All Forum Posts by: William Bannister

Welcome Rob to BP, sounds like your an investor to me. I think if you liked it the 1st time around you only get better with experience.
That is how I started I did a lot of the work myself with a little interaction with subs. Then as time moved on I did less as I could afford to have subs and labor do it all. im still rehabbing 20 years later.

Ha Ha Brandon thats hilarious spoken like a true investor. Before I got married I was such a gypsy moving from house to house just to get hud properties. Im surprised they never gave me a hard time about it.
Micheal I am doing a couple things right now rehabbing a sfh its a craftsman bungalow about 2500 sqft if you include basement which will be finished living space. I bought via tax deed auction for 1200 dollars. It needs about 10k fix and repair. It has a 80k arv.
I am also going green with several duplexes I bought a few years back. I just replaced furnace in one+ brand new gas line and insulation and a couple new windows.
1st duplex done 3 more to go. lol
In addition to that Im going to next week or 2 after start working up some empty lots I bought to do an apple, pear orchard. Il have a couple boxes of honey bees to take care of pollination too. this should keep me busy till spring then Im jetting off to Florida for a bit to get a duplex or condo or at least scout around for one while I soak up some sun shine for a week on the beach. My wife likes Orlando so we will probably eventually settle down there and start up another operation between there and Cocoa Beach.

I actually did some arm chair QB ing on this subject matter just reading some on my own and see how numbers on these issues are changing yearly. I called the CPA that handles one of my apt buildings we are going to sit down and talk about it next time I fly down to Texas. Hard to believe how fast life moves along my boy is growing so fast.

Steven, I cant remember the title I read at least 3 books a week on the matter of money and subscribe to 1/2 dozen publications online and am the geek listening to at least a few guys giving there thoughts on managing capital.
This week Im reading Wealth and Poverty,Currency Wars,Lords of finance, Last week it was The Big Short,End the Fed,Mega trends world in 2050. week before Harry Dent and a historical book on wealth thats why I am at a loss for which book I got it out of. I also checked some out at the library that I cant remember the titles.
Some times when I leave the library I will have a backpack with about 20 books for a 2 week time period. I usually wind up speed reading a couple and then pick 3 to read through cover to cover out of the 20 and the rest get a light skim because I fall out of love with them after 50 pages.
Im religious about going there because its my 1# hobby reading.
My wife lucky for me is the same way. Our library is nice it borrows from other libraries and Im not paying much to read all the new release books.
I know there is another book i read over 20 years ago on the manner of building wealth suggested the same thing and it was Napoleon Hill :Think and Grow Rich This book had a great impact on me when I was in my 20's.
Next time I go back to library I will get the book and post it so you can read it if you like. I think I returned that one several weeks ago.

I agree with what was said about getting money. Its the key to really being successful in this business if you conquer that mountain the other mountains are far easier to climb. Having a relationship with 2 or 3 portfolio lenders and at least one outside broker source and a hml and maybe a few private investors will be the easiest way to do it.
It gives you access to the conventional and non conventional capital needed.
If your after income property and trying to build a large portfolio just make sure you dont grow so fast you cant keep up with maintenance on projects you just bought. Fast growth can be dangerous and very expensive. Adequate capital reserves or some large loc that you manage closely until your really able to sock away some money.
I flipped homes on the side just to make up quick cash when I needed it but I was really after apt buildings the type from 4 to 100 units in size.
I dont care if I get an apt building cheap by paying cash or pay full price and just get a 3% fixed loan owner financed. When I buy it the spread must be wide enough I can sustain even what a bad market can throw at me in the form of vacancies or ect. If that means it takes me a year and a half to find the perfect 50 units no problem.
I just see the biggest problems new people have is the 1st thing they see they want to buy and a lot of times you really have to get used to sifting through a lot of garbage deals to find one.
Building that portfolio from scratch and cashflow w-2 to justify ability to handle more debt is the key. buying sfh's 2 3 4 unit apt buildings then doing 8's and 12's as the deals came then I bought a 74 unit.
The 74 unit was because I had the 10% down and the experience and the w-2 to show I wasnt quite doubling your business.
Bankers and underwriters usually arent going to let a guy that owns a 4 unit buy an 8 unit unless he has a lot of cash. He will let a guy that has a 4 unit buy another 4 unit. Banker might let the guy that has 2 4 units buy an 8 unit. You see they dont want your existing purchase to more then double your current portfolio. This is how experience comes into play as well as cash. When I made the offer on that 74 unit I knew I was going to get rid of all my houses if I got the 74 unit. Another thing I did along the way is I constantly refinanced houses and toke them away from one bank and went to another just so it appeared that I had other credit and could move into long term rates. I made these bankers work to get me and give me more. I would say hey Joe I can go over to 1st star to make this loan but I would rather give it to you cause your my main banker but I gotta get a better rate then what you gave me last time. I mean if I go over to 1st star they offered me a 10k loc with this 4 unit. Really I like you joe your easier to work with and always let me know quickly if you can do a deal for me or not. Then I get on the phone and call like 3 other banks in town and pump em all for rates and deals and everything just to see who really wants to make a loan.
Aside from the obvious having some skin in the game and keeping your credit intact its really mostly a matter of doing a good job of keeping costs down as you move along and grow.

Has anyone taken the steps to give there child assets in the form of equity in property? Would it be in my best interest to do this as I get older to get rid of my property without my son getting taxed on it? I already have over 4 mil in equity. By the time I die it could be 10 million. Does the fed estate tax start at 5 million for exemption per married person? If for example: I give away 1 million to my son over 20 years would this be against my 5 million exemption? Is it legal to give a child equity in a property as a gift which is accompanied by monthly cash flow? We are planning to move to Florida for retirement tax purposes.
Any estate planning attorneys in the house?

What makes me nervous about 401k's are that who know's if congress gets greedy and goes to the moon with taxes on these regulated retirement plans. I just hate having my capital tied up in it. It doesnt even feel like mine especially when they are in trouble.
When I had a 401k I toke the hit:( Ya I probably shoulda put it into a roth but I didnt. I did use the 401k money to buy more income property when I left my earned income and transitioned to living on my income properties. In my defense it was less then 20k.
I like retirement income like the next guy but i also like liquidity and real estate is illiquid enough without putting more regulation onto it.
So here is my question? If we dont work a job anymore and are a long ways from retirement and we view our equity in our income property as retirement money as well why should it be in a plan of any type since its just tied up further by gov rules?
For example if I have a 3 million dollar complex and I get 10k a month off of it what benefit is there to keep some of that money tied up when I want access to all of it?
I mean to have the gov tell me I have to keep my dirty hands off my money. I can co mingle, I cant do this, I cant do that...
@#$% Uncle Sam he can keep his defined pensions and his 401k's and other various toilet paper they come up with to screw up an average guy. I know you grow tax free and all that but in my defense I can move my money without being tied into something. Taxes ya I know Il pay that or i could just keep the apt building to my death and let my son pay taxes instead. On my flips Im screwed having to pay fat taxes. Maybe what I need to do is strictly income and quit flipping so I dont get taxed to death.

When I lived in WI we did some deals in Milwaukee I learned from a few of the bigger investors to avoid like the plague the area between highway 100 to the north and 43 to the south and 894 to the west.
The key is to invest outside those areas they are a lot safer. That is unless you invest along the lake corridor or in the central business district in commercial. I know if you know the city you will say wait that's over half the city?! Just my opinion. I mention this because its the only area of Wi you can get homes for practically nothing at tax sales.
I have been doing a lot of tax deed sales since i left WI and moved to the Ohio river valley area. Indiana has been good to me. I also get cheap land and homes in West Va. I know another guy that does well in Tx. Pa and Arkansas have some deals too. I believe some of the plains states and southern states are good as well. I never hear people talk about this type of investing on the west coast?
I have traveled a lot to go to tax sales and feel like its the best value for your dollar when it comes to sfh or land. I quit buying foreclosures for the most part after I learned how to invest in tax deeds.
The exception would be larger multi units or commercial.

I totally think like that. Im always trying to figure out what i make an hour on a job.
A rehab I am not spending much time on and I sell it and make 35k and it was a job where I spent an hour a day in the house for 60 days then sold it. Fat bank there over 500 per hour.
Other deals I actually rolled my sleeves up on and then made 30k and I had so many hours into the project I was lucky if i made 200 an hour. I was the person doing tile work laying carpets and install plumbing and doing some electrical work. A deal like that I might have 150 hours labor into it since I might have been doing some of the skilled labor myself to save a few bucks.
I just think doing the labor cheapens yourself as an entrepreneur and I dont do much on my rehabs anymore. If you say managing the rehab I admit thats where my time is, in meeting people at the property then following up at the end of the day. So I would go in the morning and meet a few people at 9 am then cut out and come back at 3pm for follow up and walk through see what happened. I might only have an hour on the property.
I have one income property I have been getting checks now for 12 years and do very little but check over a monthly cam statement.
How does one do that? Would I say I worked one hour a month on statement and 15 minutes a week with manager and for that 2 hours monthly I get xxk per month?
On income property its different if its smaller its a headache and requires management but larger projects often hands off just a check in the mail and a cam report to go through every month. I get calls once a week or so but thats because I insisted on it.
Then in my orchard I literally make nothing there per hour because Im trimming and planting apple trees how much does a landscaper cost? 9 per hour? This is a labor of love a little different sort of like a guy that washes his own hot rod.

Even at 175k, 3600 in rents works quite nicely if your getting 5% for 20 years and putting 20% down = 35k. $924 per mo pmts for 20 years?
I think that would work for me if I was in your market in Calif where things are pretty expensive. Is it a nice area or need lots of fix and repair?
Looks like a solid cash flow of at least 1200+ per month. congrats!