All Forum Posts by: Stephen Masek

Find a good full-service environmental consulting company, not a home inspector or guy who only does mold and  have them collect non-viable air samples.   Texas has a license for mold inspectors:

https://www.tdlr.texas.gov/mld/mld.htm

Wow, where to begin...

1) Yes, the agent pushed the junk offer. We had dropped the price from $180,000 to $175,000, but in several weeks that is the only offer. The house is in a gated subdivision with a clubhouse and an easy walk to shopping, so it should be attractive. Yesterday we saw a four bedroom comp 60 square feet larger on the same street sold at $191,000, so told her to raise our three bedroom house back up to $180,000 and put the EMD at $3,000 to weed-out those who are broke. She needs to market to older people with money, not broke younger people.

2) They did not tell us anything about getting that many calls.  It is a bad idea to put any such stuff in an ad, except at the end/bottom.  Instead, sell the features, then talk to people when they call.  

3) If they can not figure-out how to take decent photos, they should indeed hire somebody else, using their own money.  Taking decent photos is not difficult or complex.   They do not need to be the work of a professional photographer to be good.      

As owners, one of the things we've learned over the years is that we often need to teach property managers and real estate agents how to do their jobs.   There is some humor in the situations which arise:

1) We have a house in Lakeland, FL for sale, and the agent seemed disappointed this morning when we rejected the first offer. Lowball on price (we have solid comps on the same street), they want us to pay all of the high closing costs, they only want to give $1,000 as an EMD, and they want a long escrow. What does all of that mean? They have no money! More importantly, they are unlikely to find any money.

2) We have a house in Acworth, GA and recently switched property managers. The new managers claiming great experience, wrote ads which started out with a long list of restrictions and rules, not positive things about the house and neighborhood! We had to educate them. The first potential renter they find is a group of unrelated graduate students, completely forgetting that the house is in a HOA and intended for single family occupancy, not use as a dormitory. For all of this they and all of the others in Atlanta demand 10%. However, we get the last laugh, as the thing has almost doubled in value and is still appreciating.

3) Numerous times over the years we have had to tell managers and selling agents to take good photos, not lousy ones which make the garage door the main feature of the image.   

Do you have any funny stories to add?

You might consider a more business-like hair cut and clothing than what Is shown with your posting.  There may be some racism, but not much.  

We recently inspected an apartment building of two bedroom units  in Beverly Hills for one of our clients.   Despite having original 1960s kitchens and bathrooms, dreary corridors and badly rusted waterm pipes patched everywhere and ready to burst, the seller wanted almost $1,000,000 per unit  

How on earth is a tiny, probably old, place in Riverside worth $310?  We own a nice house in Victorville built in 2004 with 3 bedrooms and two bathrooms and it is worth approximately $194,000.  

Wealthy Californians loose money out of state?  No here!  I don't feel wealthy with a net worth of $3,900,000 and no debt, but we've done quite well investing out of state.  Our current portfolio of 15 rental houses cost us a total of $1,666,062 and is now worth $2,317,000.  That is a gain of 650,938, or 39%, and they are appreciating.  Gross rentals total $201,960.  Some are owned inside of a 401K plan, reducing taxes.   (Note the $2,500,000 above was a typo.)   Our return on the purchase price is good, but less so on the current value, so we are thinking of buying an apartment building.  Our risk is geographically diversified. 

California also has radical leftist government, a great danger to investors.  I doubt they will actually pass communist healthcare and have it survive a Supreme Court challenge.  If it does go into effect, people with money will flee the state.  I also hope the large increase in gasoline and diesel fuel taxes and the car tax will be ended by the successful recall (I was an early signer of the petition).  Brown is stuck on the bizarre "global warming" hoax.  Trees do not grow to the sky, and California apartment prices are goofy.   

Please let me know if you need some help with the environmental or property condition assessment aspects of due diligence.   

The problem with using leverage is that the lever can pry for you or against you. 

We're closing today on SFR number 15, all free and clear. There is still appreciation to be had from SFRs. There is also diversification of risk, since we have them in several states.

However, we have started to research apartments and see nothing attractive.  It seems that we should look for a neglected 20 to 30 unit building in an area where good rents can be had after renovation. 

Prices in California are bizarre, with incomes not increasing, tenants packed in and taxes and regulations increasing.   My environmental consulting company just inspected a 21 unit building in  southern CA.  It has original 1960s kitchen and bathrooms, water piping ready (literally)to pop open in numerous places, dreary corridors and needs new electrical panels.  We'd guessed that it might be listed at $7,000,000 or so, then looked it up - $19,000,00, which is $904,762 per door!   

I was on a call with his daughter a few weeks ago and heard that the revised book is coming along nicely.  With all of the positive things happening in the White House, it will be good timing. 

Wow, Soquel.  My environmental consulting company has done work there.  It is a nice part of California.