All Forum Posts by: Account Closed

I'm scanning as well.  I have a Fujitsu ScanSnap scanner.  Very fast.  I scan directly into Evernote.  Evernote by the way can be viewed from all your other devices.  I think Evernote is more convenient than Dropbox.  With Evernote you can tag all your documents or receipts.  In fact, I tag a receipt with multiple tags, so that if I search for a property it pulls up, or search by the type of repair for instance, it pulls up.  I originally used Dropbox but I switched to Evernote.  I also have software called DevonThink Pro.  Good software for organizing and scanning, but unfortunately, it's not a user friendly software to use on multiple devices.  BTW, Evernote uses option character recognition, so that when you search, it can pick up words from the document.  Very convenient.  There's a little bit of a curve that you have to overcome to scan your old documents.  So I scan everything new, and as time permits I scan the old.  You have to get your head around the idea that you don't need things in a particular file like you do with paper.  All you need to do is tag items, that makes them searchable.  In fact, with Evernote, I actually think documents are searchable without tagging because of the optical character recongition.  You have to get to a spot where you start to trust the system.

I'm not sure it makes all that much difference in the respect that what some of the listing agents have always done is just not present the offer.  Maybe a quick phone call to the seller, that's it.

The thing is you have to be making offers to motivated sellers.  Otherwise, you're wasting just as much time as the listing agent thinks he's wasting presenting the offer.  My thought is to try to find these sellers before they have listed so you're not having to present offers through a listing agent.  You'll probably be making fewer offers, but the ones you are making will definitely be to motivated sellers, and chances are high there won't be a listing agent between you and the seller.

I wouldn't worry too much about this myself. You just have to shift directions. At the same time you might want to wait until the listing expires. Give them a call then. If they have stopped you from making an offer, there's a good chance they will have stopped all the other investors. If it actually sells at the higher prices, then you may have underestimated the market. If the seller is truly motivated, there's something wrong with the sellers situation or the house itself. The seller might not have time to wait for the market. Or, maybe it's only a property that a rehabber would buy because of it's condition. Personally I don't think there are that many motivated sellers on the MLS.

Chip: I must say that what I noticed in your post is "getting flagged on All of my ads" and "this is for my SFH".

So to me, what you have said is that you are running multiple ads for one house.  As far as I know, this is not acceptable on Craigslist.  If that's not what you're doing, my apologies in advance.  Just extrapolating here.

In my market I have never been flagged.  I run one ad.  And I renew it every few days when permitted by Craigslist.  This is for rentals.  It's been very effective for me.  Most of my tenants in the last few years have come from Craigslist.

When I look at my competition on Craigslist, I'm p*ssed off, because what I see is guys running multiple ads for one property, putting me at a disadvantage.  There's one guy that has as many as 10-12 ads in my area, which have a link to a web page where you cannot find a single house in the area he's advertising in.  He runs this same ad in various other areas as well.  It seems like he's abusing Craiglist.

I've flagged ads when I had the time to do it, and the inclination.  It usually does me no good.  What's funny is that at least in terms of rentals, alot of tenants screen Craiglist for their criteria.  So number of bedrooms and rent are two typical screening criteria.

Before reading this thread I would have said that if you get flagged on Craiglist, it's because you did something unacceptable.  Perhaps that's not what's happening, perhaps its just the competition, but if that's the case they appear to have missed me.

Well if the property manager did not transfer all your funds, I'd tell them you want your funds immediately or you'll be forced to call the Maryland Real Estate Commission.  If they're telling you they transferred the funds, ask them for a copy of the check.  Did you ask property manager 2 if they got the funds.  One of these two managers is obviously not telling the truth.  But customer money is not something to be played around with...they can lose their licenses.

The employee that lives there or lived there is a separate matter from your funds.  You could always go to small claims court.  I'm assuming this employee is now gone, so what we're talking about is a few months of this 30% rent.  Was there a written agreement with the employee?  Or any type of written agreement with the property manager concerning this 30% rent.  If there is nothing in writing, personally I'd forget about it.  If you've got some type of proof, as I said before, they either pay or you go to small claims.  The other possibility prior to small claims is to have your lawyer draft a letter to the property manager making a formal demand for the money.  Sometimes this scares people into paying.  And lawyers typically will write a letter cheap.  If nothing happens, take them to court if you have proof/evidence.

What I do is call an agent who has a property listed in the area.  Discuss the property, and ask if he/she could email/fax the comps for the area.  I do this because I like to drive the comps, ie drive by each comp and look at it from the outside.  Try to figure out why it sold the way it sold.  If there are other listing agents in the same area, I'd call on those too.  Ask for the comps.  I like to talk to more than one agent, you may learn something about the area, you never know what type of person you're going to meet that might be helpful to you in the future.  After you drive the comps I think you'll be in a much better position as to value in the area.

If you already know an agent, that's good too.  But I'd still drive the comps.  I'd still call some of the listing agents.

And BTW, once you get your license....I'd still drive the comps.

The short answer is that an investor determines what the value of the property is.  You do this by looking at the comps....recent sales in the general neighborhood.  I like to also look at active listing to see where people are hoping to sell, and expired listings to see where people didn't sell.  And btw, on those comps, I'd drive around and look at it from the outside, pull up the old listing sheet.  By the time you do this you'll have a good idea of value.  From there, what you're going to do with the property is going to dictate what kind of offer you make.  But in my case, I buy at a discount to the value I arrived at.  This is the only way to make a profit.  If that happens to be the listing price, great.  As an investor though, there's no way I'm just trying to get any old property.  I'm trying to make a deal.  If I can't do that, I move on to the next deal.

One other comment though.  If the seller is holding an open house, and so other people are looking, the chances of you getting a "deal" are pretty small, again depending on what youre doing with the property and what you define as a deal.  This really doesn't sound like a "motivated seller".  Dealing with  motivated sellers is the only way you're going to get a real deal.  Now, let's say that after the open house, no one is interested.  And lets say the seller sits with this with no further interest.  Now it may be that their motivation level grows.

The advantage of the license is that you'll learn some of the basics of real estate, and after you have your license you'll be able to hang it somewhere where you will be able to access comps.  Another advantage is that you may be able to get part of the commission by representing yourself.

One of the cons is that you have to disclose your license to buyers and sellers, and on your signs, etc.  That shouldn't be that big of deal to most buyers or sellers.  And there will be plenty of fees to pay depending on your location.  

It's not a bad way to start.  That's how I started.

Using a spreadsheet you will be able to do some type of record keeping.  But to make it efficient you need accounting software.  For that I'd say Quickbooks.  And if you can't seem to learn Quickbooks, then you can get give your information monthly to a bookkeeper who can enter into Quickbooks for you.  At tax time your CPA can use your Quickbooks file to do your schedule E.

Want to know what your income statement per property?  You can do this with Quickbooks.  Want to know how much money you spent on insurance across all your properties, Quickbooks can do that.  Need a balance sheet or income statement for your bank...Quickbooks can do it.  So if I were you, I'd get Quickbooks.

Then the next question may be where are you going to store all the receipts and paperwork.  I store it on my computer by using a scanner.  I scan into Evernote so I can access from anywhere.  I can pull up receipts according to any "tag", so in my case I'll put the property address as a "tag", then I can search by property address...all the receipts for that particular property pull up.  The IRS no longer requires you have the receipts themselves, scanned receipts are enough.

The proforma is going to show you what could be, what it might be if you put in the time, effort, and work to bring the property up to rentable condition and then market the units.  You don't make an offer to the bank based on this.  This is what it might be worth to you after you have done all the work.

What I would do is make an offer based on what they occupied.  Surely they can tell you what those units have been rented for.  But I would be careful even with that number, because as said above, the tenants can all leave, depending on condition maybe you'll want them to leave so that you can rehab.  And of course, there's the cost of rehab which you should reflect in your offer.

You base your offer on what the building is now, not what it could be.

Anytime I have ever made an offer, I pencil the deal out, what can I offer that is safe and profitable to me.  It never occurred to me to worry about whether an agent thought it was a low ball offer, too low, unrealistic, or whatever.  What I focused on was what worked for me.  I figured the seller would be able to figure out what was in his best interest.

The thing is that many realtors would not know a "deal" if it hit them in the face. You can get the statistics for MLS sales and what average percentage discount from list price they have actually sold at. This discount will vary depending on the market obviously, but I would say it might be 10-15%. Guess what? That discount doesn't work for me. And anything lower than that and the typical realtor is going to start saying "low ball", "unrealistic" etc etc.

When I think back to the deals I've done, yes, I've done a few through one agent, the listing agent. But a large number of my deals have been direct with the seller. Why? Because I spent some time trying to find "motivated sellers". Now this is a term we all bandy about, but generally speaking they aren't in the MLS.

Thinking about my deals, it's amazing how many were landlords, who were finally sick of it.  A tenant had just torn up their house, they had spent a few months evicting.  You know what?  This guy wants to sell, and in the condition this property is in, he can't sell it retail.  Now, can you find this guy?  I think you can.  When the eviction is filed sooner or later a list will be published.  Some of these are going to be sick of the business, and ready to sell.  They don't want to fix their property up. Maybe they don't even want to finish the eviction.

At one time I had a 2nd mortgage lender faxing me properties every day, wanting an offer for his defaulted note.  This was in a very bad time in the California market, so you may not be able to do this at this point....but I'm just saying that if you think about it, think about your market, you may be able to figure out who is motivated.

Animal damaged properties.  I've made some amazing deals here.  You smell that cat urine, that's the smell of money.  I can't tell you exactly how to find those, but I've had them referred to me by trash haulers, my lawyer, etc.  

So where I'm going with this, if you've really got a motivated seller, you'll never forget it. They want out. And there's going to be something wrong that the realtor really can't effectively help with. So if your only source of deals is the MLS, I'd say you're missing out on the best deals. You find them by marketing in some way or another.

And when you make your offer to this motivated seller, you're going to pencil the deal out, you're going to offer a price where you can be well paid to deal with that seller's problems.  After all, they can't deal with it, so they're turning to you .  That's worth a price.  They don't have to deal with you. If they don't, you just move on.

I would not structure my offers around what anyone thinks is "about right' for the market.  Are you kidding? How would anyone know what's right for you and your business?  Realtors not presenting your offer?  Well, that is illegal in every state I'm aware of.  But I know it goes on, some of these Realtors think they're on the deed.  But where you need to get is to the property where the realtor has had no offers, where she is just wanting something to take to her seller.

You know, I mentioned the second mortgage lender defaulted loans.  When they calculated what they're note was worth, the first thing they did after figuring out the fair market fixed up value of the property, was to haircut that price 10%, for a quick sale.  Then they haircut it another 6% for the realtor commission.  Then another 1-2% for various closing costs.  And they would also deduct something for holding costs.  Folks, these  4 numbers put the value of a property well below what any realtor typically sells a property for.  We're already looking at a 20% discount, and we haven't gotten to the repairs or your profit yet.  Food for thought.