Remind me when we finally meet drinks can be on you… Well done.

Must connect your dots to my FL swamp infested trailer park friend… She may be reading…

Ride’em hard… I don’t think I could really make that a good tag line… But it isn’t a bad motto for PM’s. : )

Google drive.

Jay, I think this was for those NOT with the ability to zap themselves over here – and it is good to note that EVERY subdivision can be different but ts funny – I nearly said the same – "gut"…. I have been very very comfortable in my lovely non HOA townhome that I have been using as a central hub in ATL – mostly due to the atrocious internet at my actual house over here – desperate measures…… Non HOA 20k-er…. and I bought this (and now a few others in the enclave) because it is safe, good vibe etc. I have my chief local lawn mower here just for my properties….. (Marcus, $5.00 per lawn – I am now admitting that I am breaking child labour laws as he is 10… doesn't do the world's best job but can't beat the rate…..)

I don't buy inside the "beltway" in Atlanta for instance.

What I tell my guys is this – if you can't be here, someone needs to give it the vibe….I call it the "Emma Safety Test"… but a lot of what you can learn is from just google driving…… how do the cars look on the street? Is there graffiti? Is the street well kept? Are the houses well maintained? Are there a million bars on the windows (in any city that isn't primarily hispanic, it is NOT a fashion statement". Drive the block – in one direction might be FABULOUS and in the other ATROCIOUS.

Again though – I ALWAYS look to see who OWNS the street and do they LIVE there – if I see the whole street is owned by people wwho live there and have lived there for the last 10 years or more, it is a GOOD sign (PRE crash = not likely to be in foreclosure)….

Geojet tells you these things….so I would add that website – ask your agent to send you the Geojet report.

Usainvestor…. As masochistic as it sounds….. I actually do do it intentionally the hard way as I hate gyms…. When I am speeding I of course spray the trim! However I did give up carpeting swapped down from an 18V to 14V drill for overhead stuff to save the joints… but yes, as a previous OSHA person I must say that looking after health is something we all underestimate.

Casa, you are very welcome. I a just so so so enthused that you are looking for a licensed real-estate agent….

That’s the whole thing… Modular (I lump them all together and call them mobilies to include both in a park and standalone) can absolutely be cash cows and mobile home parks actually tempting (have had massive insight from fab person on her stunning swamp infested one) so long as you KNOW what you are buying… As remote a possible as it seems, someone may look at a Modular “house” propped up by bricks at one end to be “dream investment” at 60k in this market over any other house that is actually a house……… Until they realize that that is all it can ever be…. Yield churning and then when the market picks up and they decide they have had enough of supporting billy bob and his whole family, some of whom are even thinking of getting a job…..

Well every other house will have increased by 100% over purchase price but yours? Even if it were valued at 100k, you would have To find a cash purchaser….. Sigh.

If all that is explained fabulous but when modulars are the same price as a house….. I would suggest you go house…There will come a time very rapidly where you may not be able to afford anything else or need just a churner forever or or or… But these come with massive caveats.

Jay
The bottom line is that the Oz based flippers shouldnt “just decide” and their naivety will probably in the long run stand them afoul but will be protected by the “caveat emptor” and unenforceable real estate laws. For me though, the
US alternative Of the Oz spruiker is very scary…that is a big game for a newbie to be eaten alive in….. Ie the bigger problem is the same way that you and I may know PRECISELY how vendor financing deals work, most people from Oz seriously don’t and seriously get burnt. They haven’t played with the big boys, would be lucky if they understood the difference between a modular home and real property and are being “sold” versus entering into something with absolute transparency and THAT scares me. I love talking to you guys but I wouldn’t say there is a night that doesn’t transpire that I am not explaining to someone what a HUD statement is, what MLS means or going over what a faucet is versus a tap or or or…. Breaking down vendor financed deals to Australians desperate for the holy grail of FNAP financing below 500k is a NECESSITY.

So, what to do?

If this is your first property in the States how about you buy a nice suburban home near good schools that isn’t scary via a real estate agent…. Wet your teeth, learn the system and if you decide after that you want to delve further, go for it…. But make your first experience with someone who genuinely cares…ABOUT YOU…… Not a wholesaler who is looking to sell 1,000 properties by the end of the year…..

This is a learning curve of language, of acronyms that just fly around… POA’s, US notary publics, EIN, ITIN, SSN…..due diligence, inspections, legal rights and recourse,. Of systems , how to use it , what is MLS… 90% of those looking to invest in the US are learning what these even mean… Outlet = Power point and we often and easily forget that even the most basic of things arent necessarily the same…. ESPECIALLY tenants. A lot of homes in Oz still dont have a/c and sure as heck we are explaining freon etc..

What to do??? It GREATLY reassures me that there are a group of experienced US in easy access and I am pretty darn proud of the help a lot have given in trying to help people get their training wheels off without being too burnt….. Just remember that it IS still critical to break down EVERYTHING. Alex you probably talk to US investors …. Closing = settlement. Our lawyers are solicitors and barristers… No, a
US check can not be cashed in Australia against an Oz bank…..cheques don’t exist in Australia. I HATE CHEQUES!!!! Don’t write “check”(we think of checks and balances) … It is cheque.

My rule of thumb? Would I in good faith recommend this to a fellow Australian as a good investment for their first (in many cases) investment property and the answer in the case of a vendor financed modular home in Kansas City is “no”. It is the same as would I, in good faith, recommend buying property in the US from an unlicensed non resident based out of Oz.

Now back to prepping my floor…. I love having some of my own properties to work on for R&R…….

Btw… On behalf of everyone from Oz and the small collective who have made it over here….. THANK YOU Jay, Alex etc for the many hours of completely free and valuable advice you give both on and off forum to help people in this market.

PS…. In the ENTIRE Las Vegas market today under 75k, SFR (Single Family, younger than 1980 in construction, greater than 900 sq ft and less than 2500 sq ft there are 3 properties. 2 are mobile homes, one is burnt out..

THAT is why Atlanta looks yummy.

CH

A lot of this will come down to how willing are you to assist in the search for your own property – it is a LOT of fun but you need to know a few things (understatement)…

The BIG issue in the US we face being licensed real estate agents is to avoid being seen to be redlining or steering – i.e. “is this a good area” – you need to learn how to find that our for yourself through crime stats, trulia comparisons etc BUT working with a real estate agent gives you AMAZING tools…

Ask (other than are you a BUYERS agent):
1) To have them set you up on automatic MLS listings

2) Do they have an in-house property management system and at what percentage of gross rents – what do they charge to lease a property in the first place? Do they charge a renewal fee (iie if your tenant renews their lease and extends for an extra year)…… are they familiar with the nuances to dealing with foreigners – DO THEY CHARGE TO WIRE THE FUNDS BACK TO YOU IN OZ – remember, it is often BETTER to NOT have a US bank account – because unless you travel frequently to the US, you are pretty stuck getting funds out of a US bank!!! Better to leave the $$ in the Property Management company and have them wire…… even if it costs you $25 a quarter, TRUST ME IT IS CHEAPER THAN US BANK FEES!!!! Make sure you have built into your property management agreement that you have 6 monthly inspections conducted, that you MUST be consulted for any repairs over $200 AND GET COPIES OF ACTUAL RECEIPTS FROM THE TRADESMEN

3) If you are “doing” this alone – do they have contractors that they can recommend for repairs and what is their rate sheet if they have one… (to give you an idea, my painter charges $1500 to paint a house up to 2200 sq ft in Atlanta – 2 tone, semi gloss white for trim, including ceilings and doors, bathrooms and kitchen)….

4) Are they familiar with dealing with foreign investors – there are a MILLION nuances to this – test them…..- namely
a) They need to know your proof of funds MUST match the name you are holding title – if this is a Pty Ltd, you will be needing certified copies of the constitution most likely
b) You operate on a different time zone – can they ensure that even in rushed closings they will give you at least 5 days for money transfers if you are using OzForex etc
c) Vernacular – you will be getting a flurry – are they patient enough to explain what HUD means etc. If you don’t have a Social Security number, ITIN or EIN, there are properties you can’t even bid on.
d) Is the attorney that they use to close with familiar with us problem foreigners….you need to be receiving your Power of Attorney to have the real estate agent or someone physically in Atlanta to be at closing for you… that needs to be mailed a minimum of 10 days before the closing date……

5) How many REO (essentially foreclosures) have they dealt with and at what price level – they may HATE you if you are wanting as Jay says a 50k property ……and their clientele buy 200k plus…

6) The coolest tools – for every property that you see that you love – ASK FOR THE GEOJET REPORT of neighborhood sales (who owns the houses next door, how much did they pay for it etc) – obviously rental comps, sold comps – historical data, neighborhood demographics etc.. and in Atlanta there are just AWESOME tools available for you as an investor – actually http://www.listingbook.com is fabulous and linked to the FMLS…

FROM AN EMAIL I IRONICALLY SENT OUT TODAY…. relevant.

MLS (Multiple Listing System) Nuances
Again, remember that the MLS is simply a massive database of EVERY property that comes onto the open market listed by any real estate agent not those that come with any recommendations and 90% will probably be dire…. – so all the foreclosures, all the flips, all the “regular sales” – EVERY SINGLE PROPERTY – commercial, residential, multifamily…. Entire hotels… – the whole inventory that is publically listed via a real estate agent is on the MLS – so please be specific.. If you say “every property in Atlanta” – you could get that! the questionnaire would look like this:

1) MAXIMUM PURCHASE PRICE? MINIMUM PURCHASE PRICE?
Minimum… oh dear there are some LOVELY dire properties at 7k… (got guns?)
There are also some lovely mansions at 3 million… But you are probably wanting to cap – ALWAYS ALWAYS ALWAS work backwards –

MAXIMUM OUTLAY = Amount you will NOT be divorced over…

MAXIMUM OUTLAY = PURCHASE PRICE + INSPECTION FEE (@$300) + CLOSING COSTS (1k) + REPAIR COSTS + TENANTING FEE (you will be directed to a property manager who will let you know)

Repair Costs
if you ASSUME that rule of thumb for average repair costs are: Vegas = 6k of work and Atlanta = 7k (that would get you complete new paint & carpet (up to 2200 sq ft), all appliances and the usual amount of electrical and plumbing thrown in), your MAXIMUM outlay has to be what will not kill you!

2) FORECLOSURES ONLY?
difficult to limit in Atlanta as it is isn’t a field within their MLS

3) AGE OF BUILDING?
younger than 1978 avoids lead paint issues – younger than 1993 in Dekalb County in Atlanta avoids water requirements needed on anything other than a foreclosure

4) AREA?
Love only one area? Set up the search JUST for that area

5) SINGLE FAMILY ONLY?
I am still not an advocate of condos in Vegas but you might be! Ditto for townhomes in Atlanta (as you know, I have a few of those so can’t argue on that one) – for some, if you are looking under 30k, this may well be your best bet…

6) HOA?
EVERYONE knows I personally don’t love Home Owner Association Fees (think Strata Levy Fees) – healthy hatred of ANY variable I can’t control……..however I do get GREAT exercise mowing lawns but you might love them….

7) NUMBER OF BEDROOMS AND BATHROOMS?
Personally I am an advocate of 3 bedrooms min and 2 bathrooms min. We are buying suburbia in the main part – that means children… However in Vegas you can sometimes pick up some lovely 2 bedroom/2 bathroom houses and that might be a consideration if price is an issue

SORRY – TRIED TO PROOF THE ABOVE FOR EMMA-ISMS AND MY “STUFF”

Armed with the above – you will have enough information to whittle your short list down REALLY quickly…… again look for a BUYERS agent who specialized in the PRICE BRACKET you are looking for….. trust me, the 40k – 80k market is FAST – and I mean FAST – if you have an agent you are interested in, send them a question and if they don’t get back to you with a response in 6 hours, MOVE ON….. you need the person who is attached at the hip to iPad, iPhone, laptop and would interrupt their family Christmas dinner AND the birth of their child to reply….

Not really joking either.

Aaaaah My Fickleness…. I actually concur – ergo why I am NOT recommending a vast investment in the States at the moment purely for the point of leaping on the capital growth/fake yield bandwagon… the morsels are there and I will snap them up like anyone but unless the underlying fundamentals of the purpose for investing are there for the individual (whatever they may be) – ie yield meets expectations taking all factors into consideration etc. There comes a VERY finite point where the game, like any economic cycle changes and you thrive on the new challenge…

A US economy and housing market supported purely by foreign investors does not a sound economy make. The base fundamentals are and always will be humans requiring housing at x cost. Try to avoid that and convince yourself of anything else and you are in speculation and that is a risk I don't go with…. no CG guesstimations this end from me. There is a VERY real likelihood that rents in many areas a year from now go down as first time foreign owners are scared by vacancy rates and first time vacancies and start a downward spiral in rents….

HOWEVER, what equally gets me is that this is one HUGE market and the nuances are vast – right now – or at least dwindlingly so – there was a fabulous opportunity in SFR's but the US market (granted with all it's issues – and NOT helped by the newbies trying to sell the gold rush without a clue), is just a stepping stone to fast tracking a real estate existence that is the most amazing thing anyone can be involved with. 

Dream of developments – yep, you can. Love MFR's leveraged to the max… go for it…. 3/4 fit off flips… yep……   ha, even swamp infested trailer park homes… yep…. if you watch The Block and wished you were on it… come over here for your annual vacation and do it all including property purchase for under 70k.

THAT my fine fickleness is what people are missing – the US market affords many things that a real estate addict could NOT afford in Australia…… and those joys are there in EVERY level and phase of the US cycle…. the danger is those who can only see the benefits of something that may no longer be there next year….. not in this fashion.

With what is a seeming pittance by Australian investment standards and the same amount that you would be lucky in your lifetime to buy ONE property with a massive mortgage, you really CAN do something tangible, you CAN take control of your own investment goals and you CAN do it in less than a decade and achieve something…. JUST DON'T BE FLEECED ON THE WAY….

If, as glorified slumlord, I was the eternal optimist here would be one theory in which we would all love… Atlanta is bought out within the next 4 months (highly unlikely), new legislation hits Vegas and the flood gates open – every spruiker on the planet then turns their attention to my backyard but they all buy the crap (which for some reason in Vegas happens more) and the gems are left for me at lower prices.

The only problem is that if there are 38 offers on every property now at self evidently bad returns……how many would there be if the returns improved???

Thou protesteth too much me thinks Jay…… somehow much better to imagine the cocktail wielding dickensian slumlord explaining why the poor should eat cake while being evicted…

HAHAHAHAHAHHAHAHAHA….. of COURSE they are…. but wait, first I need a 52 inch screen TV! Oh, hold on, they must make them bigger……

Oh call me cynic.. but surely the robosigning legislation was drafted by someone who realized it would now give them 3 years to save money and live for free in their house???

Sigh… AS every one of my investors knows I haven't recommended a SINGLE property in Vegas in the past 3 months…. (actually, I lie, there have been 2 – one a 4 bedder that went off the market in 4 hours and a 3 bedder today for 50k that will need 10k which for Vegas means a virtual rebuild but actually isn't bad – it will probably go for 60k, it will rent for $900 in a churning rental area…so they are still there…

Moral of the story

STICK TO YOUR INVESTMENT GOALS – as Jay and Alex and I keep saying – there is a VERY VERY VERY definite point at which a property sitting in Australia or MFR leveraging or or or some other "thing"/area etc will start looking tantalizingly better when you run ALL the numbers….

So, it may be a case of "let's wait and see" – unless rents increase dramatically in Vegas, I personally don't see Vegas as a go at the moment and as I don't see rents increasing, I am very happy to go for a swim in the pool, have a beverage and look around for "where next"… which for now actually is still finding lovely properties elsewhere!

IF the glut occurs, I, like everyone else, will reconsider Vegas. GOD I LOVE VEGAS…. 20 minutes to drive, sick of work, go to the strip….  For all that there is about Atlanta – dear HEAVENS it needs something more to do than be in Suburbia…. sigh. Six Flags is only fun the first few times….

I can say I have found ONE bar – sigh ONE bar, that may be the redeeming feature. Yes, I have done Stone Mountain to death. Quack Quack.