All Forum Posts by: Account Closed

Why are you asking since your profile states that you are a professional licensed real estate expert?

I would buy $160,000 homes that rent for $2200 all day long in a decent neighborhood. I don't know how tenants are in New Jersey, but the properties are cheap in Memphis and the rents are not bad. The problem is; people keep telling me Memphis is the eviction capital of the world.

The numbers look great, but one problem is; we don't live in an ideal world. If everything went as planned everyone would be billionaires. So, I don't make decisions based on numbers, alone. I have to know without any doubt and if I have to ask someone whether or not an investment is good then I am not qualified to for than investment. Unless, the person I was asking was already worth hundreds of millions. I already made that mistake too many times.

Overall, the numbers look very good.

Sorry! With your lack of construction experience and dealing with contractors you should stay and look for properties that are already built. Even experienced contractors do every calculation possible based on their years of experience and they fail on many projects. There are very few projects that get finished without exceeding the projected budget. I've been in the construction business for 55 years and I still get burned by general contractors and sub contractors. There are too many codes you don't know about and there are too many things you don't about like whether or not your contractors are doing a good job.

I don't know all the laws, but I think what you are talking about doing is called syndicating and you can end up in jail when you use other people's money and don't abide by the legal requirements. Look in this forum for 'syndicating' and search the internet.

You may be able to get by if you ask friends and relatives to put up the money, but when you ask people you don't know just the asking is against the law. They don't tell you this in those b.s. get rich seminars.

Most people I know figure 8% of the gross rents for repairs, but maintenance costs vary significantly due to the current condition of the property and deferred maintenance. The cost could exceed 30% of the gross income for a run-down property.

We estimate $25 to $35 per sq foot for rehabbing an auction property. You also have to calculate the auction fee, if any. Some auctions charge 5% of the selling price and the public auctions on the courthouse steps don't have fees. If you are flipping the house, you have to calculate for a 1% transfer tax in California. You have to calculate for property taxes, property insurance, utilities and the 5% real estate fee you may have to pay when you sell the property. We always figure $5,000 to $9,000 to evict the current resident and sometimes that can take 6 months. So, if you plan to flip the property in six months you are looking at one year of taxes, insurance, utilities, maintaining the lawns, re-cleaning the property, etc.

You have to be super careful at auctions to make sure you get a title clear of liens and encumbrances. You need to have a title or escrow company check the liens the same day you bid at the auction because it is possible that someone will record a lien a few minutes before you bid on the property.

This is just an example. I've seen people pay $400,000 for a $500,000 property at an auction and then find the previous owner had $300,000 in liens that stuck with the property. I've seen people win what they thought was a property and the only thing they won was the junior lien and the first position was still close to the entire value of the property.

Auction.com's representatives are pretty helpful in regards to giving you advice about each property before you bid, but the courthouse auctions will give you no help at all. They won't even tell you if the auction is for the first or second lien holder.

Analysis for what type of business or investments? Are  your clients passive investors?  Are you a syndicator? Are you working with single family or multi-family. 

We send about 100,000 customized letters every year and we checked on EDDM several times. Every time I spoke with the post office I found the requirements were too much to deal with.

Get a USPS Bulk Rate permit and the cost to send an envelope with at least 3 pages is something like 29.7 cents each. An envelope, letter and business card is much more powerful than a post card. As I sort through my mail every day I torpedo the post card in the trash and pay zero attention to even the headlines.

How many pieces do you intend to mail each week, month, or year. I have s super MS Access database I developed for managing direct mail, but like every software that is powerful there is effort and time involved to set it up and get it to work.

I am always willing to help investors for free if they are serious about making business work.

You will get many different answers regarding who pays for the windows. Each situation is a little different. If the tenant is polite, pays the rent and is really decent in general I always give the tenant the benefit of the doubt only because a super high percent of landlords treat their tenants like trash and I don't want to be like them.

Maybe, the window just decided it was time to crack. Maybe, it opens or closes too fast. Maybe, the tenant does not even know he broke the window when it happened and is really being honest when he said he did not break it.

I always say that the reason tenants want to rent is because they don't want to own properties that need to be repaired. And...landlords purchase properties with the expectation that poop happens and they have to make repairs.

I don't want to be a crab apple every time I see my tenants, but I will charge a tenant when they smash down a door because they got locked out.

I would leave the tenant alone. The apartment is rented, they pay the rent and the smoke and dog are already there. Maybe, if you leave the tenant alone they will stay a hundred years and you will never have to clean up their mess.

When tenants move in friends, relatives and pets against your wishes you can increase the rent based on the increase in tenants and pets. That often works out much better than making waves and having to clean the unit and find new tenants who may never pay their rent and then move so you have to clean and rent the place a 2nd time.

I get a little carried away, myself, sometimes, and about a year ago I had a tenant move a friend into his unit and he refused to pay the additional rent I wanted. So, I evicted him. It cost me about $1,000 to clean and paint the unit. Usually, we have an apartment re-rented within a few days, but this apartment took about 8 months to rent and I lost $1500 per month = $12,000 + plus the cost to paint and clean. Shot myself in the foot on that one!

Aside from crossing fingers for luck, it is very difficult to be successful if you don't have a business model and philosophy where you can see your business model and philosophy will give you the end results you want.

My point for saying that is; you can argue with me and tell me I am giving you crazy numbers, or my business model won't work in your area, but you cannot be successful with my business model if you cannot; 1st) see that it does work and 2nd) see how you can make it work for you in your area.

There may be a need to change the type of properties so that you have better tenants, or maybe you ill make only 20% of what my numbers portray, but even a 5% increase is something that should not be ignored.