All Forum Posts by: Scott Trench

@Marlon Fong - Could we please move the post in question back to the Syndications section? 

I can see why the external link made you think that it was a self-promo on a cursory review, but I do not believe that it was in this case. 

We've got an exciting new program here at BiggerPockets. A very high tech one.

Here's how it works:

1) Call 720-902-8552

2) A real estate investor will pick up, or text you immediately, notifying you that they will call back if they are on the line.

3) On the phone, tell us your goals, and we will connect with the resources or network you need to solve that problem.

That's it. Super simple. Testing it out today. Please give us feedback! 

It's free. To all members.

I completely agree. 

For a while, a truly irresponsible group of new investors were joining the forums, thinking they should pursue extremely dangerous strategies that put themselves and the people they were buying from at risk. 

This has dissipated, and that irresponsible crowd has largely lost their money and motivation. Those investors have largely gone elsewhere, and the ones who are joining BiggerPockets are much more responsible and realistic in their viewpoints. 

I think that it's one thing to give sober advice that appropriately discusses risk/reward. It's another to do so in a way that makes a new investor feel bad. Too much of that lately. Let's do better BP Community!

@Bruce Woodruff

I think this is a good push. I'll give two putbacks to my prior analysis: 

1) The yield curve could invert, and the market brace, for even two years, if Trump credibly brings a candidate for Fed Chair who will lower rates regardless of what inflation data reads, or the markets expect to be extremely dovish. Even if the current Fed keeps raising rates, this will result in the yield curve inverting again, in anticipation of the new Fed Chair changing things. I think that Jay Powell has thoroughly proven that he has no political allegiance, and is singularly focused on attempting to remedy the massive err made in 2021, and that he has, actually, done the least bad job by a central banker in the world from 2022 to 2025 (*hot take!).

2) If Trump removes the threat of tariffs, inflation will stop, and he can do this immediately and at any time.

This only somewhat addresses the points in your take, which I completely respect, but also respectfully disagree with. 

I believe that inflation already picked up on the threat of tariffs, and it immediately changed some firm's behavior in pushing up prices for goods and materials that might be affected. 

I believe that, excluding "immediate deportations" of folks who cross the border and are immediately sent back, that the impact of deportations is small, and is largely isolated to the deportation of convicted criminals in jail or prison in mostly red states. I would be willing to bet on a version of that, and will, in effect, through my real estate purchases this year.

Also - to be clear, I am not arguing that the policies will be "good" or "bad" in a more general sense for Americans. Just that I believe that they tend towards an inflationary effect on non-housing goods and services, and a slightly deflationary effect on housing by reducing demand for housing.

@Greg Weik I am merely making fun of myself. I am clearly a pundit. I accept it. 

I look forward to meeting in person at some meetup around town! 

@Greg Weik

Your post just reminded me that I am now a pundit. D'oh!

Very common. Here's how I'd suggest proceeding: 

- Make it clear in the listing what your requirements are for Credit, Criminal, Credit, and Eviction. I require 650+ Credit, no violent crime or theft, 3X monthly income, and no prior evictions. What you can require legally changes depending on your location. 

- If you make the above clear in the listing, you will immediately get fewer applicants. This is a good thing. New landlords and listings that don't specify this get flooded with applications from tenant prospects who are fishing for a landlord desperate enough to not impose the above criteria. A large percentage of these folks will apply elsewhere if that is clear in the listing. 

- Even with this caveat, some tenants will attempt to go to the property. You will tell them during a showing about your criteria. They will smile and nod. 

- When you go to actually complete the application process and send them the link to complete their screening, another portion of applicants will evaporate. 

- Some of the qualified tenants will also just drop out because they found another place they liked better. It's a free market. 

- You will finally get a tenant. 

The best approach is to set clear, written criteria, and then price the property at a rate that gets you enough applicants that you can find a few who meet your criteria reasonably quickly. I'd also start the marketing process 30-45 days before current tenants move out in most cases - it just seems easier to re-let a place that is currenlty occupied than one that's been sitting empty for a while for some reason. 

I'd also encourage you to allow pets if you are having trouble. Allowing pets, including the dogs nobody wants (excluding pitbulls, unless your landlord policy specifically covers them), will give you access to qualified tenants that otherwise can't find places that allow them. 

Welcome! As you progress your bookkeeping business, you'll likely want to learn how to export statements from a variety of property management platforms, as investor books are housed in bank accounts, spreadsheets, and a variety of property management and accounting software!

In terms of using BP - I highly recommend setting up some "keywords" in your settings so that you can get alerted to discussions that talk about "CPA" "Bookkeeper" or "Bookkeeping" and related terms!

Leverage does not always win.

While you can build a ton of wealth, and your financial model will suggest that max leverage generates more wealth, the moment you go all in on real estate with max leverage, it can ruin you. 

I have some friends and colleagues who are learning this lesson very painfully. 

Some of them are, or will be, learning this very painful lesson very publicly. 

No point in arguing it, we'll just watch it unfold this year and next. 

I know that anytime Trump's name is mentioned, someone gets triggered. Either the post is too anti-Trump, or too Pro-Trump. 

Let me be clear - I do not condemn Trump's policies or necessarily know whether they will be positive in the long-term future or not for real estate investors. Further, "Downward Pressure" may be "bad" for investors, but it may also be "good" for renters - his policies, if I am correct, may negatively impact housing prices and rents, to the detriment of investors and to the benefit of renters, in the near-term. 

"Positive" or "Negative" impacts are relative. I write from the standpoint of a real estate investor, and I perceive Trump's actions to be threatening to near-term real estate investment returns, on the whole. I believe this because I think that on the whole, his first two weeks of actions are likely to: 

- Have zero no impact on near-term supply (deliveries for single family and multifamily homes 2025 are a result of actions put into motion several years ago)

- Put upward pressure on interest rates: Trump's demand that the Fed lower rates will have absolutely no effect, other than providing a cheap source of easy social media clicks and engagement for real estate pundits. However, the implementation of tariffs, or just the threat of tariffs, is likely to influence rates, by impacting inflation numbers, and this influence may come quickly if prices for many common goods and services and raw materials rise in anticipation of tariffs, or in response to their implementation. 

- Put downward pressure on demand: I personally believe it is unlikely that Trump actually deports millions of illegal immigrants who have settled in the United States. This, to me, seems impractical, and a PR nightmare. It's possible he carries it out, but I believe it unlikely. I believe it is far more likely, however, that the effect of his stance and actions materially lessens the flow of new illegal immigrants. This will slow new demand for rentals. In the event that any meaningful percentage of 10-15 million (estimates seem to vary widely depending on which news source you prefer) current illegal immigrants are deported, real estate investors will have a big problem as vacancies soar. It is likely that a huge percentage of that 10M-15M illegal immigrant population are renters. Regardless of whether investors currently rent to illegal immigrants, their competition in the market likely does.

- Put Upward pressure on real estate operating costs: Increased costs for raw materials and supplies, and the likely increased costs for labor involved in many real estate related CapEx and maintenance projects signal the risk of increase in costs for real estate operators.

If there is no impact on near-term supply, a modest slowing of inbound (illegal) migration, more reason to believe that the cost of many goods and services will increase, and real reason to believe that inflation triggered by something other than an increase in the money supply (namely the cost of specific goods and services that are NOT housing going up, which comprise the CPI) will force the Fed to raise rates, this, on the whole, is not good for real estate investment returns. 

No, I do not think that there will be a housing crash or a massive drop, nationwide, in rents and prices. Yes, there will be offsets (do Tariffs and slowing illegal immigration increase wages for some workers - likely yes). But, I believe that the actions of the first two weeks should give investors, on the whole, reason to incrementally revise down their expectations for growth in prices or rent growth in 2025. There may also be incrementally better probability of deals, as investors who are dependent on rates coming down may find their hopes disappointed. 

I think 2025 will be, by and large a buyer's market, and that the new administration's policies only, and again incrementally, make me more confident that this will be the case.

What do other investors think? Do you agree or disagree?