All Forum Posts by: Jay Hinrichs

@David Perez 

   My father who taught me everything real estate related.. would always say you can record the star spangled banner if you wish.

Just take your document to the recorders office and record. it.. now you may have to paginate it a certain way.. but other than that anyone can record any doc you want.

@Account Closed 

  I do a lot of mezz financing in FLA  its all title company driven.

@Martin Scherer 

couer d' Alene is not in any way compared to what most think of out of state investing. IE the big cities of the mid west and east. there is no comparison in socio demographics' amount of HUD amount of Ghetto 's etc.

And you did well to find that area.. I love it there we fly up there often in our plane and visit friends that own properties there.. then on to Kalispell the next day. Our rental experinces are just not what an investor is going to experience in the mid west  or out east. where half the population rents as a life style.

@Joe Villeneuve 

  And how many of these homes are being bought by investors and how many by home owners?  its the same message in all markets in that asset class....

If the properties are such great deals and rentals WHY is it a foreclosure CLUSTER.. there are reasons for this... ONe landlords are failing left and right because of ongoing management issues and being sold on how EASY it all is when in fact it is not. And because anyone who can afford a 150k house is not going to buy in an area that is predominatly rental  the schools are usually poor etc.

@Richard C. 

  your my new hero.. thanks for calling BS when you see it sometime I feel like the lone ranger here on BP :)

@Richard C. 

your spot on .. in the day us HML use to use ARV.. I would not even consider it today. Its cost lend on cost not ARV.. If you lend on ARV you are definalty taking a huge risk. in this asset class.. that being lower end rentals. And to compound it the borrower had no skin in the game and is 100% leveraged another idot idea and one I would not partake in.

@Joe Villeneuve 

IF ARV is 180 k why can people buy them everyday of the week for 20 to 30% less than ARV.. I submit that ARV is a figment of everyone's imagination.. and that the true value is willing buyer willing seller or what your paying for the property IE much less.

And banks are falling back into the trap that got them in hot water again.. Loaning on ARV that are not real.. and when people walk banks get hosed.

So I would like you to explain why if your paying 130k for property why its worth 180k and not the 130k you just paid for it. all things being equal.

@Jon Holdman 

  could not have said it better about the false representations that  sellers be them TK private or whatever promote... But people want to believe.  your dead on   on this point.

my experience with mid to lower end rentals and I have owned hundreds of them is expenses are easily 40 to 50% over time and sometime worse if you have a trashed unit.

If you buy A type properties in low tax environments you can maybe get to 35% or IF you SELF manage that number comes down.. But going the TK route you will never ever hit anything much less than 40 to 50% OVER TIME.. there is always the honeymoon period IE the first year or two... Then reality sets in and we never hear from the investor again  :)

@Terence Wang 

  I do it every day of the week and its all Mezz... and I do far better than 15 to 18% for my investors.

but to answer the 150k question I think one of the best and quickest ways to create cash is to build new construction IF  you can get bank financing on the vertical.

So take my market of Portlandia Oregon.  my bank will finance 90% of my projects at 1  point and 5.5%   So a 300k all in project I need 30k.. and we make about 12 to 16% net on the project so about 36 to 60k per home.. and we do it in 9 months or less per home.

And occasionally you get much better deals and I know guys on the east coast do way better than we do.. So I joined them out there. And I have 6 projects going in the Carolina's currently and the numbers are stupid good. One my cash out is 45k and my profit is 105k and its presold.. So that how you make bigger dollars in the RE game.

@Andrew Kerr 

  agreed and that when these investor look to buy out of area with TK and west coast marketing folks they need to understand the proforma's these companies create are very best case scenarios and your actual results may vary  ( that sounds like disclosure).. I have seen all manner of sales material over the years and many do not put any maintenance in or vacancy in the proforma.. they rationalize that a fresh rehab and fresh tenant you won't have that .. well MAYBE in year one then the reality sets in and your 12% preforma becomes a 6% reality.. and then maybe investing in fixed debt looks better and better all the time.. NO emotional roller coasters if you buy the right debt.