All Forum Posts by: William Anderson

I appreciate Evolve, they are a source of income for my property management company.  We have taken several of their clients for one main reason?  We are here on site where the rubber meets the road.  

You may be in love with them now but when you scale you will find that when the police are called to check out a guest.  You can't get around having a responsible person put eyes on your property.  

Not withstanding that some communities require a local manager.

I appreciate Evolve, they are a source of income for my property management company.  We have taken several of their clients for one main reason?  We are here on site where the rubber meets the road.  

You may be in love with them now but when you scale you will find that when the police are called to check out a guest.  You can't get around having a responsible person put eyes on your property.  

Not withstanding that some communities require a local manager.

Investors who have been in the market for the last 10 years or more and consider themselves professionals have already started to re-evaluate their goals COC, ROI etc. We are coming out of one of the most stable and one of the best investment markets on record. It was easy to work out numbers when you knew rates would be about the same in a few months when you went to close.

The last two years are an exception, they sent shock waves into the market and many new investors over bought.  There are a few investors trying to sell their properties now in my area at prices which are not realistic.  A $250,000 property generating $1,800 in gross revenue for example.  Even when rates were much lower that price would not fly.  Ultimately sanity is slowly returning, I expect to see the final closing price perhaps near $175,000 or even less. 

Most of you are right, some great buying opportunities are and will be hitting the market. As a broker, I advise my buyers to consider where the prices will be in six months (lower) and offer that price today.  A seller who needs to get out may be concerned that the longer they wait to sell the lower the price will be and they would be correct.  That fear is a tool.  

@Anna Gordon  There are several costs included in the transaction.  Some are negotiable and some are not.  There are three groups.  Lender, Escrow, Prepaids.  The lender costs include some things you can negotiate  The Escrow fees can contain some junk fees that you can work down but there is not much room here.  The pre-paid e.g insurance and taxes are what they are.  On a property of about $200,000 you will pay about $6,000, possibly more, this is a guess.

Check out this article with the closing cost calculator you can use: The best free mortgage closing cost calculator  this blog article lays out the entire closing process and discusses each line item.  This will help you talk with your lender and the escrow company.

Jacob, every market is different as you probably know. I can speak for the Mississippi Gulf Coast area consisting of three counties. A few vacation homes are hitting the market. I did not say STR because the ones that I have seen so far are actual vacation homes or second homes. One or two have rented them for part of the year. I know of a couple of actual STRs on the market.

Regarding properties that are month-to-month or LTR, some are hitting the market but I do not see a trend here.  Rents are higher than last year and still on the rise making STRs something to start looking at.  For a while prices were going up and rents were not making it difficult for the numbers to work.

More homes are on the market but not a flood.  Many but not most homes are being sold at a discount to the list price.  The discounts are modest at this point.  It seems as of the air is being let out of the balloon at a very slow pace.  

My colleagues here believe that we are entering into a "normal" market and I agree.  Some people who bought STRs in a rush during the last two years without sufficient reserves may need to put their properties on the market soon.  Mature STRs are doing ok, mine are paying the bills and generating some income.  

People have slowed down taking vacations and owners of STRs who focus strictly on tourists are having difficulty.  I have had some mid-term renters here for business that has helped some of my properties.

I think the STR business will pick up in the next few months. If you bought the property at a reasonable price, the lower or normal post-COVID margins will work.

Sorry for the long explanation but even as markets are local, each type of market is different e.g. STR, LTR, MTR. There are bargains out there. One of my clients picked up a great property within walking distance of the beach for an excellent price, he will be profitable even at a slow time.

Randy,  contact Steve Henson of Henson CPA’s located in South Pasadena.  He is an investor as well and specializes in working with businesses.  He has been my COA for 25 years.  

He has helped me structure many entities.

(626) 403-4410

Check your agreement with your broker.  That’s one of the items addressed in the agreement.  

I have an interest in a property management company ChristiesGulfBeachRentals.com on the Mississippi Gulf Coast.  They set up vacation rentals for a fee and they are good at it.  I want to pass along a couple of tips that have come up in other threads and for which I have personal experience:

1.  Kitchen tables and chairs - Make sure they are sturdy.  I have purchased from different vendors and most of the screws will become loose.  I recommend that you tighten and then use crazy glue or JB Weld to prevent them from working loose.  Same with table legs.

2. Buy steel bedframes and consider bolting the headboards to the walls separately from attaching them to the bed frame.  We have purchased the nice-looking white wood frames and they come apart.  

3. Consider rounded top tables, corners get bruised and may dent drywall.

4.  If your dining room or kitchen table is in a tight space consider adding chair rails to the walls as the chairs will wear a line in the drywall.

There are many more tips, look around and learn from all of our experiences.

Anna, 

My property manager has set up several of my properties.  She has a great eye for decorations and is handy at making items.  Start with a theme for your area.  Our theme is beach since that is where my properties are.  She goes to Hobby Lobby for many of the smaller items. 

As some have suggested, look at the properties in your area on ABB, and VRBO and get some ideas from them.  You may need to paint if your color scheme requires it.  There is quite a bit to set up a property from start including furnishings.  I recommend you browse through some of the other articles here for ideas on beds etc.

Shanna, 

Not sure what your goals are but you may want to consider the Mississippi Gulf Coast.  There are opportunities for long and short-term rentals here.  I am a partner in Logan-Anderson Gulf Coastal Realtors.  My specialty is investment property, and most of my investor clients are from other areas or states.  I am also an avid investor in both long and short-term properties.

I can work with you if you are interested.  I have a separate business for investor education KEYLADDER.COM.  I have clients who have used Community Bank, and Hancock Whitney Bank, and I work with a mortgage broker with offices in Gulfport and Memphis.  Let me know if I can help.