All Forum Posts by: Angelo Wong

@J. Martin yes!  Definitely do it again.

Amazing seeing speakers of all different levels, employing all different kinds of strategy.  Definitely gives me a lot of concrete strategies to employ going forward.  Worth every dime.  And next time I'll try my best not to throw PayPal disputes your way...

Hi,

Closing on a deal in Memphis at 38125 and I have some cosmetic work to do.

I have a bid from a contractor and was wondering if the price range is too high?  The following is labor only:

$4.50 per sq ft for flooring.

Painting: $100 per nominal room size of 14' x 16'

Doors: $350 per room

Acid/pressure washing front/left side of home/sidewalk: $650.

Follow up question: if this is too expensive (or too low), what is the appropriate cost for these items in the Memphis area?

Thanks for any replies in advance!

@Amiris Brown kind of agree with the advice to not live there.  Even if you knew (and it wasn't speculation) for a fact that you would get the appreciation, the risk of losing your life is there.  I guess a question to ask is how likely will you actually be dead within 3-5 years in that neighborhood and if that risk is worth it to you.

From a philosophical perspective there are things more important than money, but from a practical perspective, even if you knew the house would appreciate a billion dollars, there's no way you could use that money if you're dead.

But again, I'd weigh actual murder statistics to what your risk tolerance is before making a decision since your view of how dangerous the neighborhood is could be skewed.

Hi,

This is going to be a long post.

Before I ask the vague question "should I buy a property in Las Vegas for the purpose of short term rental?" on BiggerPockets I thought I might ask the owners themselves first.  I did a little experiment by sending this message to hosts on AirBnB:

Hi ___,

My first question is: is there anything I could do to make my copy better?

I've gotten many responses back even though I only sent 30 (30 is apparently the maximum number of messages you can send per day) and here are a few highlights:

"The house is doing very well and rented most of the time. The condo is every weekend for sure. You should know that las vegas limits the Airbnb rentals to no closer than 700 ft and that there is licencing. In my neighborhood for example there are 5 vacation rentals and that's all we can have. Its been a very good investment but it has been an incredible account of work due to volume back to back bookings and the pool is a daily chore in our dirty windy desert. I would do it again for sure."

"Right now there is a threat that Vegas will outlaw short term rentals. There has been a lot of meetings regarding it. The market is ok, as your competing with an abundance of cheap hotels. In most cases it's better to do long term rentals."

So anyway, my initial thought was that Vegas is a global tourism spot and so would be good to have some short-term rentals there.  However, my main worries are legislation and the possibility of high vacancy/low rent needed.  Seems like general opinion is somewhat mixed.

But anyway, has anyone here done short-term rentals in LV?  How has it been for you?

I really like "Millionaire Next Door," "Education of Millionaires," and "The Intelligent Investor." Highly recommend all 3. The second book is more anecdotal but the first and third has a lot of data to back up their arguments. As far as Real Estate goes, probably J Scott's books as those are the only ones I've read. Have a lot of non business and non REI books I like as well but I guess I'll stay on topic.

@Derek Caffe - was wondering if you bring your candidate contractors out one at a time, or if you schedule them all at the same time?

Seems like if you scheduled a bunch of contractors at the same time, you'd get a much better idea of the ballpark figure of what things ought to cost, as the contractors would know and would be competing for market price.  Also for material costs if you go to Home Depot or a similar store, you could probably look at the materials and get some idea of material costs.

Personally in a partnership for around 6 months now, and I'd say it has been pretty successful.  The work is split up so I don't have to do 100% of the work.  We go 50/50 down the middle on everything right now so the math is easy.

I'd say it depends on the person and how grounded they are -- if they freak out with any small problems that is probably a red flag, and even if you have writing in place, a bad partner is a bad partner.  Conversely, someone that's good to partner with probably you wouldn't necessarily have the need for having everything in writing (but obviously still get one just to be safe).

PS: @Kris Haskins I'd love to see a copy of the JV document as well. Thanks!

Hi,

I'm currently looking for my 2nd deal in the Memphis area (first deal in Cordova); was wondering if there were any good recommendations for buyer's agents in either Memphis, Bartlett, or Cordova area?

Also: I've been told that the MFH market is not that lucrative in the Memphis area in general versus SFH. Anybody have any thoughts on that?

Thanks in advance,

Angelo

I'd actually like to know more about this point as well.  

There seems to be two main arguments about seller's market/highly-priced markets in general: one is "buy low/sell high" and another is "this trend is going upwards, and so one should follow the trend until there are signals that state otherwise."

My current belief which is subject to change is that the fact that a market is a "seller's market" should not in itself determine whether prices are "too high."  Of course, a market could and would fluctuate between a buyer's and seller's market so you could arguably say that you ought to wait until a buyer's market to buy.  However, there's no guarantee how long that would be (or at least, I don't have enough knowledge to know--if you know, say, with good evidence, that 2 years from now the prices will drop significantly then waiting is prudent).

If there is no real evidence of large, detrimental economic factors going on (war, people moving out of the Bay in masses, an unusual amount of new construction making the supply on houses extraordinarily large for a prolonged amount of time), then there is no reason to assume that the seller's market will swing back to a buyer's market any time soon.

The fact remains that the population in the Bay is growing year after year, tech companies are still expanding (to such a point where they are closing down Gold's Gyms, grrr, but that's another story), and this is still a highly desirable place to live.  Fundamentally, to the extent of my knowledge, the Bay will still thrive and grow for a long time to come.

But the question of: "Is the cost of living in the Bay so high compared to the rest of the country (maybe historically, or just the affordability index) that it is now a very attractive option for a ton of people to start moving elsewhere?  How high would prices have to go for that to happen?"

That's a question I don't know the answer to.  NYC has done pretty well for itself and the Bay certainly has a possibility to end up like that, but one could also argue that the Bay and even SF in general has a lot more to do to make transportation as efficient as over there.

I'm kind of rambling and going off topic, but basically I guess what I'm trying to say is: a seller's market does not guarantee that the price will go down any time soon, nor does it guarantee that price wouldn't crash any time soon.  Fundamentally, there are more important factors to consider, and the fact that a place is a "buyer's" or "seller's" market ought to be a supplement to an investment decision, rather than the overarching point of contention.

But anyway, I'm doing out-of-state investing for right now because I don't really have nearly enough capital to do investments here.

PS GO BEARS!

Hello,

My friend and I are planning to go 50-50 on a property, where ideally we'd like to split costs/profits right down the middle.

Does this in any way complicate the 1031 exchange process, or would it just be 2 separate 1031 exchanges where we trade up more than half the property each?  For example, for a $100k house that we'd sell (after closing), would we both just need to trade up to a house more than $50k each or would it be tied to one property such that we'd need to trade up to a property of more than $100k?

Also wondering in general what other considerations there are when partnering up: exit strategies, have terms written down beforehand, what else?

Thanks for any response!