All Forum Posts by: Tom A.

Just a reminder, the Metro Detroit Real Estate Investors Meetup is tomorrow, Thursday. See y'all there.

I have a keyword alert set to "Detroit" and half the time it pings it's because someone 2000 miles away needed to share their blanket assessment of investment in the city and region based on a personal anecdote or something they read once.

It'd be great if those kinds of comments spelled it "Detriot".  It wouldn't trigger my keyword alert and it would probably get a grin out of the anti-Detroit poster. Win-win.

Unless someone is on the ground in Detroit it's hard to know the good deals from the bad. The housing stock can still look good even in a bad neighborhood, until vacancy goes up, the houses get scrapped and burnt, and then it's obvious it's a bad area. A lot of investors have lost money in Detroit. It's not for the new investor, the casual investor, the ignorant investor or the idealist investor.

There are some great neighborhoods in Detroit for investment as well as ones I'd live in myself. Certain areas of Detroit are really hot right now. Some people have made a lot of money recently due to appreciation, and the cash flow can be good if you invest correctly.

That said, I really don't care to have many out-of-state or out-of-country investors buying property in Detroit. They do a number of things which hurt the city and the people who live here. 

One, blinded by ROI promises, they buy crappy houses in crappy neighborhoods from shady turnkey companies. The investment doesn't perform, the far away investor cuts their losses and abandons the house, the neighborhood which was struggling to begin with is blighted by another abandoned house.

Two, buying on ROI, even if they have a decent house in a decent neighborhood, either they or their property management company cut corners and don't maintain the house properly and it starts to look "rental-ish" in a neighborhood with lots of owner-occupants.

Three, they or their property management company fails to adequately screen tenants, resulting in a trashed property that the investor may not reinvest in to fix up to neighborhood standards, becoming a blot on the neighborhood.

Four, the property management company may blatantly rip off the investor, pocketing the rent, the repair funds, and renting out the now crappy house to any derelict who can pay a few hundred dollars a month.

Astute local investors don't usually make these mistakes.  They tend to keep a closer eye on their investments and have a stake in the future of the area since they invest there, live nearby and know what's happening in the city.  They aren't going to let things slid into disrepair and react by reallocating their investment capital to a city 1000 miles away.

So rather than dispute the comments like the ones by @Curt Davis or own local Debbie-downer when it comes to Detroit (Scott K, where are you?), I'll partially agree with their take on it and hope the investment activity tilts more toward locals and away from the block of long-distance investors who really aren't a net positive for the city I love.

Another factor is the incoming water temp. While it's probably not an issue in Florida, up north it can vary by 10 - 20 degrees F from summer to winter.  Since showers are usually a blend of hot and cold water, if the cold water is colder than usual, the ratio of hot water to cold water will be higher in the winter, so the hot water gets used up sooner.

Colleen, you mentioned the bill ($) is up, but I'd want to dig into the actual consumption of electricity as measured by kilowatt-hours, this year versus last.  Then I'd want to compare heating degree-days, this year versus last. These two factors, along with the tenants' thermostat setting probably account for most of the variance.

The other thing to look at from a weatherization perspective, beyond insulation, doors and windows, is looking for air leaks from penetrations of the top plates by wiring and plumbing, outlets, soffits, plumbing and chimney chases, etc.  In the typical house air leaks are a bigger bang-for-the-buck improvement area than adding insulation and doors/windows. Look for articles on "air leak weatherization" and "stack effect".

Someone asked about the local meetup in an earlier post.  There are investors from all over the metro area, flippers, landlords, wholesalers, etc. It's Thursday, 2/12 this month, see the post in the Meetup section http://www.biggerpockets.com/forums/521/topics/173658-metro-detroit-real-estate-investors-meetup-scheduled-for-february for more details and a link to the FB page.

Ronnie, In addition to RDI which meets in Corktown (Detroit), the Oakland (County) REIA meets in Madison Heights,

http://www.reiaofoakland.com/

Wendy Patton's REIA meets in Troy,

http://www.michiganrealestateinvestors.com/

I co-host a free monthly meetup with @Aaron Yates that rotates around the Metro Detroit area, the next one is at Champps in Troy on Tuesday, January 13th 2015 starting at 6:30. Feel free to stop by. More info at 

https://www.facebook.com/events/656815207761309/ and the group page is

https://www.facebook.com/groups/MetroDetroitRealEstateInvestorsGroup/

You should definitely check out some of the local REIAs, they're well attended by local investors.

They are held every month, on a varying schedule.  We alternate locations and dates but they're usually mid-month and centrally located.

If you want to be notified of future meetups you can join the Facebook group at

https://www.facebook.com/groups/MetroDetroitRealEstateInvestorsGroup/ and/or send me your email and I'll put you on our group email list. 

The January edition of the Metro Detroit investors meetup will be at Champp's on Big Beaver just East of i-75 on Tuesday the 13th, starting at 6:30 p.m. This is a free meeting, hosted by @Aaron Yates  and myself, with the aim of helping local investors meet each other, learn, help and further their real estate investing business.

We've been averaging 25- 30 people since starting in late 2013, from total newbies to investors with decades of experience and many deals under their belt. There's no charge except for any food/beverages you order and we're a friendly, helpful bunch so there's no reason for beginners not to come out.

There also are always a good number of experienced, active investors who are doing business in metro Detroit right now, buying and selling properties, doing flips, landlording, funding deals, building new houses, wholesaling, lease-optioning and executing other strategies. There are usually several investing "team" members in attendance as well -- title company reps, mortgage pros and investor insurance experts.

We draw investors from Wayne, Oakland, Macomb, Washtenaw, Genessee, Lapeer and Livingston counties. 

There are wholesalers with properties in Detroit, Warren, Ferndale, Royal Oak, Sterling Heights, Downriver, St. Clair Shores, and more.  

There are landlords with properties in Eastpointe, Harper Woods, Warren, Hazel Park, Madison Heights, Farmington Hills, Oak Park, Redford, Southfield, Pontiac, Commerce and White Lake.  

There are flippers who are active in Livonia, Troy, Ferndale, West Bloomfield, Shelby Twp, Canton and Novi.

There are private lenders who lend all over Southeast Michigan, and investor/agents, title people and insurance agents who are investor-oriented.

I hope to meet you there, or see you again if you've already attended. Let me know if you have any questions.

More info at the Facebook event page, and you can RSVP there although it's not necessary.

https://www.facebook.com/events/656815207761309/

@Bruce Scannell, I have a home inspector I've used on multiple properties in metro Detroit.  Other local investors and agents use him as well.  He's done over 6000 inspections.  Bonus -- he's also an investor so he has an investor mindset. 

I don't want to post his contact info online due to spam issues but if you're still looking for an inspector, send me a message and I'll give you his info.