All Forum Posts by: Rob Gillespie

REALLY? I respectfully disagree. 

There are multiple ways to buy properties without any of YOUR OWN cash. Obviously someone has skin in the game, but to say that those strategies are "junk" to sling books is just not accurate. 

I can tell you first hand that although many of the deals I do I use my own cash for, I am involved in plenty of others that I do not have any of my capital invested. 

I am not saying this to start a battle of words back and forth, I just do not want one of the new guys on the site to believe it is impossible to buy with "No Money Down". It is possible and a part of most real estate investors day to day life.

@Sean Dean 

Not sure what part of PA you are in, but the Pittsburgh market is very similar to Cleveland, so would be a parallel move in my opinion. 

I am speaking from a place of being challenged by the state on wholesaling, and it is NOT illegal. You do need to operate from a place of intending to close, not just playing middle man and walking away from deals that do not close, that is what real estate agents do. 

Your biggest challenge is going to learn the market here and competing with investors like me that have spent our entire careers in the Cleveland market.

  It is possible, I have bought from out of town wholesalers that have assigned me contracts, but for every property I bought, there have been 10 offered to me that were not good deals and the only way to know that is to know the market better. 

As for getting licensed as an agent, that is a completely different career path than being an investor. There is nothing wrong with it, but it is different. 

So my advice in a nutshell...

1. Get financial backers to fund you for deals that you find in case you need to close on the contract. 

2. Pick a market and REALLY LEARN IT!  Know it street by street. 

3. If for some reason you do decide to become a licensed agent, make it worth your while and sell some high end stuff, LOL

@Tess Robinson, 

POS is Point of Sale. This is where a city comes in and tells you all of the violations on the property. You as the buyer either need to assume them or the seller has to correct them. 

If you assume them, you may need to put money into escrow that is held until the repairs are made. Some cities do not require it and others require 1.5x the highest bid to be held. So if you need 10k in work, they hold 15k until you do it.  It can be  released as you do the work. 

Now how to avoid the POS. 

1. Many cities do not have a POS, so pick a city without one. 

2. If the house is in an LLC or trust, you can transfer the entity instead of the house, but this has some other challenges.

3. Throw caution to the wind and transfer without a title company. This will work, but result in REALLY ticking the city off when you get caught... and you will. LOL

Hope that helps! :-)

@Account Closed,

Way to think things through young man!! 

Here is the problem, the laws are written on EVERYTHING so the government can shut anybody down at any time for any reason. Nothing is black and white. 

With that said, you can most certainly get paid for leads. You can not legally sign any docs under 18 or they are not valid. 

My son started buying houses and doing deals at 13. He has since done 7 deals in real estate and another 6 or 7 in collectable cars. I have to sign everything for his LLC until he turns 18 in a few months. (would be happy to connect the 2 of you if you want to talk to him)

Sorry, I got off track, LOL. In short, if you are not negotiating contracts and talking with buyers and sellers, being paid as a marketing company is gonna be hard to call illegal. 

Good luck in all you do!! I have a feeling you are gonna go far!

@Tess Robinson The Republic of East Cleveland is just a nickname I made up for the City of East Cleveland. It is its own territory that is not tied with the city of Cleveland. Because of this, it has a failing police and fire department, TONS of vacant properties so no tax revenue. Last year the city lost its ambulance and it was on the news to not call 911 in that city because no one would come. LOL. A neighboring city gave them an ambulance later that day. 

Plus the city has a REALLY BAD point of sale inspection that forces investors to put more money than necessary into places in war zones

As far as Slavic Village, It is not the burbs, but we buy there. Heck my son started buying there art 14 and his first house at 13 was in a worse area than that. With that said, you MUST have good management in place to make it work. 

We buy in all areas good and bad.  You just need to know what you are getting into and manage accordingly. 

Here is a pic of me in the Republic a couple of weeks ago! LOL The ENTIRE STREET IS VACANT!

@Ivy Flowers I think Curb appeal is important. Even on just a rental. I would not go overkill though. 

the more expensive the house, the more that goes into it. I was told rule of thumb is 10% of value of the house. 

That advice came from a landscaper though. That would include the install of the the yard itself. 

I believe that to be more true on the burbs, 

I could not imagine putting 5k into a 50k rental landscape. LOL

Hope that helps

@VB Phom 

Cleveland Ohio is a GREAT market. 

I personally use a Hybrid method of management. 

My investors buy something off market from me and 

I give them a list of managers to choose from. I also train 

them on how to self manage by using local boots on the ground. 

My opinion of  a COMPLETE ONE STOP SHOP is that the more 

they do for you, the more you are paying for the deal. 

It can be worth it though, I am just about maximizing returns. 

@Shiva Bhaskar

Some investors certainly pay cash and refi later to get a better deal, but not all of them. 

I deal with banks that lend to out of state, heck even out of the county investors. 

I would not let that brokers opinion worry you. Cleveland is an easy market with a low barrier to entry. 

Hope to see ya here soon!!!

@Brandon Davis Welcome to BP! 

I buy everywhere EXCEPT the Republic of East Cleveland. LOL

It is really deal by deal. For example Shaker hts has really high taxes and a POS, but if you are buying cheap enough over there, it is worth it. 

Some burbs have low taxes and no POS, but if the deal is too expensive, it does not matter. 

Nothing really to look out for except rural areas have well and septic that can bite ya, but that is case by case as well. 

Find a deal, bring it on here, or heck even PM me and hidden landmines can be found pretty quickly. 

Hope that helps, I know I was not specific, but really is a deal by deal basis. 

Good luck!

@Rich Rodman,

@James Wise 

I believe it is highly irresponsible to blindly turn a property over to a management company and just hope for the best regardless of the neighborhood. 

It is easy to hide behind neighborhood  statistics to mask poor management. 

I would NEVER just turn over a property over to a management company and not be involved. 

I have success in those areas because I am involved with decisions and managing my boots on the ground.

They will not run if a management company is hands off. Evictions will be through the roof. 

I deal with investors from all over the world. I meet some of them when they are just starting out and others come to me with 100 house portfolio. 

 The common denominator for the ones that are happy and making money, is that they are involved in managing their properties. At the very least they have their managers on a short string and are staying on top of them. 

The investors that are fed up and ready to sell are ALWAYS with a "professional" management company. 

This is true EVERYWHERE, not just on the "war zones".

With that said, yes James is correct that there is more risk in low income areas, but the rewards are worth it in my opinion. 

As for crime and fear of going there, my son started buying in those areas at 13 because they are affordable with high returns, and yes, he is involved in his own management too. 

I am finished with my rant now, LOL