Steve- teach us all about real estate

[pvmike]

I have been seeing some killer FSBO on Craigslist.

Hire an attorney to draft the docs, open escrow and buy the thing. You will save a fortune because you don't have to factor in a realtors fees.

FSBO means "for sale by owner".

2.5% in savings is not a fortune in today's market. I'm not familiar with Hawaii's FSBO real estate market, but I find that a lot of FSBO listings are cheapskate owners who want to squeeze every last penny out of their sale, and it's difficult to get a 'killer deal' when this is the case.

 

[Rtype1206]

+1

I have buddy up with folks in the banking industry and stay well connected with folks who are good at networking. I am curious to what other angles are out there???

[subscribed]

GREAT thread - thanks Steve & neuralpathways.

How do you locate your deals? Some people market. Some people watch the MLS. Some people buddy up with banks. Some people just know know enough other people for the deals to find them. What's your angle?

As a follow-up, I suspect you pass up 10 deals (or more) for every 1 you buy?

 

[steveny]

2.5% in savings is not a fortune in today's market. I'm not familiar with Hawaii's FSBO real estate market, but I find that a lot of FSBO listings are cheapskate owners who want to squeeze every last penny out of their sale, and it's difficult to get a 'killer deal' when this is the case.

Right on brother. Anyone who tries to cut people out of the deal will screw anyone they can for a buck.

 

[steveny]

GREAT thread - thanks Steve & neuralpathways.

How do you locate your deals? Some people market. Some people watch the MLS. Some people buddy up with banks. Some people just know know enough other people for the deals to find them. What's your angle?

As a follow-up, I suspect you pass up 10 deals (or more) for every 1 you buy?

All of the above. Mostly through networking but out going properties, always through a Realtor.

There are also huge corporations who purchase notes and then take control of the collateral. They rehab the property then sell for a profit. Sometimes great deals can be purchased from them.

 

[Ryanmcd2]

Steve I have a friend who is looking into getting his 1st home and it's the home he grew up in and it's now listed as a short sale. Any tips for him on getting this home? I just hear all the horror stories about homes never going through when they are sold short. Thanks!

 

[eddiensx]

You guy's only save 2.5% on realtor fees? In Hawaii the average realtor fees are between 5-6%.

If you pay for a bonded home inspection, and have an attorney draft the docs and open escrow, you can get a good deal. Many home owners in this situation don't have the necessary equity to payoff their loan and pay realtor fees.

I'm not talking about the sleezy people out there.

 

[steveny]

Steve I have a friend who is looking into getting his 1st home and it's the home he grew up in and it's now listed as a short sale. Any tips for him on getting this home? I just hear all the horror stories about homes never going through when they are sold short. Thanks!

I have done a few short sales but have had more fall apart than have gone through. BTW I have not done any short sales lately. The last one I did was out of an estate and not because someone borrowed too much.

Ryan, I lost your # can you pm it to me. I lost a lot of #'s when I dropped my phone in HD.

 

[pvmike]

You guy's only save 2.5% on realtor fees? In Hawaii the average realtor fees are between 5-6%.

If you pay for a bonded home inspection, and have an attorney draft the docs and open escrow, you can get a good deal. Many home owners in this situation don't have the necessary equity to payoff their loan and pay realtor fees.

I'm not talking about the sleezy people out there.

Realtor fees are 5-6%. I'm saying the guy is saving 2.5% by not going with a listing agent. He'll also have to find a buyer who is not represented by an agent. Don't forget, not all states are attorney states.

Rarely do I see a home that is only 5-6% short, where saving realtor fees will keep the home from being a short sale.

Steve I have a friend who is looking into getting his 1st home and it's the home he grew up in and it's now listed as a short sale. Any tips for him on getting this home? I just hear all the horror stories about homes never going through when they are sold short. Thanks!

There's nothing any of us can do to get a lender to hurry up and take less money than is owed on the home. I'm helping one of my agents with a short sale, and I told him that I expect a 2-3 month wait for the lender to even respond to our offer (at current market value might I add). So far, 1 month down, no response.

 

[steveny]

I have been thinking lately how to wrap this up in as few words as possible.

Success does not have a schedule.

 

[White92]

Don't wrap it up. Keep posting anything you can think of. Knowledge/learning is never ending. :wink:

 

[otoro]

Don't wrap it up. Keep posting anything you can think of. Knowledge/learning is never ending. :wink:

Agreed and subscribed. One of the better threads that I've read in awhile.

Thanks steveny & neuralpathways.

 

[steveny]

Todays happenings...

Get a call last night, tenant says the police smashed her door down during a drug raid wants her door fixed asap. I say tough shit i will call you back on Monday.
Thinking, why didn't the police get in contact with me I would have brought them a key. Errrrrrr. They just love their training exercises and destroying crap they don't have to pay for. Tenant won't have to pay for it either. Funny thing is the tenant has been there for YEARS and he is a really nice guy with 2 kids. Probably he pissed someone off and they called in to cause him problems. Oh well it will get fixed tomorrow.

Lady calls at 3:18 leaves a message she doesn't have any hot water. I am trying to get to a place to pull over and call her back. 3:29 she calls the fire department because I didn't call her back in a time frame she feels is sufficient. Fire department goes to the house and breaks the basement door in and destroys the water heater, shuts the gas service off to the building.

around noon tenant calls and says her electric is out in the kitchen AGAIN because she is trying to run 2 microwaves at the same time AGAIN. the repair guy has shown her TWICE how to reset the GFCI but she is too stupid to remember how to do it and also equally as stooooopid to take simple direction over the phone. I tell her the electrician will be there on Monday to reset the gfci, not good enough for her, she calls code enforcement.

The new tenant moved into my old primary today. I was over there showing him how everything in the house works, lean into the counter top on the outside kitchen and smush a huge slug all over my favorite white shirt.

plus about 10 other minor calls. The person who takes weekend calls is out of service area at his camp for the weekend.

The amount of entitlement tenants have is just incredible AND the fact the officials play along with it just infuriates me. who do landlords calls when tenants are giving them a hard time? A lawyer who sends the landlord a bill. When will tenants start getting charged for abusing the system???

Oh well Cornish hen on the rotisserie and swiss chard slow cooking in balsamic vinegar on the stove. Time to chill.

 

[queenlives]

Todays happenings...

Get a call last night, tenant says the police smashed her door down during a drug raid wants her door fixed asap. I say tough shit i will call you back on Monday.
Thinking, why didn't the police get in contact with me I would have brought them a key. Errrrrrr. They just love their training exercises and destroying crap they don't have to pay for. Tenant won't have to pay for it either. Funny thing is the tenant has been there for YEARS and he is a really nice guy with 2 kids. Probably he pissed someone off and they called in to cause him problems. Oh well it will get fixed tomorrow.

Lady calls at 3:18 leaves a message she doesn't have any hot water. I am trying to get to a place to pull over and call her back. 3:29 she calls the fire department because I didn't call her back in a time frame she feels is sufficient. Fire department goes to the house and breaks the basement door in and destroys the water heater, shuts the gas service off to the building.

around noon tenant calls and says her electric is out in the kitchen AGAIN because she is trying to run 2 microwaves at the same time AGAIN. the repair guy has shown her TWICE how to reset the GFCI but she is too stupid to remember how to do it and also equally as stooooopid to take simple direction over the phone. I tell her the electrician will be there on Monday to reset the gfci, not good enough for her, she calls code enforcement.

The new tenant moved into my old primary today. I was over there showing him how everything in the house works, lean into the counter top on the outside kitchen and smush a huge slug all over my favorite white shirt.

plus about 10 other minor calls. The person who takes weekend calls is out of service area at his camp for the weekend.

The amount of entitlement tenants have is just incredible AND the fact the officials play along with it just infuriates me. who do landlords calls when tenants are giving them a hard time? A lawyer who sends the landlord a bill. When will tenants start getting charged for abusing the system???

Oh well Cornish hen on the rotisserie and swiss chard slow cooking in balsamic vinegar on the stove. Time to chill.

you've pretty well laid out my reasons for never becoming a landlord, although i'm sure hiring a management firm would provide some form of buffer for me should i head down that path.

as for the cornish, chard and (pardon me for adding this a bit of wine... sign me up for that program.

dogs'n'fresh corn here tonight.

 

[texasmr2]

After reading this thread again, I realized that I probably should have refrained from joking around. Sounds like the OP really wants to learn.

The truth is, Steve should probably write a book, but I doubt a book would be able to detail the knowledge required to maximize returns in purchasing and managing investment property. It's more than just collecting rents and fielding calls - there's also construction and construction management, dealing with the city and inspectors, building a local network to source deals, deal structure and finance, an intimate knowledge of the local building code to know where there's wiggle room, and the ability to effectively manage your time and the people around you. Steve's success is built on 25 years of hard work in the field.

I have personally purchased, sold, financed, managed, constructed, and entitled various forms of real estate, and I'm still learning every day. Guess who manages property for me...

Yup, this guy:

Yes sir you are correct imo. My best friend's dad and I have been messing with 'tax sales' over the past year but I'm the so called brain's of the outfit ie the one who must do/learn everything because he is just the money man. We have yet to buy a property although have had a few very lucrative deal's fall through but knowledge and persistance is power.

 

[paladin]

Todays happenings...

Get a call last night, tenant says the police smashed her door down during a drug raid wants her door fixed asap. I say tough shit i will call you back on Monday.
Thinking, why didn't the police get in contact with me I would have brought them a key. Errrrrrr. They just love their training exercises and destroying crap they don't have to pay for. Tenant won't have to pay for it either.

Is that really not covered by the PD's Insurance?

 

[White92]

Is that really not covered by the PD's Insurance?

That's what I thought too. I'm guessing not. Is there anything preventing you from requiring tenants to provide renters insurance and if they don't, you will and bill them for it? Kind of like being required to carry more than liability if you have a loan on a car. If you don't provide insurance, the bank will and bill you.

 

[steveny]

is that really not covered by the pd's insurance?

lol

 

[steveny]

That's what I thought too. I'm guessing not. Is there anything preventing you from requiring tenants to provide renters insurance and if they don't, you will and bill them for it? Kind of like being required to carry more than liability if you have a loan on a car. If you don't provide insurance, the bank will and bill you.

You can send anyone a bill I guess. There is a reason why the cops write tickets in Beverly Hills and not Compton.

Get this one, last year the police came an busted a door down during a drug raid. They had the wrong address, still didn't have to pay for it.

 

[steveny]

Latest:

And I've got 76 more pictures of holes, garbage, ripped up brand new wood floors, etc..

 

[White92]

I hope they aren't getting their entire deposit back!

 

[Searchin4acoupe]

I'd like to see pictures of the tenants too. My suspicion is it's not just the ones missing teeth.

 

[steveny]

I'd like to see pictures of the tenants too. My suspicion is it's not just the ones missing teeth.

four 20 something guys who always had a fresh supply of young girls around. No they won't be getting the deposit back. About 10k in damage. This apartment is in a nice complex too. They were there when we took it over. They did a lot of malicous damage. They took off cover plates and smoke detectors and drew Porno pictures under the covers then put the covers back on the walls. They took the shelves for the fridge and took the handle off the oven. They also took pieces of the brand new hardwood floor right out of the middle. I could go on and on.

 

[gdae]

Any legal recourse in a situation like this? Not that you don't have other things to do ...

 

[steveny]

Any legal recourse in a situation like this? Not that you don't have other things to do ...

Absolutely! I can sue them and they will have a judgment to pay for everything. I will have a legal bill ~1,000.00 which I will pay. As far as me collecting anything from them, probably won't happen. I have hundreds of tousands of dollars owed to me that I will never be able to collect. It's part of being a landlord. I think it's important to put on this thread that being a landlord is not about sitting back and collecting rent. Most of the time it's fustrating if you let it get to you.

The good news is I found a wicked nice paint ball gun in the apartment.

 

[White92]

They took off cover plates and smoke detectors and drew Porno pictures under the covers then put the covers back on the walls.

How was this discovered? I'm sure this was quickly added to your stash right?:biggrin: