Hello,

Welcome to your 12 lesson pre-construction investing e-course...

The 12 Deadly Mistakes Investors Make When Buying
Pre-construction Real Estate...& How To Avoid Them

While there are plenty of different investing strategies out there (real estate and otherwise), we believe that pre-construction is by far the most viable passive investment vehicle available. I hope as you read this couse you'll come to understand why.

If you haven't yet read our brief complimentary investing report, I strongly suggest that you do so before proceeding through this course. It will lay an excellent foundation for these lessons.

Assuming you have already read the report, let's get right down to business. The first mistake is by far the most serious...and the other 11 can be avoided more easily if you carefully overcome this one first.

Deadly Mistake Number 1:
Negotiating from a position of weakness

In order to succeed as a pre-construction investor long-term its critical that you never buy on your own. If fact, we never invest unless we are in a position to buy at least 20% of the entire development.

The reality is that as a single buyer...you have no leverage. You are going to get the same take it or leave it offer that every other buyer is getting. While it is true that you may be offered discounts or other incentives, you can never be sure that you have gotten the best deal possible...or that others have not gotten better deals than you.

In order to protect yourself and have the greatest possibility of success, you need to offer a solution to the developer's biggest problem...getting a construction loan. Each developer must pre-sell at least 50 percent of the units in their entire project before they will qualify for construction financing. To gain leverage in your negotiations you must be able to help the developer accomplish this requirement.

By joining with a group of other investors and negotiating together you will immediately get the developer's attention. Not only can you get significant discounts, you will also be able to shift most of the risk back to the developer and build profits into your purchase agreements.

When you buy without leverage you can expect to make large deposits (usually 20% to 25%), give the developer access to most (if not all) of your deposit, be required to close on and finance the purchase following construction, and be restricted from reselling until after taking possession.

Lots can happen during the construction period. Property values can drop. Developers usually experience delays. Bankruptcy can result in the loss of your entire investment, etc. In order to protect yourself, you must negotiate from a position of strength and get the developer to take on the majority of the risk for you.

This can be accomplished by partnering with other investors and negotiating a bulk purchase.

Below is a partial list of benefits our investment group gets in every transaction. Terms like these (and more) are clearly outlined in a written agreement signed by each developer before we ever put money in escrow:

  • Negotiations and due diligence completed by the group leadership
  • Substantial discounts from public prices
  • Dollar-for-dollar discounts if real estate values drop
  • Instant equity based on the terms of your purchase agreements
  • Small deposits (usually 10% of the purchase price)
  • Letter of credit deposit optional in most cases...instead of cash
  • Deposits held in escrow and never touched by developer for any purpose (refundable if developer or project fails)
  • Opportunities to invest in non-local markets (even internationally)
  • Very low probability of closing or taking possession after construction is completed (it has never happened to date)
  • Profitability NOT dependent on market appreciation
  • 40 to 50% starting NET profits (even in flat or declining markets...based solely on the terms of your purchase contracts)
  • Complete freedom and control of all decisions regarding all units you purchase
  • Freedom to resell before closing (usually done for you by the developer on a first-in/first-out basis)

In the history of this concept not a single buyer has ever been brought to closing or ever lost a nickel of their invested capital...because we never give developers access to the money...and always resell during construction.

In summary, you simply can't get these types of protective terms from any developer unless you can help him qualify for his construction financing in a big way. Joining with other investors is the only way to effectively help the developer...and thus get the favorable terms and protection you need.

The remaining 11 lessons in this course will outline exactly what to avoid and how to protect yourself in every deal as a pre-construction investor. Next time we'll discuss six of the most critical hazards you must avoid when purchasing properties.

Feel free to call me anytime. We don't sell any products or seminar tickets. We're a private investment group committed to education and partnership. Our purpose is to provide you with a comprehensive education so you can properly invest in what we believe to be the greatest opportunity anywhere for intelligent investors...pre-construction real estate.

Respectfully,


(847)793-0146
Joint Venture Partner
Senior Executive Advisor, BPV
Founder, PreConstructionSecrets.com
President, Freedom By Design, Inc.

P.S. To regain access to your 12 page report and the pre-construction audio explaining the details of our investing club, simply click here.

P.P.S. If you are a real estate developer or know developers who are looking for project funding, please give me a call. Our buying club may be interested in acquiring a large percentage of your pre-construction units.

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