All Forum Posts by: Paul Shannon

Highly recommend Brian Burke's book "The Hands-Off Investor".  Its covers the gamete on investing as an LP, and could be a blueprint on how to operate successfully and transparently as a GP. 

I'd spread my risk and not put all my eggs in one basket.  

$250K - Index Funds

$250K - LP investments in Multifamily Syndications in high growth markets

$250K - cash to buy real estate locally with leverage 

$250K - Cash and short-term precious metal trades.  Available to buy if (when) the next stock market collapse. 

Has anyone worked with an estate planning attorney locally that you'd recommend?  Thorough, knowledgable, timely, reasonably priced, and a personality you wouldn't mind keeping in touch with for the long haul are all of importance.  Thanks ahead of time. 

@Jason Powell

Find a niche of property type and location.  Get very good and marketing and extracting deals at prices realtors, flippers, rehabbers, can't find on their own.  Build a strong buyers list.  Operate with integrity and honesty.  

Most importantly, don't be greedy.  I have no problem with wholesalers making a nice profit....so long as there's some left over for the guy taking the majority of risk...me!   Most deals I see from wholesalers are taking too much of the profit of the deal through their fee and leaving me with the opportunity to make a small return, only if everything goes perfectly.  Pro forma with rehab budget projections of 10-20% less than actual, sale prices/rental projections of 10% more than you can actually get.  

A more relevant marker would be monthly cash flow.  1 door fully paid off could potentially make more than 5 doors combined with high LTVs.   Do you want work harder to make less money or work less to make more money?  People will tell you anything to make themselves feel secure in the reality they've created, ie how many doors.  Not important. 

If you are going to buy turnkey, you should expect just that.  Low cap ex for at least 10 years.  Make sure you aren't getting a product that resembles lipstick on a pig.  Explain that you are someone who will do your due diligence through inspection, checking to see if permits were pulled, etc, .  As it relates to a specific house, its not hard to make the inside look livable, or even updated.  Focus on your big ticket expenses if you become the owner - roof, HVAC, updated electric/plumbing, foundation.  

This is the midwest.  Don't expect much appreciation unless you are in an up and coming neighborhood.  If you have issues that are underlying that haven't been addressed, it will crush your cash flow.  No cash flow + little appreciation = ??.  

Self management will juice your returns, but more importantly you'll be compensated for you time and frustrations in the form of hands-on education.  If you plan to scale, the experience you gain as a property manager will give you a lot more insight into what it takes to run properties and manage tenants.  You'll be in a position to "manage" your property manager then, as you will have done their job.  

If you haven't had that experience, you won't be able to see all the angles you can bleed money through a poor management company...and there are a lot of those.  

Are we overdue for a correction if you look at past economic expansion periods versus today....yes.  But economies are extremely complex and its anyones guess as to what will happen and when it will happen.  If you're plan is to buy and hold long-term, a deal is a deal, no matter what's going on in the background.  Its okay to be more aggressive or conservative at times, but that should be part of a larger strategy/context that you can stick with through good and bad cycles.    

Read Brian Burke's book "The Hands-off Investor".  Every question will be answered thoroughly. 

It is true. Harder to sell, but its not that hard. You will be selling to another investor in almost all cases. With that being the case, I'd consider starting with a wholesaler. See if you can get traction that way for a few weeks. If not, then list it. You can post it yourself on Zillow for free if you FSBO it, and don't mind answering calls and coordinating showings. Last resort would be listing on MLS through a realtor.