All Forum Posts by: Ujwal Velagapudi

Don't believe something to be over just because the other party said so, you shook on it, or even if you have a signed contract in place. Emotionally be calm and composed because you will have instances where a signed contract falls through, a handshake agreement doesn't end up turning into a signed contract, and a verbal agreement ends up nowhere. Just keep persisting and make sure you see the whole entire process through. I learned this over many failed "agreements" in multiple formats, and learned to be calm & steady throughout and just focusing on completing the project at hand. 

Actually not just schools, but the public libraries and other city facilities have been closed as well that we all pay for. This should be a direct correlation to a proportional reduction in the millage rate if this extends, but highly doubt that will happen. I could see it being slightly reduced next season if things still persist through 2021 and longer. 

I see this as not the same, but similar, to many of the businesses that have contracted income streams but cannot open. For example, gyms are not able to be open (in many areas), yet still have to pay all of their expenses, and they have stopped all payments from customers as they are not able to provide them the contracted services. The longer these shutdowns persist, these businesses will close...permanently (if they already haven't). It's terrible, but unfortunately a private business just doesn't have the ability to ask their customers to continue to pay for services to keep them afloat while in lockdown/limited operations.

As for education and city facilities, we cannot let them close like private businesses (nor will the city or public), so the taxpayers will still be asked for their collective support to sustain operations for the public school systems. 

I remember a few years ago I'd read posts simply responding to threads saying to go and search for it since it was already asked many times before. One thing that would help is making the advanced search feature free, primarily helping newbies search for the same question they're about to ask in a thread. 

Also, some feedback from a newbie friend I was just speaking with the other day. He said that the forums are just overwhelming, doesn't know where to begin, and needs that little bit of direction and guidance of talking him through some of the avenues. I know there is great beginner material on BP, but I can imagine starting day 1 in this RE community and being overwhelmed. 

A complete newbie forum section may be helpful to separate those that are needing basic level of support & direction, without being overwhelmed by "advanced" discussion topics that are meaningless to someone just starting out. Those more experienced can choose to help out in this section that are just starting out, I'm sure there will still be many that will lend a hand. 

I held it for 3 years on the dot, ended up being 6x equity return, and not even including cash flow. The reason was primarily because most of it was made on the front end during the lengthy purchase that nearly fell apart a few times, and negotiating a great deal. The hassle and headache of financing given the environmental studies, bypassing them, seller difficulties, etc. but it's turned out to be one of my best.  

Outside of negotiations and all, which was several months already, the longest it took for me to purchase a property was about 4 months under contract. The financing hit a roadblock with site environmental assessment, and then the seller tried to back out of the deal twice just days prior to closing. 

The same property I had under contract for 5+ months when I sold it. It was a foreign investor, and what was originally supposed to be a cash purchase but their funds got tied up with their other purchases, and it took quite a long time to find financing given their profile & lending criteria. 

Some of the toughest to close can definitely be some of the most rewarding & profitable. 

The moratorium in the state I've got a couple properties in just lifted, but then the city extended their moratorium by another month. I think the courts will be flooded, backlogging a system which is already poorly operated (in many cities). I would say closer to Q4 we'll be seeing quite a few of these from all the backlog, in addition to new ones. Not sure how things will pan out with more stimulus, more moratorium extensions, etc. though. 

I would leverage what you can to make your equity work for you...but make sure to underwrite it strictly and buy right. If you're buying it truly under market value, still have additional value add opportunities, and are in it for the long haul then I'd say go try putting as little down as possible via the FHA. Also, your lower downpayment I think will go further than a slight decrease in the interest rate.

@Afreen Khan I'd also fear those items you've mentioned based on speaking with a few local business people from my last couple of visits there. It just doesn't seem like the economics make all that much sense with an oversupply, and it being amplified during a time like this. Curious as well to see what other investors in that market would say. But to answer your question, I would consider it down the line, maybe if they artificially restrict new permits to contain the supply in the long term. I'd also need other business interests there simultaneously, otherwise a one off investment just wouldn't make sense to me. 

To echo a lot of the other voices, I agree that Austin has bubbled up to being very expensive (even in the outer edges), but I think a lot of future growth will come on i35 (Waco & others) as well as the outer rim of DFW as that has been just getting wider for the past decade. 

A couple of things caught me off guard during my very first corporate contract negotiation which I had full control of, less than a year out of college. After day 1 of our multi-day negotiation, my counterpart had just started pumping milk towards the end as she was a new mother, followed by the owner introducing me to all the extended family within the organization I'd never met before, and capped off by physically walking me through to meet the employees that he had personally hired from his church groups. It's not the act itself, but it was the fact that I was dealing with a family operated business, real people, and we had just finished a very heated discussion on how I (my company) was going to be decreasing their sales in the coming years (causing job losses within their organization). I was on their home turf in their facility, and even though the whole company was pretty open and very friendly with me like friends, I'd still say this was a bit unexpected & was caught off guard. The whole situation just tugged on me emotionally, as I was trying to negotiate the equivalence of pennies for a multi-billion dollar entity, whereas the millions for this small family owned business means so much more to their team, their families, their community, etc. That was a tough one emotionally for sure, especially at that age for me, and even more so because they all treated me like I was a part of their family organization. Also, my apathy for the profits of the corporate entity I was representing also swayed me quite a bit as I had no true vested interest and I would much rather a small business have more leverage in the deal. 

As for preparation, this is the most critical step for me. I want to know everything! I prepare to know as much as I can not only about the deal, but the folks across the table I'm in discussions with, their entity overall, their community, their overall goals and desires, etc. Literally anything and everything I can learn. I try to gather as much as I can throughout the process from the other party, which can definitely compile on if it is a long negotiation (sometimes spanning years). If I have a partner, or team, then it is even more important to get everybody on the same page and understand how you will operate. 

To make it real estate specific, I've prepared by speaking to neighbors, city officials, lenders in the area, like-property owners, and have even chilled at the neighborhood bar chatting with "locals". Also, seller permitting, I've developed friendly relations with the existing tenants of the buildings and try to engage in casual conversation slowly inquiring more about the asset, and they usually do end up letting some key information slip that you can use in discussion with the seller to negotiate a better deal for you. This is in addition to understanding your counterparty as much as you can. 

Negotiating to me is not as simple as agreeing on a number and shaking hands, especially as you deal with larger & more complex transactions involving multiple parties. It involves significant preparation, and in many cases there will be multiple rounds of negotiating in between even more preparation.