All Forum Posts by: Shane Johnson

I would go over there and try to talk to him first. If that doesnt work, and he is still being a douchebag, there has to be some course of legal action.

I would try to resolve it peacefully though, because otherwise he will be messing with your tenants for years to come.

break down the walls, into a 4 unit, and owner occupy and re-add the walls :) lol.

Kidding. yeah thats not gonna work more than likely...

welcome! Another member here from God's Country. I live near the St Croix, in Hudson.

@Travis Daggett -

How are you able to turn and burn that many props? I am assuming your offers are owner-occupy? Cash? Or are the HUDs your bidding on, not first look homes?

There are definitely days when I dream of an annual salary corpo job, making what I make now. Then I slap myself.

Gets easier with more ups and downs. :)

I am in a sales job (not RE) and have experienced it first hand. Try losing 15,000 in business, and trying to keep moving forward. It makes your stomach turn. But then their are days when you land 100K purchase orders, and then there are days when your purchasing dept, says they cant source 40k of what you quoted any longer. haha. its a blast!

I still struggle to keep the emotions out of it, but I am getting better at it. All in all, I guess Faith, has helped me keep an even keel. I know I will be taken care of no matter what.

Maybe try this:
Write down/List what you have accomplished good, so that when something bad comes along, you can say , oh yeah, this is why I do it.

After reading J Scotts blog, and doing my own calculations, this is how I see it.

Say it only costs you $300 a month in fees. That's $3600 a year. Most listing/buying agent commissions are 2.4-2.5%. Most brokers to my knowledge take half of that. (realtors please chime in, especially in the MN/WI area)

So based on that, at .0125 (1.25% comm) You would have to sell $288,000 worth of homes, to offset that $3600 cost.

If and when I get to a point where I am flipping 2-3 properties a year, and my friends and family ask me to help them buy/sell, then I will probably get my license. Until then, its not worth it for me.

Right now besides my own off-market research and driving for dollars, I have a great agent who sends kickouts to my email.

Find a good agent locally that will work with you, that will do this. For example, I have filters set for specific school districts only, under 150k, single family only, and then also have one set up for multis, and solds (so i can watch my comps).

They may even let you see the full agent views of the listing, but I am not sure if that's illegal or frowned upon among realtors. It never shows that much more anyway, because listing agents are lazy with lender owned listings. On the "solds" you can see the financing info after purchase though, which is fun to know which type of offer/buyer got the deal done.

Two good lessons here for all of us Silvio. You have to have a thick skin, and always treat them kindly. We never know what a person is going through. Also, he may have felt like an idiot after. If you respond positively, then maybe something positive could come of it. I picture the guy calling back and saying something like "hey man I'm sorry I reacted that way, my mother just died, and me and my sister... yadda yadda"

Simply put... You'll catch more flies with honey, than vinegar. ;)

Good to see another local face on here. @Ted Larson , do you ever attend the REIA minneapolis meetings?

I also agree - come in with highest and best. If this house is an instant equity opportunity, you can bet on multiple bidders. Another tip my agent told me, is he believes in getting your offers in FIRST. Be one of the first offers they look at in their stack of offers.
I bid 82,4XXk on a HUD auction, with 3% seller concessions, yielding an 80k net. I then didnt hear from them for 2 weeks. The two other offers were "owner occupy" all cash (yeah! my a$$ they were owner occupy!). One (possibly two) backed out for personal reasons. I ironically met one of them later, he was going to buy it for his daughter. The 2 other bids were around 101K.

The BPO listed price was 70k on this home. Don't fiddle fart around. Put in your best offer, especially if there is instant equity, and equity to be created in the basement.

Lastly - my agent warned of not going TOO high if you are using financing, they could reject based on the fact that your appraisal may not come in! This was obviously more of a concern last year, than right now in my opinion.

To summarize:
1 - put in an offer, you never know what could happen
2- put in your BEST offer, within the first few days of listing.

How do the rents compare to market? I hope they are below market?

Obviously they have a bad tenant mess, motivating them to sell, I would focus my sales pitch on this, and how selling to me CFD would alleviate their headaches, and make them my problem.

If so, buy them all CFD as a package deal, jack the rents on the non payer. Renovate, and rerent. Rinse and repeat until you have better tenants that pay on time in all of the units. If there is a college nearby, after its renovated you may be able to market to grad students instead of what sounds like very poor families.

Just thinking out loud here, and because I have a similar situation I am working with now...

To get the sellers attention, and due to their age, I would negotiate less down payment, in exchange for a prepayment penalty (only if legal in your state, and so they know you wont buy, fix and flip in a year) which gives them the income stream they still have, and the tax-deferred benefits for 2-3 years. I would only use this as a last technique if they get cold feet with selling. You mentioned the showing of the apartments to buyers though, so I am guessing you are looking at this as a flip, not as a buy and hold.