All Forum Posts by: Manny Vasquez

If this is your first rental, to cast a wide net, I would use Zillow, Redfin, Apartments.com, and on the MLS. Once you start getting prospective tenants, I would use the tools found in apartments.com. They can help you screen, collect security deposit, collect and automate monthly rents, and provide renter's insurance. They also have boiler-plate rental agreements. You can also use the rental agreements that have been uploaded in Bigger Pockets.

Good luck!

@Ryan Thomson -  How much does apartment.com charge for their services that you described above?

@Joseph Gozlan Great point!  I hadn't even considered the maturation of the bridge loans taken at much lower rates a few years ago.  The inability to refinance into the same rate (or lower) and thus generate the profits they had anticipated will lead to the forced-sales of these properties, and in some cases, will come with substantial losses. I agree with you that this won't be a "crash" and I also believe that there will be a consistent, slow-trickle of non-performing properties that will be hitting the market.

As @Luka Milicevic said above, there is no such thing as "too old".  I have personally bought and sold properties that were built in the 1910's and 1920's that have been very well taken care of throughout the years and were in excellent shape.  Over the years, those properties have been renewed/remodeled to some degree.  I have many clients that own very old properties that they rent out and are doing just fine.

I have also bought and sold homes that were much, much newer, say 1980's and 1990's builds that were total tear-downs.  I wouldn't look at the "age" or DOB (date of birth) of the house, rather I would focus on the condition that it is in.  I would also do a very thorough inspection so that you know what you are buying and the life expectancy of the individual components (i.e. life of the roof, condition of plumbing, electrical, etc.).   This is how I would determine what to buy and how much to offer.

@Cody J Leivas - I totally agree with you, Blackstone, Starwood and other REIT's may have been aggressive in their recent property acquisitions with properties purchased with rents at or above market, leaving them little room for growth. The FED has been deliberate with interest rate hikes, and I'm very certain that in this month's FED meeting (happening today or tomorrow) they will continue to raise interest rates (mainly because inflation is still too high). I don't think it will be a +75 bps increase, rather, I think it will be a +50 bps increase. Rest assured that they will continue to raise interest rates. This translates to additional pressure on the REIT's (and their liquidity crunch) that will continue to rise in the coming months.

@Dean Murray Hard money loans can be really good, however, they can also be really bad if you don't read between the fine lines. There are some great HML's out there and there are also some sharks. Make sure your lender spells out all the details. What is the interest rate? When and how do you receive the money for your BRRRR? What are the terms? Is there a pre-payment penalty? etc. Typically, you want to rehab your property as fast as humanly possible so that you can refinance yourself out of a hard money loan and into a much more favorable home loan. I would highly recommend that you speak with 3-4 HML's to see what they offer. You can always share the details on these forums so that people can chime in and help you determine if its a good deal. Good luck!

@Michael Kotyk - Wow!  500 properties below what they paid??!!  And that's just Las Vegas.  I wonder how many properties they have that are "underwater" in their books.  I'm pretty sure that if you ask OpenDoor, they'll have some spokesperson say that all is fine but then again, they really can't come out and say that they are bleeding red (they have to say that they are ok) or else this will cause panic amongst their investors which will lead to a drain on their funds. By the way, I hadn't heard about their Class action lawsuit?  That is news to me.  Do you have any more details on the lawsuit?  

@Greg Scott Thanks buddy!  Yes, I have been waiting for these "economic times" to manifest as I was getting outbid  on properties all the time.  Now that they are here (or very fast approaching), I am salivating at the opportunities that these economic times will provide.  I am currently "In Escrow" on a foreclosed multi-unit ( a triplex with a commercial storefront) property in Los Angeles.  I am very certain that I would have been outbid by these bigger corporations.

I also agree with you that most people will be okay.  However, there will be several people and properties that are over-leveraged and will face the unfortunate ordeal of foreclosure and/or short-sales.

I just read an article on the Wall Street Journal https://www.wsj.com/articles/i... stating the fact that investors have responded to rising interest rates by pulling money out of real estate funds in record quantities. As a matter of fact, nontraded REIT's, such as Starwood Capital Group and Blackstone , have paid out $3.7 billion in withdrawals in Q3 2022 - which is an alarming increase of 12 times from that same period in 2021 (Y-O-Y). Both of those companies have limited the amount of investor withdrawals . These withdrawal limits are triggered in order to prevent the fund from having to make forced sales.

However, even with pre-set withdrawal limits from these REIT companies, investors can continue to withdraw their money in the future, which has several negative effects on REITs:

1) It prevents REITS from buying properties or continue existing projects (in order to hold-on to cash reserves and pay back investors)  

2) If investors continue to withdraw money, this may lead to a downward spiral of selling assets if it can't gain the trust of its investors (i.e. the forced sales of its properties).   

2a) As a matter of fact, Blackstone has put up for sale its 49.9% interest in MGM Grand Las Vegas and Mandalay Bay Resort & Casino

Given the above news and with Zillow, Redfin and Opendoor closing down there iBuying departments, Is this another bellweather for dire commercial and residential economic conditions to come? 

Postcript: Personally, I couldn't be more elated with the above news as this opens-the-door (no pun intended) for the little guy to buy (both residential and commercial).

I had a similar problem and I would strongly recommend to evict NOW.  Have the PM do the job they were hired to do.  If they are already late on payments and not paying the gas, the problem is not going to get better.  These type of problems tend to snowball.  Evict now.