Someone shared inside information about making a small Real Estate investment in the Atlanta housing boom that made me 6 figures in less than 5 years.
I learned how Atlanta’s poorest neighborhoods would benefit from gentrification.
Gentrification means the process of renewal and rebuilding, accompanying the influx of middle-class or affluent people into deteriorating areas, that often displaces poorer residents.
I know a good deal when I hear one, so I immediately started looking for one of those raggedy, run down houses to capitalize on the opportunity.
During that time, I had a successful career with the Federal government.
But, picture me driving a big, black, Ford monster pick-up truck through a drug-infested community looking for a Real Estate deal!
I decided to cruise around a particular neighborhood and zip code to check out the small Real Estate investment housing tip.
To my surprise and delight, I discovered that houses were selling for $3,000-$8,000, and I was determined to get one.
That neighborhood was one of the worst “hoods” in Atlanta, Georgia, but I was not discouraged.
As I started driving through that neighborhood on a regular basis, I caught the attention of all the local drug dealers.
They noticed that I was driving slowly and looking around, so they were curious about what I was looking for.
I started hearing them call out “Five O”!
It did not take me long to figure out what it meant (Hawaii Five-O).
A few of the drug dealers approached me to find out was I the “po-lice”.
I told them that I was not and that I was looking for a house to buy.
They did not believe me, but they did not bother me either.
I am certain that I looked suspicious in my professional attire and driving a monster truck.
Well, long story short, a few years later, after suffering a disability, losing everything I had, becoming homeless (literally), and starting over from scratch, I bought a house in the same “hood”, for $15,000.
Prices were going up fast.
When I bought it, I did not have a dime, but I had another good job (in International Banking); so the owner allowed me to float two checks for the down payment; and he owner-financed the house until I got an interest only loan two years later.
By that time, the housing boom was in full effect, but other Real Estate investors did not appear to know about my best-kept secret neighborhood.
I fixed up my house the best I could with donated home repair, blood, sweat equity, and tears; but it still needed a lot more work when I decided to sell it.
It did not have a nice kitchen with granite counter tops and stainless steel appliances, or a nice spacious bathroom.
The single bathroom had a rusting claw foot tub on a make shift platform; and when I washed clothes, the water drained out in the backyard.
It was still a ramshackle house when the Atlanta Journal Constitution published an article about it, and its proud banking professional owner.
It was so close to the house next door, the neighbor could hand me his cellphone.
There were four feet between our homes and two were mine.
What my house had going for it was location, location, location.
It was on zero land, but a corner lot, in a very HOT ZIP CODE.
There were so many drug dealers that when I went to work, they hung out on my porch (according to neighbors).
After five years, my still dilapidated, historic house was valued at over $175,000 “AS-IS.”
I sold it at the top of the housing boom, rinsed and repeated.
Those drug dealers would have been better off pooling their money to buy one of those shacks as a small Real Estate investment.
It would have been a much better deal!
The lesson to be learned from this story is: If I tell you that the USDA-RD Direct Loan is the best mortgage you never heard of, you can believe it is a good deal!