All Forum Posts by: Jonathan Schell

I own 13 units in the bad parts of Norristown. To @Jim Davis's point, I never count on asset appreciation in my calculations; I only look at cash flow. If appreciation happens, it's a bonus. 

I personally handle my properties and my tenants pay their rent. Not always on time, but as of right now, 7/25, nobody owes me money. This socioeconomic sector comes with its own challenges, but the return percentages are higher. Physically being onsite with some frequency is paramount to success in my arena. I do a lot of maintenance/repairs myself, but I know my limitations. I don't mind spending 10-12 hours over two days fixing something, when I have time. The tenants see me actively working to improve their quality of life and are happy to be in my buildings.

That said, it really all depends on how much tolerance you have for the hood. I didn't exactly grow up in the projects, but we lived close enough to a railroad tracks to have the house shake, and there was a never ending supply of sirens throughout the night.

@Maurice Bailey I'm working on my second property (low income rentals) in Norristown. Concerns regarding the Historic Board are not something I'm familiar with but I know a U&O can be done pre-sale. I closed on a property a few weeks ago and the actual U&O window bridged the settlement date. The actual timeline went like this: inspection, settlement, repairs, re-inspection. Naturally, there was a contingency clause in the event the building was unable to pass U&O for any reason.

After five long months of inspection after inspection, signature after signature... I'm scheduled to close on my first investment property. I have a few questions.

1) I wanted to close (sign the paperwork, specifically) on April 14th and take possession on May 1st. The bank is telling me I can't do that. Why?

2) I got the building inspected by a licensed inspector. Why, then, did the insurance company and the bank need their own inspections done? That's three inspections. Now throw in a mandatory termite inspection (because the one performed by the original inspector wasn't good enough), a contractor walk-through for a repair estimate AND the post-2008 collapse 3rd party appraisal requirement and we're looking at SIX separate events over three months. Why? What can I do to streamline this? Why did this take so long to finish and how can I prevent this from happening in the future? Having six different guys showing up to all conduct their business on the same date isn't exactly a winning strategy. 

Beyond that, if any of you folks are in or around Norristown, feel free to reach out to me.

@Account Closed

Thanks. I've contacted a CPA in my area and he's going to, hopefully, guide me through my options to maximize a tax advantage.

I was doing a walk through on a failed deal a few years ago. The inspector said, "Well, that's not good." I asked, "Is that coming falling out of the wall?" He said, "That's not mortar.

Do what?

The size of the pile equal to about 30 one-gallon milk jugs swept into the corner of the basement. And it certainly wasn't mortar.

@Jim Hogan

Thank you. I appreciate that.

@Aaron Montague 

I appreciate the advice. 

As to why it's being sold, I can't be 100% sure but the owner's father passed away in 2014 at the age of 93. That means the seller has quite a few years behind them. Additionally, I was able to locate the sellers private residence. Via Google Street View, I was able to see contractor's work truck parked there and I know for a fact this gentleman owns at least 17 units. I'm guessing he just wants to cashout.

I'm going to be seeing the properties tomorrow (Saturday). I'm sure I'll see a few tenants.  =)

Multi-unit.

I requested two years of financials for an active rental property and the response from the other side was:

"The agents just got back to me and they simply responded with the financials are the real deal. (The owner of the property might not want to release the financials for confidentiality reasons)."

Correct me if I'm wrong, but isn't it common practice to share the financials of your business when someone else is taking attempting to buy it? To me, this is the equivalent of "Trust me. My company is profitable. You should buy it.", which is a huge red flag.

@Timothy Daniels I never consider any of this. Very insightful. Thank you.