All Forum Posts by: Jay Thomas

I'm sorry, but that is such a bulls**t article. They tweaked the data for "fundamental factors that contribute to a home’s value, such as size, condition, neighborhood amenities and schools". First off, anyone who has ever taken a statistics class knows how easily you can get the answer you want by cherry picking and assigning weights to select data. Secondly, they failed to mention one big factor that contributes to the price. DEMAND. There is significantly more demand from people who want to live in a so-called  "white areas" than people who want to live in "black areas".

If black areas really are so dramatically undervalued like this article makes the claim, why aren't investment firms buying up thousands of homes in these areas and just waiting for prices to increase?

The saddest thing about journalism today is that the outcome is chosen and the facts are selected to support the outcome regardless of whether it is accurate or not. I could easily use the same numbers and instead of claiming that blacks are deprived of wealth creation because of lower home values, I could spin it positively and claim that it is wonderful that blacks are closer to homeownership than whites thanks to the lower entry costs. It's all how you want to spin it. 

I think there is some truth to it, but also you have changed - you know more now, so things get repetitive and less interesting.

Subjectivly I feel real estate investing has become more mainstream compared to 2010-2015. Back then it was hard core RE enthusiasts who did not mind to swim against the current. After 2015 REI became a mainstream idea, competition and prices have risen. So the filter is no longer market sentiment, but the actual financial barrier entry.

Josh Dorkin has been hammering cash flow as the main criteria, if not the only criteria, based on his own experiences in CA. This has really influenced a generation of investors, who took it way to far and started looking at REI as an ATM. Now the market is correcting that; cash flow expectations are starting to reduce and a lot of people will leave the space before they bought their first one, just because its getting too hard.

As a young agent I have worked with a lot of investors. 80% bought just one property, never a second one. A few bought 2 or 3. Only 2 guys have kept going as far as I know with small MF and SF. Only one person I have ever met made it from zero when we first spoke to 1400 units and built an actual business.

I think the next 5 to 10 years will be interesting; I expect prices to keep rising to unexpected levels along with the dollar (and debt) loosing value - until legislation and builders can ramp up production to fill the backlog and match demand.

honestly what people assume to be bias really isnt. an appraisal is an opinion of value, so different appraiser will have different values. you cant choose your appraiser(before you could), they get assigned the job. they get paid a flat fee whether your value is high or low so they dont care what your appraised price comes out to as long as they can explain it. they usually dont over value it because that could lead to overinflated fraud(the reason you cant choose your appraiser anymore, banks went with their go to appraisers who appraised high so that they could get people to qualify for mortgages and sell the mortgages off) which they dont want to deal with. 

so most of the time appraisals will come right at the asking price because they are lazy and just want to do a fast job to move onto the next one and can justify it with comps. other times they will actually run all the adjustments and do a good job and if its highly upgraded then it may come in a little higher or if its not in best presentable condition it could come in lower depending on what the appraiser thinks the property is compared to comps. 

doing an appraisal is more complex than just running comps and comparing pirce/sqft like most investors and realtors do. you have sqft living, sqft land, easments, bed count, bath count, garage vs carport vs no onsite parking, condition of home, location, etc. again its just an opinion of value, so one appraiser might think there should be a 10000 adjustment to one line and another might think it just needs a 7000 adjustment. some might look at your messy property that just needs a new paint job and flooring and adjust the condition lower than someone who knows thats all it needs. 

so to say an appraiser is bias doesnt make sense to me because they gain nothing by intentionally lowing your value because of skin color. they just want to get paid and move on the next one with the least amount of work. if you said some appraisers are incompetent, then yah i would have to agree but you cant choose which ones you get.

Short of. I called around and interviewed a good number of PMs. I told them I was interviewing other PMs in the area as well AND that I plan to invest in the area for some time. I also attempted to turn the PMs into lead funnels i.e. "If you know of any tri/quads for sale give me a call.  If I close you can manage" (that's too early to see if that had an impact)... That might have played a role in the price? 

Hey can you guys please provide more details regarding this "retainer"? 

Is this essentially a one time fee ? or ?