All Forum Posts by: Jennie Berger

And I meant Bob, not Mike.🤦‍♀️😁

@Dana Sample I realize this never got a response and for that I apologize. I believe you asked Mike but I'm happy to share our feedback.

The best way to get accurate repair estimates is to have a qualified contractor walk the property with you. Do that enough and you'll get the hang of it.

Are you using some kind of repair estimator spreadsheet or software? If you have a template that can be used over and over, the more you walk through properties, the easier it is to know how much something costs. We use a pre filled spreadsheet where we just check certain boxes and the numbers are automatically calculated. These figures are ballparks for our areas, and you'd of course need to tweak the #s to fit your market(s).

(*Note: Every estimate from a contractor or spreadsheet is a just that. And estimate. A ballpark figure until you have an actual complete scope of work and/or full architectural plans, if applicable. Even the best contractor won't be able to get you exact numbers without those two items above.)

As rehabbers/builders, we tend to stick to a few particular zip codes and styles of house. This may not be your M.O. By doing this it's easy for us to walk through a new property, estimate repairs in about 15 mins (because we walk the same types of properties in similar areas, over and over again), and know the ARV. If that's possible in your market, that is one way to gain true expertise.

Let me know if I can clarify or explain anything better. I hope this was helpful!

So much great info here--thank you! A few questions IN CAPS:

A few things good advisors do to justify the costs:

• Low cost well diversified investing
• Ongoing tax planning and reviewing tax returns annually- FIDUCIARIES DO THIS? IS THIS NOT FOR A CPA TO DO? 
• Reviewing your financing options and giving recommendations- FINANCING OPTIONS..MEANING, FINANCING FOR REAL ESTATE INVESTMENTS AND THE SUCH?
• Reviewing insurance policies periodically to make sure you have adequate coverage at a reasonable cost- NEVER WOULD HAVE THOUGHT OF THIS BUT I WILL FIND OUT ABOUT IT
• Make sure you have an estate plan and it stays current- THE FIDUCIARY DOES THIS? I THOUGHT I AM RESPONSIBLE TO HIRE AN ATTORNEY TO DO THIS.
• Help you analyze you properties and determine what your rates of return are- HMMMMM...THIS SOUNDS LIKE SOMEONE WHO IS PART OF MY REAL ESTATE BUSINESS. WHY WOULD A FINANCIAL ADVISOR/INDEPENDENT FIDUCIARY DO THIS? HOW WOULD THEY HAVE THE EXPERTISE TO DO THIS UNLESS THEY ARE INTO REAL ESTATE THEMSELVES?
• Review employee benefits and stock options to make sure you're taking advantage of whatever is offered- I'M NOT UNDERSTANDING THIS ONE. I OWN MY OWN COMPANY...CAN YOU CLARIFY?
• Analyzing pension benefit options and Social Security options- THIS ONE IS ALSO ESCAPING ME. CAN YOU CLARIFY?
• Retirement planning, college planning, charitable planning, etc.

If an advisor is only managing investments, 1-1.5% is high. If they are doing some of the other things I mentioned, a 1% or 1.5% fee can be reasonable.

Thanks so much for your advice. He would be fee only. 1.5% of AUM taken out quarterly. I would be working with him throughout the year. I definitely want advice and active management because I don't have the time or know-how myself. I've been working with an FA for the last 3 years with Merrill/BofA and I'm just looking to expand my financial planning horizons since that institution is limited in what it can offer.

This new person would not be limited by institutional offerings as we'd be working through a company like Schwab or similar to hold the assets but they'd be actively managed by him and his colleague regularly.

As for financial advisors that work specifically with real estate investors--do you have anyone you recommend? Feel free to PM me. Thanks!

Thanks for your insight! It would be 1.5% per year of total AUM taken out quarterly. My brokerage accounts basically. He is an actual fiduciary however I didn't think to ask him about the tax and cash flow items. We would definitely stay in touch year round and my portfolio would be very actively managed and rebalanced on the regular, as needed. They would also advise on other products I can utilize to help me achieve my financial/larger lifetime goals (such as insurance policies, annuities, products that offer guaranteed lifetime income, etc.) I didn't realize a fiduciary for these types of things would also provide tax advice. Is that standard? 

Hi Y'all:

We're in the stages of possibly transitioning away from our financial advisor at a large institution to a third party custodian and hiring a true Fiduciary. The one I'm considering right now is fee based only and asking for 1.5%/year. It feels a little high to me, but I truly don't know what's fair, or what the going rate is. I know that they make money only when we make money, so they have a vested interest in doing well. Do you have any thoughts on this?

Thanks in advance!

-Jennie 

@David Levin Where in Chicago? I know downtown (North of the River, Loop, South Loop), studios are huge. They will always be in demand (as far as I'm concerned) because there will always be students, single people, and even young couples who want to live where the action is and don't want to (or can't) spend a fortune on living quarters. We rent in a small high rise in South Loop right now--2 bed/2 bath--and our building is at about 90% capacity on studio and 1 bed units. They're struggling to rent out the 2 bed/2 baths...

I am IN! Love the continued connections via Zoom but it's just not the same as meeting someone in real life. We live in South Loop and our properties are on the NW side of Chicago. So, anywhere that is within a 20-25 min drive would be OK for me. (Not that you have to book a location around us...just an FYI. ;) Thanks for suggesting this!

@Nathan Orta I'm with @Eric M. on this one. Any reason you wouldn't have a qualified contractor (or 2 or 3) give you some estimates? Their numbers are usually ballparks as well, until they nail down every single element with their own subs. But I believe they'll be a lot more accurate than us just tossing numbers around here...