All Forum Posts by: Cody Steck

So it sounds like I need to get an agent to work with. A few of the local brokers have real estate assistants who help pull comps, make offers, run errands, etc for bigger name agents. Perhaps I can get in reach with one of these agents who is investor friendly as @Joe Villeneuve says. 

The key will be to find one that knows how investing works...

Any recommendation in paying a "per-offer" kind of commission? A couple bucks for every offer submitted or something? I know that the agent will get commission when we get a deal but I am worried about them feeling used for submitting a bunch of offers if we don't get anything.

Thanks!

Ok, I have read books and listened to podcasts and videos. I've talked with local investors, a few developers, and have good contacts with a builder. I've attended my local REIA. I feel like I am starting to get into "analysis paralysis". I want to avoid this and jump in.

I have called sellers and spoken with realtors. I have found a few deals that could work if, of course, the purchase price works. The thing I feel that is really holding me back is how do I actually make the offer?? I am not working with an agent and I am an not one myself so as far as I understand, the offer could literally just be some simple words written up on a piece of paper. Obviously, if it was accepted we would enter into a more formal contract.

What do I need to do? Should I just send the realtor/owner an e-mail stating the offer price and terms? Should I attempt to use a REPC from the start? Do I need to do something in person or over the phone? Any suggestions?

I like this discussion. It is bringing about some important points from both sides.

@Andrey Y. I don't know what the market is like in Hawaii. What is the fair market rent of a SFR vs a condo in your area? Also, what is the difference in price between the two.

There might be a large enough spread in the price and a small enough spread in rents that it makes more sense in your area. Just a thought. I think there is a potential for condo's as long as you do your research.

@Brett Russell Yes, after doing some research, I believe you are correct. Here is a good article that seems to explain it well. 

http://www.aicpa.org/Publications/TaxAdviser/2014/...

Thanks for catching that and pointing it out. 

Good idea, sorry to detract from your original question

@Charles Kappe Interesting. I am not too familiar with the concept, so correct me if I am wrong, but isn't a deed in lieu where the borrower gives up all interest in the property to the bank? Or are you involved in these transactions before they actually finalize?

Does your job provide a conflict of interest in you personally buying the properties? I am interested to hear more about this? I kind of feel like this is a form of "insider trading". If not, I would be interested in finding a person in a similar job locally.

It sounds like you will be fairly handy in doing some of the repairs yourself with your background. You would probably be able to add some major value with sweat equity.

There are a couple of differences in the two options. In my opinion, an LLC is definitely the best choice. There is just no point in incorporating. The main thing that you can do with an s-corp that you can't do with an LLC is to issue stock which is not generally necessary in RE. Another deterrent to s-corp's is the fact that you have to hold annual meetings and record minutes. Do you really want to be required to do this as a relatively small time investor?

Basically every other benefit gained by an s-corp is also available in an LLC.

Now, if you are going to start doing business in loans, title, syndication, etc. then the pro's and con's start to change. But, from what it sounds like, it looks like you are starting as a landlord, correct?

Best of luck

Do you have any kind of construction or rehab experience? What is your background? I would assume you are looking at private lending or hard money. 

@Clay Smith don't you have to wait two years for 75% of the rental income to be counted towards income? Does this policy change if the place is your current primary residence?