All Forum Posts by: Gurleen B.

I've come across some online courses, particularly those by individuals like Tom Cruz and Section8Karim, who claim to provide valuable insights and strategies for successful Section 8 investing. However, I can't help but feel a bit skeptical about the legitimacy of these courses. It's challenging to distinguish between genuine advice and potential scams in the vast sea of information available online.

I'm curious to know if anyone has enrolled in courses offered by individuals like Tom Cruz or Section8Karim. Do you feel that these courses provided valuable and actionable information, or did you find them to be more of a sales pitch?

Thanks in advance for your insights.

@Henry Bagh it appears what you really want is a personal assistant.

Otherwise, 

Encourage you to learn from the mistakes of others - by reading posts here on BiggerPockets about owners not having their expectations met by their current Property Management Company.

To avoid going through the same poor experience, keep reading.

Even if someone give you a referral, don’t make the mistake of assuming that PMC will meet your expectations, just because they met the expectations of the referral source.

We also can’t believe how many owners hire the first PMC they speak with!

Then they complain their expectations aren’t being met!

In our experience, the #1 mistake owners make when selecting a Property Management Company (PMC) is ASSUMING instead of CONFIRMING.

It's often a case of not doing enough research, as they don't know what they don't know!

Owners mistakenly ASSUME all PMCs offer the exact SAME SERVICES and PERFORM those services EXACTLY THE SAME WAY, so price is the only differentiator – and they often select the first PMC they call!

So, the first question they usually ask a PMC is about fees - instead of asking about services and HOW those services are executed.

EXAMPLE: PMC states they will handle tenant screening – what does that specifically mean? What documents do they require, what credit scores do they allow, how do they verify previous rental history, etc.? You’d be shocked by how little actual screening many PMC’s do!

This also leads owners to ASSUME simpler is better when it comes to management contracts.

The reality is the opposite - if it's not in writing then the PMC doesn't have to provide the service or can charge extra for it!

We have a 14-page management contract that we've added our real experiences to over the years, with the intent of protecting both us AND the landlord. Beyond the Monthly Management, Placement & Maintenance fees, all other fees in our contract are IF EVENT -> THEN fees.

We don’t know any PMCs to recommend in the area mentioned, but since selecting the wrong PMC is usually more harmful than selecting a bad tenant, you might want to read our series about “How to Screen a PMC Better than a Tenant”:

https://www.biggerpockets.com/member-blogs/3094/91877-how-to-screen-a-pmc-better-than-a-tenant-part-1-services-and-processes

We recommend you get management contracts from several PMCs and compare the services they cover and, more importantly, what they each DO NOT cover.

EDUCATE YOURSELF - yes, it will take time, but will lead to a selection that better meets your expectations & avoids potentially costly surprises!

P.S. If you just hire the cheapest or first PMC you speak with and it turns into a bad experience, please don’t assume ALL PMC’s are bad and start trashing PMC’s in general. Take ownership of your mistake and learn to do the proper due diligence recommended above😊

My portfolio is managed with our internal company. We manage over 500 doors in Detroit now but only offer it to folks we work with on the acquisition side.

There are various housing committees, grants, and other organizations in and around the city of Detroit. There are many maybe 80% of them will not share much information with investors or landlords, it’s not their job and frankly that’s just extra work for them the case workers. Some of them are rockstars and have a drive in their job, those few that I know have provided me their database of open vouchers that need to be fulfilled and they are having a hard time. One of them calls me every week to get an update on my properties and whether I have any vacant so she can fill. Their rates are very reasonable 1bedroom $1000 2 bedroom $1250 3. Bedroom $1550. But the reason I’ve gotten this information is the upkeep I do with my properties and the case workers love it! They come in on the 1st inspection and it’s passed. On all my section 8 inspection I have my contractor walk with the case worker fixing, replacing or repairing anything they might have a concern about right there as the inspection is going on. If it’s an item that needs time or needs to be picked ip at the store I send the case worker my pick up order information in an hour and stating that the guys are working on it. There is one case worker that blew her mind on my process that she sat down with me to discuss their organization and how they have a tier system of helping people get a place to live, this is where I found her information alone had a database of 7000 people that had approved applications but no place to go. When digging deeper, I notice a lot of landlords would rather take cash tenants and not deal with double inspections with section 8. The way I look at it is the place has already been inspected by the city what’s the difference. There are many benefits with section 8 in order for the tenant to be placed in one of my properties they go through a process with the committee then when living in the property they need to abide by lease rules and keep the property in shape, if major damage is made or neglect to the property by the tenant they may losE their voucher from section 8, so it’s a very good idea to go this route and food for thought you always know your property is up to date safety wise and livable with annually inspections. 

@Kyle Swengel

I have done 2 cost segregations studies one for a 32 unit value 2.925mm and another for a smaller 1.25mm value deal. In my experience it will come out to be close to 15% of purchase price as bonus depreciation. Every CPA will want it done a bit differently. My CPA didnt want the 5 or 15 year to be over 15% because it could create a taxable event per their words. 

Overall it doesn't cost you any money to engage a cost segregation specialist. They will request some details on the property and generate a round about idea of what the cost of the study will be and what the depreciation benefits will look like. Once you have that its just a decision based on numbers. 

Most CPA's do not have the expertise in engineering to run a cost segregation study. Lastly in my experience most CPA's unless they themselves are RE investors wont give you the best guidance on RE. As for the recapture on the backend as long as you sell and 1031 it all gets kicked down the line. 

I used KBKG they were fair.

Can I hijack with a question?

When getting the business account does it matter if I open the account in a branch close to my house or close to where my business is? 

My situation is my business is registered in Texas, my rental properties are in Texas, but I am living in Michigan.  

Sounds like it's time to shop for insurance providers. What state are you in? Have you spoken with any other insurance companies?