All Forum Posts by: Tom A.

Last month's meetup cookout at a Berkley flip house was fun! Thanks for everyone who came out. We may have to do that again.

This month we're heading to Champps in Livonia, on Haggerty north of 7 Mile. https://www.facebook.com/events/537448233085962/

This is a free meeting, hosted by @Aaron Yates and myself, with the aim of helping local investors meet each other, learn, help and further their real estate investing business.

We've been averaging 30 - 40 people since starting in late 2013, from total newbies to investors with decades of experience and many deals under their belt. There's no charge except for any food/beverages you order and we're a friendly, helpful bunch so there's no reason for beginners not to come out.

There also are always a good number of experienced, active investors who are doing business in metro Detroit right now, buying and selling properties, doing flips, landlording, funding deals, building new houses, wholesaling, lease-optioning and executing other strategies. 

We draw investors from Wayne, Oakland, Macomb, Washtenaw, Genessee, Lapeer and Livingston counties.

There are wholesalers with properties in Detroit, Warren, Ferndale, Royal Oak, Sterling Heights, Downriver, St. Clair Shores, and more.

There are landlords with rentals in Eastpointe, Harper Woods, Warren, Hazel Park, Madison Heights, Farmington Hills, Oak Park, Redford, Southfield, Pontiac, Commerce and White Lake.

There are flippers who are active in Livonia, Troy, Ferndale, West Bloomfield, Shelby Twp, Canton and Novi.

There are private lenders who lend all over Southeast Michigan, and investor/agents, title people and insurance agents who are investor-oriented.

I hope to meet you there, or see you again if you've already attended. Let me know if you have any questions.

More info at the Facebook event page, and you can RSVP there although it's not necessary. There's also a closed Facebook page you can join at https://www.facebook.com/groups/MetroDetroitRealEstateInvestorsGroup/

 Very true. Most beginners are advised to start as a wholesaler, they know very little, and some of what they "know" or have been taught is wrong.

Unfortunately, one can almost wake up and be a real estate agent. In Michigan you only need to take a 40 hour class and pass an easy test. At that point one can call themselves an agent, despite not really knowing most of the basic aspects of being a retail agent. 

Then layer on top of that the fact that even many experienced real estate agents don't know the first thing about real estate investment, and I can understand why most investors I know in today's market don't use agents to find properties for them.

$475/month for a 1 bedroom that's walkable to, I assume, either downtown RO, Ferndale, Berkley or Clawson seems really low. I'm also trying to picture carving even a large house in one of those areas into 6 1-bedroom units. Unless the house was larger than just about anything around there I'd think the units are tiny, and some may have wacky layouts. 

At $475/month I would also think the units are very dated and substantial modernization and improvement ($$$) may be necessary to bump the rent up. Multifamily sellers always seem to say that the rent is below market. Sometimes it's true, but more often the rents are appropriate given the condition and amenities of the units.

I also agree with Jeff on the low likelihood of the seller agreeing to your proposed terms. I guess I'd recommend seeing it and then trying to reassess where you are. At anywhere near the seller's numbers ($269K and $475/unit/mo) I certainly don't see this as compelling unless it sits on a splitable lot.

@Matthew Cole, thanks for asking about the meetup group. You can join the facebook group at https://www.facebook.com/groups/MetroDetroitRealEs... and you can send me a BP message, text or email to get on the monthly email list.

The meetup is tomorrow and you're welcome to come, as are any other local investors. And thanks for the kinds words @Brandon Gentile. Brandon is a fast-rising agent/investor and a quality individual. Well worth getting to know, even if he did play for the wrong college team. Go Blue!

Welcome Chad! It looks like you caught the real estate investing bug. That's great.

You should go to some of the local REIA meetings, that's a great place to meet other investors. I co-host a local meetup along with @Aaron Yates and this month we're meeting at a fellow investor's flip house in Berkley. And I'll be manning the grill, so stop on by if you can! More info at August 18 Detroit Flip Meetup.

We do something every month so no worries if you can't make it.

I think you'll find that your real estate investing career really takes off when your network builds with like-minded people. BP is a great place to meet them and learn. The local REIAs and meetups really help develop relationships that can benefit you over time. There's a sizable population of agents amongst us as well so that's a bonus, you can bounce ideas off people who are both agents and investors.

I've heard good things about the A^2 REIA as well and hope to get to it soon. The meetup @Adam Spencer mentioned that we do is like the before-the-speaker or after-the-speaker part of a REIA. We usually meet along the I-696 or I-75 corridor so it may be a bit of a drive for an Ann Arborite. It's just the casual conversation, networking and deal making part with no formal agenda, speaker or sales. 

As such, we meet at a local bar/restaurant and the only cost is whatever one eats or drinks. There's usually 25-35 attendees, from multi-decade veterans to aspiring newbies. The venue changes date and location month to month so people can make it when they're available. It's announced here on BP in the http://www.biggerpockets.com/forums/521-events-and-happenings sub-forum as well as via our closed facebook group and a monthly email list (message me to be added).

For example, here's the thread for last month's meetup http://www.biggerpockets.com/forums/521/topics/209734-detroit-michigan-monthly-meetup-july-2015 that has links to the facebook group and last month's event page. We'll post this month's meetup later this week. Everyone is welcome.

Welcome!

There's a scientific way to determine the what size HVAC system. Its called "Manual J", and it's backed by the industry trade association. Most companies don't bother doing it, they use a rule of thumb like 1 ton per 600 sqft, or something. There's also a "Manual S" for equipment selection, and a "Manual D" for ductwork calculations.

If you talk to a company that knows what these are and how to do them properly you're probably talking to one of the elite companies. The rules of thumb don't account for many factors that influence HVAC system design.

I'd do the bathroom upgrades -- good bang for the buck and it will make it more appealing to your potential tenant pool. Royal Oak renters are choosing to spend more than they have to spend for a certain amount of space in that area. They typically appreciate and will open the wallet a little more for a place that's better than a typical worn-out rental.

On the other hand, I wouldn't do the black basement ceiling. That's a lot of money for a something that won't really pay back. I don't think I'd do it, and I already have a commercial paint sprayer.

I would definitely fix the grade. Royal Oak has a high water table in many areas and you don't need any more water pooling around your foundation, especially with a finished basement. I wouldn't put sod in for a rental. We build a new house near downtown that we sodded but that's a different story. If you seed it and keep it moist it will come in well, especially if the weather stays on the cooler side. I did that with a flip in Ferndale and after a month or so it was looking good.

If you seed then get an automatic water faucet timer and water a few times per day for a few minutes. Don't let the seeds dry out.

Thanks @Mark Nolan, there are several regular attendees who use SDIRAs and Solo 401k's to fund real estate investments or lend to other investors. There are also investor-borrowers there that have done deals after getting to know potential lenders at meetings like this. Capitalism in action. The online networking continues on our FB group at https://www.facebook.com/groups/MetroDetroitRealEstateInvestorsGroup/