All Forum Posts by: Doug Smith

Hey E. Jacobs,

Thanks for reaching out. Wholesalers and motivated sellers provide the property information, including the ARV, cost of repairs, and asking price. We have notices throughout the the site that inform members of this and encourage you to determine the ARV and cost of repairs on your own. You can use their numbers as a guide, but you definitely can't go by them for a couple of reasons ... 1) some sellers exaggerate about the ARV and underestimate repairs, and 2) both of these figures are highly subjective. What's a comp to one person isn't a comp to another. And some people can get their repairs done at a much lower cost than others. At MyHouseDeals, we feel that our main responsibility is to round up dealmaking opportunities for you. It's impossible for us to pull comps on each property and/or inspect each property to verify repair amounts. But we still let sellers post that information so that you'll at least have an idea. So if that one deal is still sitting on the market after being posted for a while, there's a chance that the seller fudged on the ARV or repairs. But again, you'll have to look into that yourself. Hope that helps!

Doug

Hey Kevin. This is Doug, owner/founder of MyHouseDeals. We've been operating in DFW since sometime in 2006. It's our 2nd most active market behind Houston. Here's the scoop ... Some will tell you the website sucks, that there are no good deals, and that you shouldn't waste your time on any site where you have to pay for a regular or premium service. Some of those types of comments are actually in other threads on BiggerPockets. But other people will tell you how great the site has been for them and how much money they've made from it. We even went up to Dallas and took pictures of 6 different people who have made between $10K and $100K from the deals. They were standing in front of the houses they bought from the site. So at the end of the day, the site works if YOU work the site. And yes, the 14-day head start is very important. I don't know of many good deals that are still available after that period of time. But do what you wish. My goal is not to pitch you or close a sale, just inform you. Hope I helped. -- Doug

Thanks Kyle. I would take you back as a member anytime! :-) Glen, I'll let you know when we come to Orlando. We have our hands full with our existing markets for now. George, I'll email you the lender guide now.

Doug

Great idea Josh.

A while back, I interviewed what I called the "top investors in the nation". These were all multi-millionaires who were so busy doing deals that they didn't have time to mentor or put a kit together. (Exception: Two of them had a product to sell, but they were not allowed to mention it.)

These investors, for the most part, were EXTREMELY difficult to dig up and get on the phone. They tend to be "below the radar".

I ended up interviewing 15 investors and got 26 hours of audio out of them. The content they delivered was absolutely incredible. I had to pay each one $1,500 just for their time since, like I said, they had nothing to sell or promote.

If people are interested, I can share 1 or 2 of these interviews with Bigger Pockets members for free. People would just need to tell me which investors they want to hear from. I could share the most popular suggestion(s).

And if Josh or someone else is interested in interviewing them again for a topic like "What to do in 2009/2010", then I have the phone numbers of these guys for you to contact them.

Hope this helps!
Doug

Hey GS. Not sure what you mean by that.

Glad to help! I just sent you the guide.

Hey there!

This is Doug Smith. I'm the founder/president of MyHouseDeals. Welcome to Bigger Pockets! I think you'll find that Joshua has put together an incredible website for networking and sharing info amongst real estate investors.

I see from your recent postings that you're a new investor. I wrote a couple of articles that may help you out ...

[LINKS REMOVED]

You can look through my blog to find many more that'll help you on your path to financial freedom.

I see that in this posting, you're asking about my website. Of course I think it's the greatest thing ever, but that doesn't carry much weight since I am, after all, its founder. So I won't get into all that.

What I will tell you is that we offer free access to the wholesale deals and motivated seller leads in your area. There are plenty in DC and a surprising number more in Baltimore. I assume you'd be more interested in DC since it's closer to where you live.

Also, we give away a guide to hard money lenders in the DC area when you sign up for a Premium account, but I'll hook you up with it for free if you'll PM me. Always happy to give new investors a leg up.

There are some current and previous MyHouseDeals members on this site. Maybe some of them will comment.

Hope that helps, and best of luck!
Doug

My original impression was that he was considering buying and holding. Norm, was this not the case? I now know that you're wholesaling it.

It's nice to hear a different point of view from Mike. We've obviously had vastly different experiences.

Norm, you asked about deferred maintenance. My opinion is that even though it passed inspection, most of the major systems could quite possibly be teetering on the brink of demise. You'll need to see how old the following items/systems are ... roof, AC (condensor, evaporator coil, and furnace), electrical box, and plumbing (esp. the sewer line). If many of them are near death, you could possibly face a scenario where you shell out $3k per year for several years to replace them.

Sounds like you have a good tenant on your other property, but my experience tells me that won't always be the case.

I've owned 10-12 rentals in the "ghetto" and have had dozens of tenants. My opinions are based on my experience with those properties and those tenants. I've had a very positive experience with rentals that are valued near the median.

Glad to hear you're likely to wholesale it! :-)

Doug

Hey Norm!

Glad you posted. You have the chance to avoid what I think would be a big mistake. I've bought numerous properties in the "ghetto" (not war zones). I rehabbed and resold some, flipped some, and held some as rentals. The ones I held as rentals are a huge pain in the butt.

Based on my own experience and the experience of several experienced investors I associate with, here's what's likely to happen with that house should you choose to buy it ...

1. You won't be able to re-sell it for the next 5+ years since the vast majority of buyers in low-income areas have been completely wiped out of the marketplace. They can no longer qualify for most loans. So the ARV is meaningless if you can't sell.

2. The repairs will be MUCH more than $3k. Potentially five times that amount over the next 3 to 5 years. This is due to the incredible amount of deferred maintenance that has likely accumulated over the house's' lifetime.

3. This tenant will be a huge pain ... they may pay on time since their Section 8 money depends upon it, but they'll request all sorts of frivolous repairs and complain about everything. Most tenants in low-income areas fit this mold.

4. Your tenant will leave in a year or two, and you'll have an extremely difficult time finding another good tenant. Potentially months of vacancy. There goes your ROI.

5. Once you find a tenant you think is good, they'll prove to be otherwise. They'll destroy your house and fail to pay rent. You'll end up evicting them.

Bottom line: Rental properties in the ghetto always look good on paper and almost always turn out to be a disaster in real life.

Wholesale all properties on the low end and move on. Hold rentals that are at or slightly below the median value for your area.

Hope that helps!
Doug