All Forum Posts by: Jon K.

I would give them a couple of years worth at least stapled together, and have them fill it out simply by checking the boxes, and some of the boxes would say take a pick of the front of the house take a pick of the back of the house.

I would want some pics even if it is in good condition to prove that they had been to those spots and looked.

I would also have them take a pic of the completed check off sheet, and picks of any problems that they had found from the list or that were not on the list, such as a large aggressive dog running loose or something like that.

As for who to have do it, I think I'd call 3 or 4 property managers in the area and interview them and see if they were interested in it.

It seems like easy money for somebody that would be out in their vehicle in the neighborhood already.

And when they show up at the property if anyone asks questions they can simply say property manager.

My preference would be to get the pics by having them sent via chat to my phone.

That way I would know when they're there, and I could ask them to look at something else if needed while they're there.

Good Luck!

Great idea about having them check off different items on a list. There have been times it would’ve been good for me to have checked out some items for myself. Lol.

It's a digital world my friend, there's an app for that (dozens really). I've never used this one personally but it had an integration with some property management software I used in the past. Might be worth a look, it seems inexpensive enough.

https://www.zinspector.com/

1 Vote

Houston, Texas

Quote from @Joe S.:

So the question is what’s your thoughts on networking and is it over rated.

From my own experience, going to meet ups and talking big game with newbies was l not all that beneficial. Going to meet ups and being exposed to a pitch fest was not all that beneficial either. Being somebody’s lap dog probably would not be beneficial for me…I never gave that a shot. Lol

What I have found for myself to be beneficial was marketing and getting in front of sellers and pretty well closing my ears and eyes from those that were talking big game so I did not get discouraged.. I’ve never had anyone take me under their wing, but that’s possibly because my personality does not seek out that kind of arrangement.

I am not a realtor or a lender so I do not have any perspective personally for that when it comes to networking.

What’s your thoughts on networking?

PS my Title was supposed to be (is networking overrated,), but I cannot edit it. Maybe a moderator can.

I suppose it depends on what you mean by networking. In the broadest sense of the term it has been invaluable for me personally. I am successful in a large part because I found great people with which to work. My general contractor, property manager, realtor, attorneys, lenders and business partners all came from networking. Some from in-person meetups, some from online (BP or Facebook groups), some from leaning on my existing network as it grew.

When I need a referral for something, sure I can ask online in a local Facebook group or here on BP, but what is a random internet's stranger's opinion worth to me? Why do they have credibility? Not saying they don't, but without having established some trust I can't blindly follow their opinion. Being able to reach out to others who are employing similar strategies in my market with whom I already have a relationship is better IMO. Easier for me to reciprocate value as well.

Absolutely agree that large in-person networking events can either be a pitch-fest or full of newbies. But networking comes in many forms and that's not the only way to do it.

1 Vote

Quote from @Nicholas L.:

@Dan H.

agree. there is no such thing as 'cash flow from day 1.' is there a way to buy without paying closing costs?

It may be uncommon but it's not impossible. I'm participating in a syndication as an LP right now that was cash flowing before the operators purchased it and continued to do so after. I've also bought turnkey single family rentals whose vacancies I was able to fill before the first mortgage payment was due. I'd say that counts as well.

0 Votes

Tacoma, Washington

Quote from @Chris Seveney:

I want to bring some reality to the situation which is 99.9% of us do not become financially free through rental properties (or real estate). Its a great asset class that is a long term play, but those thinking to get financially free at a young age, I would say go into tech.

I graduated with a friend, same degree. In 2011 he went and worked in tech for NVIDIA, I have been in real estate. His net worth is 5x mine and mine is pretty darn good. He is financially and time independent. Getting their through rentals is great for building wealth but do not count on leaving your job unless you are becoming active in real estate which is still a job.

Sorry just my 2 cents.

I don't disagree that getting into a high-paying career like tech can help, but NVIDIA is a bit of an outlier due to what their stock has done over the past few years. I've been in tech for almost 25 years. My network includes hundreds of others in the industry. Receiving stock as part of your compensation is common enough. I know a few individuals who have achieved financial freedom due to being lucky enough to have their stock increase in value significantly without selling it beforehand which is not an easy thing to do when stock makes up a significant portion of your total compensation. And for everyone who held their stock until it went to the moon, there are plenty of others who held it and watched it move at a more modest pace if at all. The vast majority of tech employees that I know are still working in their 40s and 50s because they have to, not because they want to.

In other words one should not count on becoming financially free at an early age simply by being in the industry. Luck is a big factor.

Combine that high paying career with smart investing and now you're on the right path.

2 Votes

Tacoma, Washington

Quote from @Rodney Lorenzo:

When I acquired a 6 unit property in Hartford, CT in 2022, the neighborhood appeared as just working class. Soon after, the neighborhood went from class C to class F. I stuck with the same PM, owned by Tom Kopchick, because they knew the building and neighborhood quite well. Unfortunately, things went South really fast. I thought, let me evict the non-paying tenants and replace them with paying ones. Well this was like pulling teeth. Units were not flipped because the PM blamed it on the bad neighborhood and said that govt programs were the way to go if I wanted a consistent rent roll. He never told me that it would take several months to get funds from these entities. I ended up with 4 empty units and 2 paying tenants, then only 1 paying tenant. I still paid the mortgage on time, but was a struggle at times borrowing money from friends and family just to do so. A veteran was finally put in one of the units (the one paying tenant), however, the PM failed to tell him to open his own electricity acct and after 6 months, ended up with over $2000 of charges under my LLC. When I went by the building one day, they refused to let me into another vacant unit because they said once a govt program takes over while they find a tenant, I as the owner cannot have access to it. This unit ended up costing my LLC over $1800 in electricity charges when it was supposed to be vacant. The electricity shot up to over 3000 kw over the winter prompting me to think they had a grow house in there or a squatter the PM was collecting rent from himself.

In a neighborhood like this, you need a very competent PM. Instead, I ended up with the worst and most incompetent in the state, if not the whole country. They never got back to me on anything. It was, "yeah I'll take care of it" and I'd never hear from them again. Some of the problems were not taken care of at all. Homeless people were shacking up in the basement and breaking windows on the ground level trying to get inside one of the units. The PM had a manager who stuck her "friend" in one of the units prior to my acquisition and because they had a fall out, she stopped paying rent so I got no revenue from that unit for 7 months. The PM was horrible at trying to evict her and she finally abandoned the place, costing me over $9000 in lost revenue. When I attempted to replace them with another PM, Tom begged me to keep him on. Like an idiot and a firm believer that everybody deserves a second chance, I proceeded to continue on with them. Huge mistake. Things got much worse. He deliberately used a plow to destroy my driveway when there was snow, prompting my insurance company to come after me. In the two estimates I got to repave the driveway which were around $7000, Tom wanted 15K for it. It seemed to me that things were broken so they can make money off of the repairs. A PM could easily get away with this. There was a leak in the skylight above the inside hallway and they implied that I needed to redo the entire roof because of that one leak. That would've cost me over 20K.

In trying to get another PM to come on board which none would touch with a 10 foot pole and my hemorrhaging money left and right, I decided to put it on the market. Tom the PM got upset because he wanted to sell it for me, but I told him that if he was inept as a PM, what made him think he would be great at selling my building? All reviews of this PM on the internet are all horrible. Goes to show you that before you contemplate hiring a PM, ALWAYS check their reviews first. Most lie through their teeth. Additionally, he never charged me a "percentage" of the rent roll as stated in the agreement. It was always a flat fee of over $600 whether I had 4 tenants or 1. With the appreciation, I didn't lose as much money as I thought, but had I held onto it, I would've gone bankrupt and had the building go into foreclosure, all because of their incompetence. Again, I tried my best to find another PM, but there were no takers. It's PMs like these that ruin the reputation for the others. I truly believe that they can steal from under you and get away with it. Even the REIA in CT was of no help. An entity that supposedly "helps" investors, but said nothing on how to avoid bad PMs. Besides them, I contacted the AG of CT, the mayor and an attorney to see about suing them. I got no help whatsoever. The state literally has enablers that allow rogue PMs to get away with a lot and I'm sure this is like this across the country. The Dept of Consumer Protection was a joke and was of no help either. Everyone assumes landlords have bottomless pockets so they don't really care about them. I sought advice on Biggerpockets, only to get berated and spoken condescendingly by other investors. It's as if I was supposed to have a crystal ball and why didn't I do this or that. Were they successful on their FIRST INVESTMENT? Crickets. It was more like "look at me, everything I touch turns to gold". Yeah right. Now, I'm focused on fixing and flipping. An endeavor I look forward to, as I refuse to get discouraged in my real estate journey.

Thank you for sharing this experience. The silver lining here is that you've learned some valuable lessons. Location may be one of the most important aspects of an investment, but due diligence on a PM company (as well as managing the manager) is pretty important too. I've been through my share of bad PMs in the past and each one has cost me tens of thousands in their own way.

2 Votes

Hartford, Connecticut

Quote from @Robert Ellis:

Most real estate investors fight over the same overpriced, outdated properties—when they could be building for less and making more.

I’ve been in development for years, and I can tell you firsthand: new construction is one of the most overlooked ways to generate six-figure profits.

Here’s why:
Build for WAY less than market value
Skip bidding wars and competition
Rent or sell brand-new properties at top dollar

Yet, most investors avoid new builds because they think it’s too expensive, complicated, or risky. But is that really true?

I want to hear from you: Have you considered building instead of buying? What’s stopping you? Let’s break it down—drop your thoughts below! 👇

I have, but I wouldn’t know where to begin. Any guidance as to how to get smart enough to do it safely? What’s a reasonable time to ramp up before someone would be comfortable taking on a project?

0 Votes

Columbus, Ohio

Quote from @Kyle Lipko:

Hey everyone – just wanted to put this out there and see if anyone else has been through the same thing. Lately, I’ve been deep in research mode... digging into markets, running numbers, listening to podcasts, reading books – basically doing everything except actually making a move.

I feel like I’ve hit that classic wall of analysis paralysis. I want to take action, but I keep second-guessing myself, waiting for the “perfect” deal or trying to learn just a little more before pulling the trigger.

If you’ve been here before, what helped you finally take that first step? How did you push past the fear and just start?

Appreciate any advice – or even just hearing that I’m not alone in this.

I think it helps to have a goal that you can quantify, then work backwards to define what returns you actually need over what period of time given your resources. For example, "I want to be able to pay my mortgage with passive income within two years". And if your mortgage is $1500/month, that means you need to add $750/month of passive income per year.

If you can afford two buy two rental properties per year, now you know that the average cashflow that you can accept is $375/month. At that point perfect doesn't matter any more. If you evaluate a property and it cash flows $375 or more per month, you buy it.

That's a very basic idea but I'm sure you get the idea. Also don't lose sight of the fact that the goal is to make money, not own doors. If nothing pencils, invest elsewhere.

1 Vote

Jacksonville, Florida

Quote from @Amir Twig:

Let’s say you’re starting from scratch—no network, no prior deals, just $10K to work with. How would you use it to break into real estate? Would you wholesale, partner up, buy a small rental, or go all in on marketing?

Curious to hear what strategies you’d use in today’s market! Drop your thoughts below

Based on my own experience, 10k isn't enough to market effectively. You're more likely to run out of cash before you establish enough deal flow for it to be sustainable.

I also don't think it's enough to run any sort of acquisition or rehab even with seller financing. In this scenario you're starting from zero: no partners, network or experience. What are the odds you are actually able to identify a deal that you can take down with your limited resources and turn it into a profit? It's a recipe for failure.

I don't like any answer that involves trading time for money such as pulling lists and cold calling. That's not an investment, that's a job. Semantics maybe but whatever, you could just as easily work more hours at your regular W-2 job (whatever that is) and save more money until it's enough to do something more substantial.

Ultimately, I'd either toss it in a REIT or co-invest with others. Something that has a good chance of preserving capital while providing decent returns.

2 Votes

Miami, Florida

Quote from @Jimmy S.:

Hi,

I have a 3bed 1bath single family house which is rented at $1,400 a month. Current comps in the area are around $2,000- $2500 month and should be able to easily get that.

My current tenants have been there almost 10 years now and always pay on time. They are usually several days or even 1 week early paying the rent. They are great tenants and rarely ever have a maintenance call and small stuff they just take care of on there own and don't charge me or even let me know. I already went a couple years without even talking to them.

I have been slowly rising the rent like $50 a month every year but its still way under market value by at least $500 - $1000 a month.

It is a old house and does have its flaws which is expected in a 100+ year old home.

What would you do or how much should I raise it at renewal? Its a yearly auto renew lease.

Thanks

They know they're renting at a discount and larger increases won't drive them away because the alternative is them paying market rent elsewhere after the expenses of moving. Move them up as much as possible each year until you're back to market rent without driving them away by jumping too much at once. That last part is subjective and there's no perfect answer but if you're truly under market by 500 to 1000/month maybe try $250/yr so that you're back on track in two years.

It's easy enough to explain the need to increase as well: everything on the planet is more expensive right now. That includes property taxes, insurance, the cost of maintenance and labor etc. By not increasing rent enough each year you're losing money (this is the truth).

If they push back hard or say they're leaving, you can always negotiate and back it off a little. I'd rather have a known good long-term tenant renting at a discount (but not a $500-1k discount) than fill a vacancy with an unknown entity.

3 Votes

Here's the question, and it's really a 2-part question. I would very much appreciate opinions/advice from others who have put thought into these things and maybe even implemented some of the plan.

1) What financial help, if any, do I provide to my children as they become adults and throughout their adult life? I struggle with this one. I have spent literal decades working jobs that I often hated because they paid well in order to provide a nice life for my family. I don't want my kids to have to do the same, but I also want them to be self-sufficient and accountable. I have seen first-hand in the form of an unexpected inheritance how a windfall at a young age can lead to long-term negative consequences. It seems like a fine line.

2) The long-term goal, among other things, is to create generational wealth. That means the next generation is going to inherit it and hopefully many more after that... that seems silly to say because of course it's true but it's largely an abstract concept until you actually put a plan in place. How do you prepare them to receive and manage that wealth so that they don't squander it and/or have it cause more harm than good?

0 Votes

All Forum Posts by: Jon K.

Jon K. has started 53 posts and replied 540 times.

Post: What would you pay to have somebody check on the house from time to time?

Post: Is networking overrated?

Post: How to Achieve Financial Freedom with Rental Properties

Post: How to Achieve Financial Freedom with Rental Properties

Post: Avoid Revolution Properties LLC at all costs

Post: Why Aren’t More Investors Building Instead of Buying?

Post: Feeling Stuck in Analysis Paralysis

Post: If You Had to Start Over with $10K, How Would You Invest in Real Estate?

Post: Should I raise the rent on a good tenant well below market ?

Post: How do you prepare your heirs to inherit generational wealth?