit was the smallest I had ever seen. The monthly rent was $85 in 1986. I estimated the square footage at one hundred.
Recognizing that the building was underpriced, I offered full price – $85,000. The seller accepted and referred the contract to her attorney for review and approval. The attorney told the seller she was giving the building away, and he wouldn't approve the contract.
The seller listed the property for $120,000 the next day, and it was under contract within twenty-four hours. I always wondered if that attorney was acting within the scope of his license by advising the seller as to price. I was angry, but I had to move on.
As you try to navigate the real estate maze, you will have misdirection, and misadventures such as this occur. Don't give up.
I didn't and today I am a Real Estate Mini-Mogul.