All Forum Posts by: George Azita

There is some free software that has several spreadsheet-type forms for different type of investments that someone posted on BP a while back.

Search Google for Bestline Plumbing, scroll down the home page to MS Access Software, click on the link and download the free software. This software does the calculations for single-family and multi-unit properties. Then, this software will give you an idea in regards to how to accumulate the numbers to create spreadsheets for your specific situations.

I've been in the real estate business more than 50 years and you should listen to advice from other investors, but never rely on someone else's advice and never trust a mentor, financial advisor or real estate agent broker when they have their own agenda that does not necessarily align with your agenda. I am not saying brokers and advisors are bad people. So, don't get it a tizzy. You will be ready to make decisions when you learn enough where you can tell professionals what to do rather than asking questions.

As far as people not wanting to help you on a one-on-one basis, there are many good explanations for that since a high percent of people asking questions fail to produce the necessary information required to give good opinions and a high percent of people asking questions are too lazy to gather the necessary batch of numbers where another person can help. Many requests for advice end quickly when the people asking fail to produce the information.

If you are moving to another area far from the home you currently own I would definitely sell that home and purchase a 4-plex in your new area because there are many areas where you can purchase a 4-plex for the p-rice of a single family home. I would never want to own a house out of my area where I need to pay a property manager and where I don't have 100% control of all facets of renting and controlling my expenses.

The advantage to owning a 4-plex is when you increase the rents every year you automatically increase the value of the property and you cannot increase the value of a single-family home when you increase the rent. Supposing you increase the rents on a 4-plex by $40 per year and the Gross Multiplier for similar properties is 15. Then, every time you raise the 4 units $40 each you increased the value of the property by $40 X 4 X 12 x 15 = $28,800 and when you do this over a 10-year period you automatically earn $288,000 plus the profit from your cashflow for the 10-year period.

Otherwise, you will have a very difficult time getting someone to do all your math for the questions you asked even if you pay someone. So, create a spreadsheet for your situation showing your potential profit if you keep your current property, create a spreadsheet showing how much cash you will have if you sell the property, create a spreadsheet showing your profit if you sell your current residence and buy a single family property and create a spreadsheet showing how much profit you will have if you sell your current residence and buy a 4-plex. Nobody will do this for you, but we will help if you post your spreadsheets with corrections and suggestions.

Your situation and post should be written into every post where BP members advocate out-of-state investing and advocate for using a PM.

It doesn't sound like your property is destroyed very much. It doesn't take much to clean up an animal mess and replacing flooring and painting is an expectation. We own many rental units in many states and sometimes I get tears in my eyes when I see the filth and damage, but when doing the painting and cleaning that is required every time a tenant moves the additional cleanup is not always as bad as we think when we first see it.

One thing we do that most real estate owners don't is we have an annual budget for maintenance i.e. a new water heater, furnace, roof, yard work, etc. for about $1,000 to $1500 per year and then we add to our projections, before we purchase a property, an extra $1,000 to $1500 per year for the cost to clean and put an apartment back together every time a tenant moves and we figure the average tenant moves every 5 years. So, we put into our budget $5,000+ for every 5 years.

So, if you included something like $1,000 per year for normal maintenance plus $1,000 every year for when a tenant moves then you should have $10,000 total to spend on the property every 5 years. When looking for properties to purchase, we will not purchase a property when that budget cannot be achieved after collecting rents and after all expenses.

So, maybe you need to do some serious number crunching to see how much you budgeted, or how much you should have budgeted and maybe you will feel much better, or maybe much worse. But...you need to do the number crunching so you know where you stand and how you want to analyze your current, or future investments.

 You sound almost like myself with all your warnings. I agree 100% because it is the human nature of people to focus only on the potential profits and put no focus on the risks.

That is a large order you asked for. Especially, since the real estate advice you asked for contains volumes of books and millions of pages.

The very first thing you need to be successful with real estate is to find a property to flip for a low price where you can earn some big bucks. If you want to find mentors, or get advice then start searching for properties and start posting some information about the property and post some numbers showing how you did the math that indicates that you will make a profit. Then, along with BP members, I will tell you whether you are right, wrong and show you how to crunch the numbers.

After you show you can find some properties and do the math, then you can easily find help in regards to rehabbing and help for every other facet.

Post information and numbers for properties with potential profit. Hate to discourage you, but the flipping business is super tough with today's high real estate profits, even the pros lose money on many flips and flipping can easily bankrupt you if the real estate prices decline. I've been looking for flips, single-family and multi-unit properties for the past two years and have not found a sure-thing because I don't do high-risk investing and I don't get involved with any type investment just for the glory to make a few dollars. I will wait 10 years if I have to rather than blowing my wad of cash on senseless investments that only make me age faster.

Put another way. Don't be in a rush to invest your money. Keep your cash in your hot pocket and wait for the goldmine to fall in your lap that is a sure-thing.

The only way to be sure is to spend a significant amount of time and create a spreadsheet with calculations for every possible calculation and cover every option.

You claimed you have the option to keep both properties and wait until you have a better W-2 situation. So, you are not hard-pressed to sell. Without a spreadsheet, nobody can nor should give you any advice and the very last thing I would ever do is sell a property without having a seriously good reason to e.g. if I could make a significantly better profit.

As for investing in the U.S. if you remain in Canada, I am not an advocate for owning properties when I am not hands-on and cannot have 100% control of every facet because long-distance properties have many inherent risks and have many additional expenses and inefficiencies that can bankrupt you. If the real estate is not-so-bad in Canada you should stick in your own back yard (as they say).

Post your numbers and lets see what your options look like.

I would love to see all your numbers you used to project your profit. When a person finds a real goldmine and can prove the nuggets are really gold and simple to extract then every fool in the world will throw money at you. If you are afraid to provide any details about your gold because you think everyone will steal your goldmine from you then nobody will believe in you and you won't get any help.

Post some numbers and real information that can attract help.  

Beautiful profile picture. Is that really your picture and your real name?

LLC's are a waste of time and money as far as using them for protection against lawsuits since you already have insurance that covers most claims and your LLC will not protect your assets for any amounts above your insurance policy since is is simple to get a Charge Order to go after your personal interest in the LLC. Most savvy vendors and creditors don't want to do business with LLC's or they require a Personal Guarantee. LLC's are over-rated and don't provide any true value. I've seen many investors have serious tax problems when they pass away because it is common for some property tax collectors to consider that properties in an LLC belong to the LLC, nor to the owner of the LLC and the property tax benefits do not pass to the LLC owner's heirs.

 "Never count someone else's money"

Your peers who have properties managers, acquisition managers, etc. are under a serious amount of much more stress than you can imagine because when you have that many people and different departments in your organization in your company you also have much more stress, more expenses, less efficiencies and your profit margins are also lower. I don't envy any business owner who raves about how much business he does, raves about his gross sales and raves about the number or people he employs because the larger your company is the more vicious your circle of problems widens.