Out-Of-State Investor Tips From a Veteran Property Manager

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By Anita Cooper

Investing out of state can be nerve-wracking, especially when you’re unfamiliar with the nuances of the markets you’re investing in. A property can look really good on paper, but does that automatically translate into a great buy?

Not necessarily.

That’s where due diligence comes into play. A knowledgeable broker can help you fi nd a good investment property, but that doesn’t always mean the broker can help you make the most of that investment.

The perfect option then, would be an investment savvy real estate broker who is also a highly effective property manager.

Pam Blanco, real estate broker and Owner of Professional Asset Management and Sales (PAMS), is that perfect option for investors who are interested in Texas properties.

She knows first-hand the frustration of finding a true partner who can help make the investing journey easier. When asked if she’d ever considered investing out of state or overseas, Pam shared a frustration that’s common among out of state investors: finding knowledgeable and professional industry contacts where they want to invest.

Anita: Have you ever considered investing out of state or overseas?

PAM: Not necessarily overseas, but out of state, yes. I struggle a little bit with management companies and REALTORS®. So for example, I find a good agent, but they don’t know a whole lot about property management, or I find a good property management company, but they can’t tell me what sells in a particular neighborhood, so it’s kind of frustrating.

Anita: What types of properties do you specialize in?

PAM:I do single family and multi-family. In fact, I would say, you know, I kind of grew up in the multi-family realm. I worked my way up through the ranks, so I understand multi-family very well.

In fact, we actually manage a smaller multi-family; it’s a specialty of ours, but we also do single family home. For first-time investors who are just getting into the business, and they’re looking for liquid properties, we help guide them through that. But I would say, more importantly, we just try to counsel them on good areas to be in. We help them find properties that are going to profit.

Anita: Please share with us how your program works and why it’s so unique?

PAM:We have a team of full-time researchers who do all of the research on potential investment properties, then put together ROI sheets for investors every week.

When an investor chooses a property they like, we actually draw the contracts for them, represent them in the sale, and then we do the rehabs for them as well.

So typically, when we put an ROI together, we’re budgeting the rehab, then performing the rehab for them, and then managing the investment afterwards.

We kind of have a vested interest in the property to perform as we specified in our ROI sheet, so it’s really important to make sure that we do that.

In addition, we also counsel investors on what type of investment they want. Some people want a long term hold, while others are just looking for their kids’ college education, so they may be looking at a five-year or a 10-year hold, so it just depends. We put together a plan for them and their portfolio based on what their actual goals are.

Anita: So what is your favorite part about the business?

PAM: “I’m going to say probably the deals and the people. So I guess to me — maybe, I am a deal junkie — but you know it’s the thrill of that chase, finding the best deal, getting properties that work for investors, and then managing them to make sure that it does work.”

Anita: Where would you say you see yourself and the biz in the next 5 to 10 years?

PAM:I would like to see the company in multiple states. I’d also like to see the number of investors that I work with pretty much triple and then open it up to multi-state.

As of this writing, PAMS manages more than 500 properties for its clients; a large proportion of them out of state investors. Individuals who are interested can reach Pam Blanco at 817-907-7347.

Anita Cooper is the founder of Northwoods Writer, a marketing resource for real estate professionals. She lives with her family in beautiful Wisconsin.

WHAT MAKES PAM DIFFERENT?

A true turn-key opportunity: Using knowledge and skills gained from many years working with both property management and investment companies, Pam Blanco has designed a “one-stop shop” for investors looking for profitable investing opportunities in Texas.

10 Things You Have to KNOW Before CLOSING a Multifamily Deal

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By Tom Wilson, CEO of Wilson Investment Properties

There are so many reasons to get excited about owning a multifamily property that it can be easy to overlook one or more critical areas of due diligence. I’ve been investing in real estate for five decades, and I love multifamily products. My best performing asset is a multifamily that I purchased 17 years ago. And the worst deal I ever owned was also a multifamily asset.

Often deals look amazing with the proforma (projected returns with ideal conditions and assumptions) showing high cash flow and high IRR (Internal Rate of Return) projections. These returns are indeed the goal; however, you need to determine if they are just virtual (on paper) or if they can actually reach your pocket. I’ve seen the good and the bad, compiled my experiences, and would like to share the top ten things to consider before closing on your next multi-family deal to maximize your success.

1) LOCATION LOCATION LOCATION.

The metro and the sub market are critical. What is the traffic count? Visibility? Is it on the right side of the freeway, or in the path of progress for its city or town? What do its neighbors look like? Who is shopping in the local stores? Would you walk the streets at night?

The answers to these questions are going to be indicative of your experience if you purchase the property.

2) GREMLINS INSIDE?

Every property has surprises. Some good, mostly not. While a smart purchaser always includes contingency and reserve accounts, certain multifamily properties hold more surprises than others.

The foundation, age of chillers and boilers, environmental review, roofing and all deferred maintenance can be major red flags of potential deal-breaking capital expenditures. Make sure your team walks every unit, not just a sample. Twenty percent of the units can chew up 80% of your rehab capital. Also, who is actually living inside your potential property? Review every lease and check if they are really representative of the area. Did the seller fill up the property with low qualification residents just to show a high physical occupancy?

3) JOB & POPULATION GROWTH.

How good is the metro? Any multifamily property requires stable or growing rents and tenancy to be a successful investment. Good tenants have jobs and pay their rent on time. Look at individual job growth statistics. Is the city growing faster than the state or nation? What about in your sub market? Good job markets attract people, while bad markets see net negative population growth.

If your property’s market is stagnant or on the decline, chances are your occupancy rates will follow.

4) ONE HORSE TOWN?

So you like the metro, employment is good, and population increasing. Now ask yourself “why?”. A good metro has good employment diversification that will weather storms and booms of economic sectors and individual corporations, while singular economy metros are more vulnerable.

Remote military towns can be shut down overnight by congressional base closures. Large corporate offices or manufacturing plants can be relocated else-where or even overseas with mass layoffs in the local area. Natural resource boom towns are vulnerable to single commodity prices and competition.

Even government offices can be moved to newer, cheaper areas, which can leave a non-diversified metro in shambles and hurt your investment. I like growing metros over 1 million people with a broad economic base.

5) PARKING LOT TEST.

Another surefire way to take a litmus test of a property’s tenants is to drive the parking lots at different times of the day and week. Good tenants have jobs and are at work, and the number of cars during the day should be pretty scarce.

If you find a full parking lot during mid weekday, chances are there are many tenants on various levels of subsidized or governmental support, who tend to live with less of a financial buffer to pay rent and care for their unit. This could indicate a higher likelihood for turnover, make-ready costs, and lower occupancy. Park at the property at night and watch. Who is coming and going? A lot of traffic on site that are not occupants could indicate illegal operations or extra tenants who are not on the contract.

6) SELL STORY.

Why is the current owner selling? Have they been struggling for years to make it perform and have just given up? Did they not have enough capital to mitigate deferred maintenance or to attract higher rent tenants? Perhaps the neighborhood is rougher than the listing broker is making it out to be.

I’ve passed on what appeared on paper to be amazing investment opportunities, simply by asking,“Why couldn’t the existing owner do better, and what makes me think I can outperform the current owners?”. Sometimes the property is good but the nearby properties are better, and it would take too much capital to just come up to par with the competition. Remember, the seller knows more about the property than you, so it is important to fully discover the history and challenges.

7) MANAGEMENT & MAINTENANCE.

A critical way to control the tenant density environment, improve service to tenants, and reduce costs is to have full time on-site property management and maintenance.

This allows you to better control who lives in your property and get prospective tenants to sign leases before finding other options. It also allows you to quickly evict problem tenants, and to get maintenance and other problems fixed with minimal wait times and maximum tenant retention.

Typically, a multifamily has to have $40-50 thousand minimum income to afford to have on-site management and maintenance. Any less or a parttime solution with less effective service can hurt your property’s performance. That is why I avoid small multifamily properties.

8) WEAK ASSET IN A GOOD NEIGHBORHOOD.

You can have a lot of control on improving a property, however, almost no control on fixing the neighborhood. I will look at C properties but almost always insist on a B- or better neighborhood.

You’ve heard one philosophy for buying houses to look for the ugliest house on the best block – the same can work for multifamily properties. Find a property for which added value and better management can take advantage of the lift from neighborhood. The sub market around you can help or hurt you. Choose it as carefully as you choose the property.

9) RECESSION REVIEW.

It’s easy to have a Midas complex in this bull market and start believing that everything anyone touches turns to gold. And it’s true, when the economy is on an up-swing, even mediocre properties with average management can be successful. This holds true until it doesn’t, and those who don’t plan accordingly will get hurt the most.

I look at the great recession performance years  (2007-2010),  and  see  how  the  product  and sub-market performed then. How much did the occupancy drop? Did the NOI crater? How did the sub-market’s population and unemployment do?

These are good tests on how the property and area will do in the next recession. And all expansions end, we just don’t know when. Select a historically resilient market and plan on having enough reserves and low enough leverage so your property will survive the next recession.

10) FRIENDS AND FAMILY TEST.

Lastly, especially if you are responsible for other investors’ money to help fund acquisition, ask yourself “would I offer this investment to my friends and family?”.

If the answer is “no”, or even if you have to pause and think about it, you likely already know the answer and should listen to your subconscious and walk away while you can. That final “gut test” is useful in overriding our mind’s uncanny ability to talk ourselves into a bad decision even when we know deep down it’s likely higher risk than we feel comfortable with.

This is just a sampling of the many important things to look for during due diligence before closing or even making an offer on a multifamily property. One of my top observations is that sub-markets vary a lot from the average of the metro, and the sub-markets and surrounding areas can be as important as the property itself in determining likelihood of success.

And lastly, don’t reinvent the wheel. Ride on the coattails of experts and utilize the experience of others. Even though I have almost five decades and 4,000 unit transactions of experience, I never do a new deal without consulting an expert for every aspect of the investment, including the sub-market and the asset class. Use those trusted advisors around you that have honed their expertise and judgment and you’ll greatly increase your probability of having a successful multifamily asset.

To your financial success,

Tom K. Wilson

CEO Wilson Investment Properties

New Capital Gains Tax Rule Could Alter U.S. Property Landscape

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A new change to the capital gains tax rule could have a big impact on the U.S. real estate market.

By Fuquan Bilal

Not much noise has been made about this ‘small’ tweak to the tax code yet. At least not compared to other changes in the new tax bill. Yet, it could have a very big influence on the industry, in a variety of ways.

Manipulating the Capital Gains Tax Break

Until now US homeowners could be exempt from up to $500,000 in capital gains on the sale of their homes, providing they lived there for at least 2 of the previous 5 years. Under the new tax plan homeowners would have to stay put for 5 years in order to get the break.

This could bring in mountains of cash for the government in the next few years from American homeowners who planned to sell, or who aren’t aware of the change. Yet, according to projections from Zillow, it could hit some in high value areas with $70,000 or more in additional taxes on the sale of their personal residences.

Note that this doesn’t change the rules for real estate investors.

Slowing the Flow of Home Sales

With homeowners needing to stay in their homes for 5 instead of 2 years, we could see the time many spend in their homes more than double. That means far fewer real estate transactions for real estate agents and the economy. In turn that could mean far more limited inventory becoming available for home buyers.

In an already tight market, that is likely to push up property prices further as buyers compete even more fiercely for the few homes that do become available.

End-of-Year Listing Surge

With the new twist on the capital gains tax rule expected to kick in on January 1st, 2018, we could see a surge in homes being listed for sale in December. Home sellers need to beat the tax deadline, or face losing tens of thousands of dollars in proceeds from the sale, or more. This could be an opportune time for investors to capitalize on motivated sellers and competing inventory, and create win-win solutions, providing they have the capital to close in a matter of days.

Better-Performing Mortgage Notes

With homeowners and borrowers likely to stay in homes for much longer periods, mortgage note performance may improve as well. This is especially true for more mature home loans with higher interest rates. Those who have been on the brink of default or foreclosure, may also work extra hard to catch up, and retain those homes, instead of selling and taking an even larger and longer-lasting financial hit.

Find out more about investing in secured debt and real estate, go to NNG Capital Fund.

A “Win Some, Win Some” Investment Opportunity

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Interview by Anita Cooper

In the real estate world, investors have a lot of choices to grow their portfolios; fix and flip, buy and hold, residential, multi-family or commercial, and finally, one type of investment that’s often forgotten or at the least remains shrouded in mystery: note investing.

Note investing is a fantastic way to grow your wealth, but until the last ten or so years, it’s not been on the radar of many property investors. We sat down with Jasmine Willois, founder of The Note Assistance Program (N.A.P.) to learn more about her and to discover how her organization can very often help investors reap double digit returns.

Question: Jasmine, how did you get involved with note investing?

ANSWER:Note investing is one of those things that kind of came to me. I started out with a real estate investment club called Lady Landlords of San Diego, and that really took off! We ended up expanding to two clubs, the latter being Lady Landlords of Orange County.

After years of flipping homes, offering turn-key investments (rentals) and some life changes, it occurred to me that I didn’t want to work this hard at investing.  So I called a hedge fund manager I knew from networking, and we will it off. I ended up shadowing him for the next two years of my life, and learning everything he did inside and out.

Question: Do you enjoy your work?

Yeah, it’s exhilarating… it really fits my personality. It’s something that allows me to use my problem solving skills to help those in need. You see, I used to be a day trader and a stock broker. It was a lot of money, but not as rewarding. With note investing I’m able to make good money and also feel good about what I do.

Question: Why should investors add notes to their investment portfolios?

ANSWER: Outside of the sheer return, which is very alluring — it’s really a product that, whether investors know it or not, they’re most familiar with.

The majority of people use traditional means to invest and save, such as stocks, bonds, ETFs and mutual funds. These vehicles are really hard to understand and that’s the difference with notes, if explained correctly almost anyone can get it.

Again, because most of us are familiar with the underlying asset, real estate and even further a majority of them have experience getting mortgage loans from one of the bigger mortgage banks, like Wells Fargo or Chase.

As far as the underlying asset, which is the actual real estate, investors who buy notes are already very familiar with the concept. They’ve bought a home before with a loan, so whether they realize it or not at first, they’re very familiar with the product.

Question: What is The Note Assistance Program process and how quickly can investors expect it to take?

ANSWER: Well there are two opportunities, but what is making this revolutionary and bringing real change to the market is that we have built a platform for the retail investor. You no longer have to go to a $16,000 to $40,000 program unless you need the crowds.

Until recently, the past three to six years, this side of the market really wasn’t open to the average investor, never-mind the fact that still to this day it’s hard to find out about notes without running into a guru, broker joker or scam artist.

One product we offer is our Non-Performing Note Trade Desk. Here you will find a cornucopia of notes usually around $35M to $55M worth of unpaid balances nationwide that can be cherry picked.

Investors have access to tapes that are direct from the seller, so no daisy chains! And here’s the most exciting part, because we have established such a track record with the sellers, our clients are actually benefiting from lower pricing than they can find anywhere else. Our members benefit from our relationships by being able to curtail on a bulk trade or with direct pricing from the sellers.

This is something the average note buyer cannot get just due to barriers of entry. Seasoned investors love our trade desk because they are finding that we have the inventory and the pricing that cannot be beat. Even in cases where they have access to the same inventory our the transparency and pricing you find on our trade desk is hard to beat.

They get to benefit from those relationships with my pricing so they’re buying in bulk, and then they get direct pricing from the seller there, THAT’s something that the average individual can’t get.

The second way investors benefit from The Note Assistance Program is the educational piece. We’ve put together the most comprehensive on-line note education platform to date. This platform takes out all the fluff and distractions that can be found to throw investors a loop.

For those, like me who learn best by doing, there is our accelerated hands-on program where we have a flat fee. This program is different because you have to be committed to buying a note to join, it’s not one of those programs where you can join and hang out for a few years and not invest.

Like I mentioned, we have well over 37M worth of inventory on our trade desk as we speak.

We’ve got big banks like Bank of America, all the way to smaller hedge funds in rural america. So for those who are committed to learning, buying and have the capability the program is here for you.

Through this program we offer support for the life of the loan the investor purchases. This in not a joint venture situation where we split the profits in the end, you get the full experience and the full profit at the end of the investment. To that point, being actively involved with your note is mandated here at The Note Assistance Program.

So you’ve got to know how to be active and know what you’re doing. This industry is just as dangerous as the others, you can hurt yourself and the borrowers so it’s very important that you are trained correctly. I have found that most of the programs out there are too cumbersome or leave out certain tips and best practice that ultimately leave the investor dependent on the guru. We do it differently here, and that is how we are shaking up the industry.

Question: How does the additional layer of protection work?

Answer: The protection really is for the people using self directed IRAs. It’s not a “dollar-for-dollar” type of protection; it’s really about keeping these investors compliant with IRS regulations, and avoiding decisions that jeopardize their tax benefits. If you own a self directed IRA, you shouldn’t be doing “hands-on” activities with the investment. There is a fine line with the IRS, they have prohibited transactions and even disqualified people for investors to navigate around. So a lot of people choose to use The Note Assistance Program and it’s team to handle these grey areas.

Most investors want to be active so we train them to outsource with the professionals in the industry, and extend our black book of trusted vendors to them as well. There is no need to become an attorney, to learn how to read title or do foreclosures on your own. We attract those investors who want to build a working portfolio, not another job. We focus on building the right team of professionals who can help keep us out of trouble, because as I mentioned, you can loose money.

Question: How many investors have you helped?

Answer: So far we have helped over 200 people since we opened our doors. We’ve expanded and added two locations one in Newport Beach, CA and another in Bayonne, New Jersey. Our investors are very successful, which in turn is why we are successful. We are not running a private island or club, it’s a community of investors that have established and implemented best practices.

We take our community of clients in small teams. The classes for the Non-Performing note lab that we teach isn’t more than thirty-two.

Four times a year, I get out there and teach small classes of 20 or less in our 2-Day Non-Performing Note Lab as well, so that has helped us with our reach. We keep those classes small and practical so each investor can get what they need from the experience. We want to make sure the investor is given a real life view of what it means to be a note investor, not a lot of hype.

Question: What would you say is the average return an investor could expect with a note?

Answer: It’s definitely double digits, and if you approach the business the right way you can do that consistently.

That’s what this is really about, beating Wall Street. We get these numbers because of the relationships we have built over the years with these banks, and because we have a system of people who work our system. We also only play in the 1st position space, so we aren’t buying 2nds or 3rds for that matter. You will find that most investors are junkies for control and security, we find both when note investing.

With that first position comes THE security and the control that we’re looking for, to make sure that we can tackle those types of returns. Unlike second or third position, when you buy in first position, you pretty much “win some and win some”, and that’s what appeals to me.

ABOUT JASMINE WILLOIS

An advocate for responsible investing Jasmine spends her time educating audiences on conservative real estate strategies. She has owned rentals and flipped out-of-state properties since 2005 in states such as California, Mississippi, Indiana and New Jersey to name a few. She is the Managing Director of The Note Assistance Program a firm that provides additional security and education on real estate investing, specifically with non-performing notes. Her reputation for the judicious use of resources, result-oriented management style and skillfull negotiations, has opened many doors.

Jasmine offers a unique blend of experience. She received her B.A in Economics from California State University at Long Beach, and enthusiastically accepted her first job as an equity trader with Joseph Stevens, in New York, NY. She emotionally ended her 7-year long career on Wall Street as financial advisor with Morgan Stanley Dean Witter after losing colleagues to the world trade center attacks.

Jasmine focuses on conservative real estate cash flow strategies and the abundance of opportunities that lay out side of her backyard. She hosts a note mastermind at her Note Lunch & Learn every Thursday from noon to 2 pm at her Newport Beach, Calif., office. Find out more on Meetup.com or their Facebook page.

Photo caption:Known for her signature pink cowgirl hat, Jasmine Willois, MBA, likes to incorporate fun while learning about a serious topic: distressed notes.

2020 REI—-The Mustang GT of Real Estate INVESTING

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Interview by Tim Houghten

Go faster, put the power, experience and hindsight of 2020 REI in your hands, and get on the fast track to your real estate goals

As he jumped into the driver’s seat of a new Mustang GT, Realty 411 caught up with 2020 REI’s founder, Tim Herriage. Our fast-paced, hands-free conversation, ripped open what’s going on under the hood of one of America’s power houses of the real estate investment world, as the 435 horsepower machine rumbled to life.

FORD & THE 2020 ADVANTAGE

2020 REI is a leader in the real estate investment space, and for investors it’s not too unlike the experience of getting behind the wheel of America’s best loved, and perhaps most exciting sports car.

With Ford’s Intelligent Access you have the ability to remotely start your vehicle, and the ease of push button start. You have rearview mirrors and a great dash, so you can both clearly see the road behind you, and in front of you.

In the Mustang you have many working parts, from the engine to the technology that runs it. You can have a great navigation system plugged in, a good sized gas tank, and a whole team of experienced individuals that put decades of knowledge into building it.

You don’t need to understand or master the art of every part of the engineering yourself in order for the car to work. They did it for you. You just need to know where the button is to start, and how to put your foot on the gas pedal.

At the 2020 REI group of companies you’ll find vertically integrated solutions for investing in real estate, including financing (your gas). Like the original Henry Ford, Tim Herriage says he believes real estate investing should be easy, and it should be accessible to the masses. He doesn’t believe the individual investor should have to master email or direct mail marketing, or knocking on doors to reap the benefits. Through 2020 REI, he has built his own system, designed to consistently build and turn out real estate investment success. With over $1B real estate transactions so far, the group may have cracked the code.

FORWARD THINKING VALUES

They say hindsight is 20/20. We all know we’d invest and navigate the investment landscape far more successfully if we had the benefit of time travel. 2020 REI is built on the mission to give today’s investors the benefit of the knowledge of those that have gone before them, and the clarity to make the right moves for the future. Like the Mustang, 2020 REI has changed the game from just being about having heavy weight capital to throw around, to being more like a hi-tech sports car that can take investors where they want to go, faster, and with better handling.

Tim, who would much rather talk about his great team members and customers, than himself, can’t be ignored. He continues to both harness an elite level of thoroughbred leadership, and be highly relatable to.He’s been the Marine who just got out of the service with no money and no credit. He has been the once successful hard working professional who had to fend off foreclosure in the great recession. Yet, he has also headed up Blackstone’s B2R Finance division. Now he also knows the point when you’ll get the back out on the new Mustang, and when to throttle it to maneuver safely. He’s been where you are, and knows the way forward.

While real estate has made him wealthy, Tim says he remains “extremely grateful and passionate about helping others.” Pressed about his business goals and vision for 2020, Herriage says it is simply to “just help more people next month than the last month, and even more the month after that.”

To achieve this our driver says he has focused on building a phenomenal team of professionals “who really know how to listen to customers.” Not only listen, but hear them, and help them reach their own goals and destination.

Yet, no matter how big the company has grown, and the immensely valuable set of resources it has developed, Tim Herriage says one of his favorite things to do is still to meet investors that come into the office, let them interview him, get to know them, answer their questions, and help them map a path to the success they want.

THE VERTICALLY INTEGRATED ECOSYSTEM FOR INVESTORS

Under the hood of 2020 REI, the parent company has a full stable of resources, comprising a full toolkit for investors.

  • Investable Realty

A real estate brokerage with dozens of licensed Realtors ready to help investors find, negotiate, buy, lease, and sell.

  • 3L Finance

An in-house concierge finance partner and lender providing custom mortgage lending solutions.

  • REI Choice Insurance

Insurance company designed specifically for investors.

  • H&R Acquisitions

Wholesale acquisitions company.

  • DFW Investors

A regular social networking event with over 300 attendees each month.

  • Elevate Private Capital

Private equity arm that enables investors to place their money in real estate without having to do any work, while generating a guaranteed return on investment

  • REI Data Systems

The group’s technology division, encompassing the Investor Well funding solution for matching investors with the best fitting lenders.

TEST DRIVE IT!

For those that really want to get more out of their real estate investing, don’t want to have to master direct mail or Facebook ads, and just want to get on the fast track are invited to engage and test drive the 2020 REI group for themselves.

Get out to the next DFW Investors meeting, punch in your loan scenario at InvestorWell.com, or click over to 2020REI.com and setup a complimentary consultation to find out more about how they can help you.

Embrace the Mobility of Your Investor Lifestyle

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By Linda Liberatore

As you build your real estate investment portfolio, you dream of ending your 9 to 5 corporate job and the day your freedom begins. No need to go into the office. Now you can spend your days finding properties and evaluating progress on rehabs while managing your current assets.

To operate as an investor having an office space is not necessary and it’s a great way to save capital. Let’s be sure that while you have saved on the cost of office space, you are able to keep great records in your new mobile workspace. There is a multitude of ways to stay organized while on the road. You might want to consider adding these mobile apps as you embrace your new virtual office. First things first, you’ll want to be sure your notes are logged from your mobile device. Some of our clients enjoy the speech-to-text features and exclusively use the Google suite of apps to manage their documents. This works perfect for sharing documents with a future virtual assistant.

The Zillow Rental Manager app allows you to post an ad on several sites. With Zillow Rental Manager, you can have your ad on Zillow, Trulia, HotPads and other top rental sites. And unlike some real estate apps, Zillow Rental Manager is free. Simply enter details and insert a few photos. Applicants from Zillow and Trulia include pet information, credit score and income. Remember, finding the most qualified candidate quickly is the goal.

Homestyler is a wonderful app that helps you envision your next rehab. Take a picture of the current floor plan and let Homestyler show you how it will look with tile or hardwood. Take the dream-work out for contractors and leads. Let them know how furniture placement can work. Check out lighting changes and more. Homestyler removes the guess-work, and the multiple trips and returns to the store.

It’s great anytime you need to share your vision with others. With more than 200,000 vendors checking in nationwide try Thumbtack for the next unexpected maintenance request. It’s more likely than not that you may get an emergency call during unexpected conditions.

If you can’t get there it’s worth giving Thumbtack a try. You can search for contractors by listing the job and they will send you the bid. You don’t have to accept anyone you don’t want to and you have the ability to read reviews and check credentials.

Private messaging allows you the ability to ask questions before selecting a vendor. If your regular crews are behind on projects this app is a great back up plan. Think big picture. You can get started with a small job with these people and if you like their work then you can add them to your team down the road.

As you grow your portfolio you are constantly on the lookout for the next best deal. Auction.com allows you to find your next potential deal anywhere. This free online auction app has over 30,000 properties to select from. It’s powerful features include using an interactive map in both local and national markets with the ability to access details and property photos.

You can use the search and bid features while you are on the move. You no longer need to feel limited by attending auctions. You can start due diligence research with free title information or HomeDisclosure.com reports. Whether it is foreclosure or bank owned homes this is a leading source for the real estate marketplace.

No mobile app list is complete without the power of the app that allows you to finalize the deal, cue Docusign. Docusign saves you from the time and resources associated with completing business critical transactions. This app keeps everyone more productive and accountable from purchases to rentals.

Once you have reviewed the details of the agreements or contracts it’s both simple and secure to e-sign. Forget about the wasted time associatedwith sending out lease renewals to be signed andnot knowing if they are getting to your tenant securely.

This application has been a huge timesaver for us and our clients. It is a must for anyone looking to increase output and efficiency.

As an investor you are constantly on the road looking for properties or checking out existing properties. Make sure to dot your I’s and cross your T’s with the amazing technology available to you today.

From the array of Google products to the apps listed above this only skims the water on the countless ways you can improve your business productivity. Take advantage of these today and you will see a difference!

Choosing the Right Neighborhood

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By Marco Santarelli

Classifying a neighborhood by “type”, or what many investors refer to as a “grade”, is typically nothing more than a subjective description. Although most people will have a general idea of what is being referred to, in my experience it is usually nothing more than a qualitative rather than quantitative description.  Because of that ambiguity, we’ve developed a proprietary, simple grading system that we use with all our investment-grade properties. To help you understand this, a basic overview and description follows:

NEIGHBORHOOD TYPES

Low Income (“C” and “D” grade neighborhoods)

Low income neighborhoods generally have a large portion of their residents on government assistance (for example Section 8 housing assistance). The ratio of renters to owner-occupied homes is greater than 50% and often as high as 80%. These neighborhoods are almost always the most affordable (lowest-priced) areas within a market and usually have some of the highest rent-to-value ratios.

This provides some of the highest cap rates and cash-oncash returns compared to other neighborhood types. You will find substantial area anchors including schools, churches and shopping in these neighborhoods. The anchors are there to meet the needs of the people that live there. Low income neighborhoods are best suited for the wholesale (flip) strategy.

Moderate Income (“B” grade neighborhoods)

Moderate income neighborhoods are similar to Low Income neighborhoods with one critical difference – higher home ownership. While low income areas have a large portion of their residents on government assistance, moderate income areas have a large portion of residents working in the blue-collar sector. This stabilizes the neighborhood and makes for a more attractive investment area.

The ratio of renters to owner-occupied homes is more balanced and closer to 50% for each. Area anchors are similar to low income neighborhoods but with home owners being anchors as well. Moderate income neighborhoods are best suited for the wholesale (flip) and buy-and-hold strategies.

Middle Income (“A” grade neighborhoods)

Completely different in almost every way to low income and moderate income neighborhoods. The biggest differences are homeownership and types of employment. Most of the residents own their homes in these neighborhoods and are employed in high-level blue-collar jobs or in the white-collar sector. Middle income areas are excellent for long-term holds because of the stable nature of the area and tenants.

The ratio of renters to owner-occupied homes is closer to 80% owners and 20% renters. Middle income areas will have a greater number of anchors that meet the wants of the people that live there. These include the three “Ms”: malls, movies and meals. Middle income neighborhoods are best suited for retail fix-andflips and buy-and-hold strategies.

HOME VALUES

Home values vary from market to market, and between neighborhoods within each market. So one should not choose a neighborhood based on the market values alone. It is usually best to target those neighborhoods where property values represent the affordable housing stock in the middle market.

These properties are often within desirable neighborhoods making them easy to lease, buy and sell. Properties in the upper-end of a market’s price spectrum often don’t provide desirable rates of return, while properties in the lower-end of a market’s price spectrum often provide some of the highest expected returns but with the risk of attracting some of the lowest-quality tenants.

SCHOOLS

When it comes to residential real estate investing, it is not as important to have top-rated schools as it is to have multiple schools located in the area. Too many investors put more weight and emphasis on the school’s rating than all the other factors which can be a mistake and cost you in lost opportunities.

While many of our investors choose properties in neighborhoods with some of the best school districts, when it comes to investment properties, often times these properties come at a premium price relative to the income it generates. Many renters are just not willing to pay premium rents for premium schools.

CRIME

Generally speaking, better neighborhoods (“A” and “B”) will have below average crime rates (both violent and property crimes). Although lower relative crime rates are certainly a desirable characteristic to have, it is not the most important factor in your neighborhood selection criteria.

Finally, if you’re working with a reputable company to help you find or provide you with investment-grade properties then they should be able to advise you on the various markets and neighborhoods as well as provide you with detailed information such as neighborhood characteristics and demographics.

Personal Service in a Busy Financial World

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By Anita Woods

Investing in property can be frustrating, especially when you’re always searching for good financing options that suit your time-frame as an investor.

Having someone in your corner toprovide quality information and advice can help you reach your goals more quickly than going at it alone.

Steve Bighaus’s clients know they can count on him when they need to finance a new opportunity, even when that opportunity is their own place of residence.

Bighaus has a vested interest in the success of property investors…it’s why he does what he does. His number one goal is to become the all-in-one resource for property investors.

But as a forward-thinking kind of guy, Bighaus is always on the lookout for ways he can improve his processes to get better results for his clients.

One such process is technology, using it efficiently and effectively.

That’s why, after speaking with thirty to forty companies, Bighaus settled on working with Sierra Pacific Mortgage Company. They understand his goals as a specialist in lending to investors, and they share his vision of using technology to deliver exceptional products for his customers.

One exciting development is the creation of a new loan origination system that will allow a borrower’s information to be obtained straight from the source.

This will simplify the process for both investors and homeowners and expedite the loan origination process.

One particular issue that many fix-and-flip investors are facing is the challenge of finding eligible buyers for their properties.

Steve’s research has found that these investors are experiencing a dismal fall-out rate of 40 to 50 percent.

As part of his goal to be a full-service company for investors, Steve and The Bighaus Team at Sierra Pacific Mortgage Company aspire to preclude any potential problems as early in the process as possible.

Using all of the tools at their disposal, they can provide quality pre-approval letters towards the goal of improving results for investors. Other tools that Bighaus can use include an automated system for appraisals that will let the lender know whether or not an appraisal is needed, and a great customer relationship system.

And as any of his customers will tell you, Team Bighaus is known for their stellar customer service. Whether you leave a voice message, drop an email or send a fax, you will receive a response the same day.

Need a pre-qual letter and it’s the weekend? Just call Steve Bighaus! He’ll take care of it.

Think of him as your personal banker – someone you can count on to be in your corner.

Bottom line, while pricing is important, there’s something Bighaus and his team can offer that few can: Responsive customer service paired with innovative technology to create exceptional products to help investors grow their wealth.

Q-an-A with Dani Lynn Robison with Freedom Real Estate Group

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A Question and Article Interview with Dani Lynn Robison, Co-Founder of Freedom Real Estate Group

 

 

Dani Lynn Robison is no stranger to real estate.

In fact, she is a member of the esteemed Forbes Real Estate Council and is Co-Founder of her own turnkey investment business – Freedom Real Estate Group in Dayton, Ohio. With her rapid success in real estate over the past 10 plus years, we sat down with her to find out a bit more about her success, what she’s doing now, and the advice she has for real estate investors.

INVEST IN READING THIS ARTICLE, REALTY411 GOLDEN NUGGETS , INCLUDE:

  • Discover how a life transition can result into a lucrative passion with real estate.

  • Find out what it takes to be a turnkey provider in this competitive environment.

  • Get an advantage on how a professional buys and sells real estate investments.

  • What does the future have in store for rentals in the Midwest?

  • How does real estate compare to the stock market, get a perspective.

Q: How did you get started in real estate?

A: Flip (her husband) and I spent about 10 years of our life after college traveling on cruise ships as musicians and art auctioneers. Once we were back on land, we both wanted something that required less travel and put us in one place. I decided to pursue and learn three different interests of mine and choose one. First, I tried finance. Didn’t like it. I moved on to mortgages and lending. Didn’t like it either. Finally, I landed on real estate sales. I became a REALTOR® and guess what? Didn’t like it either. Flip and I both became REALTORS® in 2008 at the height of the recession.

It was tough. So we decided to attend an educational seminar put on by Phil Grove. Soon we became part of his expert panel as we were his most successful students. After a few years investing in real estate in Texas, Florida, Arizona and other states, we were turned on to the concept of turnkey investments.

I loved the idea because it is all about helping others create cash flow and financial freedom for themselves, which was exactly what we were passionate about doing for ourselves. Now we could help others do the same and they could benefit from our experience and knowledge. We started doing it and haven’t looked back.

Q: Tell us a bit more about your current business and what you’re doing.

A: My main focus is turnkey investing. Basically, we buy properties, rehab them to our standards, rent them to a tenant, put property management in place, and in turn sell it to a real estate investor who wants monthly cash flow without the hassle. It’s an all in one, done for you real estate investing system.Most of our clients are busy professionals who understand the power of building wealth with real estate and they want to get involved, but don’t have the time, resources, knowledge or even interest to learn more about it.

An added bonus of investing this way is your investment doesn’t have to be local to you. With turnkey, you’re able to select markets with high returns that may be across the country. As long as you’re partnered with a trustworthy turnkey company, your asset should be well taken care of.

Q: Your business is located in Dayton, Ohio. Why Dayton?

A: Dayton is great for generating cash-flowing assets. A few things play into that. One, you can buy property much cheaper here than in a lot of other metro areas like Los Angeles, Miami, and Chicago. Here, a single-family property that has 3 bedrooms, 2 bathrooms will cost you as little as $75,000. Try getting that in one of those cities I just mentioned. With that $75,000 investment, you’re cash flowing about $730 per month after taxes, insurance, and management fees. That’s a 12% return on your investment. Once you get into properties with two units and higher, the returns can get even better.

We offer some properties with 15% returns. Two, the greater Dayton area has a history of a greater owner to renter ratio. Right now, it’s about 60% home owners and 40% renters. That means there is a solid number of renters in the area needing housing. Three, it’s a stable economy. There is definitely growth happening in the greater Dayton and Cincinnati area. The urban core of both cities is booming. Dayton has some staple businesses that have long been here and will continue to be. For example, Wright Patterson Air Force Base, one of the largest research bases in the military and the largest single-site employer in all of Ohio is based in Dayton.

Q: So why not just do real estate investing and rentals myself?

A: I’ve been a real estate coach since 2010. Over 90% of students fail. Either they don’t have the time, passion, or money. It’s always one of those. Seasoned investors have all experienced failure. It’s part of learning. Failures that have cost us hundreds of thousands of dollars.

We’ve done it. If you want to do it, more power to you. Real estate has a huge learning curve. Plus it’s full-time. If you do it right, if you do it well, it’s more than full-time. With no experience in real estate, you’ll likely find yourself with a money pit of a property, get frustrated, and give up.

Q: How does turnkey investing compare to investing in the stock market?

A: I love the cash flow and asset protection aspect of turnkey investing. Renters will always exist. There will always be demand. Plus, if you decide to sell off your properties, you will always have a tangible asset that has worth. Also, real estate isn’t as volatile as the stock market.

Even if the real estate market crashes, there will always be a recovery. Plus, if it crashes, you fall back on cash flow. It’s rare that rents go down – even in a recession. They may not increase but you will still be getting consistent cash flow every month. It’s just not the same with the stock market.

Q: Speaking of a market crash, how do these assets weather that?

A: When you’re buying turnkey properties, you should be buying for cash flow. Yes there are a few markets that boast appreciation as a selling point. I never advise that. Appreciation is speculative and never guaranteed. If you have a 10-year plan, what happens when the market crashes at 9 years and 9 months into your plan? Not good, right? Buy turnkey properties for cash flow. Appreciation is an added bonus when you decide to exit.

Your goal shouldn’t be to have $1 million dollars in your bank account. It should be to have $10,000 in cash flow coming to your mailbox every month. That’s how you achieve true financial freedom.

Q: What does the future look like for Freedom Real Estate Group and you?

A: I plan on continuing to work on and expand our turnkey business. We’ve been able to meet some great people across the globe. I love it. Especially the wonderful success stories. We plan to expand into some other markets. By the end of 2018, we will be expanding into Cincinnati. We’re hoping within the next 12 months to have a presence in two other markets as well but that is still in the works.

Q: Finally, what advice do you have for someone new to real estate investing who wants to begin?

A: If your passion is real estate, find someone local and learn from them. Always have the mindset of there is something new to learn. I’m still learning. If your passion is different from real estate, as in you’re a doctor, teacher, or dentist, align yourself with a real estate investment professional to define and set your goals. That’s how I approach all client conversations. I want to know your goals so I can put you on the right path to get there. Real estate is a great asset for passive income.

If you’re a busy professional who doesn’t want to quit their job and get into real estate full-time, turnkey investing may be a good option. Eventually, once you’ve built a healthy portfolio, you’re working because you want to – not because you have to. That’s true financial freedom.

For more information on turnkey real estate investments, or to schedule a call with a Freedom Real Estate Group investment counselor, please go to their dedicated turnkey website at: www.TurnkeyOhio.com.

LEARN MORE ABOUT THE LEADERS OF FREEDOM REAL ESTATE GROUP

Dani Lynn Robison, Co-Founder, Managing Partner

Dani has been a Licensed REALTOR®, Distressed Property Specialist and Note Consultant since 2009. She has participated in countless real estate transactions and evaluated thousands of houses. Dani’s joy comes from creating win-win situations that help sellers, buyers, and the community.

Dani grew up in Phoenix, AZ and earned an Music Performance degree from Southeastern University. She’s lived in Florida, Texas and Ohio and traveled on cruise ships for 10+ years where she met her husband, Flip. She and her husband are the proud furry parents to one golden retriever, Tucker and two feisty bulldogs named Spartacus and Rosie.

Eric Jones, Director of Sales & Marketing

Eric is a licensed Realtor and has been an integral part of a marketing team for a large, multifamily property management company for over 10 years. While he was there, he marketed and advertised their properties to achieve maximum occupancy and improve their customer experience to be one of the top-rated communities. He was also responsible for doing company-wide presentations to improve sales numbers and motivate the team.

He holds a Bachelor’s degree in Public Relations and Marketing from Northern Kentucky University. With in-depth experience in the real estate and rental market, he constantly strives to improve the customer experience with every transaction and any organization he is involved with. Eric lives by the quote – “Go the extra mile. It’s never crowded.”

Eric grew up in a small town in southern Kentucky before relocating to the Cincinnati and Dayton, Ohio, area for college. Eric currently hangs his hat in Springboro, Ohio, with his partner Matt and his darling step-daughter Lilly. In his free time, you can find Eric working with youth performing arts organizations across the country or jet setting to a warm location with a beach.

 

Key Do’s and Don’ts of Probate Leads: How to Find Motivated Sellers

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By Kristine Gentry, VP of Innovation, US Probate Leads

As the real estate market continues to tighten, successful investors are diversifying their lead streams and trying new sources. One of the most underutilized sources of leads are probate leads. Why are they underutilized?

Primarily because people do not understand the opportunities that are available or how to quickly and easily obtain probate leads. In addition, some investors do not know what to do with probate leads once they have them. If you are considering using probate leads to increase your opportunities, or if you already have probate leads, below are some tips for helping you make the most of your leads.

What Are Probate Leads?

Probates leads include information on property that is part of a legal filing after the death of a loved one. These cases include many types of property owned by someone who has passed away including homes, vacation homes, cars, RVs, businesses, commercial property, rental property, artwork, and other personal property. These cases are listed in each county after the death of a loved one where a probate needs to be filed and are controlled by the local court.

Oftentimes, this property has to be sold in order to pay for medical, tax, legal, and funeral expenses. The court will assign an Executor to handle the sale of the property so that these obligations can be met and the heirs can receive any remaining funds.

As part of an overall investment strategy, probate leads are valuable because they come with very motivated sellers. Executors need to deal with the property that is in the probate filing in order to meet the court requirements. Many times, they need cash in order to pay bills that have been left after the passing of their loved one.

Often, they do not live near the inherited property and simply want to sell it as quickly and easily as possible. If they know the property needs updates, they may not want to have to deal with that hassle and would rather sell the property at a discount. In addition, since they inherited the property, anything they make on the property is extra for them so they are less worried about getting maximum value for the property.

Probate properties may be available for thirty to fifty percent off of the market price and are generally available for a quick closing. So, probate leads are a great way to diversity and increase your lead source. But once you have probate leads, what do you do?

Probate leads are not like all other leads and should be treated differently. Do offer to help the executor/heir. Remember they have recently suffered a loss and are grieving. Since probate leads are generated when probates are filed in a local courthouse after a death, it is necessary to be especially warm and considerate when speaking with executors and heirs. They have recently gone through a very tough time and are probably overwhelmed with the loss of their loved one as well as all the legal and financial issues they are faced with as the executor of the estate.

For some executors/heirs, the last thing they have the time or energy to deal with is a recently inherited piece of property. They may not live near the property and may not have the time to take care of basic issues with the house. For instance, suddenly having another yard to maintain can seem daunting.

You can help by offering to mow the lawn, trim shrubs, or water plants. Sometimes the heir or executor simply need someone to talk to. You can be that friendly person they can speak with. Offer condolences and let the executor or heir take the lead in how much they want to talk about their loved one. Simply asking what they need help with can go a long way. Do continue to reach out to the executor/heir. One mailing or phone call will not be enough.

Unlike other leads sources, it is hard to know when will be the right time to reach out to an executor or heir. In some cases, heirs want to sell property as fast as possible. They may be ready to sell quickly so they can move on. In other cases, heirs are reluctant to sell their loved one’s property.

They may hold onto it for months before feeling pressured to do something with the property. We have learned that it is important to regularly reach out to executors and heirs and recommend doing so for at least a year. Sending a mailer or making a phone call every other month is a good timeline. The important thing is for the executor or heir to have your contact information available when they decide they are ready to sell.

Do be honest about how you can help and why it is beneficial to you both. Executors and heirs have a lot going on. They will know that you are interested in making money and not just a stranger who showed up to help out of the blue. It is best to be honest and explain that you make money by purchasing properties below market value, fixing them up, and reselling them. And that it might be helpful for them to sell you their property below market value so that they do not have to deal with the hassle of fixing up a house to sell and then listing it.

Remind them that you can help them get cash quick, but there are no guarantees of how long it would take for the house to sell at full value.

This is a win/win situation for you and the executor or heir, and you should be up front about that. Don’t forget about historical leads. Heirs often don’t sell right away. New users of probate leads often think that the leads have a short time on the market. However, that is not the case. Generally it takes some time for Executors to get all of the paperwork filed and to go through their loved one’s things before they are ready to sell.

There is also the process of grieving, which can cause Executors to hold onto a property for a time before they are willing to sell it. With these parameters in mind, real estate investors who are looking at probate leads will find that Executors who are selling property may not be ready to sell for twelve months after the filing. In many cases, the leads are still viable eighteen months after the passing of a loved one. This allows for plenty of time for real estate investors to make contact with the Executor. Therefore, a successful probate investing practice should include the usage of historical leads. Don’t try to get leads on your own. Purchase them from a reputable source.

Many investors have attempted to gather leads themselves from courthouse records and quickly grew tired of the painstaking and time consuming process of doing so. Now, there is no need to gather these records on your own. Several companies provide probate leads for you. Most specialize in only a handful of counties – often counties where probates are available online. However, some companies have researchers trained to go to courthouses where these records are not available online, which is the case for the vast majority of counties.

U.S. Probate Leads is a family-owned company that has been in the probate business for over 15 years. We have more experience and offer high-quality ads that include skip tracing for executors and addresses.

Don’t waste your time gathering probate leads. Instead, contact us to learn about why our leads are the best on the market. Get Access to Probate Leads Today. Using probate leads is a great way to find more leads in your area as a real estate investor. With long-term viability and Executors that are motivated to sell, you will see that probates are a way to quickly find discounted properties.

If you are looking for diversity in your lead package, then you can get access to probate leads easily and quickly by vising US Probate Leads. We offer county by county listings of the probate leads listed in your area delivered directly to your inbox. Each county in the United States is covered by our trained team of lead specialists. Our team makes sure that you have the leads that you need in order to make your business grow.

Want more information?

You can visit us at www.usprobateleads.com today and get more information on our lead services or sign up. In addition to our lead service, we also offer seminars, webinars, eBooks, software and individualized mentoring for dedicated investors. Contact us today for more information and learn how we can help you to meet your real estate goals.

Probate Leads Available Now – In Your Area US Probate Leads has access to virtually any county in the United States, meaning regardless of where you live, you can start receiving leads monthly.

Go to the US Probate leads site: www.usprobateleads.com, click on your state and get started. To get a 10% discount, place an order before September 30th. Use discount code “Realty411.” Or you can contact them directly at: (877) 470-9751.

Now is the time to make your mark in this little-known niche – never before have more properties become available than will in the coming years. Becoming a US Probate Leads subscriber could really be the start of a whole new future, a more lucrative career, and an exciting investment opportunity.

– Article By Kristine Gentry, VP of Innovation, US Probate Leads

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