All Forum Posts by: Michael G.

@Sue Lu Rochester is a great place to invest in terms of cash flow. You will find some great deals there. Property management is a whole conversation in and of itself. Call me sometime and I will tell you about my 8 years of horror stories with various property management companies.  Not just my accounts of bad property management but I can tell you stories form viewpoints of several long distance investors who put their trust in what they thought were good PM's. 

@Aqil Dharamsey Thanks for sharing your thoughts. I've never had the good fortune of having decent property management. Even the PM's that came highly recommended by fellow professionals turned out to bad news. A visit to the property a PM manages just shows you that they manage a property. I've been inside properties that PM's manage and driven around town and shown the properties they manage with their logo's in the window. It gave me the illusion that because they have 5 properties in my farm area that they obviously must know what they are doing. That was a hugely false assumption on my behalf. So let me play devils advocate and say I was neglectful in doing the most thorough due diligence. Why does it seem that 80-90 percent of Rochester's long distance investors have the same bad experiences? Only 10-20 percent did their due diligence? OK. I have met some investors that did not understand the nuances of cash flow investing and REI...granted...however I have met some savvy cash flow investors who encountered the same property management pitfalls as I did. Just telling Sue Lu it's worth looking and investing in Rochester is not bad advice however she should know where to look and invest and where to stay away from. @Mark Updegraff (a long time BP member and Rochester investor and someone who's opinion ) asked you in a property management post around 3 months ago about your property management company but you never responded. Could be you never saw the question. Are you licensed to manage properties in NYS?

@Shawn Ackerman

What's going on my friend? Still fighting the good fight I see, Looks like you got Milwaukee on lock! Like your company logo! Sharp. PM me so we can chop it up a bit...

@Ilene Na - Is the city close enough for you to drive by the house? Why don't you contact the owners directly? Send them a letter saying you would like to buy the house. Is the property actually listed with an agent and are you buying it to live in or flip?

@Michael Kelly -That really depends now doesn’t it? 

Lets talk about the rental...

Can you rent it for more than you pay to service the debt on it? Let’s run some numbers and let’s keep them round for this example. Let’s say for Principal, Interest, Taxes, Insurance, Maintenance, Utilities, Management and Vacancies, (use the acronym PITIMUMV to remember these expenses) you have to pay $400 a month. If you can rent it for $550 then you have $150 a month of cash flow. That’s a good thing. You have to pay attention to your numbers because if you get this basic formula wrong you will not be happy with the outcome. If you get it right then you have a tenant that pays off your house for you and when it’s paid off you have an asset that produces income when you are asleep. That’s what a lot of investors invest to achieve. Cash flow income or passive income. In other words you do the work once and keep getting paid over and over until the asset no longer performs.

Let’s talk about the flip...

If you flip it, how much can you make after you have accounted for the purchase price, repair costs, closing costs, carrying costs (insurance, utilities, cost of money, etc.) Let’s use some more round numbers for your flip example. Let's say it cost you $30K to purchase and $25K to repair and you have $10K in closing and holding costs. You sell it for $95K. You just made yourself $30K in profit, Of course you have to pay Uncle Sam so you don’t get to keep the whole $30K but you get my drift. This kind of income is referred to as capital gain income. You should research it to find out what the tax ramifications are because it is not the same as income you receive from your rental example above.

Other posters may have some better commentary on your question but hopefully you have gained some insight on your query but the answer is...

it kind of depends now doesn’t it?

@Sydni Chattman -  I would say YES! Why not? Use your celebrity to promote your brand. Any good marketer would do the same. I would imagine your NFL role and exposure gives you certain access that your average person does not have. Use that to your advantage. Once you say NFL, you instantly have a captive audience amongst a large portion of the American demographic. You just have to have a good story to tell!

@Scott Burke - Excellent feedback. I hope someone who is considering taking their course searches the internet and finds your post. You have just saved one or more people certainly $15K+ and a possible life time of regret.

One of the worst things GURU's do is fleece students for cash and then take no action. Incredible that GURU's actually seem to have made a business model of these cash for coaching fradulent acts.

I think your analysis is great. Very informative.  I think I supplied feed back on the city of Allentown as it relates to the rental housing market vs the feedback I think tou wanted which was on your  analysis.

The closer I read your post I see one of the potential areas you are interested in is Whitehall. Nice area and everything in your analysis should support investing in that area. 

 Are you a capital gain investor or a passive income investor?

Allentown is a great cash flow town. I've owned SFR rentals there since '05 and 07'. NYC money goes a long way in purchasing property in this region as the price points are in the 35K-70K range for turnkey cash flow properties. My tenants are cash paying blue collar workers. City of Allentown has a fair amount of crime but not any more than any other low income environment. Taxes are not lowest but not the worst either. The thing I like the most about the area is that it's close enough for me to jump in my car and do an inspection of my properties in less than 2.5 hours. It will be even quicker for you since you are in NYC. My rents are $800 and $900 respectively. Taxes are roughly $2400 a year.

I think the stickiest issue in the area is property management. If you plan to self-manage then it won’t be a concern for you.

The general rule of thumb when investing in "Center City" Allentown (if that is where you plan to buy) is this. There is numbered naming convention to the streets. The neighborhoods get nicer in the higher numbered streets on the West side. Anything above W 20th is golden but you can find nice buys in the teens. The single numbers start to get dicey even though I own a property between 8th and 9th and I'm fine with it.

I suggest you go scope out the area if you have serious intent to purchase. Take a day trip down if you haven't done so already. The Holiday Inn in Center City has decent room if you want to spend the night although I prefer the Wingate by Wyndham myself.

You can always call or PM me if you have any questions.

@Paul Holt 

you notice how NONE of these students EVER come back and report their success? You would think due to the amount of BP'ers that showed interest in Peter and Joes coaching, a successful student would come back and post their results to prove that they weren't taken for a ride.

I personally think the students are too embarrassed to come back and admit they didn’t get what they paid for with Peter and Joe's program.

The way the program is marketed it would seem like a can’t lose situation?

https://joemccall.leadpages.net/apprentice-application-joe/

http://www.peterandjoe.com/

They don’t want to coach anyone. They want to partner with wholesalers in different markets.

I'm still lost on why they need $15K "are you serious" up front AND $1K a month for marketing? 

$1K a month alone per month would mean I'm very serious.

Has anyone partnered with Peter and Joe?

@Kedian Jimenez I've been around the block. I’m familiar with what attorneys need to do with the contracts in a double close. I’ve just never met one willing to do it. Have you? In fact…some have indicated that it is out right illegal to perform a closing that way. (I don’t agree with that but this is what they say). I've interviewed a few attorneys on Long Island, none of which was a proponent of the double close (except the one who could not execute). You have an attorney referral for an attorney that performs double closes?

@Kedian Jimenez : Kedian - Have you yourself used a double close strategy for a short sale deal in NYC? The attorney I contacted in Long Island who advertised that he could perform double closes in Long Island danced around the issue when I brought him a ABC close scenario and could not execute and that was not even for a short sale.