All Forum Posts by: Jason Timmerman

It depends on the attorney.  If you worked out a flat fee, the attorney may pro rate the deal using their hourly rate

@Chris Toedter Chris, it sounds like you are running into the same problems that a lot of us ran into when first breaking into the industry.  Certain things "don't make sense" to you so you immediately assume that things are not viable.  First, I would warrant a suggestion that you are looking into areas that are far too desirable.  If a home is listed for $350k and is selling for 130% or more of that listing price, than that property was either incredibly undervalued at listing or that property is part of a long term strategy.  By looking at market trends, some high level investors predict what the market will look like in five to ten years and make purchases on that basis.  If they spent $420k on that house they are expecting it to be worth around $600k in ten years based on appreciation alone.

Second, if you are new to the industry what are you doing looking at listed properties? There are numerous wholesalers and direct marketing strategies available to you. You should not waste your time on the MLS unless you really know what you are doing.

Third, distressed houses are king.  You don't want to look at a house without major issues.  A retail buyer who is planning on living in the property or house hacking the property will outbid you every single time on homes without much work needed.  It's worth far more to them than it is to you.   

Zain,

While the $2500 tank removal is high, it's not necessarily prohibitive.  However, if there is a leak of any size whatsoever you will be losing a ton of money on this deal.  The fact that they will not let you analyze a soil sample is a red flag for me.  I would pass.

Sandra, why are you using the MLS?

@John Jimenez I'm not sure.  I'm not as familiar with Mercer County.  I do know that there is a decent market building in East Trenton/West Hamilton, but I'm not sure how much buy and hold potential there is there.  My guess is that for buy and hold you might do ok with multi-family properties in Trenton, but I'm not sure about Hamilton.

Andrew,

You're simply looking at the wrong areas.  It's a pretty easy fix.  Don't look at Collingswood for rentals.  Done. 

The way people there are making money is that they have 100% equity in those properties thus the rental cost covers taxes plus profit.  If you are going to hold a mortgage on one of those places, it is simply not possible.  Collingswood is a decent wholesale/flip market but not a buy and hold market. 

If you're new to this you need to do some market research and find what areas are best for which type of investing.  If you're looking for buy and holds you're going to have to look outside of Camden and Gloucester County.  Cost of living is too low comparative to property taxes.  For example, in Freehold (Monmouth County), a one bedroom apartment will rent for $1700/month.  Taxes will still be about $7500/year.  You can purchase a condo or apartment for about $180k, at a 3.8% property tax rate and generate $200/$300 a month on a buy and hold.  In Collingswood that's simply not possible.

I think you are not working with experienced wholesalers.  If you find the right group your profits will increase 10-15% easily.  Probably even more. At auctions you are going to be presented one property with 6 or 7 other bidders raising the price.  If you get a good wholesaler you will be presented with 6 or 7 properties without any competition. Any legitimate wholesaler will only present you with viable properties so you won't have to worry about having no inventory.  Maybe it's different down here in Central Jersey, but auctions are mostly cash on hand deals and go for far higher than the so-called 70% rule.  A wholesale deal comes along and you jump on it because if you trust the wholesaler you know he or she did their homework before presenting the deal. 

I'm curious, why would you only purchase properties from auctions as opposed to working with a wholesaler?  I find that if you work with a good wholesaler you can get properties at a far better price

The only way to get such a list in Monmouth County is through either the Monmouth County Court or the Monmouth County Sheriff's Office.  You will receive a TON of pushback from both.  Evictions are handled by multiple civil judges so in the court you are going to have to make an OPRA request for the eviction calendar of each judge in the civil division.  They WILL tell you that it's confidential information.  But keep pushing them, eventually you'll be able to get addresses.  You won't be able to get names.  Take those addresses and write a general mailer to the landlord.  You can use njparcels.com or some other address to homeowner website to get each individual owner's name.  It will take a while though.

At the Monmouth County Sheriff's office, file an OPRA request for properties with lock out notices in Monmouth County.  The vast majority of them will actually be commercial properties but you won't be able to make a more specific OPRA request for just residential properties because they do not store the lists that way and not obligated to parse through them for you.  That's your job. 

The last time I did an eviction mailing in Monmouth County I got a few calls but only one or two solid leads.  New Jersey wholesaling sucks.  The homeowners want retail prices.  They will sell for what they see on Zillow as a price estimate but they are not motivated to sell.   We eventually decided to virtually wholesale the hot wholesaling markets throughout the country instead of focusing on NJ.  NJ wholesaling is not something you will be able to do full time.  Spend the $10k or so and get set up in the better markets.  It's worth it. 

Hello Community,

I am about to embark on another big mailing campaign but this time I can't answer all the calls myself.  I am gonna bite the bullet and hire a call center to handle the leads for me.  Which is best?  Any insight is greatly appreciated.