Hi BP Family,
I am totally new to this, and kind of nervous, but I am wondering if I can get some expert advice from all of you awesome members. I currently own 0 properties and hope to have at least 6 deals under my belt by the end of next year. I have friends and their friends who want me to help them purchase some properties (single & multi-family units) in the states (a way for them to keep their assets safe and growing) and they would want me to manage those properties for them.
We have been in the talks about this for over 2 months now and I have been gathering different ways and plans to go at this, like different loan types for foreign buyers and even me as a buyer of the homes (with their money as down payments) and do rent to own type deals, as in they basically rent until they own the whole thing. They even had discussions of just buying the home outright in cash. My Problem is that they are just taking so long to get things done. Some of them seem to be waiting on the other to make the first move. Some are tied up with their personal businesses but knows they need to do it soon. Some are unsure of the whole process but don't want to research themselves...
I guess I am seeking help on how to get these investors moving forward and feeling comfortable and confident in the decision to purchase homes over here in the states. I know this is a huge purchase and step especially since they don't and won't be living in the states, but obviously, it will be worth wild for them and me.
How can I get them to move forward?
Thank you for all of your time!
Before you get too far into this, check what the property management guidelines are in your state. I know some states require a broker's license to be able to legally manage properties owned by other people.
Also, if your buyers are taking a long time to make a decision they probably aren't very motivated. You may have to just go into real estate on your own and then once they see your success they may be more motivated to participate. Trying to motivate unmotivated buyers is a whole different discussion.
Welcome to Bigger Pockets.
That is a great point, I didn't even think that a broker's license was needed. After researching it, it turns out that my market out here in Utah needs one. I will need to get a real estate agent license first and have 3 years of experience before I could even take the broker's exam. I am assuming there isn't any way around this, correct?
I think you're right about me needing to have a few properties myself first before they would want put their money in my hands. I am planning on getting a property sometime in the near future. I guess I will just start there.
Thank you for much for your time!
Thank you, George! I am glad I have finally become more interactive within the community.
The only thought I would have to "get around that" would be to get licensed under a broker that would allow you to do property management under their license. You would have to be able to show that you have really good systems in place and follow all of the state guidelines. Most brokers probably won't take on that liability. But if you can get really good systems in place and show that you are doing well self-managing, you may be able to find someone that would be willing to allow you to do that.
Good luck and welcome to BP!
Put yourself in their shoes for a bit: "Why would someone be motivated to pass their money to you to buy & hold properties for them? Do you have experience buying and managing properties? Can you show the results?"
These are more of rhetorical questions to give you food for thought so to speak. Also, don't limit yourself to apartment buildings or SFH. Why not look into buying a storage or some mini-mall. Another point is, evaluate what these investors' main goal is. If they are looking to "park" money in US, you can buy NNN lease - nothing for you to manage and they will even get a small return (5-7% roughly) but don't quote me on that number.
Anyway, if you'd like to talk offline about it, feel free to PM me.
You don't have a solid plan yet but then are frustrated that your friends are slow to move forward. Develop a strong plan with timeline, present the deals, and then they'll move forward or not. Not sure how a rent to own scenario or property managing will be worth your while. If you have your own funds to invest then it sounds like a partnership would make the most sense. Profits can be split based on the percentage of equity contributed plus your time/effort in self managing and being the boots on the ground. For most of the folks on the forums, access to capital seems to be the biggest problem. You sound set there and so you just have to find the right deals. Present them with some deals and you'll quickly find out what they are and aren't comfortable with.
My foreign investor clients are looking primarily for preservation of capital. They pay all cash and don't care so much about cash flow. They expect some appreciation over the long term but mainly just want to park their money in the US. They typically go for A class condos in neighborhoods they've heard of, so very little maintenance and cap ex, and easy A class tenants.
That is great guidance. I appreciate your willingness to take time and get my questions answered!
I will see what I can do there. I think the best route for this then is to just get my real estate license and work my way up with my properties while working things out with these international buyers, then when I am qualified after 3 years I will shoot for a broker's license.
I appreciate your time!
Those are great questions for me to ask. I am currently looking into the NNN leasing now to find out how beneficial it would be for both sides.
Thank you so much for your time.
Hi Jason, we are currently working on plans right now. They just want to know the process of getting things done. I think you have a good point about presenting deals to them. I was under the assumption that I will find deals with them once they are ready (obviously, that isn't moving fast enough), but I agree with you that I should just find the deals myself and draw out a plan and show them how their money would sit here in the US.
Thank you for that advice.