High Return Real Estate

23 Replies

About 2 years ago, a friend here in the Seattle area contacted me through a financial investment group. He told me about High Return Real Estate company. It was supposedly an all inclusive real estate sales of rental properties in Indianapolis, along with "Roof to foundation warranty", plus in place solid rental property agency. Sounded really good since I was about to sell a property in Seattle. Then, over the next year or so, after the "roof to foundation" warranty expired, Janell and I were absolutely screwed. Not only we we were told by independent contractors, that several of our properties were in terrible disrepair, we had terrible property managers. High Return Real Estate owners told me this on their own, how they messed up with the property managers. We had 7 of 8 properties vacant and all of the 7 were absolutely trashed. We lost many many 10's of thousands of dollars in repairs and turns, not to mention the lost rents. It has been an absolute nightmare. I have never, in my 30 plus years of owning rentals ever been so deceived and ripped off. High Return Real Estate will tell you that I have been drinking. I have... and I am doing better lately... They ripped my wife and I off and if I drank more after coming in contact with them... No wonder. They also offered to buy the properties they sold me back... At pennies on the dollar. After they new Janell and I were in desperate straights. Really, notice you sold us crap, then a crap management company, then losses after losses, then, "Yes, we will buy your properties back after all of your losses, at a discount? Wow, what a great unethical business model.

After this happened...  They said, it was because they did not wish to sell the properties to other buyers in such disrepair.  Wow, they sold us the properties in "such disrepair".  The condition in which they sold them to my wife and I, after all of our life's work.

Really?  Oh my goodness.  So sad.  What happened to the moral ways of my parents and what I expected from them.  High Return Real Estate, along with Urbanhaus Real Estate Managment, the ones HRRE referred us to.  They hurt my wife and I in our latter years when we were hoping to retire.  We were absolutely screwed by Urbanhaus property management, but mostly by High Return Real Estate.  

Matthew Campbell

@Matthew Campbell

Wow. I am so sorry for that incredibly tough lesson. It sounds very familiar to another company or two that have left quite a path of destruction in Indy.

I am sorry Mathew. Thank you for sharing.

Brandon P...

Please read the post.  When obtaining a "roof to foundation" warranty...   That is within the contract, it helps to trust the seller.  Also, when you are working with a trusted colleague...   this further helps with the sales.  Then, later, when the seller states, that they will no longer sell without an independent inspection, because of all the problems they have caused with their buyers, this is an admittance as to their misdeeds.  

Matthew


@Matthew Campbell I’m very sorry that this happened to you. A lot of others have been down this similar path but not everyone shares on here, cause it’s not sexy. Hopefully this is something others can learn from and to be extra careful when investing OOS. Thank you for sharing and I’m sorry this happened to you guys.

@Matthew Campbell, Thank you so much for sharing your horrific experience. Most would have stayed quiet, but thanks to your post I am sure others may avoid the pain of getting into a similar situation with this company...

I trully hope that your recovery will come soon and that you and your wife will find the peace of mind you well deserve!

Many of us here in the BP community feel for you and share your pain!

Hey @Account Closed - As Co-founder of HRRE, I just want to set the record straight.  You were referred to us by another investor.  That doesn't happen by chance.  It happens because other investors are happy with their experience with us.  

As a Turnkey company, we have an exemplary record.  You did indeed buy some properties that were inspected, and others where you waived inspection contractually.  We did indeed honor ALL roof-to-foundation warranties, on ALL of your properties...FOR AN ENTIRE YEAR.  We recognized that we were aligned with a PM team that was not up to par, and even took thousands of dollars out of our pocket to make you whole for issues that occurred.  This was above and beyond our contractual agreement.  When we had finally vetted and tested our new PM team, we then moved you over to our current PM, and helped with that transition.  We even helped financially with that transition.  

We also tolerated literally hundreds of emails and voicemails, berating us and our team members...usually written in the middle of the night.  We'd show up at the office, ready to tackle our day and our inboxes would be flooded with your vitriol.   These communications were written (or voiced) in such derogatory and disrespectful ways...we have never experienced this with any other investor, nor do we ever hope to again.  This had a very negative impact on our overall team's morale.

On our phone calls with you (which we had to initiate), you were very cordial, and you turned down any offers for us to sell off properties for you. To be clear, these were not "pennies on the dollar offers" to buy back your properties.  We were strategizing on how we could help you liquidate your properties through our network.  Is it possible that you decided against this because your portfolio is now 100% occupied and performing?  You somehow failed to leave that part out of the story.

We agree that your initial experience was not what we would have liked it to be.  But, we went above and beyond the call of duty to make things right.  To paint the picture as you have in a forum like this is not just one-sided, it's slanderous.  Had you been with sellers who didn't care, this would indeed have turned into the thousands of dollars of losses that you spoke of.  My business partner and myself would love to get back the many thousands of dollars we took out of our own pockets to make you whole.

Overall, we are grateful that things worked out for you.... that you have a solid portfolio, with great tenants that pay on time, and a very professional property management team - with a fantastic online portal that gives you full detail and analysis of all of your transactions.  What you are holding is the envy of many an investor.

We wish you all the best in your future ventures.

The fact of the matter is, I have yet to finish repairing all of the problems with the problems with the properties.  In fact one still needs a new roof.  A roof that the contractor stated has clearly been in need of  replacement years prior to you selling it to me.  The roof to foundation warranty was for the first year.  We did not know about most of the serious problems until right at about 14 months.  We were so busy trying to evict tenants, obtain good tenants and repair all of the damage from the tenants that became squatters.  Also buying new appliances nearly ever month due to the thefts.  You told us that you now do not do the types of inspections prior to sales, since it has caused such problems with buyers.  That was when I knew I should not have trusted the inspections you stated you had done.  Now, you say you do full independent inspections.  We were led to believe that inspections were done and passed.  That, I will take some responsibility.  I believed that with the "roof to foundation warranty", you must have had good inspections performed. 

The garage on one property was in such disrepair, that I recently spent nearly nearly $10,000 to entirely tear it to the studs and rebuild it roofing and all. The garage was not inspected and in fact we obtained fines from Indianapolis because it was in dangerous condition. 

The property management company you initially stated I must go with in order to move forward, messed up so badly, that we not only lost a tremendous amount of rent for nearly 8 months on all of the 8 properties, when they did get renters in there, they either did not pay, or trashed the places even further.  When vacant, we had squatters and our appliances were often stolen, even a water heater. So, for a turn key situation, it was far from that for over a year.  From nearly the beginning of the purchases, it went straight down hill. So, for the idea of spending your own money, I have no record of that and no other person has sent me any invoices or discussed this with me. When you state how I became irate, yes I was and was the other investor in which you speak.  The person that referred me. He is the one that has been supportive.  He also is the one that feels terrible for the referral.  I have no doubt you have some happy investors.  I also know that when you worked with Urbanhaus property management, you told me about how many of you investors were in a similar boat.  You stated that you, yourself was in a similar boat. That tells me, that you know how badly things got.  We stated you had vacancies upward of 50%.  Well we were well  over 50% not very long ago.  This was nearly 18 months of trashed properties with some months at nearing 100% vacant.  

When you discuss in your post, how you tried to help us sell the houses; initially we were told you would help us liquidate the properties and would not charge commission or fees. But you also advised us to hold on, as things would eventually turn around.  So, considering how I was unable to see my way, and I still had some trust in you, I followed your advice. Actually to this day, I believe both you guys are very personable.  I hate what happened.  I do not dislike you two, however.   During the consideration of liquidating for a tremendous loss, I also counseled with many other investors, including the investor that referred me to you.  He also, during that time was in despair over the properties he bought from you.  He suggested selling a few and trying to hold on to the "better" ones.  At that time, there were no "better" ones.


As for slanderous, the facts are the facts.  I was cordial in the beginning and intermittently during the debacle.  When conversing with someone that I am negotiating with, I am cordial.  When my anger got the best of me, I lashed out at the persons I felt were hurting my family and I. Whether I was irate and used rough language while losing approaching $90,000 in lost rents, damage repairs and turning of all of the properties, many more than once, within just over the intial 18 months...   Yes, I was very angry and we are still are way behind.  The portfolio has yet to "perform" as you say.

My wife and I have had rental properties since approximately 1980.  We have seen our share of rough times.  We have seen anything close to like what happened in Indianapolis. A very tough set of lessons.  My biggest regret is trusting that I did not need my own independent inspector.  I trusted the "roof to foundation warranty" and that the inspections you told us were done, were good.

Obviously, you see things much different than my wife, my investor friend and me.  It is unfathomable, that there are not many other investors out there that were similarly affected. 

Matthew Campbell 

It should not make a difference in the due diligence process if you have a 1 year  warranty  or are referred to a company by someone.

As as you have learned, it’s up to you to deal with the issues of the properties you purchased, so it’s best to fully understand them before making the purchase.

Instead of taking responsibility for the mistakes you made early on in the process, you are trying to make it seem like it’s 100% the turn key rental’s fault. 


Originally posted by @Matthew Campbell:

Brandon P...

Please read the post.  When obtaining a "roof to foundation" warranty...   That is within the contract, it helps to trust the seller.  Also, when you are working with a trusted colleague...   this further helps with the sales.  Then, later, when the seller states, that they will no longer sell without an independent inspection, because of all the problems they have caused with their buyers, this is an admittance as to their misdeeds.  

Matthew

 

@Matthew Campbell so it sounds like you didn’t inspect the property with an independent inspector?

Lessons learned and sorry this happened! I don't care if it's a "friend" or "family", always do your own due diligence and always get your own property manager. This is what I've learnt in just 2 years of real estate investing.

@Account Closed   Again, we're sorry this happened.  We were the Seller of the properties.  Although we aligned with them at the time, we were NOT the property managers.  You knew this going in.  

We recognized that there were a lot of problems with the PM piece...yes, we were affected too (with our personal properties).  Thankfully, we ended that relationship very quickly.  We took a lot of money out of our own pockets to do the best we could to make you whole....for a situation that we did not create, nor were we contractually obligated.  This was in addition to fulfilling ALL warranty obligations.  Your accusations are being directed at us (the sellers), but they should be directed at the Property Managers at the time.

All this said, we have everything corrected... we are aligned with an excellent PM group, and are able to see that you currently have 7 out of 8 properties RENTED and paying on time.  This did not happen by chance.  There was a TON of work put in on your behalf by our team (the original sellers only), at no additional cost to you, to facilitate this transition.  Further, the rented properties are in excellent condition. Yes, you had some aggravation getting to this point, but there are many investors that would love to be in your current situation.  

Of course, not just as sellers, but as fellow investors, we are thrilled to see your portfolio stabilized and performing.  We wish you all the best in your future endeavors. 

Shecky,

Thank you for your response.  I see your perspective and wish you all the best.  Things are going to be fine.  Janell and I are moving forward.  Lessons learned for all.


Matthew Campbell

Sounds like a rough string of events Matthew - glad things seem to be on the up-and-up now at the very least. My two cents: a turnkey company will never care for your properties as well as you would - this is just part of the incentives and structures of the relationships and should be expected and planned for. Another lesson learned would be to personally inspection every property you buy, even when purchasing OOS. A plane ticket to view properties is fully tax deductible.


Brandon P :

Have you ever purchased at an auction?  I have.  My wife and I have seen a crap load more than you.  Do you believe, that maybe, a friend, along with an "established" turn key seller will sell a property or properties at a better than auction value?  Get a grip insulter.  When you feel you are willing to insult a person that has obtained millions over time... bring it.  I trust what experienced investors tell me most times. Not the likes of you.  This time, I was burned.  So young man...   look to those that are willing to help you and avoid insulting them.   Okay?

Originally posted by @Brandon P. :

Did you inspect the properties before you purchased them? 

Read my response youngster.  Read, then when you feel you know enough, read more as it relates to ethical standards, Brandon.  Blame the person that was expecting value?  Blame my wife and I that did nothing wrong?  Brandon...  How about working with persons that are expected to do the right thing?   Brandon...  I would not expect you apparently, as to your response to do the right thing.  So, Brandon, I will not do business with you.

 

Originally posted by @Pau Kha :

@Matthew Campbell so it sounds like you didn’t inspect the property with an independent inspector?

Lessons learned and sorry this happened! I don’t care if it’s a “friend” or “family”, always do your own due diligence and always get your own property manager. This is what I’ve learnt in just 2 years of real estate investing.

 

Pau Kha,

Good for you...  Good that you insult me and my family.  I was trusting my friend and the roof to foundation warranty.  Don't you get it?  Sometimes, we trust people.  You, after the fact insult me and you insult all of my entire life's work.  So easy for you.  You "type" on your computer, as you hurt me and me wife?   Good for you.  You have no idea as to the truth.  So....   Type away and insult us.  We are losing our life's work as you insult us.  Shame on you.  

You have no idea what is going on.  There was such deceipt.  But you are so willing to insult us?

I would like so much to exact retribution.


Shame on you.


Dr. Campbell

Pau Kha..

Good for you...   you go forward without honest ethical moral people like my wife and I.  Good luck moving forward with all of the victims and and all of the marxists an socialists.  Good luck you dumb pieces of ...


CRAP...   Absolute anti police pieces of crap.


Dr. Campbell






@Matthew Campbell are you okay? Jeez man, get some help. How do you get “insulting you and your family” from my comment?

All I asked was if you did an independent inspection and from your post, it sounded like you didn’t. All I did was suggest that going forward, do your own due diligence and get your own property management company by doing the said due diligence.

If you take offense from my comment, that’s on you, not me. This was hardly criticism, and if you can’t even take that, you are in the wrong business buddy.

Please, see a doctor, talk to someone, it will help with the obvious stress you are going through.

Hey @Account Closed ,

After working with you directly, I can certainly understand your frustrations, but you are in a great position now. I share @Jeff Schechter 's sentiments: All of us at HRRE are very glad that we were able to assist you in getting your portfolio stabilized and performing.

We wish you continued success in your investing efforts.

Originally posted by @Matthew Campbell:

Brandon P...

Please read the post.  When obtaining a "roof to foundation" warranty...   That is within the contract, it helps to trust the seller.  Also, when you are working with a trusted colleague...   this further helps with the sales.  Then, later, when the seller states, that they will no longer sell without an independent inspection, because of all the problems they have caused with their buyers, this is an admittance as to their misdeeds.  

Matthew

Matthew, I know it's a hard lesson but regardless of a warranty, ALWAYS get am independent inspection.