All Forum Posts by: Steve Santacroce

My wife @Rebecca Lebowitz manages over 140 properties by herself. The secret is your power team. You need a good lawyer, a good accountant, a good maintenance crew, and the most important, a good piece of software!

Maintenance requests should be funneled through your software and then given to your crew. You drive over and make sure the work is done to your satisfaction. 

@Jonathan Johnson It won't be a one time expense. It'll be a monthly fee, just like Buildium or Appfolio is now.

You're on a real estate investment site... I don't know how you thought the suggestions would be any different :)

Of course you want a mortgage, the rates are at all time lows. Why would you take your money and earn ~4% when you are earning ~$500/mo? 

On another note, why put 20% down on your house!? That money could go to the roof, paint job and bathroom. With the extra 3600/yr, I think you would be much better off!

No problem, good luck!

Rochester is no different than any other city. The larger returns are in rougher neighborhoods.

You're missing the closing costs (once for the short sale, and once for the refi mortgage) and holding costs (how many months to rehab * taxes & insurance).

First close prob be around 2k. Then the refi prob around 4-5k. If you can rehab it in a month, you're looking at about 2 months to close on the refi, so 3 months holding costs. 

They legally cannot deny a loan for a property in a given area, that is an illegal practice called redlining. However, they can set a minimum amount they are willing to finance (Usually around 50k) and since most of those properties fall under that, they can get away with loaning out money to them. 

Now as to why? Because they are bad areas to own property in! I know a few wholesalers who've wholesaled the same house multiple times! Investors ignore the warning signs, only see the $$$$ and buy properties that are very hard to find good tenants. Good tenants don't want to live in those areas. Section 8 & DSS will pay for them to live in better areas, so the really run down streets are usually all cash tenants. 

I would look at what the banks are saying as good advice. Stick to areas that you can get a mortgage on a house, you'll end up making more money in the long term, and you'll have far fewer headaches!

@Creighton Bertrand If the deal seems too good to be true, it probably is. My guess (since I don't know the area at all) is that the street is not in a good area. If the house has been on the market for a few weeks, many other investors have already looked it over, and found a reason to walk away. The numbers look decent, so the next most likely logical answer is that the area will make it difficult for the owner or property manager. I'm not saying that should stop you, but most likely you will have to deal with more headaches than normal. Good luck!

I'll play the devil's advocate to @Jeff B. I want my Property Manager to help me find my investment properties. A PM will do a much better job of vetting a potential property, as THEY are the ones who will end up managing it. They will steer you clear of problem areas, even in places you didn't know they existed. A PM's main focus isn't selling/buying houses, so there is less of a chance of them steering you towards a house that is overpriced. Finally a good property management company is always looking for deals, so they might find something that you missed, or is off market.

@Philippe Busque that is true for PMs looking to make a quick buck. At our company, our goal is to make the tenants as happy as possible so they stay long term, and to make our owners as much money as possible. We think long term, as should EVERY PM company. Sure we could pinch you for an extra grand or two a year, but that's very short sighted. I'd rather make you an extra grand or two and let you reinvest those profits to purchase MORE properties that we will manage. PM is a long term strategy, you don't make much money for the first few years, but it eventually snowballs as you stabilize the units you manage and continue to add new ones.