All Forum Posts by: Robert Taylor

One more vote here for getting your license! Yes, I too am a licensed broker myself. The biggest benefit is the mls access for me, I spend hours and hours every week looking at recent sales, active listings, etc. When I'm doing a rehab project, I often, no always do comps over and over again throughout the process. As others have mentioned IF you have a close relationship with a broker, that could mitigate that somewhat, but its unlikely that a broker is going to want to spend hours and hours lurking around the mls just to fish for info for you, unless maybe you're someone that's buying and selling TONS of properties and thus getting them tons of commissions.

One valid point that @Ron Jones does make is if your time is better spent running your RE business, it is something to consider, but just because you have a license certainly doesn't mean that you're required to sell any or all of your own projects. If you feel like your time is better spent running your projects or whatever or maybe you have something to sell in an area that you're not very familiar with, you can certainly always have another realtor list that property for you-there's always a lot of hungry realtors out there!

@Justin B. -I was going to write a reply going into all sorts of details, but the more I thought about what I'd be writing, it would end up being more like a short book than a forum reply, so I'm going to try a different approach, which I hope still makes sense.

You can read articles like these (and I did read your links, I'm not just dismissing them) until you are blue in the face and still not have a solid conclusion, you'll just have a blue face! I can look back to 2007/2008 and now with the benefit of hindsight (which is of course always 20/20!) it seems so hard to believe that anyone didn't see the real estate correction or crash coming like a speeding freight train! Prices kept going up, up, up and up and we were building new houses and condos all over the place, many built to sell mostly to speculators, not people who were actually going to live there and on top of all of that, much of it was being paid for by these INSANE mortgages where someone with rotten credit could just claim they made whatever amount of income and/or owned whatever amount of assets, didn't even have to show any proof of it and would walk out with a mortgage, assuming of course they'd pay a higher interest rate! (thus making default even MORE likely!) I mean, how could ANYONE with half of a brain not have seen that crash coming, especially these pundits and predictors that write articles like these??!! Yet, only a few of them really called it out before it happened!

Whether its real estate or stocks or commodities or whatever, you can always find the doom and gloom guys and the endless sunshine guys as well. I prefer to focus on the individual investments and make my decisions that way.

I've looked at several of the (many) city of Milwaukee owned properties as well and have noticed some definite discrepancies in the estimated repair costs as well, usually where the city's estimates are also lower than what I'd estimate myself too. Of the few that I've looked at, I certainly haven't seen any screaming deals (or even moderately screaming deals!) at all either, although I haven't looked at many and haven't even looked at the updated listings too much, so won't say that I'm an expert at all on what they're trying to sell. (or give away as it is in some cases!) My experience has been that much of what they're selling is in areas I won't touch at all because they're warzones (for those not familiar with Milwaukee, I think its a great city and a great place to live, but it does have some rough and very rough areas, like most mid sized metro areas) The warzones are generally where the $1 houses are and they still need work. The properties in the better parts of town seem to go up in price quickly, they're not giving anything away for sure.

Also, while I'm a firm believer in always pulling permits for my projects, unlike some of us who will renovate entire buildings without pulling a single permit (I think it helps me sleep better at night!) I also don't think I'd want the city knowing EVERY SINGLE last detail needing attention on any of my projects. On these city owned houses, a building inspector has already gone through every inch of the house and written that repair report which is on file. This is especially true on lower end projects where there's just not that much margin for repairs.

@Dawn Anastasi -its cool to se that you're continuing to build your little empire, good luck on this one as well.

I have to chuckle at all of you from FLA, GA, etc doing double takes on the property taxes in WI, welcome to WI-property tax HELL!!! Yes, that's what we pay for taxes up here and its not changing any time soon! Here in Milwaukee County, we currently have a proposal from the absolutely INSANE Milwaukee County board right now to institute a $11+ an hour "living wage" for not only any county job, but any privately contracted county job, any job on a property that the county assists in financing for over $1M, etc. This proposal puts in jeopardy several major developments in Milwaukee, including a proposed 44 story building on the lakefront that would include retail and a hotel, all of which would thus be required to pay every last employee $11+ an hour, thus making the hotel biz and many retail businesses unsustainable. The county comptroller just released a TOTALLY doom and gloom report on all of the bad economic things that would happen if this living wage proposal goes through and the supporters are still full steam ahead! This is just one of a myriad of of things we have to fight off daily to attempt to simply keep our ridiculous taxes from going higher than they already are. Welcome to property tax HELL!!!!

@Jon Klaus

-not that I normally like to resurrect dead threads, but I'm just wondering how your restaurant experience is going? I've been in and out of the restaurant/bar biz for years and have seen many come, some go and some stay and succeed. I've also seen a phenomenon where people who make a bunch of money in some unrelated biz get the wild idea that it would be cool and fun to open a restaurant/bar and make a bunch of money while having a blast. 99.9% of the time, they seem to end up going down in flames! Yet, some do make it here and there.

Just to chime in on a few of the thoughts here, I like non-franchised places, although I've seen some make good money by owning franchises as well. Yet, I've seen it more where people buy a franchise and work their *** off for maybe $100k a year in profit or less, not a bad living but not that great when you consider not only the hours you're there but the fact that you're basically on call 24/7 and those calls do come! My older brother has done very well for himself owning several non-franchised places and still could have the option of franchising them to other people as well, which is where the really big money could come in.

My other thoughts are that the restaurant/bar biz is definitely a tough one but if you can master it, you can succeed over and over again. As some have mentioned, your two main concerns are food cost and labor cost, those are your two overwhelming variables, keep them in line and serve a good product and you're likely to succeed. That having been said, its much easier said than done. Theft is always another big concern, especially on the bar end of the biz, there are many very talented bartenders that are also very talented thieves! The old trick of selling 4 drinks and only ringing in 2 of them is probably the most common technique. Thus, you just put say $20 of the customer's cash in the drawer, yet the register thinks it should only have $10. You keep a running count in your head of how much your drawer is over through the shift and at some point, remove and pocket that money when no one's looking and your drawer comes out even when they count it and no one's the wiser. Yes, you can fight this by monitoring liquor cost closely and they even sell high-tech metering systems and camera systems now, but again its much easier said than done. The biggest obstacle there is simply the time factor, when you're already rather burnt out from a crazy busy weekend or whatever and you've got a bunch of other work to do to keep the place running right, who's going to take several hours out to sit and watch some usually grainy silent video of a bartender serving drink after drink or measuring how much booze is left in each one of 100+ bottles of liquor?

One trend that is making theft harder is that more and more customers now use charge cards to pay, I really don't know how an employee could steal from someone paying with a card, but a lot still pay with cash, more than enough to make it hurt if you have some clever thieves in the mix. Of course, there's also always the occasional prime rib or whatever else that might disappear out the back door as well. I remember at one of the places I ran, the chef REALLY wanted to order some saffron for a special, which was at the time like $70 for a small tin! You only needed a pinch, so luckily we only needed to order a tin or two at a time, but I still remember pulling my hair out each week as I'd check on the saffron supply and sure enough, one tin did disappear at one point, causing me to lock the extra supply in the safe!

Anyway, just wondering how your venture is going so far?

Not quite ready to take on the Pabst Brewery (yet!) but I've been making some headway in this learning process.

@Bradford Arner -as you mentioned, the receivership angle seems to be the one to follow on many of these, I've been hearing more and more about "receiver's auctions" or something of the sort, which aren't apparently like the sheriff's auction with open bidding but are often sealed bid auctions. Anyone with any advice on how to track down receivers and deal with them on getting the properties, I'd appreciate hearing it.

@Roy N. -I've been snooping around on loopnet a little and as a broker myself, I do have access to the local mls. Anyone with any other ideas for tracking some of these down and finding any other info as to which buildings are going into receivership or foreclosure?

One more term I've heard a couple of times lately is a "stalking horse bidder" anyone care to explain that one?

I've been in the residential RE business for over 10 years now, but I've not had experience in the commercial realm. My brother and I are interested in a commercial building here in Milwaukee that we know is being foreclosed on. My brother heard through the grapevine that it will be auctioned off sometime within the next week, but we haven't been able to find any info on where or when the auction will be held. I've bought numerous residential properties through the county sheriff's auction, where they'll occasionally have a commercial property go through, but this building isn't scheduled to go through the sheriff's auction anytime soon and we know that it is being auctioned off within the next week.

My question is,where would you look to find out where and when this auction will be? The only idea I'd have would be to contact the current owner, who may or may not be very excited to discuss the auction where he's going to officially lose his building, but the current owner is actually someone we know, not real well but more like a friend of a friend and I just don't feel comfortable approaching him about this building he's about to lose.

Just saw the pex discussion, a lot of the plumbers around here in the Milwaukee area are now using pex pretty much whenever they can. Not sure if anyone mentioned the rise in metals prices over the past 3 or 5 years, I think its topped out for a while now, but I've heard more than a few investment guru's still talking about us being in the midst of a long run up on metals prices, which besides the obvious ones like gold and silver, would also likely include copper as well. When I was at Home Depot the other day and passing through the plumbing pipe section,. I just happened to glance at the prices of some of the longer lengths of larger copper pipe, some of it is over $100 a pipe! Can you imagine how much it will be if some of these investment guys are correct and metals continue to go up over the next 5, 10, 20 years? I can certainly see why pex is so popular and why you pretty much NEVER see copper being used for the larger drain pipes anymore like you used to. I was in an old commercial building a year or so ago that had been foreclosed on where they had a HUGE copper pipe for one of the main drain pipes in the basement. I bet you'd get $100 for that one pipe at the scrapyard. I wonder if any one of these clowns that earns their living by stripping copper from abandoned buildings ever happened to find that pipe!

I'm a licensed broker in WI and really only use my license to buy and sell my own projects. For me, I think its an extremely valuable tool to have, mainly for the mls access as others have mentioned here. I just do not know how I would ever be able to really analyze my projects and potential projects without the mls access. Sure, you can get sale price and some other info from zillow or whatever other RE websites are out there, but the mls has so much more important data, like days on market, etc. In your original post, you mentioned being "unable" to obtain a RE license, so I'm not sure if you are asking if you should get one or if you mean that you CAN'T get a license for some reason. If you CAN'T get a license for whatever reason, my advice would be to find a broker/agent that's willing to really work with you on your investing plans and who help you get the info you need to do proper comps, etc when researching whether to buy something and at what price, or what you could sell it for when complete, etc. That can also be a good road to take, especially if you find someone that really knows the markets you're looking to invest in well. There are a lot of successful investors out there that aren't licensed and never will be because they work with a broker that handles that end of things.

The other possibility that isn't supposed to happen but does is when a broker lets a client use their mls access, which is as simple as them telling you their password! I've had several people ask me if I'd do that for them and I won't do it, but some brokers do. I had one guy that was a friend of a friend who had some flips he wanted to sell (which he wanted to list WAYYYY too high, so it would've been a waste of my time to list them anyway) but he also really wanted me to share my password with him and became very pushy about it! I finally had to just quit talking to him altogether, because every damn time he'd call me it was only a matter of time before he started pestering me for my password-very annoying but like I said, some brokers do it.

@Account Closed -hey, thanks for the props on my LOOOOOONNNNNNNGGGGGGG posts, glad to hear that someone enjoys them! I'm always glad to share some of what I've learned and also glad for the advice I get here whenever I have a question, because I'm still learning myself too!