All Forum Posts by: Lesley Resnick

I fundamentally disagree with the premise of this forum post.  it shoud be, "What holds YOU back", there is no gender requitrment.

I am neither impressed nor bothered by another investors gender.  Let's face it, this is a competive and sometimes shady business.  People will say and do things that if directed at them, they would find unacceptable.  Regertably, there are a lot people who are simply A- holes, regarless of the counterparty's gender and will seek to take advantage. 

The simple answer is educate yourself, align yourself with smart and moral people.  Work really hard and know /manage your own fear, then it will all fall in place.

Digital currency…Yes.

Private currency…NO

How to turn 750,000 into 450,000.  Ask Odell Beckham.

If I borrowed 100,000 in bitcoin, roughly 2 (47k today) coins.  For argument sake, it goes to 100,000.  You owe 200,000 in real dollars terms principal plus interest on the original 100k.

On the other hand if it crashed, you would owe less in real dollars.  Inflation is a decrease in buying power and a currency going up a 1000% sounds like that very definition, 7% inflation and people are losing their minds.

Someone needs to explain to me why a 64 digit number code, is not a FIAT currency?  The US could sell the Grand Canyon to Coca Cola, there are assets available in a liquidation sale.  If your bank account is hacked, the bank will refund your money.  What happens if your bitcoin account is hacked.  Some will say, thats not possible.  It is a simple as you leave your laptop and go the bathroom at Starbucks and some one walks off with it.  Since password are so difficult to remember and manage, you set the auto login on Chrome.  There is no record no authority to help you out.  Your money is gone.  

Some people say, well I could get on a plane with $1m on a thumb drive.  Who are you Pablo Escobar?  The biggest winners in the current digital currency war are the narcos, terrorist and people who live outside the law and social norms.

With certainty I can say the world governments are going to take over Digital currency.  For no other reason than it will undermine governments power and they are not in the business of giving up power.  We have gone to war over oil, we will go to war over keeping the world reserve currency.  For those who advocate a financial system based on bit coin or some other currency, you are betting against your own standard of living.  You will see un-thinkable booms and busts.  This is the best of the worst choices.  If you are successfully trading and flatten your account every day, own no real property then you should be fine.  Stable long term financial systems are best for long term wealth creation, including those who depend on rents being paid.  Some have theorized that the war in the Ukraine is to try to unseat the US dollar as the reserve currency and trade oil in Renminbi and Rupel.  China has outlawed digital currency except for their own.

People who are in favor of Bitcoin are zealots for it.  They have a level of confidence in its viability that is truly scary.  I could be completely wrong and I am watching this asset class evolve.  "It is different this time is the battle cry for all things new."  Things will always change, but it does not automatically mean change for the better.

As an industry or asset class there is very little creativity or innovation.  The physics don't change.  Wood, doors windows insulation, land mostly unchanged.  They may be better quality or efficient, but fundamentally the same.  There is a reason a 100+ year old house still have value.  People want to be warm when it's cold, cool when its hot and stay dry.

The economics have not changed.  It is a capital intensive long term asset.  There have been share croppers since the beginning of time.  I own the land and will rent it to you to farm and live on.  People have maintained generational wealth though handing down property.  Due to the size and long term nature purchasing property has always required third party financing. At its core lending is just a valuation of risk.  How much risk is acceptable and what is the cost.  The evaluation of, "will I get my money back if I lend it to you" has not.

People are excited about AIRBNB being a new thing.  Bed and Breakfast and hotels have always existed, people advertised in the newspaper or the yellow pages or left a single candle burning in the window.  It is not real-estate that has changed or innovated.  It is the technology around it.

Real estate is never going to equalize people.  Elon Musk sold a 30m house in Ca.  Regrettably I do not have a house like that.

However, we carry the I-phone he does and his calls are no clearer than mine on ATT.

It is going to rain.  I can say that with 100% certainty.  When or how much is anyones guess.  I have an umbrella and rain boots in my car should I need them.  I like to open my windows on sunny days, I live in Florida, it rains most sunny days in the later afternoon.  I know how to close my windows if I need to.  I don't need a weather man to know which way the wind is blowing.

I am more concerned about inflation in the real world, than any other scenario.  It is starting to look more and more like the 70s and stagflation is becoming a real possibility as a result of fuel prices   For the data people out there, this a different set of equations, it brakes the models and is hard to quantify in a twitter feed.  

This is what I know and it is not a manipulated CPI figure that pulls out products I buy every month…  My dumpster man just sent me a message that all dumpsters are going up $25 due to fuel costs.  The concrete manufacture has said it will price its precasts weekly.  Lowes declined to make a delivery, due to it not being a full load.  My plumber has asked for gas money to cover longer trips. 

To be in a recession we need 2 quarters of declining GDP.  We are going to be fine in Q1 ending (3/31).  If the following 6 months shows a decline, then we are in a recession.  The war in the Ukraine should be resolved one way or another by then.  The only question is who bleeds out first?  Supply chain should right itself in 6 more months.  My hope is that the government does not give away money to fix the inflation problem.  lol   I do not see a crash as a real possibility.  Stagflation on the other hand is possible.  

Regrettably, All lenders are challenging to work with.  I have loans with 5 different "banks" including the one listed above.  Generally, they sell off their loans to services who are understaffed. The people who do work, do not really care and it often feels like you are an interruption in their day.  Regardless of price, they will make you suffer to get a loan and even more to keep it current.  I had a closing canceled at 6pm that was schedule for 8am the next morning.  Last minute rate changes, "oh the underwriter…"  I have resent documents multiple times.  My personal favorite, my bank mails a paper check from online banking account and they lose it about 25% of the time and call me for a late payment.  I explain to the rep that it was a paper check and was not applied to the account.  They need to look at their lock box account, magically they find it every time.  The list goes on.  I have yet to find anyone that has done 2 loans with the same "bank" and still recommends them.

New market domination business model for lenders, Just do what you say.  Get the basics right.  You don't even have to treat me well, just get my loan closed and serviced.

 I did not know BOE did construction loans for invesmtent propety.  The web site looks like it is owner occupied.

Jacksonville is like any other American City.  There are A-F neighborhoods here.  To try to create a monolithic view of the city would be a mistake, it is the largest city by landmass.  There is great variability even among streets in the same neighborhood.  I have tenants in PP that have legitimately decorated their rentals, on a budget.  I had a tenant in the same neighborhood, well use your imagination, they were not fit to live with pigs.

While I can not quantify, the overall vibe of the city is positive, excited and growing.  Sadly, we are losing the sleepy little town feel.  There is new construction everywhere and companies are moving here with jobs.  The Jacksonville of my childhood is almost unrecognizable.  

 I like the area.  I own 4 properties in PP and Buffalo Gardens.  I am building 4 new construction homes in the area as well.  The crime is low in the area.  It is definitely improved a lot in the 5 years I have owned properties in there.  

That sounds like a great deal for both parties.  The lender gets a superior return and the builder can scale.  All builders and investors eventually run out of cash for their next project.  Banks can be tough to work with.  I find myself in that situation.  I have 23 builds in the pipeline and will either take on investors or just borrow money from a bank.  I was recently approached to buy a piece of land that I could build 60 townhouses on.  I plan to build the townhouses.  I need to decide how I will fund the project.  It is going to take a year until I can put a shovel in the ground.

Is this someone you know or how did you find them?   

I generally only raise rents when I have a turn.  This is not a hard and fast rule.  If you are a pain or if you are so far under market, I will raise the rent.  If your house is not the best value, then your product is at risk.  After all, tenants are consumers and turns are bad for business.  Every time I turn a property it costs me 2 weeks to a month.  I have my own crews and I can generally do it quickly.  There is loss of rent and the cost of the turn.  If your property in property management there is a cost of 1 month rent.  All this to make another $2,400 a year.  It will take 2+ years of rent increase to make up the time. 100 increase on a 1000 place and 3,800 turn plus management placement fees.  If anything goes wrong, vandalism, labor or materials delays, then you are significantly higher.  I will take a good tenant below market than a bad one at market.  Tenants that just pay rent and do not take up a lot of my time are at a premium.  My next deal is more important than potently chasing a few pennies, time is my most valuable commodity.  This is a long game, Bob and Betty bad *** is not a business strategy.  Just putting bigger numbers for rent in XLS, does not guaranty you will be better off.