Choosing My Personal Target Market

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Kenny Rushing School of Real Estate
If you would like to see how I make 15K
on a flip in just 8 days watch the video
below www.KennyRushing.com/retire
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INTRODUCTION
Kenny Rushing School of Real Estate Kenny
Rushing is the founder, CEO and Managing Partner
of Rush Capital Fund, LLC. Kenny added
Rehabber's Superstore in 2003 where he acquired
and disposed of more than 75 million dollars in
distressed real estate assets to investors and
completed over 1000 transactions. Kenny is an
internationally known author, keynote speaker,
educator, civic leader and philanthropist, whose
passion is helping others achieve financial
independence and security through real estate
education. Kenny Rushing's true passion is in
giving back to the community. He regularly
donates his time and expertise to rehabbing
projects that improve undeveloped areas
nationwide and plans to do more. He is also a
frequent and generous contributor to programs
that provide positive role models for
youth. Kenny is a leader among leaders!
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HOW DO REAL ESTATE INVESTORS IDENTIFY TARGET
MARKETS?
Personally, I dont care about the location of
the home I am buying as long it is in a
geographically accessible so I know the market
and can oversee any development of the property.
I buy in lower, middle and upper-end
neighborhoods.
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Choosing My Personal Target Market

• What matters most to me is making sure I can make
  a profit. The less desirable the location, the
  less money I will offer. If the home is across
  the street from a drug house or out in the rural
  country expect me to want to get a great deal on
  the home or I will walk away from the deal.
• It can be difficult to sell a house in a bad area
  that is why you want to make sure to buy it right
  so that you can sell it for a profit. The last
  thing you want is to be stuck with the house.
  Some houses sell quicker than others.

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Choosing My Personal Target Market

• Price is very important when buying a house
  however, sometimes I still walk away from deals
  when they are not in my target market. Often even
  the best price isnt worth the headache of buying
  in the wrong neighborhood. What is the use of
  buying a home for a good price if you cant sell
  it or rent it. You still have to pay for
  insurance, property taxes, and maintenance.
• What if you cant sell it for years? Can you
  handle the holding cost? For these reasons I am
  well-educated before I buy a house. I know what I
  like to buy and what I dont want to buy. Since I
  have been in business, my target market of choice
  has been buying homes that are centrally located.

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Choosing My Personal Target Market

• Most people refer to this area as the
  lower-income neighborhoods or the outskirts of
  the suburbs nearest the city. Dont worry these
  areas are not as bad as it is portrayed on
  television (and you can make a lot of money in
  the hood too). Why have I selected this area as
  my target market? The main reason why is because
  I can make a ton of money buying the homes there
  CHEAP!
• More importantly, I like to rebuild these areas
  whenever I can. What better way is there to
  rebuild than by buying, rehabbing, and restoring
  the image of these run down neighborhoods?
  Whatever target market or side of town you decide
  to invest in, you need to take the time to
  research the area to get a feel for what is going
  on in that area of town. Is it a re-sell market
  or a rental market? Buying a house in a rental
  market where I planned to re-sell was one of the
  first mistakes that I made when I got started.

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Heres the biggest mistake I made.NOT STUDYING
THE MARKET!

• Early on in my real estate career I bought
  another property in south St. Petersburg,
  Florida. Everybody else but me knew most of the
  properties in the area were rental properties.
  Few if any homes were being bought. This area was
  not a sellers market, it was a renters market.
  Not studying the market or doing any research of
  any kind, I blindly bought the piece of property
  in south St. Petersburg.
• When I bought the property, my intentions were to
  rehab and quickly re-sell it. Because I did not
  study the market or do research of any kind to
  find out information about the area where I was
  buying the property, I was stuck trying to sell
  that house for nearly eighteen months. So much
  for a quick re-sell.

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Heres the biggest mistake I made.NOT STUDYING
THE MARKET!

• There are areas in every city that are better
  markets for rental properties than they are
  markets to rehab and re-sell properties. Be aware
  that you are in the right market for whatever it
  is you are planning to do.

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How To Avoid This Costly Investing Mistake

• You can avoid this costly mistake by doing your
  due diligencestudy and research the market in
  the area where you plan to purchase a property.
  Meet with realtors who do business in the area.
  Visit with the residents living there. Find out
  if properties are being sold in the area. If
  houses are selling in the area, find out how much
  they are selling for. Ensure you gather all the
  information you need to make an intelligent
  decision based on whatever your objectives for
  the property may be.

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How To Avoid This Costly Investing Mistake

• If you want to rehab and re-sell a property, make
  sure you study the market for that area to ensure
  that its a good area for you to rehab and
  re-sell in. If you want to rehab and rent, make
  sure you study the market for that area to ensure
  that its a good area for you to do that.
  Whatever your objective, study the market and
  ensure that the area where you are purchasing a
  property will allow you to achieve your
  objective.

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Target Market Selection Tips For Beginner Real
Estate Investors

• If you are just getting started in real estate
  investing I advise you to do the following
• 1) Plan to buy, rehab, and quickly re-sell
  properties. The profits you will make early on
  will provide you with the operating income
  necessary to continue to buy and re-sell
  properties.
• 2) Eventually, when you become financially
  able, buy and keep some properties as you
  continue to buy and re-sell others. You can
  choose to live in, rent, and/or lease with
  options, etc. the select properties you choose to
  keep rather than re-sell. Keeping select
  properties that will appreciate in value long
  term will prove to be a great investment as well
  as provide steady cash flow.

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Target Market Selection Tips For Beginner Real
Estate Investors

• However, I have a lot of clients who also buy
  homes to rent. I take these clients straight to
  my stomping ground in the lower-income
  neighborhoods. The main reason for this is
  because it is easier to have a positive cash flow
  buying a cheap house in this area and renting it
  out to cover the mortgage, property insurance,
  property taxes, and maintenance than it is buying
  in one of those re-sell areas where properties
  are much more expensive.
• I always suggest to my new students never to
  invest more than 30 miles from your home. When
  you become a more seasoned investor investing out
  of the city limits or outside the state may be an
  option you consider. However, until you begin to
  gain some buying, rehabbing, and management
  experience I would not suggest you buy homes that
  are further than a 30 minute drive from your
  home.

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Target Market Selection Tips For Beginner Real
Estate Investors

• Its obvious that this was a beginners mistake I
  made. Whatever you do make sure you know what
  your objective
• is going to be before moving forward on a
  deal.
• Is your plan to build a rental portfolio or
  to re-
• sell?
• Whenever I buy houses, either to rehab or assign
• contracts to other investors that re-sell
  homes
• (wholesaling), I only buy in middle class
  communities. These are the neighborhoods where
  there are a lot of blue-collar workers who buy
  basic three bedroom/two bathroom bread and butter
  homes. Penetrating this market to buy and rehab
  or wholesale/assign contracts to other investors
  works well for me.

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Target Market Selection Tips For Beginner Real
Estate Investors

• I have seen countless people buy investment
  properties far away from their residence and lose
  money. This has happened to me even though I had
  someone who was going to look out for my
  interests. This is normally a result of not being
  able to manage the rehab or rental property (or
  depending on someone else who decides to screw
  you).
• Over the years, I have bought hundreds of houses
  from investors who were out-of-town owners. After
  months and sometimes years of tenants driving
  them insane (repairs, not paying rent, nagging,
  and countless other problems) they were so fed up
  that they just wanted to give away the house to
  get away from the tenants and all the headaches.
  I love buying these type of home because they are
  easy to negotiate. I hope you dont become one of
  this type of sellers.

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3 Basic Real Estate Target Markets

• When trying to determine your target market,
  there are only three options that you have.
• The first is buying homes in lower income
  neighborhoods.
• The second is buying homes in middle class
  neighborhoods (referred to as bread butter
  homes).
• The last option is buying in upper-end
  neighborhoods. With these options now it will
  depend on what your investment objective is and
  how much risk you are willing to take.

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Lower-Income Neighborhoods (The Hood)

• Here are the advantages and disadvantages of
  buying in each different real estate target
  market
• Advantages of Buying in Lower-Income
  Neighborhoods
• Houses are cheap
• There is a high foreclosure rate
• People need to rent homes in the hood
• There are a lot of abandoned homes in the
  hood
• People are moving back into the hood.
• Better cash flow

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Lower-Income Neighborhoods (The Hood)

• Disadvantages of Buying in Lower-Income
  Neighborhoods
• High turn over rate
• Job instability
• High crime activity
• Possible Damage to property (from tenants)
• Harder to rent and resell
• Less property appreciation

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Middle-Income Neighborhoods

• Advantages of Buying in Middle-Income
  Neighborhoods
• Better job stability
• Less crime
• Better quality of tenants
• Better property appreciation
• Easier to sell

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Middle-Income Neighborhoods

• Disadvantages of Buying in Middle-Income
  Neighborhoods
• Less cash flow
• Harder to rent (because people in this market
  buy homes)
• Higher property taxes
• Higher insurance
• Cost more to rehab

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Higher-End Neighborhoods

• Advantages of Buying in Higher-End Neighborhoods
• You can make a bigger profit
• Better appreciation (will depend on area and
  state)
• Less competition when buying
• Disadvantages of Buying in Higher-End
  Neighborhoods
• May have to pay Home Owner Association fees
• May take longer to sell
• Higher property taxes
• Higher property insurance
• Can not cash flow if hard to rent the house

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5 Property Buying Criteria For New Investors

• Before you decide on buying properties in any
  target market make sure that you follow the steps
  below.
• 1) Determine What Your Objective Is
• Are you going to buy or rent? If you are going
  to rent you may need to buy in lower/middle
  income neighborhoods and stay away from upper-end
  homes. If you are going to sell you need to stay
  away from lower-income homes (houses in the hood
  dont sell well) and stick with middle/upper end
  homes. Know your objectives before you get
  started.

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5 Property Buying Criteria For New Investors

• 2) Research Your Target Market.
• Make sure to research the market before you
  invest. You need to know if it is a renters
  market or a market where people buy homes. Then
  only buy homes that allow you to accomplish your
  objectives.
• 3) Select a Target Market to Concentrate On
• After you determine your objective and have a
  target market, concentrate on that market until
  you gain enough experience to move onto another
  target market.

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5 Property Buying Criteria For New Investors

• 4) Work that Market
• You should concentrate on that market and
  learn everything necessary to be the best at
  buying properties and turning profits in that
  target market.
• 5) Make Money Reinvest Profits
• When you begin to make money, repeat the
  process over and over again. If it works once it
  will probably work again.

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Our Testimonials
Working together with Kenny as my mentor has
truly been enlightening. I have never seen such a
creative approach to real estate that actually
worked! The program gives you all the essential
tools to become successful in this business.
Working with Kenny, we were able to develop my
own unique marketing strategy to differentiate me
from any other investors out there. This
program taught me lots of strategies that enabled
me to close one of my biggest deals yet that
netted me 39, 510.50. Thanks Kenny. You are the
real deal!


Kionna Perry Kennys ability to
teach real estate is amazing! He breaks down each
vital component into easy to understand steps. I
especially liked his Take Action Now steps at the
end of each section. Now theres no excuse why
anyone cant start in this business, even if you
have no cash, credit, or experience.


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And Many More..
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Contact Us
If you are looking for more information related
to real estate investing then please visit my
site at http//www.KennyRushing.com OR Call
office at 888.494.0511. Kenny Rushing Real
Estate Educator for the People P.S. If you
would like to see how I make 15K on a flip in
just 8 days watch the video Here
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