All Forum Posts by: Cory J Thornton

@Justin Walker - It sounds like you have a foundation built, are taking some initial actions, and are looking for the next step. I have a lot more questions than can be efficiently answered in a forum. Given you're in the Raleigh area I'd be glad to get a coffee on the schedule. My expectation is not that I am the guy to help you with large multi ... but once I get a sense for what you want to do, and what connections would be helpful, I am confident that I can help you connect with the right person in the Raleigh MSA. Ping me with a text and we can figure things out from there. 

@Mike Hodges - I'm a little late to the party, but welcome! This is a great community. I'm always game for meeting like minded people and other professionals to chat about the local market. If you ever want to connect then ping me with a message and we can get something on the schedule. 

Hey @Ambica Pilli - I would look up the following organizations to get connected with other investors. 

- I think you can search events in this forum to see when local BP meetups are scheduled. There is a monthly one in Raleigh that I used to attend regularly, but I haven't been in some time. Great group!

- Triangle Real Estate Investors Association (TREIA) has a very active calendar across the Raleigh area. Last night I had a chance to speak at the Wake Forest sub group and there was a group of about 30 in attendance. Most of their sub groups will run 20-40 folks and their main meeting is 80-100. Very reasonable membership fee, and non members can attend as well. 

- I know NCREIA also has several meetings. I went to a few of their functions, but I personally gravitated towards TREIA since most of NCREIAs events seemed to just be zoom calls. 

I recognized your name and I think you may have spoken with Lisa Rider, one of the agents on our team. As a shameless plug, Raynor Realty has started hosted quarterly client lunch and learns which are both educational and networking events. 

Best of luck as you build your local network! 

Hey @Dan Miles - Manage strictly to the terms of the lease. A security deposit is not rent. If she has not paid rent on the first, then send a notice that rent is late and a late fee will be charged on the 5th. On the 6th send a notice that a late fee has been charged and that if the fee and rent is not paid then then a move out notice will be mailed on the 10th. On the 10th serve a pay rent or quit notice giving them ten days to make you whole or be out of the home. If that agreement times out and you haven't received rent, then go to the courthouse and file eviction. Notify the tenant the eviction has been filed and then follow the court process. Most state leases in NC will support this process or one similar. For me it is a hard line, rents are not deposits. Give up the deposit and they have no incentive to leave the home in good condition or you have no funds to repair damages behind them. Feel free to give me a shout if you want to jump on a call. We manage property all over the Raleigh Area, but not Fuquay. 

A lot of folks are talking about assumable mortgages ... 

- USDA, FHA and VA loans allow for a buyer to purchase from a seller, and the loan be transferred to the new owner. While this sounds like a win, the number of cases where it is feasible are few and far between.

1) There is an application and approval process required by the bank for the loan to be transferred. This process does not have a dependable timeline or a grantee for approval. In a market where buyers a bountiful, sellers have too many other options to consider, before accepting an offer from someone trying to assume their loan. 

2) Anyone who has owned their home for 3+ years is sitting on a substantial amount of gained equity from appreciation. At closing the buyer will need to pay the difference between the amount owed on the mortgage being assumed and the purchase price which would easily be 1/3 or more of the homes value in most cases. 

The current incentive structure makes it very difficult for an assumable mortgage to actually be a tangible tool for buyers. 

Does anyone know anyone who has used an assumable mortgage in the last year or two?

As a real estate investor I am always curious about lending trends/debt trends in different sectors.  

Lenders and economists alike are speculating about the threats of "phantom debt." This debt type would throw economic projections for economists and increase the risk of lending for lenders.

Phantom Debt is created when a consumer chooses the Buy Now Pay Later (payment plan) option when making online purchases.

These types of payments are not currently reported to any credit agencies as debt which is why they have been given the term "phantom."

Some articles indicate that as many as 42% of those who actively use the BNPL purchase option are either behind in their payment or behind in other payments for other obligations.

Even though this is not something being reported to credit agencies, it could be something that starts popping up on loan applications as the amount of "phantom debt" in the system continues to grow. 

As landlords, this could also be a threat since tenants could have a wall of debt hidden from any financial screening we do during the application process. 

@Ryan Overcash - We have a few clients active in RM and Wilson. Feel free to give me a shout and we can chat through the pros and cons of the area. The biggest thing to focus on with any secondary market is the economic development activity. What business is moving into the area? What is the town doing to incentivize growth? What is the infrastructure story (do they have water/sewer/power to support growth)? What is the population trend and the average household income trend? Is there anything that gives a town a unique geographic or economic advantage/moat compared to another town? 

 There has been a lot of great conversation on this post. In case someone was interested, here is the link to the migration study I mentioned in my initial post. Study 

I have listened to a few podcasts recently from folks whose opinion I appreciate like Ken McElroy, George Gammon, and a few others. 

I have been trying to think through how a surging population (via immigration) will impact housing. 

I don't know the timeline or to what extent, but these are the the puzzle pieces around which I have the most conviction. 

- Increasing population is increasing demand 

- Labor trends seem to indicate that a large percentage of the "jobs added" in the jobs report over the last few years are works who are new to this country. - A dramatic increase in the supply of willing workers usually results in a decrease in hourly wages. 

- A dramatic increase in the supply of folks needing a place to live usually results in increasing home prices and increased rents. This is very true for anything remotely affordable or entry level. Essentially these trends will culminate in an increased cost of living and a stagnant or decreased wage (again, felt most around affordable/entry level housing). 

As things become less and less affordable we are actively seeing more people push to an hour away from a city, even into rural areas, as long as the internet speed is strong enough. 

As home owners, business owners or investors, how are these kinds of trends impacting your decisions right now? Are you putting together any strategies to specifically address these trends? 

Personally, even with interest rate uncertainty and election year hysteria, I am building a stronger and stronger conviction around the fact that I need to get a little more aggressive in acquiring more income properties.