Where to start ..My partner and I owned 18 units and we went with one of the largest property management companies in town. ( Charlotte NC area.

Long story short 3 years ago I started my own management company after the head aches.

Checks did not come on time as promised.

Vacant units looked like crap when I showed up to inspect my self ( grass actually was as high as the rental sign.)

Some vacant homes sign knocked down in yard… did not know how long the sign was down.

Our vacant properties at the time .I wanted updates on calls and showing  on the property to get an idea if over priced or what the problem was.

From the  time there office received a call  from  a tenant with a problem to the time they sent some one out to fix.Took to long for the handy man to get to the job  to fix the problem and over charged at that.

Those would be just a few complaints.Then we started our own management company.  We are always looking for more ways to keep both investors , and tenants happy. So love to see some more feed back on this subject

Sincerely
Alex

Thought I would comment on some of the answers below agree with most of the comments. Only one I disagree with .

Hi Jane, It is definitely a very exciting to be buying first investment property, specially as an overseas buyer. Below are some of the questions I would ask: Realtors 1) How many overseas investors have you worked with? 2) Can you provide me references for these overseas investors?  Simple enough referrals is a  great way to get a feel of the team and management company.I would also see that the company deals locally and nationally. For example  Dealing with Australian investors  is new to our company , but  in the USA dealing with investors  who are out of state is and has been our companies main focus for years.

3) If you like some property, ask the realtor to provide you with comparable sales information for similar properties in last 6 months. 6 months I like 30 to 60 days  for most deals  but appraisals and comps make sure we explain foreclosures and turnkey investment deals.They are two different examples  of properties  we are dealing with .

Don't go based on the comparable sales information that is more than 6 months old, as the market may have changed a lot in last 6 months. 4) If the realtor tries to tell you that Cash Flow = Rent – PITI (Principal, Interest, Taxes, and Insurance). Keep in mind, that's not true. There are a LOT of other expenses that come with owning a rental property like, vacancy, property management, repairs and maintenance, utilities while the property is vacant, letting fee, etc. Property Managers
 
This is the question for all we all have different approaches for coming up with actual rehab cost. Owning rental properties is  not for the faint of heart.You will have vacancies, repairs .With the team sthat you are dealing with that  really is the key. (How do they rehab properties what do they look for.Are the major elements  fixed , ( electrical , plumbing ,in South east USA AC units are a must , and roof s) How do they manage the properties.What is the system in place. Can they maintain and handle growth. Meet the team , that is every body the team deals with.  The last statement not always necessary.

1) How many properties do you manage for overseas investors? 2) Can you provide me references for these overseas investors? 3) Will I have online access to property financials including lease, tenant information, etc.? 4) How do you handle repairs? Do you have some handyman or repair person in your own crew that handles small repair jobs? 5) Do I get a discounted price if you manage multiple properties for me? 6) Are you licensed with the city and state? 7) How many total properties do you manage?
I agree with all the above

 Do you have other property managers on your team? What is the average number of properties each property manager handles?  Not agree completely  For example We have a full service staff with a system in place so no manger handles any certain number of homes .The staff caters to both investors and tenants.

 (You don't want to see one property manager handle more than 30-50 units)

Strongly disagree some of the strongest teams  in the USA buy fix, and manage there properties in house.We have over 150 in house adding 10 – 15 monthly. Biggest Memphis team has 800  properties and Indianapolis team has over 1000. I not sure  about Jay  please chime in I think you manage over 200 .

How do you handle eviction? 9) Is there a fee when the property is vacant? 10) How much do you charge for filling a vacancy? The average is 1/2 month rent all the way up to 1 month of rent. These are some of the questions I could come up with. I will add more if I think of something else. Again good questions.

 2 months is plenty of time to give you a good idea of the market. Are you going to be in Fort Worth only for 2 months? Just curious, how did you decide on Fort Worth market? Please feel free to contact me if you have any other questions. I will be more than happy to help you Good luck with your search.[/quote]

Alex

Agree with Jay on the South East . I am personally buying and selling in Atlanta , Charlotte . Both are great markets. 

Alex

Mosqui,

Communication between tenant, and management company is vital for rental properties. Losing touch with our clients
(tenants) would be harmful to both us, and our investors. Making sure the management company has the employees and a system in place to allow growth is important. So we as a property management company always need to maintain a open line of of communication with the tenants.Which I see as a step that should be considered very import for any property management company. The idea of  constant communication is the very reason why an investor uses a management company. This is so they don't have to.

Sure trust is huge issue, you should not work with any one you can't trust. So is running a professional company, that clients would be happy to have you manage their property or properties.

Alex

[email protected]

Engelo,

No I don"t expect 6 months of income. I just try to be a realist. I would warn everyone that when buying in rough areas, to not expect the pretty picture that some are trying to paint in these comments. My real estate partner and I own plenty of homes in C areas. These areas are what I would grade as C Rental areas because  no retail  sales there at all, if  there is one very rare.  I don't see appreciation factor at all either.You buy for $30k well it is worth $30k

I have a tenant that has been in one of the homes for 9 years. So yes I do collect rent 12 months out of the year on some

. I think the main point that Jay and I are making for any one to promise these super high returns, which in some area are feasible, but not the normal. Realistic numbers is what we are teaching and preaching, along with expecting headaches not all glamor in these type of homes.

Perfect example, I am buying a house today hopefully if bank say yes for $17,500 purchase price (rehab $10-12k) rental income $550 month (taxes, insurance $130, no management fees since I own the management company). If I was selling to a client I would then charge a management fee 10 % so $55 dollars. Sales price would be from $33k to $35k depending on rehab.

So a rough figure for the cash flow would be about $365 month. Again this is my mind set. I basically multiply that number by 6 or 8 months.This way I get what I feel is realistic cash flow on a lower income property.  Roughly 10 % return when * by 8 months. Now if I sell to a client price would be $35k and roughly based on honest figures  8 % . 

Again I rather over deliver then over  promise…..and under deliver ….

Alex

So true  no argument here. Good Post …..

John alot of information ….Which I think is awesome ..Good for you…I  will give  every one my simple version… for tenants…

Treat all  people with dignity and respect…These might not homes we choose to live in, but to a tenant its what they call home. Make the home 100 % the best it can be..If you cant sleep at night there is usually a good reason…If it breaks fix it right away.We would be pissed if some thing in our home did not work…

Again we all put our pants on one leg at time….simple process…so should be simple answers…

Tenant referrals from Family and friends say alot ,and go  along way…in this business… A property management company is and should be a professional full service one stop shop for clients.

John again great post and appreciate the information…

Sincerely
Alex

Hey All

I have been traveling all around the USA . Just got back from my Trip (stopped in  Atlanta , Los Angeles another long trip)

Yes, looking over this list…I have to say, lets not get too excited about the top rental places. Rochester I got to go comments a few weeks back. I tend to stay away from these areas with snow and cold winters. Just prefer not to add in those headaches with already buying cheap cash flow junkers (I personally own junkers so I can say that), and I was born and raised in Long Island, NY, and I still have family and friends there so I know how horrible the winters and snow get.

Here is my two cents about each market, then my comments on others comments as well. Lawsjs, Sorry now if my grammar is not great. It would be easier to hear me at a seminar speaking then typing, and again these are just my opinions.

1. Rochester NY: ( my partner company in California ) owns several homes there, nothing but low income housing there. I'm not saying the whole market is that way. She has had nothing but head aches. The weather would turn me away, being that there are quiet a few months out of the year with snow and cold.
 
2. Stockton, California: from what I see and what I hear for California it is a very cheap market, but what I also know is that the unemployment rate is very high there.

3. Las Vegas: this is a very appealing place to buy. I been there for vacation and fun and it always seems busy. There are 3 blocks from the main strip get rough. Cost  is very appealing for cash on cash investors and rents seem to make sense. The concern would be unemployment in the area. With Vegas if the Casino's are thriving then there is nothing bad to say there. I have not personally dealt with that market. I was actually going to set up a team there but traveling time is too far away.

4. Detroit: Very simple, if I can own 4 square blocks for under $20k, I need not say more. Sure there is opportunity there, but I think that has to be a big red flag. I am sure I will get negative response from any one selling there. Just being honest.

5. Flint , Mich: I'm not sure I've ever heard of that area for investing. If it is very close to the great lakes and has lake affects, snow and cold. That would be my only reason for saying no.

6. Orlando Florida and  #8 Tampa Florida: Personally I love Florida. I like to be in the sun, honestly that is my biggest reason for venturing there and setting up shop. I think Florida is going to have a second hit and prices will drop again which worries me. I am setting up a team in North Port  and the Sarasota area. Florida is a good flip market. Being that Canadians, and the northern USA states like buying second homes there. Cash on cash return is not great, but these high returns some people are posting, I would be a bit skeptic. Small fact 1600 units have been purchase in 2011 just by Canadian in Sarasota County alone. 8.2 billion dollars in now owned in Florida with single family home from Foreign nationals.

7. Bakersfield, California: again I'm not sure. Most of my clients from California are buying in the Southeast of the US. The prices make more financial sense.  Basically they are just much cheaper .

8. Phoenix: this is a market we looked at and almost made the jump there .Seems to be a good choice for a lot of USA and Foreign investors. I do worry about tough immigration laws that were passed there. For lower income rentals, I am sure that there will bring more vacancies. Unlike Charlotte, North Carolina, and Atlanta, Georgia those are two states where population is increasing.
 

I do also like Indianapolis. I know they have a very strong management team there. I have not moved any investors there but I do like the market and the numbers make sense there.  

Alright now my two cents on really any and all markets in the USA. Jay you are correct, dealing with properties over $100k you will always get a better renter. The problem is finding tenants who can afford those places, the pool get rather small. I like to stay with properties in the $75k to 150k in value. I deal with mostly middle class to lower class incomes ( border line ) where there is usually a two family income.

Lets be completely honest guys, houses that you buy for 30k are worth 30K don't give me the crap about equity in the property. No one is moving to rental areas to buy.They are rental areas and will stay in rental areas.

Again I agree with Jay (and no we don't work together, we just met about 2 weeks ago) However we do run in the same real estate circles. Actually one of his companies did some hard money loans for me a few years back. The nicer homes are what I like to call cash flow with future speculation appreciation. We hope that buying in a retail area, will now make them stronger rental homes. Down the road when the markets come back (no telling on that. US economy is not getting stronger.) the properties will appreciate. Being that they are newer homes most likely 3 bed 2 bath and larger, 15 years or newer. I feel confident banks will start to lend. It will be on the newer nicer homes instead of the cash flow rentals in the rougher area.

Now with that being said I do buy and sell in what we call C grade areas. I just don't look at income for 10 – 12 months return.      (I basically count on 6 to 7 months to work my numbers). When dealing with C grade area (low income) lower end older homes not always the hood, as most like to call it and not a war zone. I refuse to go there.

For example, I buy a house for $35k retail (value $79 K). I will never sell for $79k. You don't get too many buyers for the lower income areas. If my rental income is $650 month based on 6 months out of the year. Again average numbers for cash flow deals in my area. I then work my return based on that number. So if  I paid $35k  6 * $600 ( $50 management fee) income based $3600 10 years cash return. This is what I call worst case any thing better is great.

When building real estate portfolio's I like to have both properties included in a real estate portfolio.

Now my last comment at the end of the day…these two things will make or break you investing. One, having and keeping solid tenants, and two a professional management team in place. Florida is so high on my list but not until I can set up my own management company there it will be on hold.

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Sincerely
Alex Franks
[email protected]

Nigels contact information. Does any one have it .Being in the USA would like to speak to him on his next trip over.

Thanks
Alex
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Nathan I am no expert but most financing that we can provide for foreign nations is 50 % down for USA  properties .  The properties you are speaking will get a return. Just  those priced properties are usually in rough areas and will provide more of a head ache then a  return. I would wait and put together an investment plan after saving some more funds. Not sure about The France or Uk and our loans are done through a private lender..

Feel free to ask away any questions..

Sincerely

Alex Franks