Real Estate with Scott: Walking on a Strategic Road of Resilience

Starting his path in 2012, seasoned real estate investor Scott recently in a Mastermind episode hosted by REsimpli founder and CEO Sharad Mehta, shared his strategic approach to both residential and commercial properties as well as his experiences navigating various market conditions. The discussion included the challenges, strategies, and practical experience Scott has gained over the years running the company.

Originally focused on small multi-family complexes and single-family homes, Scott generated money and gained insightful expertise from flip-based projects. Rooted on fundamental concepts, his investment approach is built on making sure appropriate debt management, solid cash flow, and property site selection. Scott plans to perform flips for fast cash flow and have a varied portfolio of income-generating properties.

Regarding the challenges he faced—particularly in terms of cash flow management, addressing unexpected issues, and the psychological aspects of early investments—Scott did not hold back either. These meetings stressed the requirement of using realistic financial concepts and encouraged him to acquire a healthy mindset.

Currently working on a challenging development project featuring a historic Masonic Lodge, which has been expensive and demanding, Scott The site is expected to be worth $5 million even though the building will cost $3-$4 million. First, the investment was over $350,000, further costs increased the total to over $800,000 to $900,000. For Scott, long-term cash flow and equity expansion over a short resale value rate are most important.

Scott pays for his projects via corporate financing, a HELOC on his own property, and hard money. While financing for investment homes may often be challenging, Scott’s clever and creative approach is shown by his ability to locate funds for appealing bids.

Scott still questions possible market downturns and how election years impact the real estate industry. He understands the importance of changing with the times and historical patterns of market movements. His future goals are to remain focused on one-to-four-unit properties with regular cash flow and strong debt management and to raise money for larger development projects. Scott is also creatively considering purchasing inexpensive properties with specific issues.

Scott’s route highlights the importance of patience and the significance of adhering to fundamental beliefs. He advises looking ahead, learning from prior market cycles, and being ready to handle new challenges. Over time, regular buying and use of shares will enable investors to effectively control market fluctuations and achieve enormous success.

Those who would like more information about Scott’s methods and observations might find proof of the requirement of resilience, strategic thinking, and patience in the continually shifting real estate market from his experiences.

Watch on YouTube:

Key Takeaways:

1. Investment journey:
   
   Scott shared the story of his first investment and his single-family home investments before transitioning to multifamily commercial properties and small subdivisions. He talked about managing his rentals and his one full-time employee. They also discussed the challenges Scott faced. (00:02:43)
   
2. Discussing strategy:
   
   Scott shared his journey in real estate financing and investment, detailing his evolution from refinancing his first property with hard money to becoming a debt investor. He emphasized the advantages of targeting the 10 to 20 unit space for improved cash flow. Sharad inquired about Scott’s property sourcing methods, further enriching the discussion. (00:08:58)
   
3. Flipping tricks:
   
   While talking about investing and flipping strategies, Scott highlighted the importance of building relationships with agents, understanding the market, and identifying properties with renovation potential. He also recommended new investors start with low-down payment government financing to which Sharad agreed, suggesting a 4-unit property in an FHA-eligible market. They both stressed learning through experience, understanding rental comps, and maintaining consistency and objectivity in negotiations. (00:12:30)
   
4. How to find MLS deals:
   
   Scott disclosed his ways of finding good deals on the MLS with limited marketing budgets. Sharad emphasized experience in valuing properties and Scott advised staying consistent with fair offers, using large non-refundable deposits to show commitment, and regularly following up on deals. He noted that many deals eventually return to the market, offering more opportunities. (00:18:45)
   
5. Trends discussion:
   
   Sharad and Scott discussed real estate strategies, with Scott emphasizing the need for speed and competitiveness in making offers, identifying mismanaged properties, and regularly following up with agents while considering the seller’s situation. Sharad suggested using the listing agent as the buyer’s agent for lower-priced properties, but Scott raised conflict of interest concerns. Both agreed on the importance of staying updated with market trends and effectively representing oneself. (00:20:33)
   
6. Project- 100 year old:
   
   Scott discussed his real estate investment strategy, highlighting duplexes and triplexes for generating income and aiding first-time homebuyers. He anticipated upcoming legal changes affecting the market and his business. Scott admitted to an  it’s challenging but manageable through a focused approach. Scott also shared his latest project: converting a 100-year-old building into 18 apartments, storage lockers, and his new office space. (00:24:11)
   
7. $350k for 20k square foot building:
   
   Scott shared his experience of buying a 20,000 square foot building for $350,000, initially without approved parking. He financed this by selling three properties, one for parking and another for a construction loan down payment. He shared why he’s still optimistic despite seeing no cash flow this year due to expenses. (00:28:07)
   
8. $3-4 Million buildout:
   
   Scott discussed his real estate investment strategy, emphasizing properties with good cash flow and development potential. He highlighted a project involving the Masonic Lodge, aiming for a $3 to $4 million build-out. Scott detailed his use of various financing methods in his investments. While cautious about potential market downturns, he remains optimistic about the future of one to four unit properties that generate good cash flow. (00:31:34)
   
9. The impossible purchase:
   
   They discussed quite a lot of topics- election year’s real estate strategies, fundamentals and learning from past downturns, Scott’s shift from single-family properties to larger deals etc. He also highlighted a unique deal he secured that others couldn’t realistically purchase. (00:36:16)
   
10. The advise:
    
    Scott shared about his focuse on probate deals and negotiations with executors and emphasized the importance of long-term property holding. Sharad and Scott also talked about expired listings and Scott advised aspiring investors to build networks, study market trends, and learn from past crises. (00:40:44)