All Forum Posts by: Sandy Sawyer

Hey Adam, we’re about to close on our 3rd home this year! I never thought I’d find myself saying that! Houston is a great place to live and to invest. In all 3 of our opportunities, it fell into our laps from people we already knew that trusted us. As Warren Buffet said, the first rule of investing is, don’t lose money! Be careful that you don’t spend too much on the buy end in this hot market, because if and when the market turns down, you want your investments to feed you, not eat you alive! 

It's important to get some help comparing apples to apples on your offers. Here in Texas, you just do what you gotta do to get the contract, then the negotiations begin after the option period starts. Until you get somebody that will help you wade through all the red tape of closing and paperwork, etc, I suggest you start by looking at the source of funds people are claiming they have along with their offer. We call it proof of funds. Normally it's at least a letter from a lender saying how much they have been prequalified to purchase. Then, you could also ask for proof of the source of their down payment. If they are a veteran, you've got a home run; if a cash buyer, they likely multiple offers elsewhere as well and will try to get a lower price, if FHA, there may be lender required repairs to be made before bank will qualify the property. Hope this helps!

I like to chat up with the neighbors. They all want something done with that property, many will tell you all the juicy details about the owner. Investors are people, and they have all kinds of things going on. You might even score their current address or phone number. Email him if you can get it, ask him if he has plans for the property.

I'm not a tax advisor, but can't you pull out the stock that's been in the market long term in order to avoid the short-term capital gains tax? 

The only reason anybody pulls out any contract is usually when there is a problem. That's why it's really important to think about all the things that could go sideways and set your standards before inviting them to sign it. Set the professional tone by making sure everything is in writing and get them a copy of the signed lease (and addenda, and HOA regulations) right away so they can pull it out if they have any questions. Show concern for THEIR situation, thank them for coming to you right away. Let them know that if it's enough of an emergency you would understand why they think it's worth paying so much in order to move. They probably haven't really thought this through, help them do that.

Hey Jacob, make sure you don't leave out the closing costs! Also, just an idea since it's your dad, you might consider just putting the house in his name. This will leave options for you as a first-time home buyer, no issues with homestead exemption, FHA loans with 3.5% down payments, etc. Just run the numbers the same and even write contract with your dad to the effect that you are splitting the profits. (And make sure he updates his will to transfer the deed on death.)

Hi Eric,  As a Realtor, I must advise you that no neighborhood is categorically safe. That said, you may want to just go Google it. I will drive through there but will not spend the night. I had a friend just stop for gas and got shot.

Hi @Dee Edwards, did you find somewhere that the state will allow you to register the baby series? From what I understand you only register the master series with the state. They consider any individual series under the master to be rolled up into the one entity. 

Disclose, disclose, disclose! Cover your butt! That said, I enjoy gaining and keeping trust with people. It’s a mutually beneficial strategy. I offer to arrange 3 numbers for them.

#1 List price based on comps. Spell out this is top dollar along with the lookers traipsing through their house, (COVID paranoia is in your favor here) and lenders requiring repairs.

#2 What a landlord might offer. Show rental comps and 1% rule. 

#3 What an investor would pay. 70% of after-repair value for fast close for cash. 

Then sit back and let them decide what they want. You win with any choice they make. 

Hi Dominic, I’m also from California originally. I think one reason people pick real estate as investments is because it’s tangible; something you can see, touch, visit. At least that’s why I do it. (I also outperform the stock market, but where’s the fun?) People are moving to Texas from California. And not downtown, the suburbs look and feel a lot more like “home”. OOS investors get the leftovers and, frankly, help keep the markets rising. My suggestion, don’t buy a property away from you until you have an advocate with boots on the ground that you can trust and show you factually the pros & cons. Feel free to reach out if you have questions about Houston. I’m a Houston Realtor.