All Forum Posts by: Bob Floss II

@Darron Washington The Illinois Department of Financial and Professional Regulation has updated the definition of a Broker and it now includes wholesaling activities. Anyone trying to wholesale in Illinois needs to have a real estate broker's license. 

@Kyleigh Morgan The question of when to start the LLC can be a tough one. It usually takes an hour conversation before I know how to advise the client. If you are buying cash, using a private investor, or using a hard money lender, you can start an LLC now and get things set up the correct way so you can scale up your business. The greater majority of people that sit with me already have 5-10 properties and either don't have an LLC yet or did it themselves online and realize its inadequate. This happens because many new investors end up using conventional lending that requires them to apply for the loan in their personal name and hold the property in their personal name. After they've bought a few single family rentals in their own name, and maybe deeded a couple into an LLC, and try to buy their first apartment building, they realize they need to restructure everything.

I would take a hard look at your strategy, your target properties, and how you plan to finance the purchase. Once you have that component isolated, you can come up with a plan to structure the business. 

I agree with @Michael Ablan above. Use CAP to evaluate properties for current and pro forma appraised value, but set a floor for cash flow per door.

@Sami Davis Contractor bids will vary depending upon the neighborhood and the work required by the City.

No one is going to read a long ranting post, but I wish some of you would be more honest about your business practices. Yes, some of you do it the right way, but many don't. You mislead the public in your mailers, you mislead the seller, and try to hide how much you are getting paid. The state is protecting the public.

It's not like wholesaling is illegal. You can still do it. Go get your license. 

@Katy Schlake Congrats, house hacking is an amazing opportunity to build wealth. Talk to someone about getting preapproved and matching up your price range with the type of building you can buy. Sometimes the inventory doesn't match what you can afford and the process of finding a property can be exhausting. Depending upon the price, property, and area, you may need to network to find off market properties. 

I feel like debbie downer today bursting everyone's bubble.

I clerked at IDFPR in law school and helped with real estate complaints. They don't need a task force and they're not going to send people out scouring the internet or looking for mailers. They will do nothing. They will sit and wait. Almost all complaints are generated by a member of the public or another professional. This is business and your competitors want you out of the way. This is capitalism at it finest. Licensed Realtors that don't like wholesalers and even licensed wholesalers that want to level the playing field and eliminate competition are going to flood them with complaints. Your buddy that you see at networking events and seems like a great guy already filed a complaint against you. 

@Cade Andersen Go to youtube and search for Floss Law Auction and I have several long videos answering all the questions you'll have about the process.

@Bruce Runn Congrats on your success and recognition. You are doing great work that is desperately needed. I'm shocked by the amount of negative comments it received on outlets like LinkedIn where people associate efforts to create multi unit housing as hurting existing property owners or neighborhoods. A big segment of the population is in denial of the need to transition housing to meet the demand of buyers with good jobs, young families, low down payments, and high student loan debt. They want their neighborhoods to be all new construction million dollars homes even though they aren't selling. 

Keep doing what you are doing and educating the public.

https://www.bloomberg.com/news...

Coming from Chicago where zoning is a constant battle and converting a single family to a 2-unit requires navigating legal hurdles, this article makes me happy. Minneapolis is a fast growing economy that is looking to embrace affordable housing and development by eliminating single family zoning. I can't express what a HUGE impact this can have on a city. The move would eliminate the need to seek a variance and neighbor approval to change a single family home to a multiunit property.

By eliminating the waiting period of meeting with Alderman, getting plans and permits submitted, hoping they get approved, attending late night zoning meetings, and fighting with neighbors and city inspectors, developers can actually focus on improving the property. Not to mention eliminating the cost of seeking the zoning variance will open up this type of development to more investors. 

I'm also a huge fan because I'm based in Chicago where there is a shortage of quality multifamily buildings for young homeowners to house hack. Creating quality multifamily housing in a developing area and educating young professionals on the advantages of house hacking seems like a win-win for everyone involved.

https://www.bloomberg.com/news...