All Forum Posts by: Barry Ruby

Hi Mitch, if Total Cash Invested equals Equity, I mistook your meaning and totally agree

@Mitch Messer

I believe that Cash on cash measures return on equity

ROI is the return on investment which measures total cash flow and sales on total capital investment

@Mark Bringas

Too much = when the deal doesn’t work

@Andrew Burgess

Andrew, congratulations on graduating and having the insight for your future.

I have a central question for you- “how do you define success”?

More importantly, how and why are you allowing your concept of it build daily stress?

If making a ton of money is your goal, the earlier you realize that money is a result of actions, the better.

The smoothest and most rewarding way to acquire things is by doing something that you love to do for the sake of the activity itself. Money will flow from those actions.

“Do what you love and you will never work a day in your life” is a saying that rings true to me.

If real estate is your current chosen path,

Your first step should be to become financially literate and to acquire skills that empower you to underwrite deals.

However you choose to proceed, do it like the nursery rhyme “merrily”. Life’s too short to stress over an abstract concept like “success”.

Find your passion and go for it!

I’m around if you ever want to chat

@Zaki Naveed

Zaki, sorry to hear about your predicament. In hindsight it seems clear that you should not have paid 75% upfront.

Based on your description of where you are right now, I think that you should take the following into account as you go forward.

A “good” attorney will most certainly cost good money. Be aware that even if you prevail and win your case, you will still need to be awarded a judgment. Once and if you get a judgment, you will still have to perfect it by collecting on it.

Based on the information you provided about the contractor’s financial condition, collection seems unlikely.

Sometimes it is best to take a loss and gain by the lessons it brings. So, choose your path wisely.

The reality that GC1 has created needs to be dealt with. Bringing in a new GC creates a situation of its own.

You need to be extremely careful about how you mitigate your exposure to fixing legal contractual obligations to the new contractor to ensure it’s scope of services and remedies should problems arise in completing the job.

In closing, I urge you not to feel too bad or blame yourself for the situation. We all make mistakes and need to learn from them.

I made a similar mistake and did it with decades of ground up development experience.

I was building my private residence. I bought the contractor’s sob story and paid him 50% upfront. He bought a new truck and didn’t pay his crew.

I was able to get about even in terms of his work completed and pay and threw him off the job. I called a sheriff to do a citizen standby to make sure that the contractor couldn’t follow through on his threats to take a hammer to the job.

Feel free to contact me if you’d like to talk about this further and best of luck in getting this resolved.

@Jennipher Jess

Hi Jennipher,

Do you have any specific questions or concerns I can help you with?

@Michael Leccese

Learning the language and metrics of finance and real estate is the first step

Being able to use them to perform pro forma analysis is the step that defines underwriting

You can either grow your personal knowledge and skills to build your own pro forma models or find tools created by 3rd parties that fit your needs

Good luck and feel free to contact me if you have any questions

@Qui Chau

Done!

Hi Hailey,

I can send an input sheet to you that will allow me to populate a proprietary Excel Workbook I built to analyze ground-up multifamily and Build-to-rent communities.

If you send me the populated input sheet, I will send a snapshot of the full performance of your planned project.

@Nicholas L

It appears that you are conflating costs and expenses

Cost is typically a one time event while expenses occur on a daily basis for line items associated with the operation of the property