All Forum Posts by: Michael Lewis Lee

Hello Ryan!  I wound tend to go with whatever the demand says.  I might install high tech plug ins like phone and computer charging and a network that is readily available in the hottest places like the bedroom, the den, and maybe the dining area.  Definitely cable TV wiring.  It depends on several marketing issues and what your goals are, like occupancy and what any competition is offering and where do you stand on the amount you are seeking and how close it is to your positive cash flow.  Just realize that most of what you do in regards to technology will probably be outdated in 5 years.  You might be better off on lowering the rent or sales price.  You might be able to have short term rentals but that comes with a number of things to be considered even though that may make you more money.  The closeness to your residence could matter.  Good luck to you!

Hello Michele!  I'm 62 and have been in the construction management business and a Texas real estate broker for about 30 years.  even though I don't know everything but I think your leaving out the taxes due on a withdrawal on your 401K versus a loan (which is typically zero).  I'd rater be in financing debt than 401K debt.  One is a debt and the other is a liability.  Your Tenants are paying your financing debt but may not be paying your 401K debt.  If they are  paying for that too, then it is probably a good deal.  How much are you paying on the property loan?  You might need to shop around to get a better deal on the property financing.  You might be including the down payment but at least it is giving you automatic entity with it.  I would rather have entity over a liability.  Good luck to you!

Hello LaQuandra!  You should negotiate face-to-face with the seller.  Have your acceptable price range in your mind.  Regardless of their starting price, ask for the low end of your range, then shut up until they respond.  explain why your price is so low and tell them that you are an investor and that is what you need to make any money.  Remember that you can negotiate until you go to the closing.  If they say no, offer a little higher price than you gave the time before but can still make a profit.  Again, be quiet after your next offer to give them time to think.  If they say no or make an excuse to hold off to give you an answer and tell you why.  More than being direct to you, it may just be a way to say no.  You might at this time ask what they would take to make them happy or just hope they call back to say yes.  Always be prepared to hear no.  You might start off at .65 reduced by any rehab costs below the original asking price and just go up about 5% each time with your new price as long as you can still profit.  Good luck to you!

Hello Moe! Like you, most people do not know the difference and every state treats it differently.  If I were you, I would hire a tax consultant with experience in this area and does it daily.  He or she can explain to you about those two entities and advise you which way to go based on your goals.  Since there are so many laws to adhere to they would give you the best result to follow and use for that purchase and/or your lender might have a preference or the way to go and make them happy.  You may have to close in your personal name then transfer into your best entity.  Do not leave it as a personal liability.  Take advice from a professional, with experience in that area.  Good luck to you!

Hello Phil!  It really depends on what your lender wants regarding experience and how good the deal is.  Most of my early lenders really did not care about my 30 years of experience in construction and being a licensed broker in Texas for about 30 years, they were mainly looking for a good deal and you needed possession of it and they would lend you 80% of the value and wanted you to have some sweat equity in the deal.  That was from Banks, Private and Hard Money lenders.  Nothing is easy.  Get as much education as you can and network with everybody.  Go to local Real Estate clubs and educational events in your area.  Education needs to go on forever.  I've read about 170 books in the past 5.5 years but there is so much to learn but at least it is pretty easy.  Beware of what you see on the Internet.  make sure your instructor knows with experience in what they are teaching.  The Internet does not have any police enforcement and there are many crooks on there who get away with murder.  The more units at each address is better.  Vacancy of each unit does not hurt so much.  If you don't know who will help you financially that may be first that you will need.  Sending out targeted direct mail and advertising may be the way to go first.  Be aware of what the laws are and do that accordingly.  Know the demand in your area.  Do not count on the future.  Analyze everything.  Make as many offers as you can.  All properties have a number that works for you to have positive cash flow after the debt is paid.  Good luck to you!

Hello David!  Just do a transfer and do not take any liability under your personal ownership.  You can go back and forth based on what your lender needs.  Most Banks require some sweat equity and others don't.  Good luck to you!

Hello Timothy!  Is that the net cash flow after debt payment?  What is the demand for rentals in that area?  Do not count on the future unless you are convinced.  The rental revenue will be between 6 and 7 percent after the closing costs.  Does that fit your goal?  That is on the existing rentals, not the new construction.  That could be lower, higher, or the same as the existing cost. Do not count on anything that does not exist at this time.  Good luck to you!

Hello Elliot!  I was in construction for about 30 years as a construction manager around Dallas Texas.  You can spend $40 to $100 per square foot depending on your finish quality.  You did not mention what area your in but I would concentrate what is in demand in that area.  A general contractor in that area should know because pricing can be different in different parts of the country and the finish quality you want and depending if your goal is to rent or sell.  Just do what is average in that area and in demand and not what you think.  Use a G.C. or subs that are close and familiar with that area and the Building Inspector (how strict they are).  Good luck to you!

Hello Farhan!  Just about anyone could be a CPA.  Just make sure they have done it for a while, know your business, and can be a consultant and a tax preparer.  Getting a referral can be the best way.  Since I live in Dallas Texas I know nothing about your city.  Good luck to you!

Hello Corine!  Just make sure whoever it is that they have done it before and/or currently.  Also, be accountable by a third party.