All Forum Posts by: Mark Williams

After searching the market basically every day this year, direct marketing attempts with no results, and writing multiple offers that were not accepted, and a cash cow 5 property seller financing opportunity that the seller backed out on, I am under contract on an investment! Our search perimeters are pretty tight for SFH in the 8 mile radius we invest in, so that on top of interest rates and lack of inventory has made for an unproductive year. This one checks all the boxes, is in excellent shape, and I already have a long term tenant lined up to move in right after closing. My wife is the realtor, so she also gets 2.7% commission back on our purchase. Here are the numbers:

3 bed, 1.5 bath - 2-story, 1152sf

list price: $180k, purchase price: escalated to $200k (comps at $215k+ in same neighborhood)

downpayment (20%): 40k

closing costs: 6,500

repairs: 3,500

mortgage/insur/tax/hoa: 1,335

Rent: 1,775 + 50 pet fee

Cashflow: 490* (repairs/vacancy/cap ex fully funded for year 1 out of purchase commission, then use profits when needed for year 2+)

CoCr: 11.76%

No way...heck no

 I had this exact same issue come up on a house next door to one of my rentals. The tree fell, demolished part of the front of their house, and a good part of the tree ended up in my yard (didn't damage anything) where the mowers couldn't cut the grass properly. The owners were non-responsive (I had been trying to buy the house for a number of years). I spent the better part of a day cutting the debris off my property and tossing it back onto their property, and then I went to the city and brought them pictures of the damage and the issue. The city issued the property a couple of violations, got in touch with owners, and magically not only did the damage get fixed in short order the owners decided to finally sell it - too rich for my tastes - and another investor bought it and spent a bunch of money making it look really nice. So it all worked out in the end. 

That's called "Eviction with Conviction"

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Moment SWAT raids $400,000 Georgia home and arrests four squatters running an 'illegal strip club' where they also kept HORSES

The neighbors not only lost sleep but would wake up the next day to piles of trash in front of the home.

They also were annoyed by occasional gunfire going off in the area and the stench of marijuana.

'It was always something going on in that house,' one neighbor said.

After levying several complaints, police and the SWAT team finally showed up at the house last Sunday.

An officer said the last straw was a license plate reader discovering a stolen car on the premises.

The driver of the stolen car initially refused to come out when pressed by the police before they moved in.

Once officers got inside, they found another stolen car, stolen IDs and even stolen credit cards, according to WSB.

In addition to the illegal dancers, there were also noisy parties held at the house on weekends and car races on Wewatta Street, neighbors said

According to gosection8.com, Detroit has the highest number of Section 8 properties being marketed on the website (1000+). 

This is much higher than many other cities. 

Did any of you struggle to market your Detroit property and find tenants interested in it? 

Hi @Aldo Fazio, Yes, Paralysis by analysis is a real thing, but that being said, with interest rates, taxes, and insurance shooting through the roof...and coupling that with insanely low inventory...it's really hard to find a deal that works right now. If you've created a model, you're working the math, and your spreadsheet is spitting out numbers that don't work for you, don't pull the trigger. It's the dealt that you don't do that make you money more than the deals you do. What I mean by that is I've seen so many people push a bad deal that they end up losing and it sets them back. Two years ago, cash flowing properties were everywhere. That's not the case now. Don't deviate from your model just because you feel you're not finding deals. That's what everyone is feeling right now. Stick to your principals and trust your math. Athough it's really common, your post doesn't sound like your suffering from PBA (I'm trying to sound like a drug commercial), I think you're being smart. 

I'm looking to do my first fix and flip here in Pinellas County FL. I'm having a hard time estimating the repair costs. Can anyone give me some advice on where to research for the cost? Thanks in advance!

Hi Will,

Welcome to the BP Forum. I'm a real estate investor with an active real estate sales associate license and a general contractor license in FL. 

Licensing laws are state specific so I can only provide insights to you based on Florida licensing laws. Illinois could be different or similar but please verify. 

1. In FL, to get a real estate sales associate license, we sign up for a 64 hr pre-req class, passing the class will allow you to take the state exam, passing the state exam we will get our sales associate license, which most of the real estate agents are. Sales associates only allowed to work under an active real estate brokerage (RE/MAX, Keller Williams, Century 21, etc for your big name brand or you can go with the local boutique mom and pop office). In FL and I believe in many states, you need to maintain the sales license for 2 years (or 3 years in some other states) in order to be eligible to take the broker's exam and obtain the broker's license. When you obtain your broker's license, you can either a.) start your own brokerage, with that you can choose to grow your business and recruit more sales agents to work for you, or be a solo-agent broker, or something in between. or b.) decide to continue working under another brokerage, essentially staying as a salesperson but with a broker's license, which term: Broker Associate. And in FL, a real estate license will let you earn a commission on any real estate related transactions: residential, commercial, business only with no real estate properties, property management, real estate consulting, etc. 

In summary, if you were in FL, a broker wears the business owner's hat, there is no way to become a broker without having at minimum 2 years experience under your belt. And if you want to do sales and make big money on your own, stay as the sales associate is the way to go. 

2. You can be a part time agent, but don't expect to be a successful one. Everyone I know in this industry fall in the two category: 

a.) Not making enough money as a real estate agent and decided to not keep their license active at the licensing renewal time and go back to their primary job. 

b.) Making too much money, way more than their primary job and they decided to go full time and quit their old job. 

I have never seen a successful real estate agent doing this for more than 5 years as a side hustle. 

3. To find a good broker, first you need to decide what do you want to do. Do not focus on the commission split. Training and mentorship is much more important than a few percentage in the long run. If you like to keep things flexible and low cost just to feel things out, then go with a virtual broker office with 100% commission on the agent side and they don't have any commitment required for sales agent. If you would like to make lots of money ($300k to $500k a year or even more in very expensive areas) and be a very successful real estate agent, then you gotta hustle and look for the broker that runs a successful sales team. I also see lots of mediocre agents just makes ends meet and half *** in their job and just survive. The good ones maybe breaks 6 figure in commission but average agents make about $40 to $80k a year. 

Hope this helps answering some of your questions. If you want to talk more, feel free to dm me. Personally I fall in the category of a real estate investor with a real estate sales agent license. I'm not a mega bucks top producer but I've been with REMAX and small boutique brokerage. Everything I said it's from my perspective either personal experience or conversations I have with lots of real estate colleagues.