Casey Serin’s last home gone

Casey Serin, the housing bubble’s poster-child, lost his last home to foreclosure the other day. I feel bad for the guy because I’ve seen plenty of people pick up one of those real estate investment books and think they’ve found the path to eternal wealth.

I hope he lands on his feet, but foreclosure is not easy and unfortunately lots of press doesn’t always turn in to real dollars coming through the door.

I think the important thing to remember is just because someone can qualify you for a home loan doesn’t mean you can afford it.

If you’re considering investing in real estate you absolutely must do the following (check out this USA Today article too):

Run some worst case scenarios about how long you’ll have to hold a property and how much real cash you’ll be forced to spend each month to support that property if you can’t flip or rent it.
Before you buy know comparable rents in the area, even if you don’t plan on renting at least you’ll know where you will stand if you have too.
Once the appraisal is done ask your mortgage banker to run an AVM (automated valuation) or order a drive-by appraisal (or field review). You’re looking for a reason to not buy the property. The worst situation you can be in is to buy a property whose value has been inflated.
Get a sales history of the property before you buy it. If the property has been flipped several times before it landed in your lap there is probably little room for additional appreciation.