All Forum Posts by: Ugochukwu Opara

Hey buddy, 

I'm a real estate sales agent in Philadelphia.

I'm running into the same problem, with a slight twist. I have a mix of w2 income and 1099 income and my options are slim. I have to either get a full time 40 hour job and keep that for at least 6 months. Or I have to show two years of 1099 (self employed) income with $30k or more in earnings. 

I love being an agent too much to rip and get a w2 job so I just do flips in the mean time and help other investors manage their property (property management) to prepare me to be a great landlord. 

More power to you. I think you're in a better boat than I am on. 

 Hey buddy.

I'm an agent in Philadelphia. 

Congrats on going out and playing with the numbers, I can see you've done your research. I'll do mybest to answer these questions.

1. The easiest was is to ask you agent. They should be able to pull up past sales and come up with an average in your area. .5-1.0 mile radius should be good enough. Spread out further if need be but I'd rather your agent find older comps. Let me know if this makes sense.

2. ALWAYS ALWAYS factor in vacancies. 10-12% minimum. It's better to be rewarded then have things go the other way around. I allocate 12% to vacancies for all of my investors.

3. Wow that's really high for property management. Over here in Philly, 10% of filled monthly rent is the fee plus 1 months rent finders fee. I would negotiate that down hard. 

4. Maintenance and repairs. Yeah this one I keep at %10. However I do slide it up base on age and demographic of my potential renters (example, D neighborhood + section 8 ... Increase maintenance to maybe %16)

Also why don't you have access to operating data? It's almost impossible ttoreally figure things out. How are they running a 10 unit with out a record of things? I would use these and negotiating factors to bring down the price. I hope this has helped. Cheers!

Hi @Vanessa Bunch 

 This all depends on what the laws are in Cali.

Currently I am licensed in PA and here is how things work for me. Hopefully this helps you have an idea of what you might have to do:

There are two ways to really do property management in PA assuming you are a licensed agent,

1. 1. You work with a brokerage that does property management and they take a portion of your proceeds (usually 10%). This is good because a lot of the back end stuff is taken care of for you and all you have to do is generate the business and form an allegiance with 2-4 contractors. 
2. 2. You start your own brokerage and you offer property management as a service. In PA, you will need 3 years of being a licensed agent, amongst other requirements. This method goes along with you starting your LLC, hiring staff, etc. You are responsible for setting everything up from top to bottom and you must seek your own E&O insurance policy that covers you property management activities.

With your experience, I think the latter it more in alignment with what you are trying to do. However, keep in mind that you always use option one and still start a team (hire help) and manage your own property that you purchase.

Let me know if you need me to elaborate on anything. Again this is just for PA, it really all depends on what the laws are in Cali. Cheers!

Hi @Chris Friberg ,

All that matters here, just like @Philip Williams mentioned, smokers are NOT a  protected class. So with that being said, you can opt to ONLY ACCEPT NON SMOKING tenants is  you'd like and market your property as such without a problem. 

Hey @Qulia Brunson ,

@Wayne Brooks is absolutely right. What you have sounds like a make-shift duplex. I wouldn't waste to much time with it.

I would look for real 2-4 unit properties. This way you will be able to put 3.5% down for FHA so long as you plan on occupying a unit. I'm a realtor in the Philadelphia area and we often come across buildings that are shown as multi-family but public record will show that it was never zoned as such. I only recommend you put 20% down on a 8+ unit property and not a duplex.

Let me know if you have any questions. I'll do my best to get you answers. Best of luck, Cheers!

@Cynthia Dixon Yeah @Brie Schmidt is correct

For my market, assessed value based on taxes doesn't mean much at all in my market (Philadelphia). Taxes are low here so you can have a property that has sold for $200k with only $1,100 in taxes and assessed at a value a lot less than purchase price.

Your focus should be on finding what the average cap rate is for you market, get the actually numbers on the unit (not a pro-forma!) and run with your estimate of price that way.

Best of Luck

Welcome @Eleena de Lisser ,

Congrats on moving and shaking in NYC! That's one hell of a market so I tip my hat to you for doing well there! Bravo! We are glad to have you here. I'm a Realtor in the Philadelphia and I working mainly with first time buyers and investors. I am currently working on getting my first property this year as well. It looks like we share the same goals. I'll be rooting for ya! Let me know if you need help with anything. Cheers

@Josiah Halverson Hey Buddy,

At the end of the day, there really isn't a right or a wrong ... there's just what works best for you, what everyone thinks, and what you think. Short and simple.

Get in and play around to see what works best for you + your business, in your market, and with the agents that you have available to you. That's the ultimate beauty of life ...options and freedom of choice.

What ever you do sir, I'm not mad at ya! I'm just happy you're out there doing deals is all. come back to BP and keeps us updated. Cheers.

@Josiah Halverson Greetings Buddy,

So ... being an agent ... I hate what you're doing very much! It gives me zero incentive to truly work with and for you. To me its like dating three girls(or guys) and hoping one of them becomes your Valentine. As an investors agent my goal is volume, assuming we work well together and the first deal is truly a deal, the ideal is that you WILL return. The goal is to cultivate an relationship with you so that we do multiple transactions together and not just one. My goal is have a system in place so that once you say you like a place, I have everything I need and I know everyone on the team I need to know in order to close that thing before you can bat an eye. Also there's nothing that one agent see's that another can not. If its on MLS then its on MLS (Unless agents are working in different areas.)

As an investor, I understand your philosophy; the more people you have out there looking for you, then the more one of them will find what you are looking for. this is true and it makes tons of logical sense. Now allow me to play Devils Advocate: What incentive do I have to give you that deal? Why not give it to one of my other investors who's already done 3 deals with me and tells me I'm one of the few agents he or she works with? Does an agent want to run around showing 10 different clients properties all day hoping someone buys something or does this agent want to get to know exactly what 2 or 3 investors want and feed them all year round because he or she knows they will buy?

I find business to be all about loyalty. If you are going to have multiple agents then at least make sure they work different areas and aren't eating each other out of a living. The thing most buyers never realize is that agents talk ... daily. So 9/10 times we'll eventually know, before you do, that you're working with other agents.

I'd stick with 1 or 2 agents. I'd make sure you two get along first then commit the time to making sure that one agent know exactly what you're looking for. Show this guy or girl what are your must haves and make sure they know what type of investor you are and that they thoroughly understand your strategy.

So that's my advise. I hope it helps ... despite my obvious bias. Let me know what you think. Click the vote button if this helped :D Cheers!

Welcome @Ryan Cameron I also live in the area, 15 minutes from University City) and I am licensed in the state of PA.

Congrats on already having two under your belt. make sure you tell us the story on how that went down and how you deiced on what and when to buy.

You mentioned conventional and unconventional funding strategies, what specifically were you looking to learn?