All Forum Posts by: Thomas M.

Lots of great input in this thread. I have done both and I think long term is better these days. The main reason is because local governments are getting quite aggressive trying to shut down STRs and creating new taxes etc for them. I think there's still money to be made but it's going to get harder and harder. Neighbors are hostile too. People really hate STRs.

I think it will be important to buy in areas that are just starting to sprawl. Then you can be in it for the long haul when the area becomes more developed and the market starts to mature. The idea is to take advantage of the growth of cities and suburbs.

The price of getting started is higher for you than it was for previous generations.  I think that's what you're referring to here and I agree with your sentiment. That is a problem for sure. The ceiling of property values is not infinite. We are in a historically unusual time where the increase in credit and lending has pumped up prices. Will it continue? Nobody knows.

The growth of RE values is also predicated on growing population and increased population density. If those things go down the values will go down (or rise more slowly), like in the rust belt.

And keep in mind you're on a forum full of RE agents. Agents will ALWAYS tell you it's a good time to buy. That's how they make their money. It's also ALWAYS a good time to sell, upgrade for that growing family, downsize for that retirement. Agents encourage MORE TRANSACTIONS and that will be their general message.

Here's a question for anyone who works in lending (and a cautionary tale for those just getting into RE.

I own 4 properties, all 4 of them are on my credit report. All 4 are rented out and cash flow positive.

I have applied for a few small loans over the years (solar loan, car loan, etc) and my application gets denied INSTANTLY because of how many properties I own and how it affects DTI ratio.

My credit score is over 820, my income is very high.

Total mortgage on the 4 properties is around 25K per month. The lenders simply look at that and assume I'm on the hook for 25K a month for 4 houses and I live in all the houses and have no renters. They say "you have 25K in mortages every month, your income doesn't support that so the loan is denied."

I've tried to tell them I have renters and all the properties are cash flow positive. They will hear NONE OF THAT! They just say "DENIED, thank you goodbye." The banks have never heard of such a thing as renting out buildings.

Does this happen to all landlords??? Am I the only person in the world renting out a few 4plexes profitably?

I had one bank that asked for my taxes, I gave them the taxes and it was way too confusing for them they just denied it right away.

There's a serious class action lawsuit against Vulcan 7. I expect more enforcement against this robo-dial stuff. People are really REALLY sick of cold calls from agents who want a huge commission to sell a house.

https://classactionsreporter.c...

I own 4 properties. I used to get hundreds of calls per year from real estate agents who are cold calling using Vulcan7's illegal auto-spam robo-call dialer system. It's a real nuisance. All of them want me to list my property for sale.

I've gotten a few of the major offenders off my back with this little trick. It's usually jack-*** companies like Hilton Hyland, Coldwall Banker, and Keller Williams (the worst one).

They usually have a sales person call who has a british accent, and this person talks to you like you've known each other for years. It's very patronizing and obnoxious. They ask if you want to sell, and tell you how Hilton Hyland is the GREATEST EVER!!! blah blah blah.

First thing I do is tell them I want to sell. Then I tell them I'm very busy but I want to have a meeting about it, at my office. Then I tell them I'm too busy to manage the rental property anymore, I'm always at the office. I ask them to come to my office for a meeting. I give them an address of an office 40-50 miles away and set the meeting for a time with heavy traffic.

After they drive 2 hours in traffic, they arrive at the office, and they call me to tell me they arrived. At this point I tell them I never had any interest in selling, I'm just wasting their times because I'm sick of cold calls and I'm hoping to discourage future cold calls from RE agents. They get pretty mad usually. Then the next day I call their office and tell whoever I can get on the phone that this person yelled at me and was all angry. This causes the story of the 4 hours of pointless driving to circulate around the company. BINGO no more phone calls from Coldwell Banker!

It's a bit of work to get rid of them, but faster for me to spend 15 minutes on this than it is to answer hundreds of calls from annoying british people.

Here's a link to a lawsuit against Vulcan7 anyone can join-

https://classactionsreporter.c...

It's TIKOTZKY vs. Kai Data.

Happy Hunting!

My suggestion would be to get rid of your agent. From now on simply have the seller's agent do all the work, make them kick you back half the buyer's commission, and they will put you at the top of the list because they still get more commission from you than from someone with a buyer's agent. Decide on a price you are willing to pay and stick to that. Agents make a big deal of "someone to protect your best interests." It's hogwash. Protect your own best interest by decided what you want to pay and if they wont sell at that price just move on to the next deal. There's always another. Buying a house is not hard. All it takes is money.

I think the RE agent era will end some day soon, in the next 10 years. But it's not because of the corona virus or virtual tours, it's simply because the fees are too large that agents take.

5% in total fees is just really unfair to sellers in big city markets. If a house is 1.5M (and lots are in big cities), why would a seller want to pay out SEVENTY FIVE F-CKING GRAND to 2 agents. When sellers finally get sick of this and put their foot down, that's when this will end.

In big cities now, we have an over abundance of real estate agents and they go around knocking on doors asking old people if they want to sell soon. They also partner with a spam phone call company called Vulcan 7 and harass people over the phone. It's because the need to find new sellers is simply too strong, it's too lucrative, and it's a burden on the general public to have to deal with this many real estate agents.

I am closing in 3 weeks on a $2M property, SFR in an "old money" area. I was thinking about backing out, but I've been watching this play out and houses are still selling in this area, and all over SoCal. A few have fallen out of escrow, but lots are selling at full price....high prices. At first I thought it was buyers who were locked in and had no way of getting out of the deal, but now that this has been going on for over 2 weeks I can see that this can't be the case, it's actually buyers who want to buy and don't care about the potential drop in prices, or just really like the house they are buying, etc. Friends of mine who are investors also are yelling GET OUT... IT'S GONNA CRASH!! But as I talk to them more I think they are wishing for a crash so they can buy cheap deals, and people believe what they want to believe. People with cash are HUNGRY for cheap deals and they are getting obsessed with the possibility of a crash. Truth is no one really knows. For some people it's a good time to back out and wait, for me it's a good time to stay the course and buy. I think it really depends on what's happening in your own little economy. If YOU INC is doing well that's the most important factor.

I'm in escrow now. I'm thinking about asking the seller to take a lower price since the economy just tanked by 35%. Anyone got suggestions on how to approach this topic? I can still back out if he says no.

:)