All Forum Posts by: JD Martin

I predict interest rates come down, and perhaps housing prices in certain areas but not in most areas. Interest rates are going to have to come down because there's no way the federal government can afford long-term interest payments at these higher levels, and other countries are going to buy our debt even if their return sucks because there's no realistic viable alternative. US debt is not going to be so much for making wealth as much as for preserving wealth.

This lesson came home to me talking to a guy near my STR in Florida a couple of years ago from the Middle East. He was telling me about several of his friends trying to buy houses in Florida for STRs but getting outbid, and I asked him how they could make any money at the prices they were paying. He told me they don't care if the houses make money, only that they more or less hold their principal because what we think of here in the US as volatility is laughable to most of the rest of the world.

A lot of the US market - housing, stock, treasuries, etc - is basically a legal money-laundering location for honest or ill-gotten gains in the rest of the world, because the markets are open to foreigners and as close to a guaranteed safe haven as can be found. The average person would be shocked but even our enemies like Iran and Russia are still buying our assets through shell companies. 

 If you can't touch it up you're using the wrong kind of paint. Flat is easiest, eggshell next easiest as far as sheen. You don't need to use pure white - actually you can use any color, though lighter is easier - but you do need to use a paint brand and color that's not going to change. That generally means getting paint from someplace like Sherwin Williams and using one of their long-term colors. We use a color called Shoji White, which is kind of gray/beige white, has enough color that it can pop white trim but is light enough on the wall to match anything. Navajo White is another popular color. The bigger point is that if you use Walmart, Lowes or some other big box paint the base colors can and do change which will make touch-up difficult. Those stores go with whoever wins the cheapest contract. Case in point, years ago we used Olympic paints from Lowes, which were carried for a long time. Then Lowes phased out Olympic, and even with the paint code I couldn't get mixes that touched up. And if you're not already using the same paint color on all properties, you should start and you can thank me for this tip later. Using different colors was one of the biggest mistakes we ever made in the early days; tracking the colors even with a spreadsheet was a nightmare, as was keeping dozens of different touch up colors in the storehouse. 

The other part of this: don't scuff or sand any more than you need to. Anything the size of a plastic wall anchor or smaller, you should be hitting it with lightweight spackle and use a damp sponge, not a sanding sponge, to take off the excess. That will prevent scuffing the paint making touch up necessary. 

Finally: *DO NOT* let tenants attempt to fill holes or do touch up themselves. Many tenants are idiots and I'm surprised they can dress themselves in the morning. We have had tenants use everything from latex caulk to roofing cement to try to fill nail holes. One guy used white rubber cement, left in big blobs everywhere because he thought it just peeled off after he was done. We had to repaint the entire unit because the material he used left oil stains everywhere. In our move out sheet we specifically tell tenants not to fill holes or try to touch anything up. 

 If they replicate that kind of profit reliably, what would they need you for? You are going to be $15k poorer with nothing to show for it. 

Anyone who is advertising an "easy way", you are the product. There are no "easy ways" in real estate. To make real money in this business requires busting ***. It's pure BS that you're going to pay $15k and someone's going to bring you a $50k profit. Like Chris said, forget about finding 20 people that have done it - find 5. They're not out there because that would be one of the greatest money-making machines ever invented. 

 Pricing has changed but J Scott's one of the smartest guys around and is one of the books I always feel comfortable recommending. There's a ton of information in there and what you're really interested in learning is how to come up with prices, not the prices themselves as those will change over time. 

 We require proof of insurance before move-in day, and we are listed as additional interest in case they cancel. We have it set up where they can upload their proof on a regular basis right in their online tenant portal. It's one of those things where if you are going to require it, you have to be prepared to evict for not getting it. Years ago we didn't require it and just recommended it to the tenant, but it's so cheap and gives our insurer something/someone to abrogate against should we have to make a claim that we don't allow it to be optional anymore. 

 Ouch. 

East St. Louis. Not for the faint of heart for sure. Everything over there is really poor. I haven't drove through that area in about 10 years but I remember we closed all windows and locked everything up when we did. I did a quick look and violent crime rate almost double that of Illinois as a whole. 

I'm normally not one that advocates trigger-happy decisions, but IMO this kind of investing needs solid boots on the ground, and you're out of town. Long term I think you end up losing your shirt here, so if you can get out without too much damage I'd take my lumps and move on. Section 8 is not a panacea anyway and doing it from a distance takes a really good team, and that's hard to get in rough areas. 

 Why would you have 180k in the 600k property but only 60k in the 4 300k properties? I assume your question means you already have a 600k property that you owe 420k on, and are wondering if you sold that property to buy more properties which way would you come out better over time. 

It is not really apples to apples, but generally speaking the more money invested the further ahead you will be eventually in the future, just because your compounding base is higher, regardless of where the money comes from - ie, 4 300k properties are 1.2 million on property, which is double the 600k property. Unless the 600k property is in some crazy appreciation area, or conversely the 300k properties in depreciating areas, 1.2 million of property is going to be worth more than 600k worth of property in the future. 

Online platform or the tenant schleps off to our business bank account and makes the deposit. No other methods of payment accepted, written into the lease. This is a business, not some mob collection system. Someone wants to pay cash they go to the bank and pay cash, and get their own receipt. Otherwise they pay free online. 95% of our tenants pay online, most of those with auto pay. The bank people are either the least stable or get paid irregular. 

We use Turbotenant and used Apartments for years before that and a different one before that, that apartments bought out. In rare instances we will let someone pay through Square or Stripe, with them paying the cc fee, but only in unusual cases, such as one time with a tenant who was traveling and didn't have a bank account to use with our online platform.

 1. You're going to have to contact Zillow by phone to solve this. I've had a similar issue in the past and had to resolve it by phone. They took the other ad down when I did.

2. If you are renting a furnished home you should show the home exactly as it will be provided. If anything is missing or changed you should specify in the ad. Otherwise any reasonable person would assume that what is in the pictures is what comes with the house.