All Forum Posts by: Alex Craig

Guilt no.  Feel bad yes, but it is part of the biz and I accept it.  There are people who truly try, but come along a streak of bad luck that causes financial issues.  There is nothing worse then putting a kids toys on the curb, but again, part of the biz and you just move on. Now there have been some evictions that I feel like a kid on Christmas Eve I am so excited because the tenant has been a total jerk.

Ok—where have I been? 😯

@Duane Welch if you have any general questions, PM me and I will share with you what I know.

@Mike D'Arrigo I thought about KC, but have not heard a lot about that market in a while and really do not know of anyone to refer out.  But noted. Thanks!

I like homewyse.com. I am not sure if it considers the present economy where good contractors can charge a premium simply because the good ones are extremely busy and backed up.  That being said, if you have a contractor that is able to start in 2 weeks, I would put my pessimist hat on and really screen them and do the property back ground checks such as google review, BBB and ask for 3 recent projects, before and after pics of that project and the phone number of the individual who hired that contractor.  

If you are going to have office employees you not need workers comps until you get to a certain size. But if you are going to employ someone out in the field doing repairs, then you may want to go ahead and get it.  It is a huge expense, but helps me sleep at night, along with General Liability. Your state will likely require you to be a broker, which comes with its own insurance requirements. I think the GL is the important one to carry from day 1.  BTW, make sure you are working with subs that have WC and GL, otherwise you will have to pick up their bill each year when your insurance company audits you.  

Welcome.  Wholesaling can be lucrative with littler risk.  I would say make sure the market you are wholesaling is not over saturated with wholesalers. Right now, Memphis has waaaaaaaaaaaaaaaaay to many.  I get robo calls daily, mailers and every corner has "We buy houses."  I think people who start wholesaling here likely get frustrated and give up.  Here is my advice to standout as a wholesaler

• Be transparent with the seller
• Be transparent with the buyer, especially if you are doing a JV with another wholesaler or reverse wholesaling
• Provide accurate rehabs
• Report the age of the big ticket items such as HVAC and Hot Water Heater
• Tons of pics
• Don't oversell the deal by exaggerating the ARV, under estimating the rehab, calling it "great neighborhood" when in reality it is D class. There are D class buyers, so no need to oversell. Local buyers will sniff that out and the loss of credibility will happen

Good luck. 

It could be cash buyers looking for 6 to 8% cap rate, but also figuring in the massive advantage of owning real estate with the new tax bill.  @Frank Wong nailed it. "At some point, you do have to adjust your game plan to reflect on the competition."  I would say if you are just buying for cash on cash return, then it could be very hard to compete with the buyer who figures that 6 to 8% return is really 15% with the blended return (tax savings, appreciation, equity gain through tenant paying down mortgage and hedge against inflation).

To take this thread to the next step, these are the cities to research.

• Little Rock -- hot right now, we have had 4 other Memphis TK providers follow us here. Well not really follow since we are locally owned
• Memphis -- a household name for investments -- several TK providers operating here
• Birmingham, AL -- cash flows good--seems like this market has come on strong the past 5 years
• Jackson, MS -- I hear a lot of investors going here and getting good cash flow. Personally, not a big fan of the city in general, but that is just my opinion of the state of MS.  I am sure this will get me scolded by the MS faithful here
• Columbus, OH -- I see good TK providers operating here
• Houston/Dallas -- I see these on a lot of the affiliate websites, but my feedback is property taxes are high and cash flows are not good.  
• Indianapolis -- this one has been around for a while
• Cleveland -- I know zero about this market, but James Wise is active on BP. He would be the resource for you

There are quite a few multi-market 3rd party providers who can present several other markets.  If you are on the fence, they could help you find the market that is right for you.

I was so poor in college, I could not even pay attention, that is why it took me 7 years to finish.