All Forum Posts by: James Paine

 100% agree with the above.  I buy for cashflow, appreciation is a guess. The smartest investors in the world all have one thing in common, they will tell you that they are not sure what is going to happen next. 

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My California deal is a formal partnership that owns a property.  My interest is 33.3% of the equity and I hold a senior note of $20k as well.  What is the zipcode of the partnership? (I don't understand?)  I am not selling anyone anything? I am literally in the middle of this transaction. 

This is the way that all leases are set up in Australia.  

Personally I don't like it much, accounting seems like a headache. 

Wholesaling works in every market.  Those that say it doesn't mean: "I don't know how".  Ignore the it can't be done talk. 

@Hedy Kromer

I am in a partnership doing the exact same thing.  We are selling (in escrow, closing next week) to sell a CA property that has about $100k in equity after sales costs and 1031 exchanging it for 3 properties in Chicago.  (Turn Key)

The reason I am doing that is to create greater cash flow.  My main goals are around cash-flow, I don't predict the future well so if there is appreciation that will take care of itself. 

A note on some of the other posts:

• If you decide to buy all cash your next properties a 1031 won't work, you will pay capital gains on your sale
• If you decide to invest in a DST you might as well just send me a check for 20% of what you were going to invest and I'll send a thank you note. They are terrible investments. I've personally been the general partner in an institutional fund. I have consulted for several banks and REITs. DST's used to be called TICs, they failed so terribly that they needed to find a new name after the crash. There are TONS of reasons they suck but here are the main two:
  • The guys who put the deal together make 100% of their profit up front and have little to no vested interest in the future. 
  • There is legally 15% of start up expenses that you get hit with up front that they don't have to show as a reduction of capital on your statement. (7% Broker Dealer fee, 3% referral commission, 1% organization fee, etc, etc. 

Best,

James

Frank - 

My recommendation is to sell them all to your tenants with land contracts. 

Selling properties in Ohio to a fund as a package would be a pipe dream.  You won't get a premium.  

I know one of the biggest lenders in your state and they charge 2-3 points and 10%-12% and they lend about 80% of the purchase price and I believe most of the rehab as well.  PM me if you need an intro.  

One of the main things is underestimating the time the deal will take and deals that take over 6 months can cost more points as well as more interest.  Plan ahead and be safe. 

The first part of the name should give it away.... CONtractor...

How long is it taking other properties in the same area to sell?  I've done deals all over the country and I can tell you that in southern California that if you don't have offers in two weeks then drop the price.  In Michigan we drop the price after 45 days then every 30 days after that. 

@Steve Lockwood  We partner with guys all the time.  PM me if you'd like me to have my partner reach out to you.  

As a general response about HML. They will come easy but they are all very different (rates, LTV, points, etc) Make sure you compare and contrast. With more experience the money will get cheaper and can be great.

Private money is great but on your first few deals getting enough of it is difficult to get enough.  I started doing deals with private money, my money, and hard money together to get a deal done.  

Good luck!