You will have to do ugly things to get ahead in real estate

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Originally posted by @Alan Ouellette :

@Jim K.

It sounds like you may feel beat down man, keep the faith. In all honesty, someone needs to own those properties and it's best if it's someone like you who will think about these moral questions. I am sure the slumlords are out there but they're not going to be places like here. I lived in class C neighborhoods growing up. Knew where to buy certain drugs and who were the big names on the block. Those places exist and there's nothing we can do about it. But owning those kind of buildings gives the downtrodden a place to live and there's honor in that. If the neighborhood were renovated and rented at high prices, it would push those most vulnerable out, needing to find a new home. Or worse, leave the house abandoned which would attract far worse energy.

Oh, trust me, Alan, there are many days when I feel that gentrifying the hell out of my target neighborhood would be the best thing for it and a public service.

Originally posted by @Anish Tolia :

Everyones hands are dirty no matter what they do. Its just a matter of how far removed the consequences for your actions are. If you kill someone its murder. But  by simply paying taxes you are contributing to war and misery for millions. More degrees of separation but same results. Much of your benefits come at the expense of others. This is the nature of human societies. Always has been and probably always will.

As I've said elsewhere, I cry for the pain of the world, too. But running rentals in the ghetto is pretty near the bone, Anish. As least I'm not scooping out the eyes of little boys who can sing to make them more profitable beggars under my thumb. Or showing my stable coathanger love when they get lazy or hide scratch from Daddy.

@Jim K.

My apologies for coming off like that. Not my intent at all. Really not being sarcastic or trying to be a dick. But from your post it sounds like you’re having some inner conflict and the real estate question is merely a catalyst.

Originally posted by @Reggie Desir :

@Jim K.

My apologies for coming off like that. Not my intent at all. Really not being sarcastic or trying to be a dick. But from your post it sounds like you’re having some inner conflict and the real estate question is merely a catalyst.

No inner conflict other than real estate. I went to a meetup recently where everyone was doing their best to pretend that there's absolutely nothing savage about landlording in Yinzburgh, especially the speaker. She was snide and supercilious to me afterwards. This has been bothering me.

There is a difference between being a horrible person and also running your business. Some decisions in business are hard but necessary. By the sounds of it you'd rent to a tenant that clearly doesn't qualify for your unit because they have a sob story. That won't get you very far. Sure some people got the short stick in life but most times the "short stick" is self inflicted. I am extremely involved with my community in my other business but I didn't get into real estate to help people turn their life around. 

I look at business exchanges like relationships. If one party is bringing more to the table than the other, that’s generally an unhealthy relationship. When renting, both parties agree that living in this property is worth X amount of dollars, and the moment they either stop paying me; or if I randomly raise the rent on them, it is unhealthy for either party. So if my tenant cannot pay their rent for an extended period of time, why should I be forced to stay in an unhealthy relationship? 

Also, I look at my Lock Screen and see a picture of my baby girl looking at me. And I love people, and my heart goes out to them, but that little girl is way more important to me than any of them.

@Jim K. whole heartedly disagree. Real Estate is a people business. The better you treat your tenants, buyers, seller, peers, etc., the faster your business will grow.  Real estate is a tight knit community. If you are a lazy flipper, slumlord, or shady wholesaler, your reputation will be known and you'll go out of business quickly. 

"You can get everything in life you want if you will just help enough other people get what they want." - Zig Ziglar

@Jim K.

After reading your responses, I think I know how to help you.

I think what you are doing is unethical, immoral, and weakens the backbone of our country. From What I gather you are buying, rehabbing and renting cheap single family homes. Every time you come by and scoop up a single family home, fix it up and turn it into a rental, you are taking away an American families chance of living out their American dream- home ownership.

Lob some shots back at me!

@Jim K. It just seems like you have some unattended to deep seated issues that are eating away at you. Most of the stuff you are alluding to I have NEVER heard any of my landlord associates talk about. It will be changing soon but I have all class D units and none of that applies in my mind. I started out there because I can handle risk, and the higher the risk the higher the reward. It was a good training ground to equip me for anything. Iḿ nice and fair by nature but like someone said earlier, I take the middle of the road approach. This is my business and the goal in any business or any job is to make a living for you and your family. I have a place for them to live and they need a place to live. In fact, I feel great about it because in so many cases no one gives a damn about them, will exploit them and never give them any kind of chance I would. If they could do better and go somewhere else, most would. They cant. With me they get a fair landlord that treats them decent and a decent place to live in. In terms of wishing little kids were white, some can interpret that as racist. I know its a common mindset and this is America with its current political climate,  but itś not that Black and White. No pun intended. That ideology is what leads to redlining and bigoted business models. If this is something you ponder often, you probably subconsciously treat them different and should not invest in minority communities.  I have had several tenants from several demographics. Most have been low income whites and behavior has more to do with class levels as opposed to their pigment. Yes, I get the over all notion. Yes, in general a white area is perceived as more valuable but its so many things that go into it. Pouring white paint on the face of those kids wont do it. Come to the Curtis Bay/Brooklyn  area of Baltimore. Predominately low income whites with high crime and poverty. I have units there which do not appreciate and creates nothing but problems many would associate with other demographics. Buy some units there and tell me what color you would be wishing they are next. I guess you were posing the question to someone else but it came from somewhere. Either way, nothing you said so far is anything to feel guilty about over all. Treat people good, give them respect and treat them no different than the class B and A and its all good!

Originally posted by @Travis Frenchak :

There is a difference between being a horrible person and also running your business. Some decisions in business are hard but necessary. By the sounds of it you'd rent to a tenant that clearly doesn't qualify for your unit because they have a sob story. That won't get you very far. Sure some people got the short stick in life but most times the "short stick" is self inflicted. I am extremely involved with my community in my other business but I didn't get into real estate to help people turn their life around. 

You know precisely nothing about me, Travis. You've certainly got a bunch of assumptions, though.

Originally posted by @Kevin Hart :

@Jim K. whole heartedly disagree. Real Estate is a people business. The better you treat your tenants, buyers, seller, peers, etc., the faster your business will grow.  Real estate is a tight knit community. If you are a lazy flipper, slumlord, or shady wholesaler, your reputation will be known and you'll go out of business quickly. 

"You can get everything in life you want if you will just help enough other people get what they want." - Zig Ziglar

I keep hoping you're right, because I can barely believe I'm at where I'm at starting from where I came.

Originally posted by @Andrew Carlson :

@Jim K.

After reading your responses, I think I know how to help you.

I think what you are doing is unethical, immoral, and weakens the backbone of our country. From What I gather you are buying, rehabbing and renting cheap single family homes. Every time you come by and scoop up a single family home, fix it up and turn it into a rental, you are taking away an American families chance of living out their American dream- home ownership.

Lob some shots back at me!

I needed that, Andrew. Thanks.

@Jim 

@Jim K.

Let me preface this by saying I have read many of your post in the past and voted for some of them. :)

If you take your logic that you are referencing in your post and your responses so far it is pointing more to a socialist or even a communist mindset IMO.  A lot of people are where they are in life because they made choices to do so. To punish or shamed ambitious people  could lead to more people simply giving up as well. In your post it was kind of a mixed smorgasbord so I know that you are ambitious and hard-working. We just need to be careful as a society that we do not lean too far to the left that we create a culture that shames the entrepreneurs and business people.

Originally posted by @Joe S. :

@Jim 

@Jim K.

Let me preface this by saying I have read many of your post and vote for some of them. :)

If you take your logic that you are referencing in post it is pointing more to a socialist or even a communist mindset. A lot of people are where they are in life because they made choices to do so. To punish or shamed ambitious people  could lead to more people simply giving up as well. In your post it was kind of a mixed smorgasbord so I know that you are ambitious and hard-working. We just need to be careful as a society that we do not lean too far to the left that we create a culture that shames the entrepreneurs and business people.

You can fatwah-hurl "communist" and "socialist" at me all you want, it does not change my reality. I doubt quite a few real estate investors ever had any shame to begin with, just some vague middle-class-minded, status-seeking notions about not being embarrassed publicly for what they did as privately as possible. I have met trash on trash on trash on this business pretending to respectability. It's like a Zola novel.

Of course you voted for some of my posts. Quite a few are reasonably well-written and witty. If anyone's supposed to write well here, it's someone like me, a failed humanities academic turned landlord. It helps me not to grunt out my ambitions or howl out my ignorance in the standard manner, maybe put up shots of my wife and boast at 70 that she's thirty years younger than me and as limber as a teenager.

Originally posted by @Jim K. :
Originally posted by @Travis Frenchak:

There is a difference between being a horrible person and also running your business. Some decisions in business are hard but necessary. By the sounds of it you'd rent to a tenant that clearly doesn't qualify for your unit because they have a sob story. That won't get you very far. Sure some people got the short stick in life but most times the "short stick" is self inflicted. I am extremely involved with my community in my other business but I didn't get into real estate to help people turn their life around. 

You know precisely nothing about me, Travis. You've certainly got a bunch of assumptions, though.

 Nor do I care to. I literally couldn't care less about you but you came on a public forum looking for comments and opinions and I gave one. Don’t be so sensitive. Good luck to you. 

Originally posted by @Travis Frenchak :
Originally posted by @Jim K.:
Originally posted by @Travis Frenchak:

There is a difference between being a horrible person and also running your business. Some decisions in business are hard but necessary. By the sounds of it you'd rent to a tenant that clearly doesn't qualify for your unit because they have a sob story. That won't get you very far. Sure some people got the short stick in life but most times the "short stick" is self inflicted. I am extremely involved with my community in my other business but I didn't get into real estate to help people turn their life around. 

You know precisely nothing about me, Travis. You've certainly got a bunch of assumptions, though.

 Nor do I care to. I literally couldn't care less about you but you came on a public forum looking for comments and opinions and I gave one. Don’t be so sensitive. Good luck to you. 

Thank you, Travis, right back atcha. But to be clear, I posted an agree-or-disagree question and people like you are making it all about me. And the reason why is simple:

"Where imposture, ignorance, and brutal cupidity, are the stock in trade of a small body of men, and one is described by these characteristics, all his fellows will recognise something belonging to themselves, and each will have a misgiving that the portrait is his own."

Charles Dickens

@Jim K.

I’m a big fan of the Socratic method.

Anyways,

In the words of my mentor…”just keep going”

Simple words, but very profound if taken to heart.

Mark,

Thank u so much for pointing out his racist thoughts in bullet 1) regarding Black kids basically affecting his property values.  It's these same racist attitudes that can keep us, (AAs), from getting loans to become homeowners, where our kids can get access to better schools, in turn affecting their higher education, & last, their standard of living as adults.  Also, thank u so much for pointing out there are poor Whites.  If he'd come to Northeast FL, drive thru the trailer parks, & a # of neighborhoods, he'd see them.  If his only concern is his property value & not helping people thru RE from all ethnic, socioeconomic backgrounds, then he should get out of real estate.

Originally posted by @Mark Cruse :

@Jim K. It just seems like you have some unattended to deep seated issues that are eating away at you. Most of the stuff you are alluding to I have NEVER heard any of my landlord associates talk about. It will be changing soon but I have all class D units and none of that applies in my mind. I started out there because I can handle risk, and the higher the risk the higher the reward. It was a good training ground to equip me for anything. Iḿ nice and fair by nature but like someone said earlier, I take the middle of the road approach. This is my business and the goal in any business or any job is to make a living for you and your family. I have a place for them to live and they need a place to live. In fact, I feel great about it because in so many cases no one gives a damn about them, will exploit them and never give them any kind of chance I would. If they could do better and go somewhere else, most would. They cant. With me they get a fair landlord that treats them decent and a decent place to live in. In terms of wishing little kids were white, some can interpret that as racist. I know its a common mindset and this is America with its current political climate,  but itś not that Black and White. No pun intended. That ideology is what leads to redlining and bigoted business models. If this is something you ponder often, you probably subconsciously treat them different and should not invest in minority communities.  I have had several tenants from several demographics. Most have been low income whites and behavior has more to do with class levels as opposed to their pigment. Yes, I get the over all notion. Yes, in general a white area is perceived as more valuable but its so many things that go into it. Pouring white paint on the face of those kids wont do it. Come to the Curtis Bay/Brooklyn  area of Baltimore. Predominately low income whites with high crime and poverty. I have units there which do not appreciate and creates nothing but problems many would associate with other demographics. Buy some units there and tell me what color you would be wishing they are next. I guess you were posing the question to someone else but it came from somewhere. Either way, nothing you said so far is anything to feel guilty about over all. Treat people good, give them respect and treat them no different than the class B and A and its all good!

Originally posted by @Mark Cruse :

@Jim K. It just seems like you have some unattended to deep seated issues that are eating away at you. Most of the stuff you are alluding to I have NEVER heard any of my landlord associates talk about. It will be changing soon but I have all class D units and none of that applies in my mind. I started out there because I can handle risk, and the higher the risk the higher the reward. It was a good training ground to equip me for anything. Iḿ nice and fair by nature but like someone said earlier, I take the middle of the road approach. This is my business and the goal in any business or any job is to make a living for you and your family. I have a place for them to live and they need a place to live. In fact, I feel great about it because in so many cases no one gives a damn about them, will exploit them and never give them any kind of chance I would. If they could do better and go somewhere else, most would. They cant. With me they get a fair landlord that treats them decent and a decent place to live in. In terms of wishing little kids were white, some can interpret that as racist. I know its a common mindset and this is America with its current political climate,  but itś not that Black and White. No pun intended. That ideology is what leads to redlining and bigoted business models. If this is something you ponder often, you probably subconsciously treat them different and should not invest in minority communities.  I have had several tenants from several demographics. Most have been low income whites and behavior has more to do with class levels as opposed to their pigment. Yes, I get the over all notion. Yes, in general a white area is perceived as more valuable but its so many things that go into it. Pouring white paint on the face of those kids wont do it. Come to the Curtis Bay/Brooklyn  area of Baltimore. Predominately low income whites with high crime and poverty. I have units there which do not appreciate and creates nothing but problems many would associate with other demographics. Buy some units there and tell me what color you would be wishing they are next. I guess you were posing the question to someone else but it came from somewhere. Either way, nothing you said so far is anything to feel guilty about over all. Treat people good, give them respect and treat them no different than the class B and A and its all good!

 Perfect reply!

@Jim K.

Raising the big existential questions of RE is the perfect topic for a Saturday morning in the fall. 

1. Being proud of ones work: I don't think that is ugly or nasty at all to get dirty and work with your hands. To a certain extent it is unnatural not to.  I think that is something to hold dear and be filled with pride: doing the job right even if only you know.

"Far and away the best prize that life has to offer is the chance to work hard at work worth doing" -T Roosevelt. 

Not that my opinion matters, but I believe rehabbing old homes to the condition they used to be in while adding modern fixtures so that families can live in them is worth doing. 

What I wouldn't not be proud of is posting a bunch of pictures of a slap dash rehab to a RE social media site to collect adulation about how I slapped lip stick on a pig in a city thousands of miles from where I live because I had my Core 4 on lock and can now sell/ rent it to some poor soul, but hey I made my $$$. That would fill me with shame, but that's why I don't do it.  

2. The morality of profiting off human misery. Ecclesiastes 9:11. 

We control from the top of our head to the bottom of our feet. If we do nothing wrong, we don't cheat, lie, steal, ect, then we have not harmed ourselves. If others lie, cheat, steal, take short cuts, yes that will impact us, but it will only hurt us if we allow it. At the end of the day we can bemoan the fact that misery exists, but as you know better than most, it has been a constant traveler with humanity for thousands of years and shows no sign of taking a different path. 

Thus we must accept the traveler for what he is and accept and embrace the challenges he brings to our lives; mainly, how to band together, act for the common and individual good so that we may not be forces to corrupts our morals for the whims of the entropy created by human misery. 

At the end of the day, taking run down houses and making them nicer so that a family can turn them into a home, brings a tiny bit more order and a bit less suffering to the world.  Since you aren't a billionaire with a large trust fund, the best way to make this a an ongoing addition to humanity is to make a profit on each. 

@Terri Fulwood-Young yes, it was an open racist comment regardless if he was posing it to someone else. What is more disturbing is it seems like that kind of remark had some sense of acceptance or normality. I do understand that the current political climate has legitimized many segments of this nation to believe open bigotry is cool or ok, but freely spouting off about wishing little Black kids who have done nothing were white is tragic in my book. Also, I love how you defined all the historic, factual ripple effects of how that mentality devastates minority communities for generations. I just wish people who do not understand or respect various communities (pigmentation) just chose not to invest there. Invest in the places they dont feel are so terrifying or inferior. I listed above the very white Curtis Bay which is one of the lowest areas in Baltimore. I have investments in Hagerstown which is predominantly white where values are dust bowl ghetto numbers compared to Fredrick right down the road. Like I explained them him, its so much that goes into in and income or class level is a major factor. 

Food for thought to any landlord who wishes all their minority tenants where white; you should only invest in white communities and over the long run believe me, it will help to to avoid all kinds of negative situations that will directly come for you. 

Originally posted by @Jim K. :
Originally posted by @Eric Bilderback:

@Jim K.

Whats so bad about switching out a carpet, paying a guy to do it, renting a place out to some folks who may have less opportunities in life than yourself.  I would argue it is unethical not to try and make money.  More often then not you are morally obligated to act in you and your families best interest.  I disagree that you are screwing people because you are making money on them.  Instead feeling guilt or shame (if thats the problem) own what you do be an example for guys who want out of depravity or sadness of their life, they can look at you and say "man that dudes pretty cool I'd like to do what he is doing some day."  If you look at those people as victims for one you're probably wrong and more importantly who are you to help them?, what makes you think that you know anything about their life, or what they need, their character, etc.?  

I know I assumed some things in here but if that was road you were going down no stop it!  (Picture Chris Farley here). For the Love God Stop!  

Keep doing good my man!  

OK, so Eric:

1. Have you ever caught yourself looking at a bunch of black kids playing on a street you own a property on and wishing they were white kids so that your property value would go up?

2. Ever gone by a tenant's house in the middle of the day, seen their car there, and wondered why they weren't at work, knocking out the rent? Wondered if they're taking a day off, does it mean you should raise the rent because they have too much free time on their hands? B****, get out there are EARN for me! 

3. Ever evicted an inherited tenant who was clearly too stupid to breath, too beaten down by life to think, just mentally incompetent to do anything other than lose? You had to evict them, you knew they were stupid to understand what they were doing to themselves, but these people were just dead from the neck up, off with no hope of recovery? Caught yourself feeling gratitude that there but for the grace of God and a few more hard knocks go I?

4. Ever gone through public records and found out WHY this single mom with four kids and a good job keeps renting from you? Seen the computerized record of her last encounter with her ex and read the statement that led to the protection-from-abuse order against her ex, with all four kids SSN's clearly written out by an incompetent cop in the report? And the first thought that you had was, oh, OK, that's why I'm renting a C-class property with no sign of it ending to someone with good credit making 5X the rent, because she feels safe in that house next to the cop station and with a married landlord who doesn't give off the odor of eau de creep?

-----------

I can't say this doesn't weigh on me, Eric. A lot of days, I'm dealing in human misery. Taking a bath in it. Very profitable human misery, but misery all the same. I tell myself I should be like everyone else in every developed society and not worry that my prosperity is built on a mudsill over the less fortunate of the earth, feed myself some cheesy moral double-talk like "I would argue it is unethical not to try and make money" with a hefty side of rationalization, but it doesn't always work.

 None of that has ever crossed my mind.  

Hey it could be worse you could be a landlord in Kabul Afganistan! 

I’m guessing I’m going to be in the minority on this one, but I feel like this is a clickbait conversation starter and we shouldn’t even be responding to it-yes I realize I’m currently typing a response. Let’s stay focused and keep our eyes on the prize-learning about investing in real estate and helping others grow personally and professionally. 

Originally posted by @Jim K. :
Originally posted by @Eric Bilderback:

@Jim K.

Whats so bad about switching out a carpet, paying a guy to do it, renting a place out to some folks who may have less opportunities in life than yourself.  I would argue it is unethical not to try and make money.  More often then not you are morally obligated to act in you and your families best interest.  I disagree that you are screwing people because you are making money on them.  Instead feeling guilt or shame (if thats the problem) own what you do be an example for guys who want out of depravity or sadness of their life, they can look at you and say "man that dudes pretty cool I'd like to do what he is doing some day."  If you look at those people as victims for one you're probably wrong and more importantly who are you to help them?, what makes you think that you know anything about their life, or what they need, their character, etc.?  

I know I assumed some things in here but if that was road you were going down no stop it!  (Picture Chris Farley here). For the Love God Stop!  

Keep doing good my man!  

OK, so Eric:

1. Have you ever caught yourself looking at a bunch of black kids playing on a street you own a property on and wishing they were white kids so that your property value would go up?

2. Ever gone by a tenant's house in the middle of the day, seen their car there, and wondered why they weren't at work, knocking out the rent? Wondered if they're taking a day off, does it mean you should raise the rent because they have too much free time on their hands? B****, get out there are EARN for me! 

3. Ever evicted an inherited tenant who was clearly too stupid to breath, too beaten down by life to think, just mentally incompetent to do anything other than lose? You had to evict them, you knew they were stupid to understand what they were doing to themselves, but these people were just dead from the neck up, off with no hope of recovery? Caught yourself feeling gratitude that there but for the grace of God and a few more hard knocks go I?

4. Ever gone through public records and found out WHY this single mom with four kids and a good job keeps renting from you? Seen the computerized record of her last encounter with her ex and read the statement that led to the protection-from-abuse order against her ex, with all four kids SSN's clearly written out by an incompetent cop in the report? And the first thought that you had was, oh, OK, that's why I'm renting a C-class property with no sign of it ending to someone with good credit making 5X the rent, because she feels safe in that house next to the cop station and with a married landlord who doesn't give off the odor of eau de creep?

-----------

I can't say this doesn't weigh on me, Eric. A lot of days, I'm dealing in human misery. Taking a bath in it. Very profitable human misery, but misery all the same. I tell myself I should be like everyone else in every developed society and not worry that my prosperity is built on a mudsill over the less fortunate of the earth, feed myself some cheesy moral double-talk like "I would argue it is unethical not to try and make money" with a hefty side of rationalization, but it doesn't always work.

I don't do that, I look at this like a business..like a big Hotel, or a 7--11, like a business.

Customers want a product and they pay for that--to the best of their ability.

I try to match the product offering to the target customer as best as possible, while keeping my profits as high as I can--like any other business.

Unless the Emotional side of this is your gas pedal, (it's not mine) it can burn you out.

High initial years cash flow on reasonable down, and good appreciation to me are two different business models that don't have a meeting point.

And as a Business Man I try to treat people in a "Rational" "Un-emotional" "Fair" manner, realizing I have the power to do otherwise--but I believe doing otherwise is not a good practice in the long run.

Renters like everyone else will always have drama--Class C and D even more--They have the same drama in the Local 7--11 too. It's not my Drama.

Just my 2 cents.

Case in Point--Landlord found Smoldering in Dumpster: https://nypost.com/2014/01/05/slain-slumlord-found-in-trash-had-enemies-list-a-mile-long/