Looking for some advice here. I wanted to get into real estate investing the easiest way possible and I figured using rent to retirement would be the simplest solution.
Their projections showed a 17% yield with $789 cash flow for $75k down.
I am over $100,000 cash into the deal and losing money, negative cash flow ~$200 a month.
This is a new construction and so many things needed to be fixed by the property management even though they said everything would be fixed from the inspection report. They refused to provide pictures and said that it's just how it is.
The provided loan company was also terrible to work with. They were super pushy and had very outdated technology. Loan was instantly sold to NewRez which has been pretty good for a loan holder.
Any recommendations? Should I wait for the end the year and hope for rates to drop? Or should I just sell the property and take the loss? Is the better to take the loss in the next calendar year?
Investor · College Station, TX · Member since 2023 · 16 posts · 98 votes
1y
Peter,
Thanks for the details of your situation. RTR is here to assist you however we can, we just need to be made aware of the issues you are experiencing. We reviewed communication and we do not have any notification from you that you are experiencing issues. It's important to communicate with us so we can proactively be involved to assist you with anything you need. We understand Scott has spoken with you this morning already and that you have another call scheduled with him this afternoon.
Just for clarification purposes for everyone else reading this thread. You purchased a new construction property that had a $21,000 incentive on the property. Meaning you had $21,000 that you could use as a price reduction, cash back or rate buy down (or combination of the above). You chose to take the full $21,000 as a price reduction on the home, meaning you acquired it at a discount allowing for immediate equity. The numbers you are referencing on the pro forma shows that $21,000 being applied to rate buy down and a portion as cash back at closing. That was our recommendation of how to apply the $21K incentive. Buying the rate down significantly would have allowed for much better cash flow each month along with more funds in reserve from the cash back.
We did look through the inspection report from when you purchased the home a few months ago, and it appears the builder remedied everything that came up on the inspection report. We do not have any other details about management issues you are experiencing, but we are happy to look into this further with you to see how we can further assist. Scott will cover this on his follow up call with you later.
Again, we are here to help you however we can, but we just need to know about the issues you are experiencing. RTR was not notified about these issues until we saw this post on BP yesterday.
We look forward to working with you to review all details and help build a strategy to set you up for long term success.
Investor · Fort Myers, FL · Member since 2015 · 292 posts · 278 votes
1y
There is no substitute for hands on. Every level of control you give up is a lost learning opportunity and an opening for dishonest actors. If your going to invest in real estate maintain control, evaluate everything. If you outsource lending, underwriting and property selection all you have to go on is a sales company marketing. Do it yourself. If you don't have time, stick with the index funds.
Property Manager · Royal Oak, MI · Member since 2012 · 12k+ posts · 9k+ votes
1y
@Peter ONeill you should have negotiated better requirements with the PMC BEFORE hiring them!
Owners rarely actually read their management contracts, just like tenants rarely actually read their leases, then act surprised when terms are enforced:(
Yea I realize that in retrospect, remember this is my first deal. There's easily a dozen things I would have done different/better.
Hoping people can provide some advice on how to move forward and not just call out things I did wrong.
Just breathe and get it worked out. Time is your friend. If you can’t make it with the current rent you are collecting and mortgage you are paying then sell and take the loss and move forward with your life. If you can weather the storm I guarantee you 5 years from now you will be glad you got your foot into the real estate game. Learn from what has happened so far and don’t repeat the things that you didn’t like. Best of luck.
Investor · College Station, TX · Member since 2023 · 16 posts · 98 votes
1y
Peter,
Thanks for the details of your situation. RTR is here to assist you however we can, we just need to be made aware of the issues you are experiencing. We reviewed communication and we do not have any notification from you that you are experiencing issues. It's important to communicate with us so we can proactively be involved to assist you with anything you need. We understand Scott has spoken with you this morning already and that you have another call scheduled with him this afternoon.
Just for clarification purposes for everyone else reading this thread. You purchased a new construction property that had a $21,000 incentive on the property. Meaning you had $21,000 that you could use as a price reduction, cash back or rate buy down (or combination of the above). You chose to take the full $21,000 as a price reduction on the home, meaning you acquired it at a discount allowing for immediate equity. The numbers you are referencing on the pro forma shows that $21,000 being applied to rate buy down and a portion as cash back at closing. That was our recommendation of how to apply the $21K incentive. Buying the rate down significantly would have allowed for much better cash flow each month along with more funds in reserve from the cash back.
We did look through the inspection report from when you purchased the home a few months ago, and it appears the builder remedied everything that came up on the inspection report. We do not have any other details about management issues you are experiencing, but we are happy to look into this further with you to see how we can further assist. Scott will cover this on his follow up call with you later.
Again, we are here to help you however we can, but we just need to know about the issues you are experiencing. RTR was not notified about these issues until we saw this post on BP yesterday.
We look forward to working with you to review all details and help build a strategy to set you up for long term success.
Thanks for the details of your situation. RTR is here to assist you however we can, we just need to be made aware of the issues you are experiencing. We reviewed communication and we do not have any notification from you that you are experiencing issues. It's important to communicate with us so we can proactively be involved to assist you with anything you need. We understand Scott has spoken with you this morning already and that you have another call scheduled with him this afternoon.
Just for clarification purposes for everyone else reading this thread. You purchased a new construction property that had a $21,000 incentive on the property. Meaning you had $21,000 that you could use as a price reduction, cash back or rate buy down (or combination of the above). You chose to take the full $21,000 as a price reduction on the home, meaning you acquired it at a discount allowing for immediate equity. The numbers you are referencing on the pro forma shows that $21,000 being applied to rate buy down and a portion as cash back at closing. That was our recommendation of how to apply the $21K incentive. Buying the rate down significantly would have allowed for much better cash flow each month along with more funds in reserve from the cash back.
We did look through the inspection report from when you purchased the home a few months ago, and it appears the builder remedied everything that came up on the inspection report. We do not have any other details about management issues you are experiencing, but we are happy to look into this further with you to see how we can further assist. Scott will cover this on his follow up call with you later.
Again, we are here to help you however we can, but we just need to know about the issues you are experiencing. RTR was not notified about these issues until we saw this post on BP yesterday.
We look forward to working with you to review all details and help build a strategy to set you up for long term success.
-Grant, COO Rent To Retirement
Just got off the phone with Scott, he's great btw.
Yea it seems the first mistake I made was using the $21k incentive to lower the price of the purchase. Without the rate buy down, and getting free PM fees the cash flow was destroyed on the deal. This probably changed things -$500/m for payments and -$150/m for PM.
The second mistake was not speaking with the property managers to verify what I could expect for rent. It came in at $1700 instead of the predicted $1925. My mortgage is $1860. If the rent was as projected it would I would be almost break even after PM fees. This made another -$225/m in lost cash flow.
The third mistake was not knowing the timeline of things that needed to be done. Starting the process there was an onslaught of emails, and of course the loan officers were the ones emailing and calling multiple times a day to close their deals and earn commissions. The Property managers were surprisingly quiet. I signed with RTR on 1/18/25 and I got the rent deposit on 5/23/25.
There's probably a few more smaller things but these are biggest contributing factors. All of them could have been solved by me knowing what to do before starting the process with RTR. Or with more guidance from RTR in the purchasing process.
Working with Scott now, hoping to figure out how to at least stop the cash flow from bleeding out on this deal.
Investor · Fort Myers, FL · Member since 2015 · 292 posts · 278 votes
1y
The humility you show in the above post shows huge steps forward. There is no one hear who hasn't made mistakes in this business, lost money, not optimized an opportunity, passed on a good deal etc that hasn't learned the hard way. Reviewing all your actions and making adjustments on future purchases will ensure your eventual success. Now keep on pushing if you feel it's worth it. Hands on experience is the best way to learn. Kudos to you!
Looking for some advice here. I wanted to get into real estate investing the easiest way possible and I figured using rent to retirement would be the simplest solution.
Their projections showed a 17% yield with $789 cash flow for $75k down.
I am over $100,000 cash into the deal and losing money, negative cash flow ~$200 a month.
This is a new construction and so many things needed to be fixed by the property management even though they said everything would be fixed from the inspection report. They refused to provide pictures and said that it's just how it is.
The provided loan company was also terrible to work with. They were super pushy and had very outdated technology. Loan was instantly sold to NewRez which has been pretty good for a loan holder.
Any recommendations? Should I wait for the end the year and hope for rates to drop? Or should I just sell the property and take the loss? Is the better to take the loss in the next calendar year?
I appreciate any advice!
Peter
First time home investor.
Most people don’t realize it that buying rentals (usually) cost you money initially…. sometimes years….😢😳
Huntsville, AL · Member since 2018 · 577 posts · 864 votes
1y
"This is a new construction and so many things needed to be fixed by the property management even though they said everything would be fixed from the inspection report. They refused to provide pictures and said that it's just how it is."
@Peter ONeill - This comment got my attention more than anything else in the thread. Are these insignificant things, like one of the toilets needed to be secured? Or major things like the breaker box was improperly wired? Did you consider having the property re-inspected to validate everything was done? Typically, a home inspector will re-evaluate the deficiencies found after remediation for a very small fee, and totally worth it if you were skeptical that everything was completed.
Real Estate Broker · Cape Coral, FL · Member since 2015 · 2k+ posts · 1k+ votes
1y
This is an unfortunate situation but one that we have been dealing with for years in Cape Coral. I am working with about 15 investors (There are HUNDREDS of them) who got taken advantage of by R2R because their builder that has taken 3 years to get to mid completion. R2R has been zero help to them.
@Drew Sygit These folks aren't savvy investors. Half of them are people that have never owned a home but were sold a dream of wealth. R2R is supposed to be a one stop shop, financing, builder, and PM. But, what these folks don't realize is that R2R is just a middleman putting a deal together. Oce the deal is put together they are ghosted. These folks don't know to research PM's because they trusted R2R's sales pitch.
This is an unfortunate situation but one that we have been dealing with for years in Cape Coral. I am working with about 15 investors (There are HUNDREDS of them) who got taken advantage of by R2R because their builder that has taken 3 years to get to mid completion. R2R has been zero help to them.
@Drew Sygit These folks aren't savvy investors. Half of them are people that have never owned a home but were sold a dream of wealth. R2R is supposed to be a one stop shop, financing, builder, and PM. But, what these folks don't realize is that R2R is just a middleman putting a deal together. Oce the deal is put together they are ghosted. These folks don't know to research PM's because they trusted R2R's sales pitch.
Adam, you know my thoughts on SWFL Lehigh Coral as I have described them in detail on BP. I just want to chime in though on RTR.. They have reached out to me personally trying to help their clients that got screwed by the builders.. I have not been able to waive a magic wand and help them to date, however I have given them my opinion on best options .. But RTR is not abandoning them and RTR was not the builder.. The investors do need to take some responsibility in the area they chose the and the projects they chose Hindsight being what it is right ?
Real Estate Broker · Cape Coral, FL · Member since 2015 · 2k+ posts · 1k+ votes
1y
@Jay Hinrichs There have been some things that I consider to be questionable, or at least from what the owners are telling me. Like advising owners to use another R2R "approved" builder but that builder consistently comes in about $40k higher than any other builder. Why so much higher? Or owners reaching out to R2R for help years ago and them telling the owners that there is nothing they can do. These stories have been repeated to me many times by many owners. I called R2R about 4 years ago to hear their sales pitch and to understand what they were selling, they were selling a flat out lie - appreciation, cash flow, rents... I am not here to bash anyone or convince anyone but the situation that these first-time investors have been left with is deplorable. I am just sharing my experiences.
@Jay Hinrichs There have been some things that I consider to be questionable, or at least from what the owners are telling me. Like advising owners to use another R2R "approved" builder but that builder consistently comes in about $40k higher than any other builder. Why so much higher? Or owners reaching out to R2R for help years ago and them telling the owners that there is nothing they can do. These stories have been repeated to me many times by many owners. I called R2R about 4 years ago to hear their sales pitch and to understand what they were selling, they were selling a flat out lie - appreciation, cash flow, rents... I am not here to bash anyone or convince anyone but the situation that these first-time investors have been left with is deplorable. I am just sharing my experiences.
I understand every company sells the sizzle thats for sure.. or should we call it blue sky. I just dont think folks really understand supply demand of buildable lots how that affects a market as a whole.. Plus and I am sure RTR is aware of this.. but how can ANY builder take on 50 100 build jobs on scattered lots ? Answer is they cant.. those are production builder numbers were the lots are right next to each other and you build them in a progression .
I built 5 homes up in Ocala on scattered lots and thankfully got out of them. Never again though building in FLA is not easy and I have some experience at it having built over 300 spec homes over the last 12 plus years in multiple states.. FLA like many areas has a sub contractor shortage and quality issue when your talking these starter type homes.
But bottom line not sure RTR or the buyers or anyone else did a deep historical dive into how that area was developed and understood the massive supply of shovel ready lots.. Now granted not all areas are over supplied with lots in that area .. but many are.. Then you have buyers I remember a few jumping on BP kind of bragging about what a great deal SWFLA was an instant equity and all of that with not a lot of thought to RISK side of the equation.
But if we look at ANY company even yourself your going to promote your area end of the day thats why your there.. And I do commend you totally on giving both sides of the coin how good it is to live and invest there and the struggles of the market. But I guess its not on you to do a deep dive into a history lesson like I have done.. And I only know this because I was there in the mid 80s at a antiquated land / lot conference that was a national conference on what to do with the lehigh acre and CAL Pines type developments that are all over the US.
I understand that it benefits you to comment on any negative thread you see about my company, Rent To Retirement. If you are "not here to bash anyone" then why are you jumping in to comment on any negative thread about RTR, even when it's not relevant to you. Clearly you have your keyword alerts set up for my company anytime you see something potentially negative, even if it has nothing to do with you or the location you operate in, like this thread. This benefits you because you operate a management company in SWFL and you also benefit from referring clients to builders to finish uncompleted projects, which you are correct, there are many unfortunately. However, everything else you are stating is completely inaccurate, so please get your facts straight and quit disparaging my company in an attempt to send more business to your company.
Yes, RTR is a marketplace for deals that our community has access to. We have over 50 builders that use our marketplace nationwide including the nation's largest builders like DR Horton, LGI, Lennar, Century, Toll Brothers, etc. Investors get access to wholesale pricing on builds that they cannot access on their own due to economies of scale.
It should first be noted that there are many investors that did successfully complete jobs in SWFL that turned out very well for them that did have significant equity. Here is an example of one of those sharing his experience: https://www.biggerpockets.com/forums/88/topics/1047543-big-p...
Yes, there are many builders in CC that did not complete jobs, which is unfortunate. Some of these builders have been in business for 20+ years prior to this completing thousands of jobs. This is not just specific to the builders that marketed on RTR. There are many builders in SWFL that have struggled and went out of business unrelated to RTR. However, there are still many that are completing jobs in a timely manner within budget. We still work with those that are completing jobs that I reference below.
No, you are completely inaccurate that RTR "ghosted" people. We never do that unless the investor cuts off communication for whatever reason. We have significant documentation showing proactive outreach to anyone struggling to complete a build with their current builder to provide them multiple options to build with a more competent builder. The fact is the majority of investors in this situation have already switched and successfully completed their build. The builders we still work with in SWFL are Holliman Construction, SI Homes, Panther, DR Horton, LGI and Christopher Alan. These builders offer options to complete jobs, buy out jobs or trade in partially completed jobs for fully completed homes. Many of these builders have already taken over jobs and completed them. The options to change builders to complete jobs have been presented multiple times for years to anyone who is unsatisfied with their current builder. Of course, it's up to the investor themself to make the change if that is what they want to do. If the investor waits years to switch builders, even after multiple recommendations from us to switch earlier, that is on them.
It should also be noted that RTR did not receive any compensation from any of these builders that did not finish projects in SWFL. This is true for both the land acquisition and the ground up construction.
Please share publicly which builder you send clients to? What is the fee you earn for referring clients to this builder? There should be no issue stating publicly the builder(s) you recommend.
It's unfortunate you took the approach of trying to jump on the bandwagon anytime anyone posts negatively about RTR. Anyone can see that you are one of the first people to comment on anything negative about RTR, even when it's not relevant to you at all, such as in this case. If you would have simply approached me to see how you could help investors for either property management or solutions to other builders, I would have gladly accepted your assistance and would have been able to send you a hell of a lot more clients than 15...
Peter, the individual posting in this thread, purchased a home from LGI in AL who received a significant discount on his home at time of acquisition. You do not work in AL. This was an already completed home. I don't see how this situation correlates to SWFL at all. Yes, he seems to be experiencing some issues with mngt and he regrets taking the $21K incentive as a price reduction instead of using it to buy down the rate to cash flow more. However, as you, and everyone else can see from this thread, we are working through this with him to see how we can assist, which he is appreciative of. We communicate extensively with every single person in our network and we never leave anyone stranded when they experience issues as long as they communicate with us and they are professional. However, this is real estate, and sometimes people don't always like the options they are presented with, but that is part of the investing game.
Real Estate Broker · Cape Coral, FL · Member since 2015 · 2k+ posts · 1k+ votes
1y
@Zach Lemaster In my opinion, your comments are wrong. Maybe not all of them as you wrote a lengthy response. I understand your need to save face, and you should fight for what you believe. I am only regurgitating the story's that they have told me (other than the over inflated sales pitch your team made to me years ago).
I will gladly share the fees we charge - $0. Why would we ever charge anyone to work with a contractor? That is between them and the contractor. Why would we ever make a bad situation worse? But, I see how you think... Your thinking is how you got "them" in trouble.
Maybe, instead of wasting your time responding to me you could call each and every individual owner that has been affected and explain this to them and see how they respond to you. Maybe you could apologize to them and accept responsibility. I am only regurgitating the story's that they have told me (other than the over inflated sales pitch your team made to me years ago). Maybe, you should ask yourself if the product that you sold them is the product that was delivered.
Rental Property Investor · Denver, CO · Member since 2015 · 1k+ posts · 3k+ votes
1y
@Adam Bartomeo we have made outreach on multiple occasions to every single investor that has participated in these projects. There is no question about that and we still continue to help these investors as long as they want us involved. And yes, I have personally spoken to most all of them, which is rare for a CEO at our scale to do. That is how we do business. We do not put our head in the sand or ignore situations. You can see from this thread, and our very positive public reputation we've worked hard to build for over a decade now on BP.
I usually ignore your consistent negative commentary on every RTR thread that comes up, but after you post so many times, I figured I would spend the time to share my insight to clarify for the general audience.
I'm still curious why you don't publicly share the contractors you recommend for the projects if you are truly here to help people. And I'm not talking about fees you charge the investor for management or anything else, but rather the fees you collect from contractors for referring people to them to complete builds and who those contractors actually are.
Adam, we've spoken and I believe you're one of the 20% of "good guys" in the PMC induarty - yet, we all have warts and horror stories.
Zach, have always admired the patience & professionalism you show in your answers and that you don't ignore posts here.
If you guys can't pick up the phone to chat this out and better understand each other, you're part of the problem:(
I don't see that happening Drew. It's clear that Rent To Retirement worked with a builder on that project and there were issues, however it's also very clear that Adam is using it as ammunition for his own lead generation by mischaracterizing the situation as well as how Zach & RTR operate their business.
Adam I get it man, it's dawg eat dawg out there, and real estate is a savage game, I pride myself on being an absolute savage when the situation calls for it, but what you are doing is pretty transparent to anyone paying attention.
Having personally worked with Zach, I will unequivocally vouch for the fact that dude values customer satisfaction and customer good will, above all else, no matter what. Even when the customer or investor or whatever you want to refer to them are in the wrong, I've seen him and his team go above and beyond to get the customer / investor happy.
These things stick out to me quite a bit because I've seen Zach & RTR do this in situations where I thought the customer was in the wrong and I sure as hell wouldn't let that type of crap fly at HoltonWise, but contrary to how I run my business, his model has always been more of a "the customer is always right" model, so I know you're just gaslighting people with your comments so you can generate leads.
An example of the gaslighting b/s you're doing: Zach has marketed many of his products, services, properties etc... on HoltonWiseTV, so I have had many, many, many marketing strategy discussions with Zach. The guy literally discusses the fact that he's networked with many national builders as part of the value proposition of his company. Like that's literally what he leads with. On top of that, other 3rd party management companies are literally named in Rent To Retirement's marketing materials. So when I see you on here and you're saying they try to trick customers into thinking they aren't setting them up with other 3rd party companies, it’s laughable.
Also bro, why would Zach even want to pretend that he isn't working with 3rd party companies? One would have to be a complete moron to think that would be beneficial to him as a business owner. As you well know as a property manager yourself, you can't control other people's actions. Sometimes you've got a tenant who's good, till they aren't good. Zach has no control over a 3rd party going rogue on him like the FL builder you're always talking about did. It would be career suicide for anyone to try to trick their customer's into thinking otherwise.............As a matter of fact, I only know of one idiot who was stupid enough to try and do that..........His name is Clayton Morris. Go ahead and give him a google lol.
Rental Property Investor · Denver, CO · Member since 2015 · 1k+ posts · 3k+ votes
1y
@Drew Sygit my contact info is in my signature block, just as yours is. I always make time to collaborate with professionals in any of the markets we operate in. RTR does significant business across the country and we have partnerships with national and local teams in multiple locations. I have grown this company significantly over the years because of the collaborative nature I maintain just as @Jay Hinrichs has pointed out. Anyone who has worked with me will attest to that.
I would also like to point out that you will never see me on BP or any other public forum badmouthing any company or individual, even if I may have a certain opinion about them. That is simply not good business practices. That is how professionals operate and that approach is what allows businesses to scale.
RTR drives significant volume of leads and sales and we've helped many local businesses grow dramatically by collaborating with them, which I am always open to do. However, you don't see those businesses meticulously watching the BP forums daily for any chance they have to take lowball shots at others. That is a different approach to trying to gain more leads...
Looking for some advice here. I wanted to get into real estate investing the easiest way possible and I figured using rent to retirement would be the simplest solution.
Their projections showed a 17% yield with $789 cash flow for $75k down.
I am over $100,000 cash into the deal and losing money, negative cash flow ~$200 a month.
This is a new construction and so many things needed to be fixed by the property management even though they said everything would be fixed from the inspection report. They refused to provide pictures and said that it's just how it is.
The provided loan company was also terrible to work with. They were super pushy and had very outdated technology. Loan was instantly sold to NewRez which has been pretty good for a loan holder.
Any recommendations? Should I wait for the end the year and hope for rates to drop? Or should I just sell the property and take the loss? Is the better to take the loss in the next calendar year?
Looking for some advice here. I wanted to get into real estate investing the easiest way possible and I figured using rent to retirement would be the simplest solution.
Their projections showed a 17% yield with $789 cash flow for $75k down.
I am over $100,000 cash into the deal and losing money, negative cash flow ~$200 a month.
This is a new construction and so many things needed to be fixed by the property management even though they said everything would be fixed from the inspection report. They refused to provide pictures and said that it's just how it is.
The provided loan company was also terrible to work with. They were super pushy and had very outdated technology. Loan was instantly sold to NewRez which has been pretty good for a loan holder.
Any recommendations? Should I wait for the end the year and hope for rates to drop? Or should I just sell the property and take the loss? Is the better to take the loss in the next calendar year?
I appreciate any advice!
Peter
First time home investor.
This is giving me a seizure
Same. Whomever created the technology to make that thing should be jailed.
Slight switch of subject, but relevant to overall post. After a year of getting super frustrated finding good markets to invest in outside my East Coast area, I came across Bright Investor. I liked the data on the site so much that I signed up with a mentorship program with the owner (Donato Callahan).
I'm in no way related or comped by Bright Investor- just had good experience. Happy to chat with anyone about the service, but working with Donato has been great for me. It's not a cheap service, but it is phenomenal at pulling the data we need in investing in out of state markets.
Slight switch of subject, but relevant to overall post. After a year of getting super frustrated finding good markets to invest in outside my East Coast area, I came across Bright Investor. I liked the data on the site so much that I signed up with a mentorship program with the owner (Donato Callahan).
I'm in no way related or comped by Bright Investor- just had good experience. Happy to chat with anyone about the service, but working with Donato has been great for me. It's not a cheap service, but it is phenomenal at pulling the data we need in investing in out of state markets.
lol, this is the lamest advertisement attempt I have ever seen. Stop spamming the forums bro.
@James Wise zero spam, but you can think as you want. I was struggling for a long time with my multi family strategy, and finally found a tool that helped. There are so many BP newbies, as I once was.
but glad you feel better after calling my post spam.
