Multiple Streams of Income: How to Generate a Lifetime of Unlimited Wealth! Second Edition by Allen Robert G

Author:Allen, Robert G. [Allen, Robert G.]
Language: eng
Format: mobi
Publisher: Wiley
Published: 2005-04-04T16:00:00+00:00

The 20 Percent Strategy 8: Conversion

When is a house not a house? It depends on where it is located. Have you ever driven by a residential-looking house on a busy street occupied by a commercial establishment—an insurance broker, a dry cleaner, a florist? Why was such a normal house built on such a busy street? At one time it was a sleepy residential neighborhood that slowly became a busy business thoroughfare.

By going down to your city planning commission you can find out exactly where the new streets are going to be for 10 years into the future. One day, those residential homes will be worth double their value simply because the city leaders will rezone the property from residential to commercial.

Sometimes, by doing a bit of homework you can plan your investments to have a dramatically improved value in the future by selecting properties in the path of progress.

One of my favorite conversion experiences was transforming a rundown 12-unit apartment building just off of Center Street into well-appointed office space. The conversion costs were about double what I had originally anticipated, but I was rewarded with a value quadruple what I had paid for the building.

It would be difficult to calculate my rate of return—well into the hundreds of percent. My original intent had been to buy the property and keep it as an apartment building. To be honest, the idea of becoming a property developer was way beyond my comfort zone at the time. It didn’t even enter my mind. But after owning the property for a short time, I realized that it could be an incredibly lucrative investment if I were willing to put up with a lot of hassle and headache.

Whenever you look at a piece of property to buy, put on your profit glasses and be willing to dream about what might be done with the property. Perhaps you can reap a huge conversion profit.

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