All Forum Posts by: Vikram C.

Lily, not all experienced investors disagree with what you did. I, for one, think you made the right call in deciding to increase the payment amount in order to not burn bridges. Here are my views:

1. If you feel the group or the referrer may bring you additional business, it is important for you to maintain good relations with them. Remember that 76% of something is more than 100% of nothing.

2. I also disagree with the other posters who have suggested various values for the other person's service. The value of that referral to you is simply whatever value it is worth to you. If it is worth it to you to spend 24% in "marketing" costs, then by all means pay it. I often pay well above market rates for certain types of services that are extremely important to me and hard to obtain.

3. I agree with the others that it is entirely inappropriate and unprofessional for someone to come back later into the deal and try to change its terms. You will have to make a business decision on whether you would rather keep the other person happy, or possibly piss him off (even though he is the one in the wrong) by refusing his request for a higher compensation. It appears as if you have made that decision. I do not think anybody on this site can decide how much that relationship is worth, so please do not get influenced by the posts that suggest that you may have made a mistake. However, you do need to make it clear to the referrer that this is a one-time accommodation that you are making because of his inexperience, and in the future a deal would be a deal and he cannot expect it to be retroactively changed.

4. The other posters are correct that there are regulations that restrict payment of referral fees by agents to non-agents. However, most regulations have ways around them are are an impediment primarily for the unwary. Having said that, I think you need to be very careful and make sure that you pay the other person in such a way that it is demonstrably legal. Otherwise, you could expose yourself to risk and perhaps even future blackmail.

Be confident in your business judgment and do not feel that the weight of opinion on an online discussion forum determines whether your actions are right or wrong. Anybody can post on a forum and none of us understand the nuances of your business circumstance the way you do.

I meant, whether it is a good deal as an investment. Not based on the quality of the upgrades or how much you like it. If the cash flow and / or appreciation do not justify the price you can sell it for, then you should sell it.

Would you consider it a good deal to buy the house at its current market value? If not, sell it.

I think Economics is a very good major. It gives you an analytical framework that will be useful to you as a businessman, investor, and even voter.

My undergraduate major was accounting, which is also somewhat useful.

And where is Rich Weese? He used to be pretty active here last year.

Singapore yields are around 2% and Bombay is often less than that. These are for nice condos (called "apartments" in those places.)

Single family homes are very rare to non-existent.

Incredibly, some of these cities are also expensive from the landlord's perspective. Property values are so high that the rent yield is low despite the seemingly high rents.

Zillow's zestimates are mostly useless. But you can try using the "recently sold" and "comps" links on the site. It may be better to put some effort into getting mls access, though.

There are some title companies that have comping tools, as well, and their data includes both mls and non-mls sales, which is good. They will let you use their service without charge in return for your title business.

I agree. It's one of my favorite places to eat at while traveling. I particularly like the fire sauce but found out recently that kids in the Boondocks use it to draw pictures on tables, so Taco Bell has restricted the supply of that sauce to a few packets per item purchased, which usually is not enough for me.

Regarding the OP's question, I am yet to find an agent whose comps are good enough for me to depend upon, so you will need to figure out a way to get access to the mls if you want to be on top of the game. In many states, it only takes a couple of weeks of classes and a few hundred dollars to become a licensed agent, so I would suggest that all investors consider that option.

Joel, this discussion is about what investors are doing, not what brokers would like. We all understand that the ideal listing contract for a broker is an exclusive one that never expires and the client pays for all costs.

The compensation paid to the listing agent is a big part of the costs of a real investor's business. So is the risk of being stuck with a lousy agent when you are starting out. I think investors should negotiate their listing agreement terms such that they do not get locked in for too long, and they should also negotiate the agent commission such that it offers the agent a fair compensation given the investors' volumes. Higher volume investors, naturally, will be able to negotiate these terms better.