Real estate investing gets under your skin and keeps you coming back for (WAY) more!
2012 is a nice milestone year for me. I celebrate two very important anniversaries. The first is the anniversary of my first investment property purchase. 35 years ago at the age of 15, I bought my first real estate investment property.
The second anniversary is my 30th wedding anniversary. This year I will also be celebrating 30 years of marriage to my childhood sweetheart (Laurie). Yes, I had a crush on this gal since the second grade. Years later I was fortunate enough to make her my wife. Having the loving and loyal support of a spouse is paramount to not only a great relationship and family life, but also to the success of a real estate investment career.
My First Real Estate Investing Purchase
This was actually more exciting for me than buying my first car and we all know how cool that was. Believe it or not, my first real estate investment came BEFORE buying my first car, which is why I found it to be more thrilling.
Growing up in a house with three older brothers, I watched them one by one purchase their first house. Yes, I had envy, I too wanted to buy my first investment property. I could not wait until the day I turned 18 and I could make the big purchase.
At age 15, in May of 1977, I was mowing a new sub division for a local real estate company. Each week when I went to mow this development, I watched surveyors out there putting stakes in the ground and dividing the property into individual lots. One afternoon, after finishing up on the mowing of the whole subdivision with my 18 HP garden tractor, I headed for home. I was in heavy thought and decided to stop at the office and talk to the developer, Jim Donahue was his name. Keep in mind, in a small town in a rural community in Minnesota in the late 70s, times were much simpler. I asked Jim what he was selling the properties for and he told me each lot was $6,700 and the premium lots went for about $500 more.
Long story short, I arranged to pay him $6700 for a premium lot and I would make monthly payments to him directly. No down payment, just start making payments and the lot was mine. Of course, I had to get my dad to sign for the property and make it all legal. I knew my dad would not have a problem doing this as he was always teaching us to be financially responsible.
I was so excited. I bought the very first city lot of what was known as the Waseca North East subdivision. One of the first things I did was to research to see what some of the fastest growing trees were. You see I wanted to hold the property for a few years and wait for the rest of the lots to be sold. As I had one of the most premium lots in the subdivision, I knew my lot would sell fast as supply and demand became more in my favor. I knew that having nice trees under way would add even more desirability leading to value.
Three years later I sold the property for a $3000 dollar profit. I was now positioned to buy my first house. I had over $3000 from the sale of the property, as well as some money I had been saving from all my high school jobs. Also I was now 18 years old and old enough to make a legal purchase. I went out and bought a duplex. I remember it like it was yesterday. My mortgage payments were $308 per month and my rent from the upstairs unit was $325 per month. I was living in the nicer unit on the main level virtually for the coast of the utilities. How cool was this?
Then to up the value of the property I found a 1 year old double garage that someone needed to have moved as it was built on rented land. I paid $200 for the almost new 24 x 24 garage. I paid $800 to have the concrete slab prepped and poured and now I only had to get the darn garage 4 and a half miles across town to the new location in my back yard!
To accomplish this I hired a family friend who ran a backhoe business. We jacked the building up on a couple of big beams, put it on the trailer and scheduled a police escort for Mother’s Day morning. We knew the traffic would be quiet then so we could get this beast across town before most people went to the streets. So, at 5 A.M. on a crisp cool morning, off we went. Taking the whole road up but with the police escort we were legal (back in 1980 anyway). I was riding on the back of the truck watching my garage rolling across town when it happened – crack, bang, cluck. As we approached the bottom of the hill and the weight of the garage shifted onto the front support beam it snapped. The front of the garage instantly dropped to the street.
Did I panic, hell yes I panicked! Beams that are 24 ft. long in a small town population of 10 thousand in the year 1980 were nowhere to be found. I had no idea what I was going to do. You see the story gets worse. Where it fell was directly in front of the emergency entrance to the Waseca Hospital.
Fortunately for me the policeman had a good sense of humor. He jumped out of his car and said “son you cannot leave that there, the ambulances need to get in through here.”
OK now, my brother who worked for the city water and light department, had a telephone pole that was over 25 ft. long and it served as my beam. Within an hour and a half, we were back up and running and down the road we went. Now I had a double garage with a total investment of $1500 and my real estate investing career was underway.
Over the past 35 years I have learned much more about real estate investing…hey that sounds like a great lead to another post. So watch for it – 35 Years of Real Estate Investment Experience
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