All Forum Posts by: Kathy Potter

I am mostly a buy and hold investor. One thing I did differently was find a more stable market and invest far away from home. Had never done that before. It is a little challenging managing cross country but I bought nice sfr in a nice area so I have had GREAT tenants.

Dan,
What do you do with the foreclosures?

Can anyone share with me many what benefits you have experienced from using these different sites? Or things you don't like about them?
Any other things you like for promoting yourself or your business online?

Chris,
Unless your property is something that sells well no matter what, you might want to rethink the FSBO and find a good real estate agent. They will give you more exposure on more popular sites, like MLS & Realtor.com. Most importantly the MLS listing will be seen by the buyers agents in the area. Since most areas have high housing inventory buyers have alot to chose from and they want to see alot of homes before they buy. This can be overwhelming so more buyers are choosing to work with a real estate agent to show them homes. If you are not listed you won't get shown. This may lengthen your market time and may not save you anything in the long run.

Also my experience has been that potential buyers who respond or target FSBO properties do so because they think they will get "a deal" without an agent involved. You may find you end up giving that money you tried to save to the buyer anyway.
I could go on and on about the benefits of a good real estate agent, especially in the current market. Good luck which ever way you go!

We all had a reality check 1-2 years ago depending on where you live. The changes in the housing market have had widespread effect, good and bad, on every area of real estate investing.
Can you share what your business is and what you had to change in your REI business in order to still be successful?
Or
How you were able to capitalize on this market change?

Thanks for the advice. Our website is pretty clear what the stategy is anyway. I am changing a couple of things to make it even clearer. I am here to learn and to share what I know and hopefully help, not to fight with anyone or to be insulted. My husband always had a bad attitude when he was dealing with all those icky tenants. It will make you nutty!

You really have a way with people don't you?
I am actually glad you asked because sounds like you could really use something new if what I have read is all true. Dealing with that kind of tenant day in and day out wears on you. Obviously gives you a bad attitude too.
If you seriously want to know and ask nicely I will tell you.

I am new to this forum but old to landlording. When I first started reading about this 50% rule I thought "that's crazy". I was even annoyed that some poor newbie in Florida was talked out of a pretty nice duplex that cash flowed, had long term tenants in place who wanted to stay and were taking care of the place, all based on this 50% rule. Now that I know Mike's business I understand why the 50% rule is what he uses. He has to with evictions, vacancies, property destruction with those type of tenants.

I have owned more and currently still own those exact kind of properties as well as many that are not like that. My husband goes armed to pick up rent (we live in Arizona so he goes armed to the grocery store too,haha), it is the "rough" part of town. One 4-plex has govt housing across the street and the sex offender halfway house the next block over.We used to have the same type of tenants that have been described in this thread. It was horrible, crackheads, lazy-asses, drunks, even had one ho. The stories I could tell.

Lots of people own these types of properties, lower income people need a place to live and in larger cities these parts of town are where you find most multifamily properties. Unfortunately those properties attract many "undesirables" too. We had to use the 50% rule too (didn't know it had a name). The kind of tenants described that Mike has are what you get in those areas if you don't think outside the box and come up with a different strategy.

Out of believing "there had to be a better way" we decided to take control and have these types of properties run our way and not the tenants way. Now we have no property destruction, not one eviction in five years, tenants who always pay, extremely low vacancy. Much lower expenses.

The 50% rule should not apply to every property in every part of town in every city, but if everyone uses it you will always make a safe deal, but in some markets you may never make a deal at all. For newbie advice, those who are in markets where sales prices rose faster than rents, they can make a good deal on the right property and be below that 50% rule. They take what some of you say as gospel and if they think they always have to use the 50% Rule they will never buy anything.

If you can afford to buy more without selling this is a great time to buy. Depending on when, where and what you bought it might or might not be a good time to sell. Also have to consider your goals, long haul investor, if tenants are covering payments keep them.
If you are going negative on rent because you speculated on appreciation and that is not happening now, maybe you are losing value right now, might be good time to "make that tough decission" and get out of those.

For the cash out refi idea..not bad if you can make that money make you some more money and you don't negative cash flow on the rental by doing that. But if you have borrowed 100% of the value, which is not really possible right now, and have no cash flow, you need something going for the investment or it is not an investment. It needs to have good appreciation, cash flow or it allowed you to make big $$s by taking that extra cash. If no positive quality then it is a liability only.