Casey Serin is a 24 year old from Sacramento, California, who aspired to be a real estate mogul. He amazingly bought 8 houses in 8 months in 4 states without any downpayment. Along the way, he quit his job; his only source of income.
He intended to build his real estate empire by renovating and flipping his properties. His intention was good, but his means was fraudulent and his timing was bad. He obtained his financing by lying about his income and his purpose for buying the property. He also obtained "cash backs" from 5 out of his 8 properties which is deemed illegal. He bought his properties during the peak, thus it’s hard to resell them immediately for a profit.
Due to some serious mistakes from the start, instead of coming out wealthy from his real estate transactions, he accumulated millions in debt. It’s nice to hear if you have 8 properties under your name, but if it’s only giving you losses, then its not assets but liabilities.
In Australia, negative gearing gave mom and dad investors the opportunity to invest in the property market. It worked for some, but a lot lost money in their investment exercise. It was good when the market was bullish, but when the property prices became stagnant and further declined, their tax loss was nothing compared to the losses they raked in interest payments and decline in value. Negative gearing easily became negative equity.
A lot of people, in their desire to get rich quickly and fueled by some misleading property investment seminars missed the whole point of property investing. They aimlessly bought properties thinking that any property will give them the riches they wanted. They fail to realize that just like any business, property investment needs careful thought, a plan, a strategy and knowledge of how to do things right. Casey Serin’s experience is a perfect example of the things you should not do in real estate investing. You could read his story in IamFacingForeclosure.com
He describes his blog as:
"a calm and honest discussion of what NOT to do in real estate as well as a close look at what works and doesn’t work in getting out of this foreclosure / debt mess. No sugar-coating. No cover-up. I tell it how it is from the trenches."
RE: Casey Serin:
Some similarly business-minded folks from the old country also run into tough times, due to their own innovative ideas for creating wealth, just like Casey:
Uzbekistani immigrants await discussion of entrepreneurial methods