All Forum Posts by: Calvin Thomas

I'm in central NJ and studying for my realestate licence. I have a small chunk of cash that I would like to invest after I get my licence. My day job is 6am-230pm so there's alot of daylight left when I get out of work. What would you do if you had to start from scratch and still work your day job?

Does anyone have recommendations on accounting software to best serve STR owners. I currently have two STR's but am looking to grow in the future and want a software that will help me to grow and automate my accounting needs.

Hi, I’m Nariah. I’m a Senior in highschool planning to go to college for Business management - real estate minor. I am interested in investing in Real estate , but I’m not sure how I would begin that journey throughout college/after. I’ve done lots of research regarding REITS as something to get started with. Just need more advice on how to get the path started. 

BiggerPockets has the perfect book for you. Check it out. I think it will answer a lot of your questions.

https://store.biggerpockets.com/products/first-to-a-million

Quote from @Calvin Thomas:

I don't have my finger on the pulse and nobody knows the future. I just know Cleveland has always had a large population and they've always had cheap prices (for a reason). The market looks great now because so many investors are pumping money into that market. Eventually the markets around the country will balance out and the flow will slow. I'm predicting Cleveland will return to what it has historically been: cheap houses for cheap prices filled by cheap renters.

That and a $1.74 will get you a cup of gas station coffee.

Typically, the owner is the only one that can sign a lease as they are the owner of the property. The PM should have written authority to sign on the owner's behalf. 

Quote from @Jonathan Feliciano:

I just posted about this elsewhere. Property is affordable and looks good on paper, but your actual experience may be very different due to costly turnovers, bad renters, vacancies, etc. 

I see Cleveland as the Canary in the coal mine for the maret. Housing prices stayed flat in Cleveland for 30+ years. People were selling houses for $10,000 six years ago and then prices shot through the roof for the first time. Can you name one time in the last 100 years that we saw property values jump so high, so quickly, without a correction?

Door count is the worst (commonly discussed) metric in the real estate investing community. Why does everyone use it? Can we all decide to collectively kill it? Or are there some of you out there that stand by door count being a useful barometer of success? Honestly, I'd love to hear the argument for why this metric is useful, cause I can't think of one -- so please reply back here. 

Here's my argument. Door count is what many in the analytics world would call a 'vanity metric.' It's something that looks important and fancy,  but doesn't actually tell you anything about business performance. Sound familiar?  It's because door count is a useless metric, it exists to pump up the ego of the investor, and nothing more. Here's why: 

1. Door count tells you exactly nothing about the quality of a portfolio. As an example, let's say Jane T. Investor has 12 doors, and she leads with that when networking. Well 12 doors sounds solid, but how are they performing? Are they cash flowing? Do they require enormous amounts of time and maintenance? Are the returns as good as what other investors in your market/asset class are generating? I know people with huge door counts who lose money every month. What good is a 'door' if it doesn't generate returns? Tell me how efficiently your deals generate returns, and then I'll be impressed. 

2. Prioritizing door count makes you focus on the wrong thing. If I wanted to get 100 doors in the next few years, I bet I could -- but you can bet many of those deals would be thin. Shouldn't we be prioritizing quality over quantity?  If I could choose between earning $5,000/month from 10 doors, or from 5 doors, I would pick 5 doors all day long! Good metrics push you towards good decision making, and door count does the opposite. For a lot of people getting lots of doors would be detrimental to their strategy! 

3. Don't even get me started on passive investor door counts. They're absurd. I invest in multifamily syndications as well as residential properties. On the passive side of my portfolio, I am in syndications that collectively own over 2,000 units. Does that mean I own 2,000 units? Of course not, claiming so would be ridiculous (don't tell people on Instagram, though). If I own 1% of those syndications, does thatmean I own 20 units? I have no idea, nor do I care. Why on earth do I care what % of the doors I own? I care about actual measurements of returns like CoCR, AAROI, and IRR to determine if my portfolio is doing well.

There's my argument -- but I want to be proven wrong. Someone explain to me why this metric is useful. 

@Jacob Brenyo I do have a local realtor working with me right now. We communicate almost everyday. I do get the feeling that he doesn’t believe we can sell it because of the street it’s on, so it’s been kind of hard. Him seeming hopeless also makes me feel hopeless too.

Quote from @Russell Brazil:

Whats the address?

I think knowing the address would help you get the best advice. There might be a pathway where you can hire a better PM (easier said than done) who gets better tenants and you can stabilize the property and catch your breath. But the likelihood of success with that depends on the specific street. I'd hate for you to go through this all again. If you for sure want to sell it, there's not much to do, the best offers you are getting are what it's probably worth.