All Forum Posts by: Scott L.

Thanks everyone for you replies thus far, much appreciated. Keep them coming!

REI investing for almost 20 years, owning a wealth management company for 22 years, suffice it to say there has been a lot go data/spreadsheeting/tax analysis/meeting with my team go into this overall decision to sell the entire portfolio at once. In making this post here on BP, I wanted to humbly come to the forum however and start from scratch in terms of idea generation as to any and all avenues to pursue in getting the word out there so as to not miss any options. I've already received some great feedback here so far, which i gratefully want to thank you all for!

Right now I am already in the process of:
-posting the portfolio for sale here in the BP forums.
-contacting several LP's nationally that take on large investment opportunities
-posting on loopnet
-sending the link to the website we built-out to all the the top real estate agents in our local market.

I did not think of the Facebook group channel, so thanks for that recommendation @Ryan Arth!

Last but not least....
A few members in replies have already mentioned why it makes sense to hold…….I very much appreciate ALL FEEDBACK, however I think it will be helpful to provide some added context as to why I am absolutely certain (and my CPA’s are convinced as well) on my decision to liquidate the entire portfolio and once

• As I educate clients on daily, income tax brackets as well as long term capital gain tax brackets in our country are more favorable right now than they've been at any point in the past 80 years. At our wealth management firm we have CPA's on staff, we provide overall wealth management services for high net-worth clients. In our world this is referred to as "Family Office Services". Our team has been pounding the pulpit for five years about how favorable our tax brackets are and helping clients conduct moves such as IRA to ROTH IRA conversions in order to take advantage of the current tax deal of our lifetime. Unfortunately most CPA's have not lived through more realistic income tax bracket environments such as the 50s 60's 70s and 80s……so what I'm saying here is not something that most investors, business-owners, high net worth families, or REI investors are thinking about. The focus for these groups of people too many times is always on defer defer defer….. Which means that most people are kicking the can down the road only to find out later that it's turned into a 55 gallon drum. Two things are certain, 1) taxes are lower today than they've ever been in the past 80 years. 2) they are certain to be higher in the future.

We should all be focused on paying the lowest “lifetime tax bill” not the “lowest tax bill this year”.

• By paying 20% and settling up my long-term capital gains is not a bad deal. During my REI investing journey I've done 7 1031's, then followed each of these up with cost segregation studies. Obviously if I held all these properties long term I could continue to 1031 from property to property and indefinitely defer long term capital gains. If I can't hit the 1% rule on a real estate deal then it's not worth my time given my experience and options in the equities markets. The current real estate environment that we've been in for the past several years hasn't presented any opportunities for deals like this.
• Because of the above bullet point, my real estate folio is kicking off a ton of profit each year which is fully taxable at ordinary income rates for me with federal plus state that means 42%
• From day one we've always self-managed everything, and built a great team of sub’s and handymen in every area, so that I’ve never had to do any labor. It’s ran like a business, not a personal investment.

Given the heavy workload I have being the CEO/founder of the wealth management company, my wife has set up a well oiled machine on the property management side, due to her perfectionist drive however, it still means that she's constantly dealing with tenants and toilets and replying to items at all hours of the day and night. So at this point given the large amount of income that the wealth management company kicks off, this very nice profit from the real estate portfolio is looking less and less attractive every year especially considering the time and mental real estate it takes up for her and the tax consequences.

Looking for the forums help in understanding all of the different avenues you would be exploring if you were me in posting this portfolio for sale. 

I have been investing/building this sfh canton ohio portfolio since 2007. All properties were bought rehabbed, rented .... 85% of the portfolio was  acquired during the golden years of '07 to 2016. Long and short, when I now look at my "return on Equity" numbers as opposed to my casual on cash return numbers it makes all the sense in the world for me to sell.

Wholesalers contact me at least once a month the past 10 years and are always asking if I want to sell one of my properties, but I'll be hard-pressed to ever find a wholesaler that wants to pay me for what these properties are worth and is also willing to buy all the properties in one transaction which is how I'm looking to sell.

Given how good our return numbers are here in northeastern Ohio compared to the parts of the country I know that out of state investors would definitely be very interested in in this portfolio. I've looked into roof stock as a possible option but I've heard nothing but negative reviews about them.   

My primary business is owning a wealth management company, and is where I enjoy spending my time. Over the past 6 months I've had one of my staff members a has done a fantastic job of building out a website and we have detailed every single property with  professional pictures and all our financials. We have QuickBooks reports going back for 10 years as well that we are posting to this private investors portion of our property management website.

Thanks in advance Community for your feedback, any and all feedback and a time you take the chair of your thoughts is very much appreciated.

Does the desktop version of QuickBooks allow for automatic bank accounting linking/downloading? A great feature of QBO is that my credit cards and bank accounts assigned to my rental property LLC link and automatically push transactions in daily.

After 5 years of using QBO for my primary business (financial-planning firm) and 3 years using it for my real estate LLC, I'm thinking about going to the desktop version for my rentals. I have 24 SFH's that I own....so I am not a property manager, however it just seems that there is more that I can get from the desktop version and track more tenant info as well. In hindsight, I really overestimated the value/amount of time me and my CPA would have "online meetings" where we are both logged in at once.

please send me a private message if you are a current buildium user and would like to share your referral code.....we both save $50.

Thanks in advance!

hello all and thanks in advance for your reply. 

Just joined the community a few weeks ago, I have been acquiring SFH's and making them income properties for the past decade. My career though is as a financial advisor as I own a financial planning firm here in Northeastern Ohio.

My question for the forum is simply getting your opinions what opportunities there may be out there for my clients, in a very structured and professional way, to put money with a firm and earned a fixed rate of return.  I am not specifically thinking of REITS here, rather I was thinking of something different.......such as maybe there are hard-money lenders or companies along the lines of B2R finance that accept investor money and pay them a fixed rate of return.

Thanks all!

 James, thanks for your reply, and thanks to all of you for your replies thus far....your insights are appreciated greatly.

Let me clarify my earlier post when I said that I have no interest in working with a "traditional broker".....

I spend 95% of my week being a financial-planner and meeting with clients, only 5% of my week is spent with my Real Estate LLC employee's. I go look at houses in the evenings and early early saturday morning.

So although I desire to have a great relationship with my broker, I realize that the less time and attention they give me the more profitable I am to them. 

So I guess the better way of stating my thoughts would be that I desire a brokerage relationship that realizes I am an advisor and business owner first and foremost.  I don't want to be looked at as anything other than an investor who has a license for his own deals. An investor only gets their license in order to avoid the "middle-man", I don't want to have new headache's/middle-men with a broker who expects me to act all their other career agents. I know of an investor who hooked up with Cutler Real Estate here in NEO and although he was very clear about his desires, he soon figured out that he was being asked to do all the same things, attend the same meetings, as all the other agents.

Given that I own 90% of my properties free and clear I am exploring the idea in 2016 of taking a chunk of my equity and making a large purchase on my first multi-family....additionally I will be selling my primary residence and buying another. Outside of those, I plan to purchase 5-6 more SFH's in 2016.

Given the above it just seemed that one of these online brokerage relationships might be the best fit.......however I could be wrong here and am willing to look at any and all options.  My only desire is to have a mutually beneficial relationship.

Thanks for the 2 replies thus far....

Yes, I am getting licensed only for my own investment purposes.  I do not have any desire to work with a "traditional" broker who will try to sell me on all their value-adds.  I want the highest payout with zero support.

Any others thoughts or insights are much appreciated!

Hello and thanks in advance for any replies.....just joined the forum today.

I am an investor in Ohio that is looking to take my Ohio real estate licensing classes in January. My LLC currently has 23 properties that I have purchased, rehabbed, then turned into higher end rentals.....I am looking to buy/remodel 6-7 more in 2016.

I realize that I need to have a sponsoring broker and have found one who has a special design for "investor only realtors", however I am looking at these online brokerage firms where you pay transactions fee's deal.  In particular Fathom Realty seems to be a one of the larger players in this space along with Premier Agent Network.

So my question is are their others that I should be looking at?  And secondly, since in Ohio I need a "sponsoring brokerage firm" what does it entail for them to "sponsor" me....I am going to be paying all my fee's for the courses myself.

Thanks again so very much!

Hello All~

Somehow I am just finding this online community....looking forward to learning and sharing in this online forum.

I buy single-family homes, mainly foreclosures, rehab and remodel them and turn them into higher-end rental properties.  Full-time I am a financial-advisor, and my real estate llc currently has 2 full-time employee's and 23 single-family homes.  I am going to start my Ohio real estate classes in january so that I can become more efficient buying and finding deals.

Looking forward to learning and sharing