All Forum Posts by: Doug Shapiro

Hi Joshua,

My advice to you is to outsource as much as you can.  The value you and your wife have is finding and buying properties that are a good deal and I'm assuming would generate monthly cash flow.  All of your time should be dedicated towards this.  Here are a few ideas on how you can free up you and your wife's time:

1) Online portal for all rent payments and maintenance requests (this way everything is organized and handymen can be notified immediately what work is needed to be done and why)

2) Set up online billing if you have not done so already, with recurring payments or automatic payments. 

3) Hire a virtual assistant(s) to answer calls, make calls, and do other work that anyone can do. 

4) Keep track of how you spend your time currently so you know what changes to make first that will have the biggest impact.

Thanks!

I created my own spreadsheet because I wanted something very detailed.  I wanted the ability to quickly change variables and to see worst case scenario #s, as well as to account for all expenses involved in a remodel (by line item).  One column I use is "Projected Costs", another is "Actual Costs", and yet another is "Paid", which keeps track of whether I've paid the bill or not.  The "Paid" column is useful for contract work where it is paid over time.  

Having this level of details is a must for me because the more accurate information I have beforehand, then the easier the decision is with buying a place.  I also use the spreadsheet to keep myself honest - it helps no one to inflate estimated profits.  Using very attainable #s, like projected rent, projected vacancy, etc. will go a long ways with insuring you make solid decisions.      

Hi Tim,

Welcome!  Familiarity with the market is the biggest hurdle IMO.  When you end up buying a place, you want to make sure you are getting a good deal and you want to know what kind of return you will get.  Knowing what to buy and at what price is...priceless to know.  

My strategy is buy, remodel, and hold.  Decisions to buy boil down to a spreadsheet I use to estimate costs and returns.  I am familiar with several real estate markets, so as soon as a property becomes available in a particular location for a certain price, I crunch the numbers and then make a decision.   

The best thing you can do would be to see as many places as possible and to become intimately familiar with your market. Know the sales prices and rental prices for different neighborhoods you are interested in. You want to be in a position where you can act quickly once a good deal comes onto the market.  

Hi Andrew,

Those numbers look okay but are not amazing. A cash on cash ROI of 6% is a little low - is that the best opportunity in your area?

Hi Karyn,

In your lease you should have clear verbiage that says who is responsible for the lawn and to what extent (especially if you belong to an HOA).

As far as providing a lawn mower, it is up to you.  I personally would leave the current mower with the new tenants (and to have verbiage in the lease that holds you harmless for any equipment malfunction etc.).  I would also say that if the mower needs to be replaced, then you would subsidize part of the cost to replace so that the tenants have some skin in the game.  

Hi Matt,

I think buying in Fishtown with the higher rents is the better option.  Cosmetic work is easy to do and not too expensive.   You can completely change a space by doing purely cosmetic work.  For the bathroom, for instance, repainting, re-grouting the shower walls, installing new shower head, swapping out vanity, swapping out toilet, and installing new faucets would completely transform the space and isn't too difficult to do on your own.  

Once you do this light remodeling work then your unit will stand out from the others when you rent (because most of the other rentals will still be outdated).  

Hi Branden,

I'd recommend buying the SFH in the good area. You can change a lot with a place but you can't change its location.

It's also riskier buying in a bad area because that area may never become desirable.

Hi Richard,

Referral of a friend/family member is what I see the most.  The agent-client relationship needs to have trust and it is difficult to build this online without social proof. 

I would expect all of my clients to ask me these questions:

1) What is your background and what is your real estate experience?

2) What are the ballpark rental/sales prices for X neighborhoods?

3) How does the sales process work and how do you fit in?

Thanks.

Hi Gideon,

Find out how much it would cost to finish the basement and also find out how much more you can rent the house for with the additional 1-2 bedrooms and bathroom.  This should give you a better idea on what is the best option.  

Hi Luckisha,

I wouldn't ask for it. 

On a side note, make sure you are handling the security deposit carefully (in a non-personal interest bearing account).  In reality the security deposit acts more as a deterrent.  It's like you are holding the security deposit hostage in the hope that the tenant will respect your unit and not cause damage.  If you use the security deposit you will need to prove that the tenant caused the damage and it was beyond reasonable wear and tear. 

Thanks!