All Forum Posts by: Anthony Vicino

Sounds like you've been through the ringer on this one from the beginning. Gotta admire the persistence!

A couple others have echoed the sentiment, but it's worth repeating, I think you'll find yourself disappointed with what the property can actually fetch for rents. A 3/1 in a C neighborhood (where contractors are afraid to go do work, no less) is probably not going to fetch $1,600-1,700/month. As somebody else pointed out, $1,200-1,300 is probably more realistic.

With those new numbers, does this thing still cash-flow? Probably not.

Tread very carefully, my friend. Just by asking this question in a public forum you're butting up awfully close to discrimination pursuant to The Fair Housing Act.

FHA prohibits discrimination in housing based on race, color, national origin, religion, sex, familiail status, and disability.

There are some exemptions, but you'll want to be certain you're on the right side of those if you're going to use them.

Now, with that said, you aren't required to bend over backwards and make obscene concessions just to make the property usable. I believe the phrasing is: "reasonable accomodations". That is, say they need a wheelchair, you can accomodate them by allowing them to install their own ramp, but you aren't necessarily required to build it yourself.

Might be wise to brush up on the Fair Housing Act and chat with a lawyer to understand the nuances in your particular area.

If I was in your shoes, I'd ask: "Are there any legitimate reasons I might not want to rent to this person (credit, evictions, felony, etc...)" If so, then there's your out. If not, then heck, they'll probably be a great tenant.

Rentometer is alright if you're looking at the outer ends of the spectrum, but they aren't terribly accurate in judging the median.

A solid option is to call up property management companies operating in an area and pick their brains.

When we're determining median rent for apartments, we'll often call up similar properties in the surrounding area to schedule tours and determine baseline.

If you know somebody with access to Costar, that can be a good source as well. If you're working with a commercial broker, they might have that information available. Not so helpful if you're looking for single families.

This is an easily overlooked gem of advice, right here.

Modeling the actions of those who've been where you seek to go is a great recipe for success. Actually finding somebody who is where you want to be, and then bringing that person massive value and putting yourself within their sphere of influence is beyond powerful.

Warren Buffet relays the story of when he first met his mentor, Benjamin Graham, and told him he would work for Graham for free.

Graham, rightly understanding the value of the education he would be bestowing on Buffet said, "Even at free you're overpriced."

I mention this, because most people looking for mentors don't really understand the value-exchange dynamic occuring, and they fail to bring true, recognizable value to the table.

If you can figure that out, you're well on your way.

Now, as far as a technical answer to the question at hand, Value-Add Apartment Syndications.

A lot of the value you can charge for will be dictated by your local market.

For us, with Class B and C assets, we see the most bang for our buck with flooring, appliances, cabinets/countertops, fixtures, and paint. The areas in particular to pay attention to are kitchens and bathrooms.

Avoid the renovations that are invisible to the tenant or that make the unit "too" nice (no need for granite countertops if none of the nearby competitors have the same).

A great way to determine market baseline is to go visit comparable properties renting at market rate to see what the generally accepted standard is in your area.

Clearly the owner knew you wouldn't be able to get financing.

Sorry, but you're throwing hail maries. This is a "dream" home that, even if you could somehow magically afford it, will inevitably turn into a nightmare. Guaranteeed.

If you really want this house, the only realistic route to success is:

1) Move someplace cheaper

2) Save

3) Increase your income

4) Buy the house at full market value when you can actually afford it

Short of that, I suppose you could always win the lottery or just put it on a credit card.

That's a big steaming pile of nope, nope, nope.

If this were a review on a public site, then certainly a reply is warranted. Seeing as how this is her personal Facebook page, well, two things:

1) What's your desired outcome? You're certainly not going to change any of her "friends and family's" opinions in a Facebook post, so why bother?

2) You lend more creedence to her claim that you're a creep because "now look, he's stalking my Facebook and blah blah blah."

Don't throw wood on that fire. Just let it burn. People like this tend to start a new dumpster fire every week. This shall pass.

Erik is spot on. The key takeaways are:

1) Locking in losses right now is a question your partner will have to weigh for himself right now. Will stocks return in 6 months to where they were before all this went down? Who can really say? That's between you and your oracle. Though, like Erik pointed out, this doesn't really sound like the argument the financial advisor is making.

2) It's not your job to convince the Financial Advisor. In fact, it's nobody's job to convince the Financial Advisor. It's your partners money. He's the person that needs to be convinced.

3) Don't trust anybody who makes broad sweeping generalizations such as "never invest in real estate". And yes, "don't trust anybody who..." is a broad sweeping generalization, so I guess maybe take this advice for what it's worth. ;)

 1) If the right opportunity comes across the plate, we'll swing. The big question mark at the moment is bank lending. I've heard from other operators with deals in the pipeline that the banks have come back in the 11th hour recently asking for more reserves or more down payment. These sorts of last minute shenanigans can really sink a deal.

3) 50-150 unit apartments in Minneapolis.

4) Sure is!

"Pessimists see difficulties in every opportunity. Optimists see opportunity in every difficulty." - Churchill

We tend to find that which we seek.

Seek fear, find fear. Seek opportunity, find opportunity.

It might be trite, but the choice is yours.