All Forum Posts by: Neal Collins

You’re going to offer a financed cash deal at $240,000, and a seller financed deal at $300,00 where they could somehow call the Note and redeem $270,000 within a year? Is that right? First off, this is the problem with analyzing the deal from your own personal lens. You are trying to win the deal based on your own self maximizing interest without regard to what the sellers actually need and the tools to fit the scenario. Second, if you really want to make a seller financed offer, why offer an optional ballon at $270,000? If I were them and I was presented with those two offers I would first need to determine my capital gains liability, and if it was low enough I’d choose the seller financed route and then give you notice a day after closing that I want you to cash me out. My suggestion: simplify. Make an offer at whatever price works for the deal. Maybe shave off a bit to leave room for negotiations. Match the right kind of financing with the right kind of asset.

Glenn Gayet You’d he surprised at how small of outfits investment firms or developer shops actually are. They really don’t need or want a ton of overhead to eat at the margins. If you want to learn acquisitions then try out a brokerage. Developers use broker relationships to get deals. You’ll learn the ins and outs of marketing, relationship building, and how markets operate. Agents like to work on listings because it’s more product use of their time versus the reward than representing buyers. Working for an investor will certainly have its merits as well. You would hopefully be able to see the life cycle of projects and how internal underwriting and project management works. Most of these firms source deals from other sources. There is no wrong way to go. Just identify what you want and go after it.

Welcome @Brendon Lindsey. I've heard of a couple other people that have set their sights on the Yakima area. What motivated your decision to target that town?

Shiloh Lundahl Buildium would be my preferred way to go with a small portfolio when you aren’t leaning back on quickbooks. Having one system for rent collection and another system to track expenses is too antiquated and cumbersome. Just making a simple income statement takes an extra step having to marry income and expenses.

Brad Hammond ad You’ll be able to rent this place at that price. Potential tenants look at two things and in this order: 1. Price, and 2. Photos. They won’t see the photos if the price isn’t in line with what they are looking for. I recommend setting your rental up for long term success by investing in quality photos of the unit. For $100-150 you can get professional photos that make the unit look fantastic. You’ll want to make sure you replace all those daylight light bulbs with soft white (nothing says tacky more than office lighting in a home), open the blinds, and have all the lights turned on when photographing. Think about the sequencing of the photos as well. Does a picture of a bland looking 1970s multifamily create immediate demand if that is the first thing they see? Having good marketing on file also helps reduce vacancy in the future when your tenant’s stuff is in there and you need to market the place before they move out. You won’t have to worry about the photos, or using the crappy iPhone photos from previously.

Kayla Truong The tenant responsible for the damage. If she claims domestic violence then you won’t have grounds to evict. You can give her notice to prohibit the boyfriend from visiting the property again. She really should drop him and get a restraining order though.

Kids take over property after dad dies. They then sell it for top dollar and subsequently claim ignorance when the new owner needs to increase rent in order to make a return on investment. You replace anyone in Portland in the kids shoes and they would gladly take the money and run. The buyer sounds like they came in with a great strategy by offering more than the relo fees. WW and Mercury always on a crusade to crucify.

Toby Russell Beware of what you are about to get into. Managing a couple properties is fundamentally different than managing a portfolio, much less starting a management company. I would imagine that it’d be challenging for the realty company to pay you a salary and a percentage of the revenue to start. The margins are so thin that they would have to subsidize the salary for a good while. Can it be a profitable business model? Sure. Are the margins good? Not until you hit massive scale, and the probability of that is slim. For every company that makes it past 1,000 units there are dozens more that failed or could never figure out the pieces to grow.

A friend and colleague of ours was approached by a similar company several years ago with a house and ADU that they wanted to rent. He did his due diligence to make sure the company was legit and then decided to move forward. Since then he has leased several more properties to the company and has nothing but positive things to say about the experience. He gets above market rent and zero vacancy. Let me know if you’d like me to put you in touch with him.

Check out Edge Development. Good fee developer in town.