All Forum Posts by: Dave Gallogly

As so many have said already, the best area is really up to what you are wanting out of your house hack.  We as an real estate investor have purchased very heavy in North Mpls because they were affordable to purchase and they all cashflow. North Minneapolis like many urban area have special challenges you need to consider for example Minneapolis inspectors are very on top of our properties in making sure they meet their standards for rental units. We tend to have a higher rate of crime in north compared to Blaine, but the good good area to invest in is relative.  For us and our goals and business model North Minneapolis is a good it.

For your first deal you are smart and will be ahead of the game by having a place to live while having someone help you pay your mortgage. Good luck

Well said Terell.  Its amazing how each area is so different.  Here in MN, you can do all the work yourself working as a general contractor, but once you buy an investment property (one more property then your personal residence) you have to have a license to do any work on it.

I guess I am alittle on the conservatives side and want to be able to see my investments.  I know many investors are doing deals allover the country with success, but being a newbie I would make sure your first deal is a success. to many investors jump into things and either lose money or have a terrible experience then get out of real estate.  I don't know how to make it work in CA (I live in MN) but maybe the Auburn area would work if you planned on visiting there often to keep your eye on the property.  

Personally being a real estate investor I got frustrated with the lack of attention I was get from the realtors I worked with and became one myself. You are asking a great question and will be putting yourself ahead of many of the other realtors by taking the advice that I plus others will give here.

To Answer your question:

1.  listen to me and what I am wanting for a property. 

2. Don't try to sell me, If I am a professional Real estate investor I know what I am looking for I just need you to present deals to me that I am wanting to buy.

3. Respond quickly to request

4. Being another set of ears and eyes looking out for my best interest

5. Bring to me value added experience that keeps me loyal to you. Anyone can set me up on a MLS feed and have me call you when I see a property I may be interested in. Dig deeper for deals not every one is on top of. call people with expired listing that I may want and see if they would be interested in doing a one time purchase agreement with an investor if the deal works.

Its all about a win win situation.  I have a need to buy and you get paid when I do buy.  If we are successful in doing that once and I as an investor see you as a realtor being out for my best interest and not just getting a sale. We will do many more deals in the future.

I have had them in the past, but now have enough experience to do it in my head.

Over the years, I have seen many wholesalers and investors put out list like this for people, the problem is real people are doing the work and products each investor uses varies much in cost depending on what your own personal quality standard is.  For example:  We can do a completed bathroom gut job and rebuild with our team pulling permits (that cost more money) and all for $6000 on average.  But if you had to hire a general contractor to do the same job it would start at $10,000 or a all cash handyman for $4000.

The best thing for you todo is find a local General Contractor or Handyman and had a real person put numbers together for you.  They are on the street in you state buy products from your local stores.  Otherwise you are going with someone else's guess and who knows if that is accurate.

Great question.  Being a General Contractor in Mn and real estate investor I can only speak about my experience in our state. A general contractor in our state is someone who has passed an exam issued by the state, paid the appropriate fees and has liability insurance along with workman's comp if they have employees.  I say that because the level of expertise varies a lot between each one from very knowledgeable in all areas of construction, codes, and business to  someone with very little in each of those areas. In our state if you want to build a skyscraper or in reality any commercial building there is not requirement to have a general contractors license.  You do have to work with official city and state officials and inspectors to make sure the structure is built at a high standard though. Why do I start off with all of this? Its the persona not the title that makes someone good that can do all the things you talk about.

Ok, that is enough ranting and raving. Back to you question.

A General Contractor should be knowledgeable to work with and direct all areas of a project.  They hire subcontractors for each discipline as in plumbers, electricians, HVAC contractors to complete a project. It al starts with your conversation with them and what the scope of work you want accomplished within the project and what they accept they will do.  Be very clear with the relationship of what your expectations are with the project and how you communicate back and forth with each other.  It good to ask them what are the different things they do in a project and what things are expected of you.

We could go a lot deeper, but does that help?

Investor from Minneapolis with 31 doors mostly houses with 6 duplexes. 40% paid in full, 6 units have not paid a dime, the rest are putting together plans to make payments. We were planning on the worst being 5 will not be able to pay at all and have to move out after May. This first month is not my concern as much the as June rent. I think we will feel the full weight of the shut down by then.

Most of our tenants are in the pouring part of town and the working class there is almost totally out of work. Time Will tell.

Thanks Tim Swierczek. 

I already have gone down the road and have licensed Electrician come out and now am talking with a local Real Estate Attorney who has ran into this a number of times in Hennepin county which she says is the worst.  The short of it, with us being illegal in fallowing the statue we are required by law to have the Utilities moved into our name and because of items that were stated in the MN Statute about what is stated in the lease, we are required to pay all of her gas/ Electric Utilities from the time the lease started until now. Also, we could be required to pay legal fees and extra costs associated with the tenants attorney pulling together their case.  In her mind it is an open and shut case for the tenant and i need to comply with my other duplexes before they are found out.  Bunch of Crap!!

We came across a Statute here in Minnesota that affects our duplexes we own in our portfolio. A few months ago our local Utility company called to tell me that the Utilities are being placed back into my companies name (each one of our tenants in the duplex had both gas and Electric in their names with separate meters) because of the MN Stat 504B.215 that talks about shared services. Now I have an advocate attorney for the tenant wanting to press the issue. I now see from the MN statute there needed to do some changes to be legal. At this point I would like some clarity on the law from an expert Real Estate member or attorney who understands and has been an advocate for land Lords. Lots more details, but I will keep this short.

Has anyone dealt with this Law?

Has anyone had a tenant advocate Lawyer dig in their feet on this for a tenant and maybe went to court?

Do you know an attorney that can advise?

As for me I would buy in my own area that I can monitor.

Through the years I have tried other businesses that I was a remote owner and the old adage “when the cat is out the mice will play” came true. Since then I will only buy for rental within my own area (within 45 miles). As a newbie to rentals, I would recommend not rely on others to totally manage the properties without your oversight.And if a property is not easy to look at, drive by or to visit with renters there is all kind of things that could go wrong.