All Forum Posts by: Balkrishna Agrawal

@Adrian Night

At this point I have not been provided statements for last 4 months, while I have already exited the current PMC.

I am not looking for any more PMCs here, I just want to know from fellow investors how to deal when PMC is completely irresponsive in state of Michigan

Sunbeam Property Management 

NREMG : National Real Estate Management Group

@Drew Sygit there were couple of red flags when we interacted last year 

- Your office scheduled a phone call and no one called on scheduled time, this happened twice. Third time is when we talked and that's when I talked about fees. While management fees is not the only criteria, it is important aspect for my business and bottom line profits.

- Based on the your posts about items to check on for PMC, I did read your reviews as well as got in touch with one of your existing client at the time. Its no different than my current experience. I appreciate your posts helping investors like me to be aware of 'things to look for in PMCs'

Based on my experience, I have learned few things in last one year. I will use this forum as a way to communicate with fellow investors but not to give in to marketing gimmicks.

Hello

I have worked with 3 property management companies in Detroit for my properties in Detroit. None of the management companies have been great but this one is the worst.

Assigned 2 properties with this management company last year, common problems were 

1. Owner statements were consistently delayed by 15-20 days, a Jan 1-31 statement which was due on 15 Feb would show up some time in March

2. Every month one or both properties will have $200-300 maintenance charges, which fall under the threshold of not requiring owner permission. When asked, they'd respond vaguely in couple of weeks. Keep following up and they stop responding

3. Rent roll and monthly statements were not aligned, when asked they'd correct it and update in next statement which would take another couple of months for me to check

With this I was not able to keep my books in order, and realized I am losing almost 30-40% of actual cash flow to unknown items every month. I did setup a zoom call with the manager, and the manager skipped the call. 

After few months, the monthly statements stopped updating on the owner portal. I have been emailing, calling, request for a zoom etc to management since last 4 months and no success. Frustrated with no response I asked another PM to take over the management, which they have been cooperating. 

Recently, the original PM disbursed around 60% of the money I would have expected during these months from the rent. But still no statement. I think they'd frame maintenance bills like the previous months if I was to ever see the statements.

What are my options to deal with this management company? They are on the way out, but most management companies have similar traits in the area.

How much is insurance of these properties?

California has seen huge uptick in home insurance, I'd imagine Santa Cruz has a high fire insurance

@Sara Emmanuelle Dube just wondering how your experience has been with your duplex in monrningside

I am closing on a SFH in the neighborhood soon, looking for some insights

Bay Area is mostly appreciation market and if you go with 20% down and financing you will be in negative cash flow for few years. 

Few areas I am personally aware of with good appreciation 

- Tracy, Lathrop, Manteca, Mountain house : All have good appreciation, Stockton has some high crime areas to watch out for. Class A/B

- Stockton, Fresno : Class B/C areas especially Fresno. Although both can have a decent cash flow 

- Sacramento, Roseville, Folsom : on the radar because of healthcare, tech, govt and insurance offices. Growing population, decent appreciation. Class A/B

Question regarding buying an investment property in CA which was used as a grow house in past

Known things so far 

- Growing was done in one room of the house, seller claims it has been cleaned up completely. I would like to know what all qualifies as completely clean here

- Electrical wiring is normal and no unlicensed modifications 

- Structural inspection is also clean.

Seller is ready to discount the price by ~20% from market plus the cost to repaint the whole house 

What are other questions to ask and things to consider in this scenario?

@Account Closed

This is what I do when I invest out of state. I am not an agent or a realtor or a banker, I am just an investor.

1. First find the location/city where you want to invest. List out your investment goals in terms of timeline and expectations. 

Location/City : how well do you know the city and the areas within? How well do you understand the trends that drive the city real estate? Are you comfortable with a possible downturn?

Investment goals : Do you want to fix, flip and sell? or do you want to buy and hold?

If fix and flip : you need good agent, good contacts(including contractor) and also a property manager. I dont suggest this strategy as a first investment. 

If buy and hold : are you looking good cash flow or good growth? Just because some areas have grown in last 2-4 years they may not continue same way. What is your timeline for returns, do you want sell and reinvest? do you want to sell and exit? etc..

2. Pros/Cons of out of state investing : 

- you learn how to delegate and deal with others doing the job, instead of you doing all the legwork. Important if you plan to scale your investments in future.

- diversification 

- better chances of optimizing your results in terms of risk, cash flow and growth

- Taxes. I am not an expert but if you are a CA resident you may be pay higher property taxes for your investment state and higher income taxes in CA

- while property management works well with scaling, its a big overhead if this is your first investment

3. How to find deals, experts. 

- Look for public rental and for sale listings, find agents who are on buyer and seller side and analyze their profile. Shortlist the ones who are dealing with multiple properties  every month in the area. Reach out and make them sell you their services. 

- Depending on the state, you can access historical sale prices, property taxes and rental history either free or at minimal cost. Do prepare this data for atleast 50-100 properties before making a decision

4. Travel to get the feel 

Once done with 1 and 3,  fly out in the area and spend few days to drive around neighborhood and take notes per home/block/street on what I feel. Check out open houses, foot traffic, etc. Click pictures of the street view and note down. This is where you understand difference between looking at homes on zillow/redfin vs your real experience. 

Meet some of the realtors, agents, property managers, contractors you have shortlisted. 

I find it worth every penny to do this analysis before making an investment. 

You dont need to be real estate agent or contractor or handyman expert, you need to know the right questions to ask each of them and decide who can help you best. 


 

I am in similar boat as Carolyn, starting out in Detroit and looking for recommendations and contacts of realtors, property managers, insurance agents. I did make a trip to Detroit and drove around neighborhoods to realize 'every block is different'.

Its still sounds lucrative wrt ROI, but with concerns of

- Property taxes : probably most complicated of all states

- Home insurance is too high

- Property management is too variable, anywhere from 6-12%. Some are flat $200

I am looking for more info from likes of

@Michael Smythe

@Travis Biziorek

Thanks