All Forum Posts by: Ann North

I'm so at the bottom of my rope here with our rental property! I know there are some great and wonderful agents, I've met them, it's just in this particular area of Southern California I have had the hardest time. I am starting to think some of the Zillow reviews might be fake, I don't know, maybe not but I have had terrible luck finding ethical and even just normal agents. If I reach out to them, I start getting hounded. One agent started video taping 'imaginary' or pitch like conversations with me and sending me the videos! Isn't this a bit overkill dude? Others start texting me constantly and emailing me constantly. But my biggest gripe?

They cannot comp!!!

All they do is pull recent solds in like a 3 mile radius!!! This is not comping!!! I'm at my wits end.

Our property, first of all is NEW CONSTRUCTION. It was newly built at the end of 2015-2016. It is a HUGE townhouse - about 2600 square feet. It is LEGIT 5 BEDROOMS 4 FULL baths and ALL upgraded in a gated community with a pool. In addition, it has a main level in-law suite/2nd master/home office room.

Our area has appreciated quite a bit but these (insert expletive) agents keep coming me lower than what we paid! This is because one person in a house that isn't even like ours on a busy road fire sold their house. The one next door to us last year sold for a decent amount and it was smaller and not as nice as ours... for some reason this house doesn't come up on comps???

The area in SoCal is very master planned. The agents are used to knowing every floorplan and it all being the same but we are in a gated community where all the houses are $900,000-$1,000,000. We are a townhouse. 

Also, this is now a rental/investment property. None of the agents seem to even understand that. We are near a pricey private college, a community college, and an amusement park -- all making for great rental. We had great tenants for 3 years.

So I had a couple agents who knew the area comp it right and I should've gone with them. Instead, I didn't and one agent convinced me to put it on MLS really low to "get a bidding war." Well turns out they were flipping it to someone they knew! Of course they had multiple offers because they had priced it about $80,000 below market. (I found out they didn't tell us about all the offers but that's another story.) This caused us damage and now Zillow dropped our value about $100k. The Zestimate was good and then overnight, it got the bogus list price and dropped. Zillow doesn't show the multiple offers we had. This is a lesson to anyone trying to manage a property from another state -- beware.

I am going to make a deal with an acquaintance who's reached out and is interested. But how do I fix the Zestimate? How do I fix these moronic comps that aren't comparable? (and yes I know because I spoke to an independent appraiser.)

We moved a two years ago from California to the Western suburbs of the Twin Cities, Minnesota. We love it! I'm wondering if anyone else has made the move. I'm an Adjunct Professor but I would like to supplement my income with RE investing. I'm willing to work for someone or am also thinking about renewing my RE license. I sold for my family's new home building business that built custom homes awhile ago. I do not like realtors in general (some are great) and am a very strong negotiator and very ethical but I love doing many things at once and am entrepreneurial. Am trying to think about next steps! I have a Masters from UCLA and am interested in RE investing, house hacking, BRRR or BURR and especially flipping.

@Account Closed Hello, I sent you a PM! Since we have a gorgeous Turnkey property we are either going to be exiting or renting out up near Cal Arts. (5 bedroom 4 bath with a main level 2nd master full bath or home office) in a gated community with a pool. Anyway, I wanted to touch on your question:

3) Should my first buy be turn-key ready for renters, or should I be looking into fixer-uppers if I have a knack for design?

I think in your case it's much better to get something turn-key because a knack for design doesn't translate to "fixer-upper". I was a licensed RE Agent for my family's new home business - we built custom homes. Our home in California is a newly built townhome (but it's large, almost 2600 square feet). The skillset for fixer-upper is construction manager skillset, rehabbing, knowing what needs to be fixed, scoping and estimating costs -- the cute "design" part of arranging pillows that draw the eye -- comes at the VERY VERY END and doesn't translate to your bottom line. Fixer-Upper means knowing what work *must* be done (to pass code, safety issues etc,) knowing *how* to get it done and estimating costs -- scope of work. That is learnable but it's a very serious learning curve.

Turnkey or close to it (paint touch up) seems to be much better for your situation. Plus, running your own business you probably wouldn't have the time to put into managing a fixer upper. It just doesn't seem to fit in with your lifestyle and goals. Think about what you want - you want to keep cash flowing and grow your income, living in something that is a bit bigger and you're able to rent it out right away seems to be ideal.

One thing to keep in mind with FHA is the PMI/MIP it is a LOT monthly and can make the difference on cash flow vs. neg cash flow.

@Omar Gonzalez there are some great neighborhoods in Minnesota in the Twin Cities area that would be great for BRRR and flipping. I'm looking to work with a qualified investor. There are some up and coming neighborhoods and areas where it's all tear downs.

@Shari Nott mcKinley sorry to hear about your loss. You've done very well on your own! If you have time, I'd love to hear about how you acquired the properties and your analysis of how to know if a property cash flows. (Either here or PM). We currently have a rental we built that we had to rent due to job relocation in SoCal. We are looking for an exit strategy. It's 5 bedroom 4 bath in gated community with pool. It's hard to know what to do! So I understand. I think it's a great question. When you've been successful - what to do with your money? I would be nervous about refinancing too because that is not really getting your money out -- it's taking on more debt.

I think you need to contact someone who specializes in this -- a financial planner or an estate planner. Estate planners are often also Real Estate Attorneys. Especially if you're focused on retirement. if you need the cash for retirement then you should sell. I would not do anything rash and just think about it. Last but not least, it's very, very hard to find a good realtor in California. There are several highly successful people on BP who could help you - who have knowledge.

I do know of some investment groups (not REI Clubs) that offer opportunities to investors like yourself and it's required that you have a certain level of assets. Like you have to be in the $1,000,000 range and then you get opportunities for other investments.

Last but not least, hold onto what is valuable to you -- there are a lot of avenues in real estate where people will happily take your money. Don't do it. You don't need to be sold stuff at an REI Club etc. KEEP YOUR MONEY, YOU EARNED IT!!!

@Joe Villeneuve I may have misunderstood but the OP said he was using "pen and paper" and not apps so I offered what apps can do to the OP. Yes, agree with your points.

@Joe Villeneuve great points! Part of #2 is learning the ins and outs of all of it. For example, coming from a family home building business of custom homes - I know there's more to rehab than meets the eye! You can analyze BRRR props all day long but for some (if not all) cash flow is important! You want positive cash flow. "How Money Works" I'd say money flowing is good, money falling down a pit is bad :P !!!

Also, I'm not sure where you're learning "apps are bad" or maybe I misunderstood but there is nothing wrong with utilizing Zillow or Trulia or what have you to get a general idea of 

sales, valuation estimates, schools (can be inaccurate but good starting point), neighborhood (nearby coffee shops, freeways etc.), square footage and number of BR/Bath, year built, sale price history, and photos! This is all found instantaneously with an app!

@Tyler Kress wow, there are some great responses on here! You probably have stopped reading by now, LOL but it is sweet that you are concerned about your family's buy-in. First off, renting in a college town to college students is its own thing, that's totally different than house hacking. It's easy to dismiss naysayers but *sometimes* (not always) they have your best interests at heart.

If it's what you and your wife want to do and the numbers MAKE TOTAL SENSE - do it! Don't worry about buy-in. They can be against it but you have to live your life. One thing -- Remember with FHA the PMI/MIP adds a LOT onto your monthly.

When we took a tenant, very close family members went on and on and not very savvy real estate agents went on and on about tenant headache. 3 years later -- not one problem with our tenants! They were a dream. So you never know.

This is a silly question but coming from the background of a family custom home business in single family residential, is ANY multifamily called 'commercial'? Some people seemed to only use the term Commercial Real Estate when discussing office space, hotels, retail and instead of commercial say "multi-family" I was looking for general clarification if and when multi-family is "commercial" for example - what if a SFR is rented out is it then "commercial"? Thanks!