All Forum Posts by: Andy Luick

I like smore.com for some of the flyers I use. They have some nice templates. I'm not sure it will suit what you are after for your commercial needs but it works well for properties or rentals that I am marketing. Happy Investing!

After over 20 years in my market, I get bombarded with emails from wholesalers. I love buying from wholesalers and have a few favorites. Like J. Scott, I appreciate some pictures and a "rough" idea of the repairs needed. As a lifelong contractor/remodeler, the numbers or costs provided by the wholesaler are not very important to me but the suggested scope of repairs is. Most successful wholesalers in major markets have never seen the properties they are marketing and have an assistant running around looking at things.

For a new wholesaler, I'd say you are new to the game in your advertising and maybe even align yourself with a competent local contractor who can run through the properties with you and provide you rough numbers. You could then have a contractor who has seen the properties prepare detailed bid to you buyers once they are under contract...or put them together beforehand if you are so inclined. I've done this for so many years I can usually walk through the house and have a pretty good idea of my repair costs within 10 minutes. Happy Investing!

Good stuff - we all develop a barometer of sorts over our years of doing this and we can be hypocritical in how we apply our tests. I use the vehicle condition all the time and absolutely will not rent to someone with 8 weeks of coffee cups in their vehicle...many of my renters only own a car...or are trying to own it....if they don't have pride in that ownership, i don't want to rent to them....even though, if I saw the inside of my the contractor truck I often drive....i would NEVER rent to me.

Depending on your market, often the best dressed renter is your worst renter...especially inner city. They have learned the art of deception and arrive straight from church looking their finest. These types have always been my worst renters. I love the snotty nose test.....good one! I like tenants who provide me with tons of personal references that they have known for years....those are you usually my best tenants as they tend to care what other people think and know how to maintain relationships. I don't mind parents who come out with their kids....in fact, that a plus. I have a scoring system that I have developed over the years and it rarely fails me. Parents interested in the kids well being usually means they will be good tenants and the rent will get paid even if someone loses employment. Happy Investing!

With hourly workers it can be tough. I like to see 3 times the rent in combined monthly income....in some inner city areas, i may bend that some if the potential renter has excellent job history in terms of tenure and references both working and personal. I like to see 3 months of bank statements especially for self employed people. Some employers will be very direct and tell you the straight skinny on a worker....others are strictly by the HR book of name and duration of employment. Happy Investing

The fun thing about real estate is that there are so many options & approaches...what works for one might not work for another or even be appealing. Like many, I have here to learn and share. There are some phenomenal people here to network & share with. My approach here was to see & share what others are doing....my responses have been in reply to what others asked.

@Eric M. - this is absolutely a great approach to turning around under performing rental units. We've been doing that for quite a few metro atlanta investors stuck with properties they bought "rent-ready." I've been around this business for a good many years and a 10% to 16% net return is very strong for a passive investor holding a renovated & rented property. At least on everything that I do, I offer a 10% net guaranty for 18 months. You're absolutely right...you can get better returns doing deals differently. My front-end JV partners earn 10% plus half the profits on the sale and they control the property. For these partners, their returns are in the neighborhood of 20% to 30% in 6 to 12 months with some running as high as 40% or 60%, depending on what we bought and how well it rented out.

You're certainly right, there are risks to everything. That's sadly why we have lawyers and insurance. I hope we never have such an incident in one of our properties. We have no interest in creating a scalable model...that isn't our niche. This is a very personalized model and it's effective because of all of the effort we put into it. I started doing shared housing in college and have been doing it approaching on 25 years now. It was profitable then and it certainly is profitable now.

As a transactional lender, yours is probably the most profitable operation of all. Like mine, it almost makes owning real estate silly. So aside from your lending business, what type of residential investment deals are you doing and what types of numbers are you seeing or producing? In some markets, like Chicago, there's still a very robust flipper market and that may well be what you are doing. Great numbers in that too, if it's in the right market, which is honestly true for all of this. It's all about sharing & networking. Most residential investors in our market are very lucky to see 2% to 3% annual returns by the time they account for repairs, evictions, taxes and insurance....plus vacancy & commissions. Quite a few of the investor properties we've taken over and turned into shared housing were empty for over a year. Now they are back producing and at a better net rent with less vacancy.

I would send a certified letter back to the tenants telling them that you cannot accept a partial payment & that you are taking it down to magistrate's court. I would then take it down to the magistrate's court and deposit it with them until the judge can rule on it. In my mind, a mailed money order isn't payment of the rent until it is cashed but I wouldn't want to take that chance. Not sure where you but Fulton County can be a crapshoot sometimes. Most times, partial payments are made in cash or at least in person and you cannot accept those without resetting the eviction wheel in GA. Now you could also accept the money order as a partial and then immediately refile for the difference. Do you want the tenant or do you want them out? If you want them out, I would try to deposit the money order with the court and it can then be applied to your damages when you win....half the time the tenants don't show up anyway...even after filing a response. I'm so happy I don't deal with single family renters anymore...absolute nightmare the atlanta market and a headache for tons of investors.

@Kizzy Robb - it's not a shift in the market....just recognition of a niche that we are suited to fill. Most would thing that the tenants are marginal or low class and that isn't the case at all. We get renters from every cross section of life. We have some who could well afford an expensive home but prefer to share one. Some of our home shares are million dollar homes in gated communities....they run the range from $300/mo to $2,500 and everything in between...some furnished some not. I love this model because I get better net rents on the houses for my investor partners (not all of our homes are investors products as we work with homeowners are well). We took over an investor property recently that had languished for a few years and tripled the net rent in about 90 days.

BP is an awesome place to share and exchange ideas...leaving many of the better for the experience. I was at a meeting recently and got laughed out of the place when I explained my model a bit. In the back of the room, unbeknownst to me sat one of my joint venture partners...the laughing stopped when he stood up and said he made over 40% in 6 months on one of our deals. He basically said...I'm the one who is laughing now. Fun stuff really. There are so many ways to make money in real estate....but probably more ways to lose it!

@rachel leonard - shared housing at our level has been around for a bit but mostly out of necessity in very expensive housing markets like NYC, LA and the sort where even couch crashing can be expensive. I think you will see this evolve to address senior housing as well where seniors might have a private room or two and share the rest of the home. Necessity is the mother of invention. I like that our partners can earn good by doing good...affordable housing is a blessing for those who receive it and provides great returns to those who invest in it.

ahhhh and the real rub is ask the mail lady who the certified is from before signing for it. To the best of my recollection, nothing any good has ever come to me in certified mail.....certified funds, yes...but not mail.

As Matt noted, it's all based on confusing the consumer....are consumers going to be confused that you & your operation are really Homevestors? I don't think so but the practical matter is that they probably have deeper pockets than you do and while you are right in principle....principles get very expensive or "dear" as my grandmother use to say. Better to change it up a little bit and send them back a nice letter telling them you have done so. Happy Investing!

In most markets, the renters are all the ones with bad credit...just MHO. We don't even look at credit. We do full background checks otherwise and put more stock in job history, personal references and the length they have known them and, believe it or not, the condition of the inside of their vehicles. Our process is fairly straight forward: contact is made, we chat, we send them an app and get the information we need for background & criminal checks, we then meet them in person at a public place...unless it's a current renter referral and we might meet them at the house their friend is renting....if the meeting goes well and the person checks out, we then show them some property. We never ever advertise by address...ever. For those of you advertising on Craigslist, it's a bad idea to advertise by address or meet potential renters at the property. We've had quite a few cases in atlanta of people viewing a property, then coming back & changing the locks to rent it as their own.

Try getting to some local real estate investor meetings in your area and ask around for professional referrals. Most are protective of contractor or real estate agent leads because they want those available exclusively to them....usually! Lawyers & CPAs are easier to get a good referral on. As Joel mentioned, figure out what you want to do in terms of investing and then seek the appropriate team partners. Happy Investing!