All Forum Posts by: Benjamin Portnoy

Thanks for the response, and good point. 

What if we condense that down -- what about the level of headache and time of a one-city portfolio? How self-sufficient is that process with a good manager (assuming she/he sticks around and works out well)? 

There are people on here who have 100s or 1000s of doors in a portfolio. What am I in for if I go that route? 

Hi Jack -- thank you for your generosity and wisdom.

I've been working in SFH flips and land wholesaling for a number of years, but have never taken the plunge into rentals. Ideally, I'd like to start building a multi-city portfolio.

If you have the right team set up so that day-to-day is taken care of through property managers and a good communication setup, how much time and headache can I expect from owning rentals in multiple cities? 

I've been using SAS for about 3-4 months now. I really wanted to like them...their back-end setup is really tech-focused and the onboarding process and customer service are really terrific. 

But they've fallen short on everything else. 75% of their operators sound blah, bored, incompetent, or just plain not fun to talk/listen to. Many of them don't know what to do (and sound like it) when they get a question not in the script.

We (together) programmed the script to have the operator to fill out a form on my CRM, and half of them don't do it -- they just take down basic info and move on. Aside from poor internal communication, I don't feel like they're capable of handling a more complex set of requirements, and I certainly am not convinced they're able to handle functioning as a the first line of gatekeeping for my acquisitions. I'm embarassed to listen to the call recordings.

If you want a company with a strong tech background focus and lower prices with mostly substandard operators, and only need them to take down a few pieces of info for callback (basic name, phone, email, etc.), SAS might be a great solution. If you want them to take the place of a high-functioning inbound sales call center, I'd look elsewhere.

I'm hoping PatLive picks up the slack where they are failing.

Note: CallPorter seems like a more real estate-focused option...but are SIGNIFICANTLY more expensive. Starts at $500 setup + $500 month for an intro package. But, maybe it's worth it if they know how to actually process leads.

On the heels of what both @Bruce Lynn and @Christopher Campbell mentioned re: Austin versus outer nodes and tertiary markets...  

There are some terrific markets 1-2 hours outside of Austin that have been on the rise over the last decade. Kyle, Buda, Round Rock, Leander, Pflugerville, NB...might be better places to start. I lived in Kyle for a year or so around 2010, and even then the suburban sprawl/retail boom was happening fast. Lots of good stuff west of Austin, too.

Has anyone kept an eye on wine-producing areas in the HIll Country? i.e. Driftwood? I've heard of new wineries popping up, drawing even more attention to the region...curious if that has had a trickle down effect on residential building and growth there.

Thanks, @Daniel Parnell! I've noticed that. I have another, similar deal at a resort in Arkansas that I'm working with -- something like 12 courses and tons of resort amenities, but a massive amount of inventory. I'm finding if you can really sell the same dream as the POA or builder (with a more attractive price tag), it puts the odds in your favor. We'll see if this one moves as fast.

What are you guys working on these days?

Hey @Bruce Lynn. I'm not in the area, so no golf for me. Also turned it around pretty fast. It helps when you can get it pretty cheap! :) Quick profit, base hit, move to the next deal!

Investment Info:

Other wholesale investment in Cleburne.

Purchase price: $1,500
Sale price: $9,000

Wholesaled vacant land in residential golf resort community.

What made you interested in investing in this type of deal?

Currently buying and selling vacant land parcels throughout Texas and beyond.

How did you find this deal and how did you negotiate it?

Direct mail to absentee owners. After performing due diligence, we made an offer based on local comps, pricing the lot roughly 20% below retail. Sold to a local builder.

What was the outcome?

Roughly 300% return

Lessons learned? Challenges?

Good lessons: perform more intensive due diligence on lot and owner back taxes, HOA and other liens before making offers. Be specific on who pays what closing costs.

Investment Info:

Single-family residence fix & flip investment in St. Louis.

Purchase price: $120,000
Cash invested: $30,000
Sale price: $185,000

Purchased 3/1.5 from wholesaler. Updated kitchen and bathrooms, minor electric updates. Acted as general contractor and oversaw subs. This was my first deal, so I learned how to change out outlets and other minor electric work, as well as how to structure a deal and corresponding rehab from a mentor. I was a licensed real estate broker in Missouri at the time, so I handled the marketing and sale.

What made you interested in investing in this type of deal?

First deal as an investor/rehabber. Loved the process!

How did you find this deal and how did you negotiate it?

Through a local wholesaler who was also a mentor. We talked through evaluating comps, market conditions, how to list and market properties, etc.

How did you finance this deal?

Partner investor with an equity stake in the deal.

How did you add value to the deal?

Updated kitchen, bathrooms, outdated drop ceiling, flooring and more.

What was the outcome?

Sold for small profit. Great learning experience.

Lessons learned? Challenges?

I learned a lot through the process, especially how both houses and deals are put together. I also learned the value of hiring out as much as work as I can afford, both in the ability to scale and the time value of money.

Investment Info:

Single-family residence fix & flip investment.

Purchase price: $321,000
Cash invested: $120,000
Sale price: $507,000

Two story, 4 bd/3 ba. Cosmetic updates including full kitchen gut and updates, consolidate obsolete extra closet and undersized master bath into large master bath, finished empty basement into extra living room, etc. Sale to retail buyer.

What made you interested in investing in this type of deal?

Enjoyed the process and potential for lump-sum profit.

How did you find this deal and how did you negotiate it?

Found through local networking connections. Purchased through wholesaler.

How did you finance this deal?

Private money partner.

How did you add value to the deal?

Identified and negotiated acquisition. Hired contractors and managed remodel. Listed and negotiated retail disposition.

What was the outcome?

13% net profit.

Lessons learned? Challenges?

Larger property that involved moving walls, finishing rooms, envisioning and enacting potential updates.

Thanks, Jingwen! 

Do you source markets from any particular list/resource, or do they just pop up on your radar and you explore further?