All Forum Posts by: Victor Patel

I’d avoid flat-rate fees if possible. With a flat fee structure, if you have a vacancy, the property management company has no real incentive to fill it quickly. In my market—Cincinnati, OH—most property management companies charge around 10% of the collected rent, plus a fee equal to one month's rent for finding and placing a tenant. Some may also charge a small fee for lease renewals.

As a real estate broker, I’ve come across a lot of property management companies, and honestly, most have been disappointing. When interviewing property managers, make sure you ask plenty of questions, thoroughly review their management contract, and request references.

A little due diligence upfront can save you a lot of headaches down the road.

I recently invested $60K with a local hard money lender who has been established in the area for decades. He's got a solid reputation and is an active member of the local REIA. To clarify, I didn't invest in a "fund," but rather purchased a note for a specific fix-and-flip project. The note is for 12 months. The flipper pays 12.5% interest to the lender, and I receive 10% of that. The lender does charge the flipper 4 points upfront, and the note represents 55% of the property's ARV, so I'm not too worried about needing to foreclose if it comes to that.

The lender uses his own capital for initial funding and then sells off the notes after that. He’s not a pushy salesman, and I’ve got a business partner who has worked with him for the last 10 years without any issues.

As for your situation, I wouldn’t say it sounds like a Ponzi scheme, but I’d strongly recommend meeting with the fund sponsor in person and asking as many questions as you can. I tend to ask the same questions multiple times over a period of time to see if I get consistent answers. If the answers match, you’re probably in good hands. If they don’t, that’s a red flag, and I’d be out of there.

Hope that helps!

Congrats!  That is awesome.

Starting my own firm was surprisingly straightforward, thanks to the lessons I learned from past failures. By the time I launched, I had already established a solid reputation in the Cincinnati market. My motto, "Honesty, Integrity, and Accountability," has always been my guiding principle—not just in business, but in my personal life as well. I am deeply grateful for the challenges I've faced, as they have shaped me and brought valuable perspective to my journey.

4o

Kendall,

Since you asked, here’s my story.

Thirty years ago, in my mid-20s, I made a life-changing move from the San Francisco Bay Area to Ohio. It all started when my wife's college friend offered me an opportunity to invest in a commercial property. The catch? I had to relocate to Ohio to manage it. At the time, I had just graduated with a physics degree, landed a great job in the Bay Area, and was newly married. It was a tough decision, especially since I had no experience managing commercial properties and knew no one in Ohio.

Despite the uncertainties, my wife and I decided to make the leap to escape the hustle and bustle of the Bay Area. We packed up and drove cross-country, arriving in Ohio on Christmas Eve in 1991. The culture shock hit us immediately, and we struggled at first—it wasn’t easy, but we were committed.

Unfortunately, that initial investment didn’t pan out. We lost about $100,000, which we had borrowed from family. It was a tough blow. However, my partners recognized my dedication and work ethic, and they offered me another investment opportunity. Once again, I had to ask my family for financial support—a daunting task after the first loss. Thankfully, I come from a close-knit family who believed in me.

That second investment turned out to be a game-changer. Within a few years, I was able to pay back every penny I owed my family. The success of that venture set the foundation for my career in real estate. While I eventually parted ways with my original partners, we remain close friends to this day.

Now, 30 years later, I’m still in Ohio and loving it. The people are friendly, the business environment is welcoming, and my real estate investments have provided me with financial freedom. I retired in my mid-50s and live a comfortable life, grateful every day for the path I chose.

Looking back, I’m forever thankful to my partner who encouraged me to take that leap of faith and move to Ohio. It turned out to be the best decision of my life.

Golan,

There are typically two reasons why a property listed on the MLS hasn't sold: either it's overpriced or there's an issue with it. In either case, the longer a property remains on the market, the more motivated the seller often becomes to offload it.

Savvy buyers understand this and often target properties that have been listed for three months or more. These homes can present excellent opportunities. By negotiating a significant discount, buyers can secure great deals while meeting the seller's urgent need to close the sale. It’s a win-win situation for both parties.

4o

I have been a real estate broker in Ohio, specializing in rental properties, for the past 25 years. Most of my clients are based in Los Angeles or San Francisco.

Initially, they would fly out to personally view the properties before making a decision. However, after their first few purchases, they began trusting the process enough to make offers without visiting in person.

So far, this approach has worked well. In the beginning, I would personally shortlist properties and visit them to assess the property itself, the tenants, and the surrounding area.

Always conduct your own due diligence. Be skeptical of the developer's claims, as your property's value likely won't see substantial growth until the entire development is completed and sold, which could take several years. Proceed with caution—Buyer Beware!

 Hello Jorge,

In my 25+ years as a real estate broker specializing in multi-family sales, I've only had to challenge an appraisal once. I had listed a 10-unit property in Cincinnati, OH, and found a buyer through an agent from a different office. Everything was progressing smoothly until I met the appraiser to provide access to the property.

Right away, I sensed something was off. The appraiser didn’t seem knowledgeable about multi-family properties. It turned out this was his first time appraising one. The buyer's agent, though excellent, was new and unsure how to handle the situation. Despite my concerns, I allowed the appraisal to proceed. About two weeks later, the appraisal came back with a value that was off by approximately 35%, leading the lender to reject the loan.

I contacted the lender to explain why I believed the appraisal was flawed. While they agreed with my assessment, they couldn’t reverse it as the appraisal was already "in the system."

I then spoke with the buyer and his agent, suggesting we use a commercial lender I had worked with for over a decade, who could provide an answer within 24 hours, contingent on a new appraisal. The buyer agreed to cover the cost of the new appraisal, which came in significantly above the purchase price. We closed the deal about 30 days later, and the buyer still owns the property today, 10 years later. Fortunately, the seller was cooperative and patient, and we only lost about two weeks in the process.

Great job!  One thing you might think of doing is having and promoting your own website to avoid the exhorbitant fees charged by the third party sites such as Expedia, Booking.com and Air BnB.