All Forum Posts by: Robert Taylor

@John Moore-That's an interesting idea I'd never thought of before. I did have one house I sold that came with a used but in decent shape washer/dryer pair in the basement. So, I left them in there and sold them with the house and it was a pretty expensive house. I'll have to think about that because I was just looking at some used ones on craigslist for one of my rentals and there were a good amount of them that looked decent or better for not a lot. Many of them were under $300 for the pair, some even well under that.

In one of the three houses I will be putting up for sale soon, I was thinking of putting in a "laundry room" in the basement, just because its an old brick basement that even when its all cleaned out, still doesn't look like anywhere you'd want to spend ANY time at all, even just to load and unload your laundry. I figured I could put up some drywall and whatever else to make a little laundry room on the cheap, maybe a washer/dryer would be good too, if I find them at the right price!

Good to hear both of your answers! I think I will keep doing it as I have been and including the new appliances. Most of the time, I've bought single-brand packages from one vendor that has had great prices and also has GREAT service, they can deliver the next day or within a few days and are easy to deal with, not a national chain. On my latest house which I am shopping for now, I did also shop online with Best Buy and Home Depot and Best Buy ended up coming in about $200 less for the package, although they couldn't deliver for a few weeks for some reason and I need these in within the next week or so. The guy I work with at the local retailer was more than happy to match Best Buy's price on that and they deliver quick!

I'm going to think it over about the french door vs side by side and I'd like to hear other people's thoughts on that one. It does seem to me that the french door style is definitely the "in" thing right now over the side by side style, I'm just not sure if its worth spending the extra momey, which is a fair amount more. These two houses are what I'd call mid-maket as far as price range goes and I'd say the market would call for at least a side by side style and not one of the cheaper, top-freezer models. I'm also sticking with stainless, which seems to be the popular choice these days as well and I think the market calls for that as well.

As far as microwaves go, I've found that I have usually been including an "over the range" micro as well, certainly on these "mid market" homes. This is because even a plain cheapo model stainless range hood is usually $100 or so, while I can get a decent stainless over the range micro for $200 and sometimes less if there's a sale. Now, last year on two houses I did that were higher up the price ladder, I put in fancy, wall mount vent hoods instead of the micro's over the range because I think that market called for that.

@John Moore-as far as buying "like new" appliances on craigslist, I've looked for them before and have found a surprising number of them, but they're nearly always something other than stainless because they say they're selling them because they just switched to stainless! So, I gave up on looking for them, have you found any like new stainless appliances? If I could find some that they had the receipts for so I could give them to the buyers with a warranty.

I've usually been buying and including the kitchen appliances in my flips. (fridge, range, dishwasher and usually an over-the-range microwave, at least on the more expensive ones) I do this for a few reasons, mainly because I think that usually when people move to a new house, they want to leave their old appliances behind and moving into a freshly rehabbed house with brand new appliances is a real turn on for a lot of buyers. I also think that just as many of us rehabbers/flippers have noticed, a staged house seems to sell more quickly than an empty house and to me, a kitchen no matter how nice, without appliances has the same look as an empty, unstaged house.

Yet, at the same time I have some questions if this is the right way to go too. I've always been buying stainless appliances because that seems to still be the "hot" item these days, although I know some people still buy them in black, white or whatever color as well. I'm also looking at appliances right now for two houses I'll be putting on the market soon and I was planning on going with a side-by-side fridge for both houses, they're both what I'd call middle of the market houses for my market (listing for probably $260k and $170k respectively) but then I wonder if I should spend more and get french door fridges, which also seem to be the hot item these days, but cost considerably more than a comparably sized side-by-side fridge.

So, with all of these questions, I wonder if I should just list them without appliances and offer a credit towards new appliances for the amount I would've spent on them, so buyers could pick out exactly what they wanted. I tried that once before and the house was slow to sell and it was a bit of a work to work with the buyer to get exactly what they wanted.

Just wondering what others are doing as far as kitchen appliances go-should I stick with picking them out and having them installed when it goes on the market, which I've been doing, or maybe offering a credit towards the appliances of the buyer's choice?

@Jeff Wagner-Welcome to BP, you'll find a wealth of information here, especially on anything related to residential investing. Its a great resource and also a great way to help others out as well!

@Account Closed-You are certainly correct, Milwaukee is a VERY highly taxed community, not only through our very high property taxes but also through a multitude of other ways, things like how City of Milwaukee residents have to pay a "wheel tax" on any car they register with the state DMV, I think its $20 extra a year now. Our building permits aren't cheap, they just get you coming and going. Actually, all of Milwaukee County is quite bad and despite Gov Walker's best efforts, they're still taxing the hell out of us! We have a truly radically left-wing county board that's been screwing the taxpayers every which way, their latest trick is to pass a "living wage" ordinance so that ANY project, contractor, anything connected with county gov't in any way has to pay at least $11 and some change per hour! Its especially glaring when you consider that in the county directly west of Milwaukee County, Waukesha County which is generally at least middle class up to very affluent in certain areas, you're property tax in the cities in that county will be about HALF of what it is in Milwaukee Cty and in some of the townships it can be even less than that!

On top of the high tax RATES, the city of Milwaukee also assesses its properties quite high as well! After the crash of 2008, they moved values down a bit, but not nearly as much as actual prices fell. Like I said, they get you coming and going and it doesn't look like its going to let up any time soon!

I still love the city of Milwaukee, I live on the east side, which I'd say is comparable to maybe Lincoln Park area in Chi-town (although not nearly as expensive!) and I wouldn't want to live anywhere else in the area. Yet, when you look at what we pay in taxes, it does make me wonder how long I'll want to put up with this crap!

I guess that's why I prefer to be my own listing agent, that way I don't have to spend my time evaluating agents!

Hi @Karin Crompton , I understand what you're saying, although what about this scenario-I'm also a broker myself and although I usually just list my own properties, if and when I do take on other listings, where exactly does my best motivation lie? My motivation is to SELL the houses I list, thus getting me the commission check when they close.

Now, if someone comes to me with a house to sell that after I run my comps and do my research, I think should sell for between $300k and $320k for example, whether its an investor owned property or a regular homeowner, what should I price it at for the best benefit of the customer and myself? Lets assume that they want to sell to buy a bigger home in the same area, its not as if there's a job transfer out of town or some other situation where they have to sell and sell quickly. It is just a normal, "retail" sale. Should I list it at $320k and try to get them the maximum value out of their current home? Should I list it at $300k for a POSSIBLY quicker sale but less money? Or maybe I should "fudge" the truth a bit to them and tell them I think it should be listed at $275k! Sure, at $275k, it would probably sell real fast and we might even have multiple bidders overbidding, which would make me look GREAT in your % ratio! Let's say we do that and it ends up going for $280k, now I'm at 102% on your ratio, I sold the place in very few DOM, BUT I may have just screwed my sellers out of nearly $40 GRAND!!! $30 or $35k could've furnished much or all of their next house, depending on how extravagant their tastes are!

That's why I don't like that ratio, you're simply taking a snapshot of what really should be a much more detailed look and you're missing a lot of hidden details. If I'm simply out for making my commission on as many homes as possible, selling them as quickly as possible, I would "under price" all of my listings. I'd look great in your ratios and stats, but I'd be losing a LOT of sale proceeds for my sellers at the same time!

I think its quite hard to "judge" an agent based on list price (or original list price) vs selling price for a lot of different reasons, a few of which I'll mention here.

First off, you really don't know what the intentions of the sellers are. I can think of one house I know of, where I know the sellers, which has been perpetually for sale on and off for several years, through several different agents. It is listed at a rather high price because these people aren't selling because they have to, they are quite well off and wouldn't mind moving to another house, but they're not in any rush to sell, if that makes sense. Their house is in a "hot" area of Milwaukee, half a block from Lake Michigan with some great lake views over a huge bluff and if someone comes along that wants to pay their price, they'll sell, if not they'll stay! They've actually had several offers that I'd consider to be quite good, but not quite what they're asking, so no sale. I wouldn't consider this to be a failure for the agents involved, even though they so far, have all failed to sell the place. Those agents went in knowing what the seller's deal was, so they knew what they were getting in to as well.

In my own flipping experience, I've listed some at a higher price for a few weeks to start off, as JScott mentioned. Usually when I've done that, it has also been for what I'd consider to be a "special" house in a hot area of town. I have one that I'm finishing up now which I will be trying that with and two more which I won't. One of the ones I won't be trying it with is also in that same "hot" area, but I want to get it sold and I don't consider it as quite as much of a "special" house, I'm not going quite as all out on that house.

I guess this follows one theme that you can find in a lot of my comments, that ratios are great, stats are great and all that, but when you're talking about as big and always unique of a deal as selling a house, its hard to try to plug any particular sale or deal into a set of ratios and get concurrent answers that make sense for every deal. I think you have to look at each deal as its own animal with its own unique set of circumstances.

First off, I'm always quite leery of ANY "Top 10, 20, 100 or whatever" list of ANYTHING! Its like when Maxim (do they still even publish Maxim?) or whatever magazine comes out with its list of the "10, 20 , 100 HOTTEST women" each year. Now, obviously every single guy (or girl) has their own set of criteria for this and no one is exactly the same. We may agree in general on some or even many of the results, but its not as if you're supposed to walk away from reading that list now realizing that yes, Angelina Jolie IS "hotter" than Giselle whatever her name is-you know Tom Brady's wife-and that you should now feel dumb because you think Lady Gaga is gorgeous and not only was she not on the list, but they were making fun of her in another list! Same goes for the "Top 100 guitarists of all time" list that a bunch of music mags do, where one list has Eddie Van Halen at #1 while another list has him behind the guy from RATT! All of these lists are so subjective, even if we could agree on the criteria, there would still be arguments as to who's #1, #2, etc.

Besides that, how in the world can they even begin to lump all sections of any at least moderately sized city into one lump category? Here in the Milwaukee area, you can buy rentals in "the hood" for really low entry prices and they cash flow very well, assuming you can keep them rented and actually collect the rent each month. Don't expect much in the way of appreciation though. From there, you can move on up the market through lower-middle class, middle-class, all the way to the top of the market. It generally seems to me that the higher you go in the market, the less cash flow you're going to have each month, (as a percentage) but you may have a better shot at the property appreciating in value over time, although that's certainly not guaranteed whatsoever.

What about buying in neighborhoods that you think are turning around, going from bad to good, as has happened in more than a few parts of Milwaukee? So, you may or may not be looking for instant cash flow from the tenants and as far as appreciation, you're not looking for a set, certain amount of increase each year, but you're more or less making a bet that the area will come around and you'll cash in big time several or more years down the road? I know people that have done just that and made huge money that way!

I just don't see the value in reading these articles that lump entire cities into one boat. There are so many different ways to invest, speculate, etc in real estate that you can't just lump it all together!

Actually, I know several couples that have kids in MPS (Milwaukee Public Schools) and love the schools. From what I've heard, it sounds like MPS has a number of specialty schools at all grade levels that are actually quite good at educating kids and its the parents that actually care about their kids education that make sure their kids get into those schools. That having been said, I know a lot of MPS schools are definitely in real disarray and are problem schools, but I blame most of that on parents that just don't give a damn about being parents to their kids.

I don't do much if any demo work anymore but its really hard to say how much to spend or will you spend on demo without knowing exactly what has to be demo'd. One thing to consider also is that you want to find people that actually know what they're doing, at least as much as you can know about demo. If you send just anyone in there with some 55 gal buckets and sledgehammers, they just might end up destroying some stuff that you didn't want destroyed. I'm not talking about destroying a whole bathroom that was meant to stay but more like not knowing exactly where to stop, thus you have to do a bunch of extra work to rebuild what shouldn't have been taken out in the first place!

Another thing is planning out how to get rid of all the waste you'll accumulate. Lathe and plaster for instance, I've seen some guys who neatly break it down into buckets of plaster and bags of lathe boards for easy removal and others who just make a giant mess!