All Forum Posts by: Michael Lam

Hi @Ayo Isijola

It's going to depend on the issue at hand.  You can't base it off purely a dollar figure.  Because a roof leak is considered minor when compared to a roof revamp.  But a roof leak to repair may cost more than repairing a water leak (plumbing issues).

Generally how I would define a minor vs major is comparing the worst cast vs best case scenario of a repair within that category.  Going back to my example, a roof leak would be considered minor if its just patching the roof, putting in new shingles.  But if the roof is leaking due to the wrong angle used when laying down the plywood, then what 'appears' to be a minor repair is a much larger repair.

Hi @Timothy Howell,

Was this credit 'crash' recent during your contract?  you mentioned you have a awesome flip under contract.   Most lenders once they approve, your credit score is taken into account and will take into account right before you close,

Do you have a reasonable explanation?  A lot of times you can explain with your financial history. like a stable job, consistent income and a reasonable explanation.  Policy are much looser than it was before, so i'd reach to the lender and explain and see what options you have before putting the 'horse in front of carriage' type deal.

its good to always be prepared but more information is needed if I can give more feedback (and possible others on this board),

Welcome

@Chris Vair,  As a fellow engineer your embarking on an amazing opportunity,  what we are all excited about or atleast IMHO, is the volatility in 2017 with the Trump presidency taking into affect.  He's laughing his way to the bank.  Love to connect with you.

Just like any journey, it'll get rough, bumpy ..but at the end its the sunset you'll enjoy (we all seek to enjoy),

This is why you have to hedge your purchasing by leveraging the 4 pillars of real estate investing.  Appreciation alone is just one component when evaluating a property to purchase.

During the housing bubble, "appreciation" was thrown at anyone that had a heart beat and acted like they were experts in the housing market.  Unfortunately many people got caught digging the fools gold at the end.

Hi @Donald Howaniec

I can best understand "why others don't preserver" by asking this question.  "Why are their winners and losers?"  You win because you worked hard at your craft.  Your better than the competition because you worked harder and smarter.  The harder you worked the "luckier" you got.  Sometimes the ball does bounce your way, but without strong work habits, you won't recognize a good bounce vs a bad bounce.

You lost, why?  Because the competition was better than you.  If you loss with grace and you accept it, then you accept that the competition outworked you, worked smarter than you, was hungrier than you, had more passion than you, has stronger purpose than you.  

If you lost and made excuses...like "they had help, they got lucky" then your thinking is the exact reason why you lost and gave up.  Winners does not yield to excuses.  

I'm a strong believer in this saying,  "You either get better or get worse, you never stay the same".  In anyone's endeavor for a better life you need to work at it to achieve it.  

With the strong foundation of excellent work habits and perseverance, you can achieve unlimited success, regardless of any perceived or real disadvantages you may have.  Want to hear a great story, read up on Jack Ma (worth ~$25 billion), he's one of the BEST EXAMPLE of perseverance and never giving up.  http://www.businessinsider.com/the-inspiring-life-...

There is no short cuts in life that won't come back to short-circuit your success.  Work hard and the rest will come.

Hi @Holly Jackson

You are absolutely right, it is an "invasion" of privacy.  I wouldn't want to do it either.  However we have to be objective about this.  What is our scenario?  

1.  We are in a blazing hot rental market.  Rents are skyrocketing.  Landlords are leveraging this and increasing rent while choosing the "best" tenants.

2.  You are at a disadvantage because of the bad rep tenant with pets have.

3.  You have no leverage. 

At this point, its painful but you have to give and take.  You give and sacrifice your privacy for the love of your dog to find a home your entire family can enjoy.  

I would recommend not to let every landlord look at your home.  I'd only do this to the ones you really really want.  Try the other tactics first.  So you won't have the feeling of everyone peeping into your home.   

Good luck and really hope you can find home

Hi @Holly Jackson

I have empathy for you.  I myself have several dogs (small ones) that have a bad rep.  Chihuahuas.  I know some folks reading this naturally would be like "yikes, they bark a lot".  Its true they can and if you don't train them well they will.  However my dogs are well behave.  Enough about me.  You wanted to know what a landlord would need to see to consider "no pet" policy to be reconsidered?

I myself own several rental properties and I'm too are in the "no pets allowed" group.  Due to the fact that generally the demographic in my rental market don't care for their pets like I do.  I truly treat my own dog like a family member.  But the fact is a lot of pet owners treat their pets as "pets".

If your such a great pet owner.  Then you could do your best to be presentable and convey this to the landlord.  Here are few options you can do that would make me reconsider my stance on "no pet" 

1.  Give me your existing landlord phone, so that I can make a phone call to check on what you say is true.  Go beyond and give me the landlord prior to your current landlord to check out if stories line up on your dog's behavior

2.  Let me visit your home with little to no "lead time" to clean up.  Meaning, if you offered, "you can come by my current home anytime to check it out"  that would instill some confidence in what you are saying.

3.  Let me meet your dog to see how friendly it is.

4.  And if you really like a current rental unit, you may offer to carry rental insurance with pet inclusion.  A lot of existing rentals that offers pets will charge extra to to make part of rent to carry this insurance or enforce renters to carry such insurance.

5.  A nice little story with the picture of your dog, your story to let the landlord experience the empathy you'd want.

If you did those things, it does a few things for me in my perspective.

1.  Wow, this tenant is going beyond what is expected to get this place

2.  Shows commitment

3.  If you went this far to "sway" me, I can imagine you'd not want to do anything after signing the lease to ruin this impression and relationship.  So I would be more inclined to trust you'd take care of my property.

Hi @Samantha Klein

Your walking a fine line between putting in something that market may not necessary need. Be real objective about this and look at the rents in your area. Can you find any comparable homes with better amenities that justify a higher rent? How much more are you caring beyond the FMR in your area.

A luxury update, should only be considered in area of neighborhoods that expects this.  If you put these updates in a for example, 'ghetto' area.  All that will do will incur damage pretty quick because of the general pool of quality tenants are low in those area.  So even if you have made updates to justify the rent increase.  Where are you going to get the tenants?

So these updates you make needs to also consider the location of your area, the demographic pool of tenants in this area.

My general rule when renting out units and doing any rehab is to use decent material that last long.  A nice clean look and feel will show great during showings.

Hi @Steve Edwards

Its relative how you decide to allocate your time.  Are you the one spending time looking for deals or will you enlist help from a team of agents?  Granted getting a realtor license will save on commissions both buying and selling,  the key question could you find a real estate team worth those commissions paid? 

I personally enlist the help of agents to find me these deals.  By them helping find these deals, public or private, them handling the transactions is worth the commission paid.  Its also scalable in finding deals.  Remember your one person.  But if you work with several agents that knows your criteria, you can work out deals regarding commission payments.  

In terms of getting direct MLS, you can work with a realtor that will give you direct access. If you build a relationship (your not a one time flipper but if you plan to be doing this as a business, then its worth building such relationship), the realtor may not have problem sharing access with you.

To me as a flipper one of the key essentials is building the team around you.  But I also understand the lure of saving money and keeping a strong cushion on your profits.

In terms of fees,  that won't be a problem if you do this as a business.  But if your doing just one flip a year type deal, then that will eat into your profits.

@Paul Timmins

The biggest learning was just that.  When you purhcase a home, be very clear,  flip or rent.  That way the strategy of renovations change.

1. Example, if i had decided early on to rent, I would not have converted attic space into a room.  It was built out enough to be used as a room but "finishing" it would not yield more rent money.   The kitchen I chose was too expensive for a rental.

2. But because I chose to finish the attic to a room, chose nice kitchen, re-positioned layout of home, I ended up making the home unique on the block.  I held the home for 1 year.  YES 1 YEAR as a newbie spells disaster.  But what I got lucky was the price I got it on was dirt cheap.  I did the renovations myself which saved a lot while maintaining my full time engineering job.

3. Another job i  did that was not needed for a flip or would be a problem for rental was a French Drain.  For a flip i would not have wasted my money on that.  But for rental I would as it ensures no water damage on your property and reduces risk of incurring maintenance cost.

This gives me a great idea,  I should add this to my list of blogs  I will write,

"My first flip mistakes"

Many people can learn from this!  Connect with me so that when I post it here on BP you'll get first notification.