All Forum Posts by: Gregg Cohen

@Matthew Lucas - Thanks for sharing your experience!  We've loved working with your family through the years.

Hi @Craig Oram,

I can see that there are still a number of issues that we’re just not on the same page about. I’d love to come to a meeting of the minds and a public forum probably isn’t the best place to do that. I’d be happy to jump on a call with you or chat over a private message if you’re open to that.

@Jay Hinrichs - Hey Jay!  Nice to chat with you again.  Thanks for the kind words.  I'll send you a private message...I'd love to hear what you've been up to lately.

Hello all. I'm one of the owners of JWB and would like to provide some additional information as well as clear up any miscommunications.

@Craig Oram - Hi Craig. It's been a while since we've had the opportunity to chat. I hope you and your family are doing well and staying safe. I can tell you're frustrated on a number of items. I've read through the notes on the conversations you had with my team as well as pulling real numbers on your maintenance and property turn costs and your lease terms.

You purchased your property in 2017 with an expected rent amount of $1,549 on the original property evaluation. 

In 2018, we had a property turn and the net cost to you out of pocket was around $500 (costs to repair minus the security deposit that was returned to you.) We were also able to recover $1,550 in liquidated damages from that resident which meant that you were not out of pocket at all for that property turn.

In 2020, we just had a property turn.  The actual cost of the turn is $2,843.17 but the security deposit returned to you is $1,650 (may change slightly on finalized intent to claim proceedings.)  The net cost to you is roughly $1,193.17.

After the turn in 2020, your property was rented within a matter of days at a rate of $1,699.  That is roughly 9% rent price appreciation over the original rent estimates.  We signed a 3 year lease with your tenant for you.  

It is common for rental property investors to feel the pain when a property turns over but keep in mind that is why we retain security deposits for you.  The net cost of the turns is what really matters to your return on investment.  

I also wanted to clear up that fact that JWB does not mark up maintenance items.  If you get a plumbing bill for $100, that $100 goes directly to the plumber.  Our goal is to keep your maintenance costs low to keep your return on investment high.  The only time you would see a fee related to maintenance would be a project management fee if multiple trades are required during a property turn.  That fee is based on the amount of work completed but is somewhere between $150-$400 typically.

As far as the 10% fee charged during the first month that we lease a property, you are correct that is a part of our fee structure.  This is explained early and often with new clients and it has always been a part of our fee structure as long as you've been a client.  The reason for this is there is certainly a lot of heavy lifting of resources required by a property management team to bring on a new resident including rent collection, setting proper expectations, accounting and building a positive relationship in the first month.

As far as the quick re-rent of your home, I was hoping that would be something in which you'd see the value of working with us.  Renting a home in a matter of days is something we're really excited about for you as it is a great thing for your overall return on investment.  Just because we did it so quick shouldn't diminish the value, hard work and systems required to produce the result for you.  

I'm going to take your comments about the communication to heart.  We would never want to make a client feel as if we are scripted, heartless or looking out for ways to maximize our fee structure.  I'm sure there are things we can do to get better and we'll use this as a learning opportunity.  

Hello all.  I'm one of the owners of JWB and just wanted to join this thread as I can tell it's been quite popular throughout the years.  First off, I just wanted to say thank you to @Rebecca K. for being a client and also for sharing her journey over the years.  As we know, investing in rental properties involves a lot of moving parts.  I know there were some concerns and it is a great learning experience for the entire BP community.  I haven't been an active contributor to BP in the past but I'm looking forward to jumping in and being a resource to the group!

@Rebecca K. - It's been great to have you back as a client.  I really appreciated you updated your post and clearing up the fact that JWB didn't charge you an additional tenant placement fee due to the extenuating circumstances with your previous tenant.  I also am glad you gave real numbers for the property tax concern.  It is really common for investors not to properly estimate property taxes, especially when it comes to new construction properties that haven't been appraised for the first time.  Luckily JWB builds roughly 400 new construction properties each year and many of these are in the same neighborhoods so we can use our previous builds when estimated property taxes.  Conservatively estimated returns on the original property evaluations is really important to us!

I also wanted to address any other concerns that others had.  You'll have to forgive me as some of these posts were made quick a while ago but I wanted to clear up any misconceptions.

@Joey Hamaoui - We love working with real estate agents to acquire properties.  We do charge a full month's tenant placement fee while others charge only 50%.  However, we only sign 2-3 year leases whereas other companies only sign 1 year leases.  So the tenant placement fees with JWB are actually less expensive many times when analyzed over the long haul.  And the investor wins in the long run when you have long-term tenant stays.  Hope we can work together in the future!

@Jim Schock - Sorry if I made you feel like you could never walk your property.  Must've been a miscommunication on my part.  We actually fly all of our clients in and take them on a tour while covering up to $1k of the costs because we want our clients to get to see their assets.  We just work very hard on the front end to bring clients who want to be passive in this investment.

@Jack Bobeck - Thanks for the compliments!  

@Emy Bernardo - Hopefully Rebecca's most recent post gives you confidence to know that JWB uses real numbers for both property taxes and insurance in our initial property evaluations. 

@Jay Hinrichs - Long time, no talk!  You're right.  Many investors only pay attention to the previous year's tax assessed value which is no good for buying a new construction property.  We estimate property taxes based on comparable properties that we built in the area to make sure we give the appropriate expectation to investors. 

@Robert L. - Hey Robert.  Like we discussed on the phone, we made a few mistakes in the management of your home.  We're not perfect and if we screw up, we want to be accountable.  We also went out of our way to cover a significant amount of costs for you as a sign of good faith.  I can understand your feelings but I can assure you that we're not too big to pay attention to ways to save investors money.  Maintenance and vacancy costs are the two biggest pain points for an investor and we care deeply about keeping these costs low.

@Jasmine Hu - We've found the most success by investing in below middle-income to middle-housing for cash flow and appreciation.  But you're right, investing in these neighborhoods many times means investing in a house that you may not want to live in yourself.  We try to address this one one of our first phone calls with a potential client.  Best of luck in the future. 

@Sri Yalam - We recommend clients buy and hold for a market cycle to achieve the highest rates of return from cash flow and appreciation (10-20 years.)  However, when the time is right to sell, we're a resource for you.  You don't want to sell to an investor typically as your best price largely will come from someone who wants to live in the house.  So we pair you with a local agent that we trust to liquidate the asset.  As far as tenant info, we don't share that with owners.  Part of this is due to confidentiality requirements and part of this is because the type of owners we typically have put their trust in us as the experts to make the correct decisions as far as tenant approvals. 

@Timmi Ryerson - I hope you have a chance to read Rebecca's update.  We care deeply about doing things the right way and being a positive force in real estate.

Thanks again for sharing all of your thoughts and concerns and I'm looking forward to interacting with you all on a more regular basis.

Hi @Account Closed, I'm not a realtor.  We have many realtors on our team here at JWB Real Estate Capital but it has never been necessary for me to become an agent specifically.  I'd be happy to help you so feel free to send me a PM if you'd like to chat.

Just been reading the post again as it has been a couple of years and I thought it would be helpful to point out that a hard money loan shouldn't be necessary (and might prove costly) if you are planning on buying a turnkey property for positive cash flow and long-term appreciation.  It may be necessary if your criteria for buying is more about buying a rental property with built-in equity.  However, there's typically a lot more work that goes along with trying to find properties with built-in equity.

Hi @Carolyn Morales - Thanks so much for the kind words and support.  That's a great idea to give a little more insight into our story but as of now, we haven't taken the time to write that out.  I'll certainly keep you posted!

@Jack Bobeck - Thanks for recommending us! Always great to connect with you after so many years. Seeing properties sell at the courthouse steps for more than ARV surely is one sign that investors are over-paying. There are a lot of data points to consider when forecasting and you've brought up a few that should be taken into account as well.

@Seavron - Nice to meet you!  Looking forward to having you as a client.

All who mentioned that Jacksonville is really southern GA....very true!

I meant to say above 7 months is an indicator of lower than normal appreciation in the short run.  :)

Months of inventory in Jacksonville is very low.  This tracks the # of houses on the market divided by the # of houses that sold last month.  Below 6 MOI is an indicator of higher than normal appreciation in the short run.  About 7 indicates lower than normal appreciation.  From 1978 to current, the avg appreciation rate in Jacksonville is 3.8% so we deem that “normal.”  MOI has been in the 4-6 range since 2013 so it’s not surprising that we’ve seen above avg appreciation since that time.  And MOI is much lower today.  Dipping into the 2’s.  You’re going to see prices going up in Jax until supply increases.  But building in the middle income and below middle income neighborhoods hasn’t happened much in recent years because prices aren’t high enough for a builder to make a profit.  Prices need to go up to give an incentive for builders to increase supply. We’re expecting higher than normal appreciation in the short run in Jax (12-18 months.). Hope this helps!