All Forum Posts by: Buddy LaRue

Kevin,

Beyond finding the property, the agent should be able to help you in locating financing (refer you to a mortgage broker or mortgage banker), refer you to inspectors and be there for the inspection (some agents won't show for the inspection, but any that are worth their salt will show), as well as go over the title report and point out anything that an he/she feels an attorney should look at, be there for the closing and go over the final HUD-1 closing statement, looking for any charges that are out of the ordinary.

And before any of this, they should pull "comps" on the subject property so you'll know what a good offer is for the property before starting the process and paying for an appraisal.

Agents do a lot more than just show pretty houses.

@Justin Przybylski

Right and left coasts....as viewed on a map with north at the "top" side and south on the "bottom". :-)

@Kevin NA

In the states that I have worked in, if you have not signed a buyer-broker representation agreement, you have no obligation to the agent/broker to use their services or pay them any commission if you locate and purchase a property without the use of their services.

Since you have located a property that you are interested in writing an offer on, and the agent has been working with you for the last couple of months, consider talking to the seller and explain that you've been working with an agent, that you would like him/her to handle the paperwork, and see if the seller may be willing to pay the agent a small commission (think 1% since you've already found the property) or hire the agent to handle the deal for you and you pay the 1% commission.

I've been licensed for over 15 years and have helped clients this way in the past. It's more beneficial to the agent than a "thanks for your help, but I did it on my own" phone call or email, better than a "let me take you to lunch", etc because this is how we make a living (and the occasional lunch is nice, but doesn't pay the rent), and you still have an agent (assuming they're willing to do the paperwork for the 1%) who will look out for you.

Just my two cents.

@Mike Hansen

How does "Acquisitions Manager" sound?

@Justin Przybylski

The more GOOD information a wholesaler can give to a prospective end buyer the better. You need accurate estimates of after repair value, accurate estimates for repair, etc. The quickest way to earn a bad rep as a wholesaler is to inflate the ARV, and deflate the cost to get it there.

Earn a good reputation, do it right and the buyers will keep coming back. Anyone can make a mistake and they do happen, so people will overlook the occasional "I missed that", but they will not work with "shysters".

In short, the answer is yes, the wholesaler should know just as much about how to do an analysis as the buyer/investor in order to earn and keep a good reputation.

John,

This property sounds like it should have its parking "grandfathered", and that it is actually a six unit apartment building. You should check with the city about the parking.

If the property was built as a six unit apartment building, it's doubtful that you will get it financed as a four unit building because of the parking ordinance. If the city gives you a hassle about the parking, contact an attorney. It's unreasonable for the city to expect you to grow more land to accommodate a parking ordinance instituted after the building was built and was not in place at the time the occupancy permits were granted.

One thing you may consider, if there's room, is to make the parking spaces smaller, if need be. Oftentimes, parking is not laid out well, or has spaces that are wider than needed.

Best of luck to you!

I'm on the "right" coast (as opposed to the "left" coast). I'm in West Palm Beach and looking at Palm Beach and Broward counties. I've found more cash flowing properties in Palm Beach than Broward.

@Bryan P.

As for Homepath properties, I've sold a number of them (I'm licensed in three states).

In Texas, where I've sold most of them, they were good deals and many of the investors I worked with were able to buy them using HMLs and there was enough capital gains after repairs that they could refinance the deal and essentially end up with ZERO out of pocket, which equivocates to infinite returns.

However, in Florida, most of the Homepath properties are seriously overpriced and have to sit on the market for a while, with price reduction after price reduction before it's work seriously considering.

Overall, Homepath seems to be very "area specific" as to if it's a good deal or not. Always check your current value comps, as well as your ARV comps, and do your math. Let the numbers guide you.

Maybe this will help.

First of all, always try to keep moving up. If you're just starting out and are short on funds, try wholesaling for a while until you have enough cash to invest in buy and hold.

Once you start buy and hold, continue wholesaling as well for cash to buy more buy and hold.

Once you get to, lets say 10 buy and hold properties, and have been wholesaling as well, maybe it's time to do a 1031 TDE into larger multifamily (think 50 doors or more) where you can control the value of the property better. Start cash flowing from this, and use that money to buy more SFRs, while wholesaling properties you've found but don't want as part of your buy and hold portfolio. Also, you can wholesale apartment buildings, or any other property you find.

Keep building from there until you've got more money than God, and a better house than him too!

He who dies with the most properties wins!

At the chance of sounding like a downer, I have to say that I don't like either scenario, for a few reasons.

1. "that we can use when not rented". If you're expecting cash flow, your best bet is annual leases that bring you regular cash flow.

2. I hate investing in condos. You don't really have control of the property, the HOA does, if the complex drops below 70% owner occupancy your exit strategy gets blown out of the water as banks will no longer lend, leaving you only cash buyers which usually drops the sales prices. Also, HOAs are a pain with all their rules, regulations and wanting to approve your tenants.

3. "rentability" of a mountain cabin. I'm sure there's some, especially during hunting season, but I don't know beyond that.

Instead of buying either as an investment property, have you considered buying an investment property that you can rent on an annual basis, with good cash flow, then taking that cash flow and renting the mountain cabin or beach condo when you decide to get out of town for a vacation? Your vacation plans aren't tied to your purchase, you can go to either and your investment pays for it!

Best of luck in your investing!