In any real estate transaction, profits can be made from items other than the building and the land. As a buyer, you are in a position to negotiate for "extras". Your purchase agreement should include these extras. If the seller accepts, you own these items. If not, you can "trade" back these extras in exchange for better terms or a lower price. We refer to these extras as "the cookies at the party".
For example, when I offer to buy a property with a large yard
and the owner has a lawnmower (perhaps even a riding model) I write into the agreement that the
mower is included in the purchase. I tell the seller that it will be needed to take care of the
yard. I will also try to get furnishings, other tools and equipment, or anything that may be
collecting dust in the attic, garage or barn. I have seen times when I was able to get some
valuable antiques that the owner thought was just junk. In another instance, an abandoned 1964
Mustang sitting out in the field was included. Have you priced one of these lately? The owner just
didn't know its value. Or how about this 1980 Porsche 924 Turbo that was siting in a barn and I managed to get for just $1.00 extra (runs great, sold it for $11,500)
Always ask for such things. You may not get them, but perhaps you will. Even if you don't, do not give them up without getting something else in return, such as the seller paying the closing costs, or doing certain repairs before closing. Either way, you come out ahead.
All of these items can be sold for a tidy "extra" profit. It is not unusual to earn an extra $3000 or more in this manner, all from a single transaction.
Of course, when you resell the real estate, be sure to exclude these items from your sales
agreement. Don't you be the one giving them away!
Oh, and if the property has an old barn? Exclude that from the sales agreement, too, if you can. Not the land it is on - just the barn. Take it down and sell the boards and beams - old lumber and timbers command a high price on the open market.
Bear in mind that many of our techniques will increase your tax liability due to these extra profits. To reduce your taxes, you can give these items away to charity and write off their full value, rather than sell at half-value (which adds to your income - and your taxes!)
Check out "The Simple Man's Guide to Real Estate Investing" for a lot more ntips to increase profits or decrease costs.
/
