All Forum Posts by: Chad Hovermale

Does Phil also mention in the video that REI are giving away the lion's share of headache, hassles, risks, potential losses, holding costs, etc. by selling to private investors as opposed to retail buyers?

If he didn't mention those things, then it is worth adding them to your deliberative process when you are deciding whether to sell a contract or list for retail buyers. I'm guessing that you will have to consummate your purchase agreement before you can list it on the MLS. Also... don't be afraid to leave money on the table. You have to leave some meat on the bone for your investors, and you'll make more allies and advocates. And... a retail buyer will buy one house from you before their buying power is exhausted. A private investor could buy ten, twenty, thirty houses from you.

There is a lot of nuance missing here.  I betcha it's in Phil's book or course ;-) 

Good luck!  Keep it up!

Step 1: Start attending local REI meetings.

I would recommend that you not rush to refinance your home in order to buy 2-3 properties.   Two reasons for this are:

1.  It's your home.  Protect it.  You are going to learn costly lessons as you begin investing in real estate.  Risking your house to buy investment real estate could leave you in a pinch and having to make difficult decisions about your finances later.

2.  There are different rules to the financing game once you have collateralized multiple properties.  Take time to learn the rules.  Work with a great lender or agent who understands investment RE.

Make sure you understand the limitations of using LLCs.  It can complicate your financing.  I would wait to spend the money on the lawyer.  An accountant that understands real estate would be a more beneficial professional to have on your team.

You have done greatly to get your home paid off.  You are in a terrific position to do great things as you launch.  Best wishes!  Hope to see you around GR.

Here are links to the DTE and Consumers Energy forms that you need to have signed and approved by the tenants in order to monitor their utilities.  Absolutely, set up landlord accounts; but, also make these two forms are a part of your standard lease package in the future.  The utility companies will require the third party authorizations if you call and ask for information about an account.

https://www2.dteenergy.com/wps/wcm/connect/7af5a2c6-d30f-40d5-84dc-614415fe2227/landlordTenPropProtect.pdf?MOD=AJPERES&CACHEID=7af5a2c6-d30f-40d5-84dc-614415fe2227

https://www.consumersenergy.com/uploadedFiles/CEWEB/SHARED/Rates_and_Rules/Electric_Forms/1394.pdf

Good Luck.

You could check into a drywall grid system to replace the acoustical grid system.  They are similar systems but the drywall grid will support the weight of a customary drywall installation.

I think I've read the replies thoroughly enough.  Has nobody said, "Call an electrician.", yet?  Where would the fun be in that, though, right?

Talk to your realtor.  Do it as soon as possible.

My perspective, if I were in your shoes, is that your reputation as a buyer and your agent's reputation as a deal closer are WAY more important in the long run than the 1000 you would potentially lose in earnest deposits.  If you are going to be investing in real estate long term, your reputation as a serious buyer is priceless and will earn you more than a thousand dollars in the long run.  

That said, a mutual release from the agreement might be acceptable from the people from whom you are buying the SFH.

Good Luck.

Gotcha.  Sounds like you should go with the texture.  THE reason to use texture is to avoid long term eye sores.  It also saves labor on sanding when you are installing new drywall and can be sprayed over concrete.  It cuts down on production costs in large apartment complexes.  In one or two units, the savings is marginal.  Good Luck!

I contract drywall and have come across this issue more times than I can remember.  In fact, it is a discussion that I have on almost every project that we do when ceilings are involved.  If the middle to lower end apartments have knockdown or orange peel, and you want your rehabbed units to feel middle to lower end; then do the same thing that the apartments are doing.  In some places, you'll pay a premium for smooth ceilings from a drywall finisher, but I think it is worth it for the updgraded "feel" of the property.  I have a customer that is paying around $2000/unit to have us strip off popcorn texture and make ceilings smooth in his duplex units.  If he can get $20 more a month or reduce his vacancies because his units feel high end, then he gets a decent return on his ceiling investment.  What will your market bear?  How do youwant to position your units in that market?

note that the previous cash flow analysis assumes gross rents with both units rented out and doesn't include management expense.  It is not an investment.   It may make a nice home for your family, but it doesn't appear to be a good buy and hold property.  You may end up stuck with this for a long time with negative cash flow.   Consider it carefully.

Hi, BP!

Many of you are already aware that the FREE Annual Conference and Event is coming up next week on Feb. 26-28, 2015 at the DeVos Place in Grand Rapids.  There will be national speakers there sharing real content, and if you have been before, you know that there will be some great ideas shared.  The speakers will be offering resources for sale after their presentations.  

Two things that I want to share if you are planning on attending:

1.  Our drywall business will have a simple vendor table set up.  I am not going to have any drywall on site to sell you :-) , but I would really enjoy the opportunity to meet fellow BP community members.  Please stop by my table and say, "Hi!"

2.  The conference wraps up daily before dinner, and Thursday night would be a great time to grab dinner downtown in GR and network with other real estate investors and investigators, especially from the BP network.

Please touch base with me here, or in a private message, to let me know if you think you might be there so that I can look for you!

Details about the conference can be found here:

2015 RPOA Annual Conference and Event

If your are not a member of the RPOA and you are involved in real estate investment in West Michigan, then let me refer you to the most value driven membership driven organization that I've engaged in.  You can explore membership here:

RPOA Membership

Hope to see you there!

Chad