EPISODE · Jan 19, 2025 · 52 MIN
How to Lose Half a Million Dollars on One Door | # 2
from The Real Estate Pessimist · host RE Pessimist
In this episode, Erik Stenbakken dives deep into a real estate nightmare—a project gone so wrong it ended up costing nearly $500K. This isn’t just any horror story; it's a detailed breakdown of how things can spiral out of control in real estate development and what you can learn from it.🔗 Link to full show: https://youtu.be/rhwsZYLUAxoWhat You’ll Learn in This Episode:🤦♂️How Erik went from successful builds to a disaster project⚠️Why working with the wrong contractor can make or break your deal🛠️The importance of vetting builders and understanding market-specific risks❌ Red flags he ignored—and why you shouldn’t😬The financial and emotional toll of a two-and-a-half-year failed buildKey Takeaways:1. Vet Your Builder Extensively: Work with a local builder who has a proven track record in your specific market. Even if a deal looks great on paper, it can quickly turn sour without the right team.2. Understand the Financing: Builder-financed projects can protect you from carrying costs and delays. If you're financing the build yourself, be prepared for unexpected overruns.3. Don't Pay Until Inspections Are Complete: Ensure that all inspections are passed before releasing any draw payments to your contractor.4. Budget for Overruns: Expect the unexpected. Costs can escalate quickly, especially in volatile markets.5. Trust Your Instincts: If something feels off, it probably is. Address red flags early and be ready to walk away.Was it worth it?Despite the setbacks, Erik survived this ordeal with invaluable lessons that will shape how he approaches future projects. This episode is a raw and honest look at the harsh realities of real estate investing—because sometimes, the best deals are the ones you walk away from.Stay tuned for the next episode, where Kristi shares a wild story involving a property, the cartel, and a Homeland Security drug bust. You won’t want to miss it!Got a similar story or lessons learned? We’d love to hear from you!💥 Interested? Email us at [email protected] and let’s chat about having you on an upcoming episode!Follow us for more real talk on real estate investing!Want to become a STR Expert with Erik’s help? https://eriks-academy.teachable.com/p/str-in-an-hour Ready to go from podcast listener to Local Developer with Kristi’s guidance?Whether you're just getting started or ready to go all in, we've got the tools to help you build what matters in your own backyard. → Programs & Resources: https://www.localrealestatedeveloper.com/ → 90-Day Masterclass: https://www.localrealestatedeveloper.com/build-it-course → Apply for the Mentorship Program: https://www.localrealestatedeveloper.com/dev-mentorship#RealEstateInvesting #PodcastEpisode #TheRealEstatePessimist #LessonsLearned #BuildingGoneWrong #InvestmentMistakes #RealEstateFails #DevelopmentDisasters #InvestorEducation #ShortTermRentals #VacationRentals #BuildingChallenges #RealEstateStories #REInvestorJourney #OvercomingSetbacks #ConstructionWoes
What this episode covers
In this episode, Erik Stenbakken dives deep into a real estate nightmare—a project gone so wrong it ended up costing nearly $500K. This isn’t just any horror story; it's a detailed breakdown of how things can spiral out of control in real estate development and what you can learn from it.🔗 Link to full show: https://youtu.be/rhwsZYLUAxoWhat You’ll Learn in This Episode:🤦♂️How Erik went from successful builds to a disaster project⚠️Why working with the wrong contractor can make or break your deal🛠️The importance of vetting builders and understanding market-specific risks❌ Red flags he ignored—and why you shouldn’t😬The financial and emotional toll of a two-and-a-half-year failed buildKey Takeaways:1. Vet Your Builder Extensively: Work with a local builder who has a proven track record in your specific market. Even if a deal looks great on paper, it can quickly turn sour without the right team.2. Understand the Financing: Builder-financed projects can protect you from carrying costs and delays. If you're financing the build yourself, be prepared for unexpected overruns.3. Don't Pay Until Inspections Are Complete: Ensure that all inspections are passed before releasing any draw payments to your contractor.4. Budget for Overruns: Expect the unexpected. Costs can escalate quickly, especially in volatile markets.5. Trust Your Instincts: If something feels off, it probably is. Address red flags early and be ready to walk away.Was it worth it?Despite the setbacks, Erik survived this ordeal with invaluable lessons that will shape how he approaches future projects. This episode is a raw and honest look at the harsh realities of real estate investing—because sometimes, the best deals are the ones you walk away from.Stay tuned for the next episode, where Kristi shares a wild story involving a property, the cartel, and a Homeland Security drug bust. You won’t want to miss it!Got a similar story or lessons learned? We’d love to hear from you!💥 Interested? Email us at [email protected] and let’s chat about having you on an upcoming episode!Follow us for more real talk on real estate investing!Want to become a STR Expert with Erik’s help? https://eriks-academy.teachable.com/p/str-in-an-hour Ready to go from podcast listener to Local Developer with Kristi’s guidance?Whether you're just getting started or ready to go all in, we've got the tools to help you build what matters in your own backyard. → Programs & Resources: https://www.localrealestatedeveloper.com/ → 90-Day Masterclass: https://www.localrealestatedeveloper.com/build-it-course → Apply for the Mentorship Program: https://www.localrealestatedeveloper.com/dev-mentorship#RealEstateInvesting #PodcastEpisode #TheRealEstatePessimist #LessonsLearned #BuildingGoneWrong #InvestmentMistakes #RealEstateFails #DevelopmentDisasters #InvestorEducation #ShortTermRentals #VacationRentals #BuildingChallenges #RealEstateStories #REInvestorJourney #OvercomingSetbacks #ConstructionWoes
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How to Lose Half a Million Dollars on One Door | # 2
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