All Forum Posts by: Anthony Angotti

 I don't know how much the deposits were but if it's just two tenants you are more than likely to pay more in lawyer fees and court appearance fees than what you'd get from an agent. Especially since the responsibility of verifying you got this stuff was yours.

Yes, you should have had you agent notice this (I always check for this for my clients), but pursuing legal action is going to be a waste of time and money. Just give the tenants their deposits so you don't have to deal with losing three times the deposit for holding improperly and move on. 

Since you said you're new I'll let you know that in this business plenty of people are going to be incompetent, sleazy, or both and you are going to get screwed over. Your best tool in your real estate investor arsenal is going to be thick skin and long memory. The longer I've been doing this I realize that REI is stressful enough and not stressing out about the small stuff is going to be the thing that keeps you sane. If you go after everyone just to get even you are going to drive yourself incredibly crazy since in practice real estate should be so easy, but all of the idiots and bad people are out there as land mines to suck your energy and make things difficult.

Since the financial damage here is assumingly quite low take the lesson and move on. Don't let this sap your energy and keep moving, you'll achieve more that way. 

If you need a lawyer for something worth hiring a lawyer for though Scolieri-Beam Law Group do a great job on everything real estate related.  

 Yes, but it's best to come for the inspection if you can. 

@Simon Powe

Multifamily will generally have higher turnover than single family and it can also be a bit higher maintenance since the tenants seem to take less care of the units. This is based on my own experience, but I think it's similar for most MF owners. 

You'll also want to pick your unit size based on the part of town you invest in. 

If the area is known for a good school district you won't want 1 bed places. If it's known as a more entertainment area your large units will usually be roommates so it's sometimes best to shoot for 1/2 bed units. 

That's something not a lot of ppl think about. 

Also, you'll want to look at value add opportunities with utility optimization, either a reno project to pass utilities on to tenants or some kind of billing system. If you want to be buying right now and can't self source leads though you're probably going to need to adjust your acceptable numbers and focus on the long term. Expecting big cash flow in multifamily apartments right now is kind of a fool's errand because if you find it it's probably in an area that won't be kind for out of state ppl with a third party property manager. 

Hoi! 

My extended family lives in the Netherlands and I've always been curious about investing there, but most of my properties are in the States. I also have investigated using the DAFT visa to move one day. This seems like an opportunity to look into it more. I'd be happy to connect and learn more. 

Ik vind het ook altijd leuk om mijn Nederlands te oefenen! 

Fijne Dag!

Tony

 Most of our out of state investors in Pittsburgh find success depending on their expectations. Things just require more ongoing expenses percentage wise out of state because you have to pay people to do everything for you and you will have a longer time building relationships with vendors even when getting decent referrals. 

Managing from afar can be done on single family homes with a few properties, but you'll still need a solid leasing agent and handyman which can sometimes be hard to find. 

You also will want to stick to on market properties at first because the purchase process and evaluation process (namely title and inspections) will be more defined. Off market deals usually have nonrefundable deposits and a clunkier process that isn't as suited for out of state people until they have good contacts in the area to evaluate the property (mostly contractors that feel comfortable evaluating projects for you). The vast majority of contractors won't want to give bids on properties while under contract unless they have a relationship with that person from prior jobs. Otherwise they just run around and bid projects for people that don't close. So as a newer person in an area if you want a lot of bids before you close you'll normally end up with the more expensive guys or the ones that don't have work at the moment (usually for a reason). Even on referrals a lot of contractors are hesitant to run around for investors new to an area until they trust that they will actually get work out of it.  

If you consider Pittsburgh in the future I'm happy to talk about the market and help you get set up. 

I would say this about BRRRRR, especially as a newer investor.

If you expect to get every penny out of every deal you are going to be disappointed. As @Jonathan Greene mentioned this is kind of a dated strategy in the new price/interest rate environment. You can still achieve it, but finding deals that actually pencil out on all criteria (low enough purchase price, low enough renovation cost, cash flows on the backend, all cash out at refinance) is pretty hard. And usually you have to be self sourcing them or doing some serious turnover. 

If you move your expectations to keeping some money in, but refinancing out as much as you can then you'll be set up to not be let down from the jump. It will still be hard, but you'll likely be able to find deals. 

When I see newer people expecting to find full cash out deals from out of state sourced from a wholesaler or agent I know they are setting themselves up to fail 99.5% of the time. OR they are investing in areas they think are good, but that usually aren't. So shift your expectations to most of the cash out and you'll be good and you'll actually start buying deals, versus people who wait for the perfect deal, spin their wheels for 6 months terminating contracts/analyzing hundreds of places, and then eventually burn out and give up. 

 Moves risk to be financially covered by insurance hypothetically. That's all there is to it. 

You only want to file a claim if it's much greater than deductible or your rates shoot up pretty quickly. 

I've filed claims on things that are pretty severe and couldn't cover out of pocket, so as a result I just upped my deductible. Since I was only filing on major things like underground utilities, fires, etc. You should 100% have insurance because of the worst case scenarios (what if someone dies and they blame you the property owner), but it's not something you'll want to use frequently. 

You'll want to have an insurance agent familiar with rentals since a lot of the extras on your coverage that you will want, the average insurance agent won't know to give you. 

 Agent: Their experience with investing personally and their experience working with customers just like you. If you are house hacking ask about house hacking, OOS ask about OOS, etc. etc. Outline your goals and ask them how they can help you achieve those. Ask them what their expectations about you as a customer are. 

PM: Ask them how many properties they manage in your asset class. Ask them how many customers they have and how many own a single property vs. many units. When you discuss fees don't just ask the monthly and leasing fee. Ask if they upcharge maintenance, charge to go to eviction court, post notice, etc. etc. The cheaper property managers with the monthly fee are making it up somewhere else. 

 If they specifically tell you NOT to fly out and see the property you should run away. 

As an agent that works with OOS investors frequently I prefer they come into town at least during the inspection period. This seems shady. 

 Where are you looking? I live in and invest in Pittsburgh and do things pretty hands on with my own portfolio but I'd be happy to chat if you'd like. I can tell you how we source deals locally and whatnot. 

If you need seller finance though you're likely going to have to do a lot of that marketing on your own.