All Forum Posts by: Neal Collins

I've got a house on a 5,000 sq ft lot in the Overlook neighborhood in Portland that sits in good zoning for development. The house could be rehabbed or it could be scrapped to build 3 to 6 units (6th unit allowable with density bonuses. Great potential for rehabbers or builders. PM me for more info.

The million dollar question is to determine the market value. List source won't give you that information, and I wouldn't fully trust any site that did provide a definitive market value. The absolute best thing you can do for your real estate career is to define your area and know what you're targeting. Forget Listsource. I'm serious. Call a local Title Company and tell them what areas your looking at and your criteria. You'll get a list for free. At the same time have them pull a list of properties in the same area that have sold in the past six months. Go by and look at each one. Knowing values is the crux of good marketing campaign.

Pro tips for you: Dark towels, dark sheets, bright open spaces with zero clutter. Label everything. Make sure you get a good house cleaner. Start cheap and get some good reviews and then increase your prices. Good luck!

Wow. What a journey. My brother in law spent many a year in Humbolt. Spending time there is like stepping back to a different era. If your in Humbolt I'd start scouring the west coast for cheap vans on Craigslist. It's the most robust market in the country. It won't make you rich but it'd make a profitable hobby there. Best of luck on your real estate journey.

@Veronica Brock Seller financing can be a powerful tool for both buyers and sellers. It helps buyers finance a purchase without having to go to a bank and leaves flexibility to negotiate. A seller can also benefit by receiving interest payments above and beyond what you would get from a sales price, in addition to deferring capital gains in some instances.

As a buyer of real estate, terms and price are the crux of the deal and need to be considered equally.  You trade price for terms, meaning that if the terms are right then the Buyer doesn't have to pay rock bottom prices.

Without changing the direction of the boat if you like the basic structure of the offer I would counter with sales price and define the interest rate. This is just me but I would have purchase price be $76k, $25k down payment. If you're fine with 4 years then leave it be with a balloon at the end. Some people don't want buyers to be able to prepay, but this is a relatively small transaction. I personally would leave a little meat on the bone by not gouging your buyers with usury rates but would try to negotiate around an 8% interest rate if they don't have a prepayment penalty. Everyone one of these items are negotiable and in the end your looking for mutual ground. Best of luck!

Who says you need a good credit score to invest in real estate? Keep reading that book and you'll have a lot more practical guidance than people can really give in short forum posts. There's a million ways to skin a cat, especially when it comes to acquisition and finance.

Contact a real estate attorney to draw up a contract if you're unfamiliar with the verbiage. It won't take them long at all. 

I don't know how much the back taxes are on the place but I would imagine they can't be close to the value. Great job negotiating that if that's how it is!

So you're trying to sell it on a seller carried note? You're going to need to establish the terms of the transaction so here are some things to think about:

1. What is your Sales Prices

2. How much money do you want Buyer to put down

3. What kind of interest rate are you looking for

4. How long you want to hold the note

5. Do you want to receive interest only payments or principal and interest payments

6. What happens in the event of prepayment, or your Buyer sells the place, etc. 

7. Any other terms that you or the Buyer are interested in.

Once you have those details sketched out you will draw up a Purchase & Sales Agreement that outlines that the purchase will be financed with seller financing. You are going to want to draw up two more contracts- a Promissory Note (the mortgage) and a Trust Deed so that Note is secured in first position on the property so that you have proper recourse if anything goes wrong.

You can get these contracts online, but do yourself a favor and talk about all these things with your Buyer ahead of time, write it down, and then go to a real estate attorney to draw up the Purchase and Sale Agreement, the Promissory Note, and the Trust Deed all at one time. It might cost you a couple hundred bucks but it will be done correctly and will save you a lot of time, energy, and money in the long run. All of the contracts and Earnest Money will go to the Title Company/Escrow and within a couple weeks you should be on your way.

Good luck!

@Joel Owens

 Great feedback. I agree the property management business model isn't a great one. It is time intensive and the margins are slim. At the end of the day though my main objective is to get in front of property owners and establish rapport with them. If I can't buy someone's property, I want to be able to manage it or sell it. Right now we are very exclusive with our clients but are starting to grow and now have a new 12 plex that we are pre-leasing. As long as I'm not throwing money away to subsidize a business I think property management is a great way to create an avenue to have property owners come to you.

@Curt Davis We do need an office person as well. We have a lady now that is a great sales person and wants to come onboard. My goal is to keep our property management fee structure easy to understand without breaking the bank for property owners. We've been charging $375 per unit for a one-time sign up fee that covers advertising, account setup and leasing.

Let's say a broker refers me to a client that has a duplex that wants property management and I pay $100 for the referral. I'll assume we have another $75 in advertising fees, and then $350-450 per lease to our leasing agent. We're up to $975 for the two units in costs, offset by only $750 in revenue, leaving us in the hole $225 from the get go. Would you eat this knowing that breakeven will be down the road in a month or two, or would you rethink your fee structure?