Home Union - homeunion.com reviews

48 Replies

Hi folks, just learned about homeunion.com through and ad on BP newsletter.

Their marketing page is very well designed, with explanatory video and all the stuff. I tried the platform too, and it's pretty cool as well.

This all helps but at the end is all about the properties, numbers and quality of property management.

Has anyone heard, used, invested with or have more info or thoughts about it?

Disclosure: I am an employee of HomeUnion

As an employee of HomeUnion, I'm not going to answer the specific questions, but if anyone has questions about HomeUnion, please feel free to ask me. I'm happy to answer any questions.

I am in discussion with them and would also appreciate feedback. 

Thanks!
b

Does anyone know how the Homeunion process works? Is it suitable for a self directed IRA?

I believe they are established to assist with SDIRA investments already.

I am interested in info on them as well. Any feedback appreciated.

Does anyone know what HomeUnion charges as fees?

THanks.

M

@Scott Hetherington  

Hey there does Homeunion own any of these properties in all the markets that are on the website.. OR are you a marketing agent like a Norda or Maverick type company or like  some of the other posters on BP that refer business to TK operators.. ?

I think if you could clarify those points that would help the folks asking questions about your company get a better understanding of what Homeunion is or is not.

Pretty good weekend for Bay Area sports first the Giants then the 9ers .... Baseball is having a fun post season..

Medium ksqoekox 400x400Jay Hinrichs, TurnKey-Reviews.com | Podcast Guest on Show #222

Disclosure: I work as the Sr. Director of Marketing for HomeUnion.

First of all, I want to apologize for falling asleep at the wheel on this discussion. I have to figure out how to set up alerts so I can respond in a timely manner. Thank you, Jay for pulling me in.

I'm going to attempt to answer all the questions that have been asked over the last few months:

Yes, HomeUnion is equipped to work with Self-Directed IRAs. We have a lot of clients who have invested with us via their SDIRAs. Some have had they already set up and some we've helped them create.

As for our fees, we charge an annual asset management fee of $495/property, however, that might be going up to 1% at the end of the year. This fee covers our costs for helping finding and vetting properties, acquiring, managing the rehab (if necessary), connecting with a pre-vetted property manager, making sure that property manager does a great job over time, managing expenses (including taxes) and providing detailed reporting.

HomeUnion does not own any of the properties that are listed on our site. We get properties from a combination of turnkey operators, the MLS, etc. However, not every property we have access to actually makes it to our site, we run quite a bit of analytics and use our local market employees to determine the viability of the property as an investment. If it passes all our checks and balances, we make it available on our site.

Does that answer all your questions?

As for the Bay Area sports...I grew up in the East Bay so am a Raiders and A's fan...in other words, I spent the weekend sulking and acting as if sports don't exist :-)

Hi @Scott Hetherington  

Thanks for the reply.  Some follow-up questions:

- Is the 1% fee you refer to 1% of purchase price?  1% of annual rents?

- Does this fee cover the property management fee as well?

- Is there a minimum contract commitment for properties acquired through your service?  In other words, if I purchase a home through HomeUnion and decide that I'd like to self-manage (or hire another manager) after a few months, what would occur?

- How many properties are you managing currently?

Thanks.

M

Disclosure: I work for HomeUnion

Hi Michael,

Let me start by saying to get an exact breakdown of all costs, it's best to chat with one of our solution specialists. I can easily put you in touch with one of them or you can just fill our the contact form on our web site. https://www.homeunion.com/contact/

The Asset Management Fee is 1% of the purchase price.

No, it doesn't cover the property management fees. Those vary from market to market, one of our solution specialists would be able to give you the exact details.

No, there is no minimum contract commitment. You never have to use our ongoing services if you do not want to. In other words, you can purchase through us then self manage immediately. If you do choose to have us manage, we have an annual contract so you can pull out at renewal time, if you so choose.

To tell the truth, I don't know the most recent number of properties we have under management.  While we've been in business for almost 4 years, the after purchase management aspect is fairly new (since the start of 2014) and we've been getting our past investors on board, but I'm not sure how many have done so. I believe it's more than 100, but not sure how much more.

Hope that helps.

I have not done business with Homeunion although we met with them multiple times 3-4 years ago and as recently as two years ago.  At the time, they were charging a very healthy fee to Turnkey companies in order for the HomeUnion team to do a site visit and consider you as a provider to their platform.  I will give them a lot of credit for the thorough process that they made you go through.  I also know that they told some companies no, which should be taken as a positive sign.

I liked their team (not sure if they are all still there) and I liked their CEO Don Ganguly who is a client of our company.  We were approved at the time, but I think they may have been a little ahead of themselves and working with companies before they had clients.  We had a great deal of respect for them, but were not willing to wait for their programs to be completed and moved on, but they have stayed in contact.  

@Jay Hinrichs  , your questions are spot on.  They are just like Maverick, Norada and Real Wealth in that they do not own the properties that they are selling.  They are being paid a fee on each deal from the company whose property is sold (that was the previous model that they explained to us 4 years ago).  We have never done a deal with a client from there, so I cannot say for sure that is still the case although i cannot see how they could stay in business off of a 1% charge.  That charge is unique for a company that is providing third party due diligence.  That is what all of these companies are - just a third party giving their opinion and making a fee in the process.  

I have reviewed their site and I do think they have a set of robust analytics and I give them an A for at least trying to provide a high level of info. and data on an ongoing basis.  As with anything, completely up to the investor to decide if that is worth it, but the owners of this company have a background in data, metrics and systems and that comes from Oracle.  They also just completed a round of fundraising from a venture fund and stated that they planned to use that to complete their analytics and systems for investors.

So, If you feel like you need to have someone else do your due diligence on vendors, they would be a good choice.  That is a personal preference for each investor and I am quite sure there are plenty of investors out there who want that.  Again, my company has not done any deals with them, but we have with their CEO and all of my comments are from what I personally know about their company as well as my familiarity with the other companies as well. 

Medium memphis invest logo mdh 12 4 14Chris Clothier, Memphis Invest, GP | 901‑751‑7191 | http://www.memphisinvest.com | Podcast Guest on Show #224

Disclosure: I work at HomeUnion

Thanks for the input, Chris. You're spot on in what our business model was 4 years ago. Our model and services have changed significantly.

We now provide services throughout the entire lifecycle of the investment, not just the initial due diligence. While we have put a lot of analytics behind our due dilligence, we have also built a team in each of our markets (Our boots on the ground) to make sure that the data is accurate on each particular neighborhood/property.

The majority of the properties we have vetted out no longer come from turn key providers,  so we almost never collect a fee from the seller unless of course you count the commission that we get acting as the buyer's real estate agent (we have licensed professionals working as HomeUnion employees in each of our markets).

BTW, Chris. I really enjoy your blog posts. Keep up the great writing.

@Scott Hetherington  Very good.  Thanks for that post as well clarifying how you guys have changed.  I knew that you had undergone a lot of adaptation with the influx of investment, just wasn't entirely sure how it changed the model.

Good luck with the new model.  I am sure Don and the rest of the team (including yourself) are trying to build a high quality and valuable product.

Medium memphis invest logo mdh 12 4 14Chris Clothier, Memphis Invest, GP | 901‑751‑7191 | http://www.memphisinvest.com | Podcast Guest on Show #224

@Scott Hetherington  

I signed up and looked around your website.  Why do your financial estimates not include vacancy or repairs?  This omission can artificially pad the cash flow numbers.  Or is this included in the asset management fee?  There isn't a lot of information available on the site on this topic so I can't really tell.  Thanks in advance!

Disclosure: I work at HomeUnion

Hi Scott,

Thank you for the feedback. We know our interface isn't ideal and we're working on it, so thanks for giving that feedback.

You're absolutely right that both vacancy and repairs can greatly affect cash flow and returns and, I've got to admit, you've caught me off-guard. We had provisions for both last month so I'm a little confused as to where they went. 

I'll need to do a little digging to find out why those numbers are no longer there.

@Scott Hetherington  

  Nice to see someone do it legally... a lot of marketing agents could take a page from your play book and of course when you went out to raise funds I would think any astute investor would want to know that you have a Licensed RE brokerage that you own so you can legally collect commission on properties you do not own and are just middle manning..

And when I first looked at what your company was repping it was some pretty low end stuff in the beginning and I also choose not to put any of my product I had on the time on your site. I am hoping you have upped your quality game to go along with the other nice things you appear to be doing.

Medium ksqoekox 400x400Jay Hinrichs, TurnKey-Reviews.com | Podcast Guest on Show #222

@Scott Wessels  

  just take the rent and divide by half that will usually give you a good SAFE number to see how the asset will perform then take your mortgage payment out of that half and that is your net cash flow ... Don't need any fancy analytics for this if you do better great but don't buy anything that does not meet at least this test as many times with older and out of area properties cost to run them are much higher than anyone can proforma its called blue sky.

Unless said asset has 2 years of history IE tax returns and realiable fiancials.. Like when someone buys a already running Multi unit.. the due diligence is in the financials. with rehabbed houses that have no history its a just a shot in the dark its all just best guess's you won't know what you have until you owned it about 3 years then you will know.. But based on my experience for Cash flow properties that are on the Homeunion site.. the 50% will keep you safe and give you a quick look at properties.

Medium ksqoekox 400x400Jay Hinrichs, TurnKey-Reviews.com | Podcast Guest on Show #222

@Jay Hinrichs Since you mention about the 50% rule, what sort of COC return should investor look at to determine it is a good deal for Class B property and above? After applying the 50% rule.

As an international investor, with lending rate at approximately 8% and 40-50% down, the COC return (Applying 50% rule) is very low. So what makes investing in US real estate attractive for foreign investors aside from the benefit of diversification?

Besides, what if we only choose real estate that was constructed after year 2000, would this reduce the overall maintenance charges?

Thanks

@Martin Yung  

 returns are in the eye of the beholder its what ever makes you happy.  I used the 50% rule before I even knew there was a 50% rule. just based on owning hundreds of this class of asset. Now if you buy new or almost new homes you will get

1. better tenant

2. more consistant rent usually if tenant procurement is done correctly

3. much less maintenance over the first 5 to 10 years.

4. since its a nice new home less vacancy factor everything being equal good renters love new or almost new compared to some home that has been a rental for 20 years.

Medium ksqoekox 400x400Jay Hinrichs, TurnKey-Reviews.com | Podcast Guest on Show #222

@Bruno Tavares  

I just saw this thread but wanted to give my two cents as someone that has actually purchased property through HomeUnion!  I bought my first true investment property through them and it was a smooth and easy process.  They helped me narrow down what market to look at and eventually a specific property that I was comfortable with.  Like @Scott Hetherington and others have said, they don't own the properties, but help investors find investment properties. That used to be just turnkey properties, but now they also list properties off the MLS in different markets. They use analytics to help identify good potential investments and then they have an employee in each market, usually a local real estate agent, that knows specific neighborhoods, etc. They now also provide asset management so the investor doesn't even have to deal with the property manager anymore. This is why they now charge an annual fee. It's definitely a little different from other Turnkey providers I've seen. I think it's a better fit for those investors that want to invest as passively as possible. I've enjoyed working with them so far and will likely continue to work with them to find deals as long as I'm living in areas that aren't great cash flowing areas. I've bought two properties through them now and am looking at another one now.

I hope that helps!  I was VERY hesitant to move on the first property because I was overseas with the military at the time and couldn't find much(any) information on HomeUnion online.  After talking to a few of their employess I became comfortable enough to move forward and I've been looking for more properties since!

Disclosure: I work at HomeUnion

Originally posted by @Scott Wessels :

@Scott Hetherington 

I signed up and looked around your website.  Why do your financial estimates not include vacancy or repairs?  This omission can artificially pad the cash flow numbers.  Or is this included in the asset management fee?  There isn't a lot of information available on the site on this topic so I can't really tell.  Thanks in advance!

 Hi Scott,

Sorry for the delayed response. We have temporarily removed the vacancy and maintenance provisions as we didn't have very accurate numbers so our investors were complaining about them. We have since gotten better numbers and are in the process building it into our system. We do have a little disclaimer at the bottom of the financials, stating those things will effect, but we should have it be MUCH more prominent and make estimates so that we don't overstate.

Thank you for your feedback. Please keep it coming.

Disclosure: I work at HomeUnion

@Jacob Elbe
Jacob,

Thank you for the kind words and for all the feedback you've given us here at HomeUnion. We're continually looking for ways to improve our processes and feedback from investors like you are extremely important to us. We're already in the process of making improvements to our web site based on your comments.

If you ever need anything, feel free to reach out to me directly.

Scott Hetherington