All Forum Posts by: Brett Tousley

Like any real estate broker, I run into investing opportunities during the course of my daily business.  I'll probably need to call an RE attorney and our State real estate commission for this issue but I thought I may get some good info here on BP before I do.

Considering I am a licensed agent/broker, I am not allowed to take a net listing.

Net listing meaning I list a house where the seller tells me they want $100,000.  but sell it for $150,000.  Give the seller their $100,000 and I pocket the surplus.

That seems to be very similar to what a wholesaler is doing except most do not have a license.

Of course I would disclose that I am licensed and planning to purchase and resell/assign for profit. 

If I know I can sell for $150,000.00 and the owner only wants $100,000.00 I see no conflict to purchase the home, I've done that before.

But the thought of putting it under contract and assigning the contract seems more murky as it is so similar to a net listing.

As a licensed agent/broker, is it possible for me to legally and ethically wholesale a property?

I don't know your market but regarding this particular Realtor, I advise you to trust your gut.

If you feel they were being honest and telling you the truth about the market, you may have found a great Realtor.  

Because he or she already works with investors, they will know where to set up searches to find the right deals, how to negotiate on distressed homes, how to write an offer for HUD, Fannie or one of the various reo companies out there. The process varies quite a bit from company to company.

Unless you are planning on buying a home a month, the Realtor will need to be working with other clients to avoid going broke.  

Good luck out there!

Nice looking building!  

If everyone has individual locking storage I guess the theft concern is low.  But I'm not sure a female tenant would feel all that comfortable to have a strange man walk in on her while she is doing her laundry downstairs.  

I'm not a landlord and I'm not a lawyer but I'd deal with it if it were my building.

If I understand it correctly, you have 1 key to a main entrance and once you access that door, you have access to unsecured storage areas? 

If that is correct, I don't think you would be out of line at all to have a conversation about who should and should not have access to keys.

We aren't talking about a key to this tenant's individual door, we are talking about a key that puts all tenants storage items within the grasp of anyone that has access to the main door.

I've only been on this site for a short while now but I respect both of your opinions.

This market feels very much like 2006 to me.  Buy, buy buy go the buyers and sellers are selling quickly with multiple offers.  Inventory in my area is very low and has been for some time.

No 80/20 loans but I'm seeing plenty of FHA and no down payment conventional loans in the lower end of the market. These are more vulnerable than the buyers you mentioned but I wonder how sustainable these low interest rates are? What will happen to home prices when they rise and affordability becomes the issue not lack of inventory?

Looks like a great home for only $145,000.  How many square feet was it?

It's always interesting to see how different home values are across the country.

I'm in the minority here which surprises me. 

The way I look at it, this is a rental home and my goal would be to keep it rented.  

Why not contact whoever the "lead" tenant is and tell them the 6th tenant needs to go due to a county issue?  Then explain you saw the 2nd dog and will be expecting the additional deposit for the dog ASAP.

Thank them for complying and don't bother checking if the 6th guy ever leaves or not.

Tell them they will be receiving some paperwork in the mail stating what your concerns are just to keep everything on a professional level, but you'd rather work it out with them because they've been good tenants.

If these guys are paying on time and not giving you trouble other than this, why not approach them with a lease extension instead of looking to take additional funds out of the security deposit and winding up with an empty rental?

I don't know a lot about their operation or their pricing but I have worked with a very good fix and flip investor that was one of their speakers, I've used some of their deal analysis tools and I attended a day of one of their seminars as the realtor who opened doors on the tour bus.

The info they shared prior to our tour was good info, especially to someone that was new.  The seminar environment was a little "peppy" for me personally but I'm a pretty low key guy.

On the tour, the speaker gave out good advice, handled common objections you'd expect from new investors and was respectful of my time and local knowledge.

I left after the tour so I can't say what went on afterwards but I got some value out of my time there.

1. I had a chance to meet quite a few hopeful investors.

2. It was interesting to watch how the speaker dealt with people struggling with their own self limiting mindsets and fear.  I generally work with more experienced investors and I sometimes forget how scary the process can be for those that are new.  

Overall, for me it was worth my time and I'd do it again for that group.

Hiring a "guru" isn't for me but I can see how it could be valuable to some folks just getting started in the business. 

There are many ways to pick up experience and education and they all have their costs.  Even BP which is awesome, costs time to sort through all the info.  Finding a partner or mentor can cost money on your first few deals, hiring a guru costs money out of pocket.  I know 2 of the 3 investments pay off down the road but I don't know if the Guru route pays the same dividends?

 Yes there are already real estate appraisers that provide that service.  In my market they are around the $500.00 mark.  

Considering there is already a provider for this type of service and the compensation is pretty well set, I would not consider offering a similar service.

As far as the insurance side of it. My E&O policy is based upon risk and my provider assesses risk by the number and type of transactions the brokerage does in a year. Offering a service like this would increase my transactions, increasing my risk of a suit and increasing my premiums in the future. Normally, increasing your transactions is a good thing but when the potential compensation is so low compared to a normal sale, it is not something I would consider offering.

I do know brokers that kept themselves afloat quite nicely when the market last tanked by providing BPO's to banks, lien holders and servicers.  But I would imagine an insurance company would find that practice less risky and cheaper to insure than offering a similar service to the general public.

For me personally, I would not be interested in providing that type of service. But the nice thing about real estate is there are many different paths you can choose so I'd suspect another broker may be willing to provide a BPO to a FSBO. Unlike a FSBO I carry Errors and Omissions insurance and I'm fairly certain my insurance provider would frown upon that practice. All it would take is 1 unhappy seller to claim they sold their home too low based upon my BPO and any profits I made with that service could go towards increased premiums in the future.