Forum Replies Created
What about someone with a god awful handlebar moustache and too much hairspray:)
I didn't go to Melbourne Cup – Emma did:(… dates the post though – well spotted! If I had gone to the Cup, I would have enjoyed it though:)
lawsjs,
About your sister buying property in LV, I think she is crazy to invest in property there. I'v been doing some more research and found that LV is forecast to drop 19.4% by the end of next year! Here is a link to prove it
http://cgi.money.cnn.com/tools/homepricedata/index.html
Just select the state and then the city and you will see the figures. Now this site, CNN Money uses data collected from Moodys, the top analytic research company in the world. Now i'm not having a go i'm just curious as to why she is investing there.This is straight from my post regarding the foreclosure market on somersoft. Straight cut and paste feel free to ask her (Emma) directly anything you want – selectusaproperty.com. I hasten to add that she is up about 100% in CG in the last year and half. Her worst return is around 19%, she is currently getting 16-17% as a buyers agent. She helps people choose the properties then helps them rehab them THEMSELVES (if they want to save money) – no multi tiered marketing at all. Rehabbing costs so far havent been above about $2k, some as little as $500. Its not for everyone but she _really_ knows what she is doing and is there doing it herself. Before anyone asks, the only reason she is doing this is because so many people asked her for help to avoid the multi tiered things. As she said to me she is in LV looking after her own stuff, so it makes little difference to her to assist others not be ripped off. I have not bought in LV but I wish her all the best in it. I buy very different stuff. But you asked so I will repost one of her somersoft posts when someone asked the very same question.. If you read the thread you will understand she was not out to sell anything, but so many people were asking for direct help and even turning up on her doorstep in LV – sort of happened by itself.
http://www.somersoft.com/forums/showthread.php?t=66392
Why VegasVegas specifically:
1) in SFR's virtually no vacancies… See below
2) no state income tax and under US tax rules, I can claim the 8.1% sales tax back
3) the most pro landlord rules I have ever found anywhere… Where else on the planet do you have a situation where every tenant pays the $50 late fee on the fifth day of rent due? Why? Because on the sixth, I can go to the constables office, walk in, pay $39 and they, not me, go and deliver a 5 day quit or pay notice… Unless all outstanding rent is paid in full by that fifth day, THEY go down to the property, the sherrif changes the locks and evicts the tenant… NOT ME… YIPPEEE! Try that in Australia, Alaska or any other pro tenant place.
4) no earthquakes, termites, mold issues, snow, ice, hurricanes etc… Leave a house in Vegas for four thousand years untenanted and the desert dry climate will worship you… I spent three weeks driving Florida properties and apart from atrocious vacancy rates, can anyone say termites, mold and water? After Alaska I will never pay oil bills again.. First you are protecting from frozen pipes then, come thaw, you are dealing with melting snow and leaking basements that tenants don't tell you about…. Ha lessons learnt from what may look like a great yield on paper… Start thinking new furnaces at $8k a pop!
5) I didn't go to "the strip" until I had done 3 properties. Once I went though, I got it. They would bulldoze the rest of Nevada and probably the United States before Vegas would go under. It may be kitsch, it may be over the top, but it is quintessentially USA. Ever wondered why songs come out about Vegas, "the Hangover" is based in Vegas etc… There is money churning to keep Vegas going. The value of a movie based in your city is worth millions upon millions in translated occupancy. Vegas has "it". "It" requires staff and those staff are my tenants.
6) Vegas is not reliant on my real estate taxes. Government is supported by gambling revenue and liquor taxes. Name any other city in the US where property taxes were cut in half this year without a major glitsch on services? Mine were. Room rate taxes, gambling and alcohol taxes, no matter what your thoughts are, these keep my rates down and survival of Vegas guaranteed… And the police employed and the fire and ambulance…you get the idea.
7) I don't personally know what the "voluntary foreclosure" rate means in the rest of the states but in Vegas people aren't leaving the state, they are merely quitting the mortgage and buying a cash foreclosed property on the same street! I have bought back the blinds for my own property from the previous owner who lives three doors down now….. Another topic another day.
California is bankrupt and Arizona is anti immigration… People are moving to Vegas.. It was in the 2009 Uhaul ( massive moving rentals van company) top inbound rental destinations… Significant.
9) cheap, cheap labor…cheap, cheap qualified labor. Cheap, brand new appliances.. Whole kitchens available for $350 ( my latest… Including stainless steel microwave, stove, fridge and cabinets.. Although a bit of a don't ask don't tell but done..)Ok, getting late, hope that answers a bit…there are of course other markets. I looked at Texas, phoenix Florida etc .. This is just my market.
Another way of thinking…
How to find a good market is another question. I do the most basic thing ever when I start a search on any real estate market.
This is coming with a caveat that this is of course just my two cents worth and not gospel
1) go to zillow.com and pick any city that you are curious about. In my mind, a good city is nowhere that involves cold weather that could freeze pipes or has a utility that the landlord has to pay to keep this from happening – especially not one that involves an ever increasingly scarce resource like oil!
2) choose any random property for sale in your target city that meets the bare minimum of walking distance to schools, transport and shops – within your target price range
3) take note of the address, the. Go to realtor.com
4) type in that you are looking for somewhere to rent.. Then type in the street (not number) of your target property and search. This will give you properties within half a mile
5) pick any of them and call them pretending you are renting. How much and how long has it been on the market… If they offer ANY discounted deal, you are looking in the wrong city or they are asking the wrong rent… That simple.. There is a glut.. Or the property is overpriced.. What would it rent for for the yield you are looking for?It is getting late and I hate to say it but am packing in theory for Melbourne Cup. I am so happy to answer questions ..makes me feel as though all the hard work may help someone.
Ask away.
Despite my sister having 15 foreclosures of her own in LV and now helping dozens of people buy WITHOUT PAYING MASSIVE COMMS!! i have a general nervousness of most of the bulk foreclosures.
Being in Australia and having been on aircraft more than enough times I like getting on ONE aircraft and getting off at my destination. That led me to LA.
The bulk of foreclosures are in rust/white/sand belts and Cleveland is slap bang in the middle of rust.
I have done very well from property but I firmly believe in paying for quality properties. Unless you really know what you are doing (like my sister in LV) I think any foreigner who buys in an area where single streets had DOZENS of foreclosures is completely mad. And only then should you buy if it is a _real_ bargain – not by paying an 80% commission to someone just so you can say you own the most exxy property in the street.
The US banking system has faults but those places offloaded in that manner created a ‘market’ value. Buying at grossly inflated prices is taking out probably 10 years at least of growth before you start. Then there are problem tenants etc etc. And if you think these streets will have no tenant issues down the track when more than half the houses are bought for $20-50k then you have a very optimistic view of the world.
Steve M said in a BRW article last month that you shouldn’t buy in the US for CG. Steve does not know enough about the US to comment. He has had only minimal experience with it and bought (IMHO) absolute junk, so of course he only has that view. On that subject I got an email from Steve M saying something along the lines of ‘having more than $1m invested in the US market I am probably one of the best people to inform you about the US market’. I bought more than that last month alone, so that hardly qualifies in my book:) The properties I have bought are clearly growing in value right now and although have been harder to sell recently they did not lose any value during sub prime. My ‘worst’ property was bought in 06 and suffered from my bad management of bad tenants. Yet it was only a 5 minute walk from one of my best buildings. I bought it for $715 and sold it late last year for $705 – and the rents had fallen!!
I only started posting on the USA topic on somersoft because a friend went to a boholt seminar and I could not believe she could look people in the eye and charge what she did. Months later someone asked about myusa again on somersoft (my sister has become a bit of a hit over there) and bugger me if they don’t appear to be ten times worse. Rip off merchants in realestate are like a red rag to a bull to me, seeing this post I was compelled to say something. Real estate has been very kind to me, I enjoy it and I enjoy seeing people do well out of it. The likes of myusa are not the types that I like seeing. That is the beginning and end of my ‘rant’. As you get more successful these forums mean less and less to you. You read the same stuff over and over again and never learn anything. I hadn’t posted for nigh on ten years, so it was a bit of a trip down memory lane. I get nothing out of this, I just don’t like seeing people ripped off.. Go out and buy, but you will never succeed if you are only out there looking for ways of paying more than the next guy…
BTW: My sister has experienced something like 100% CG in ‘her’ very specific areas of LV in the last year. I am not saying it is impossible to make money in foreclosures, but starting out by paying more than 50% more than anyone else has is like trying to fight Mike Tyson with one arm and one leg:)
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And… The $AUD has had quite a slide today. Whilst you can never predict currency the high dollar is a very helpful thing. I had an argument about this with someone on SS. My final comment is that I don’t really care where the dollar is, but I can say I MUCH preferred getting $USD rent ‘checks’ when the $AUS was .48c than I do at $1.01:)Cleveland quite possibly jumped 7% purely because of multi tiered marketers selling otherwise unsaleable properties to australian ‘investors’….
And the $8k I spent rebuilding 7 units was in a beach suburb of LA where costs are LOT higher than some of these very dead beat towns where unemployment is through the roof..
<moderator: delete personal comment>
Worst of the worst that I have found in this market – so far…
My post on somersoft below:
Please be careful. IF you don't mind spending a lot more than you have to to buy something then thats OK, but my guess (somewhat educated) is that they are possibly (probably?) buying something for $20-30k and selling it to unknowing investors for $80k+ with a tenant and the excuse it is 'completely renovated'.
1) A complete renovation in the US really shouldn't cost much more than $5-10k at the ABSOLUTE OUTSIDE. I just gutted 8 units in LA (more exxy than most 2 tiered marketers dead beat towns) in a building I owned and with new bathrooms/kitchens and floors all 8 cost just under $7k.
2) I am deeply suspicious of anyone providing a property with a tenant in place. Call me Mr Cynical but if you have paid me $60,000+ for a renovation that cost $5k MAXIMUM I would be happy to pay someone's rent for a year and install someone in there for free.
3) I can almost 1000% guarantee you will NOT get any bank finance (probably no other finance either) in the ground zero sub prime areas some multi tiered marketers target. It is a VERY specialised area – Emma makes it look easy – it isn't. It scares me, but she has spent 2 years HERSELF doing it. The finance you will probably be getting is from a line of credit on your Au property. IE: Au finance to buy US property for cash. Which is still 100% finance – so I have no issue with that. IF you are getting US finance I would hazard a guess that they have bought the place for $30k, selling to you for $80-100k and offering 80% finance – so effectively you are paying their cost upfront and generously financing you their profit at 8-9%. in other words you put up say $30,000 to buy a property 'listed' for $100k. They then finance you the $70,000 – happy days! However they probably only paid $25-30k for it so your 'deposit' is actually their full profit – the extra $70,000 is 'financed' to you for at say 7% ($4900pm interest only) with the final $70,000 payment being in 5 years – nice work it you can get it
Maybe an extreme example but I would be surprised if not something similar.4) Emma has worked out how you don't need a bank account in the US. Believe me this is a big deal.
5) The LV stuff Emma has found people costs INCLUDING the reno's about $65-70,000. Ask her directly she will give you answers but she wont advertise herself. She has got people from this site tenants the day they own the place – real ones from advertising for around $1000 per month. So, if you borrowed $250,000 you would be able to buy 3 x $70,000 properties renting for $1000 per month = USD$3,000 x 12 = $36,000 per year. And two 1st class return A380 tickets to LAX with the extra $40,000 left over. Say you borrow $250,000 in Aust at 7.5% the I/O cost is around $19,000 per year. Your NET rental income is $36k – $18,750 = $17,250 per year.
6) Some groups are offering 'tours' of the dead beat towns they sell in. These tours themselves are 100% overpriced at least. Even if the 'clients' DONT buy, Flight Centre would love making those sorts of profits on the travel alone.
Chui is exactly right. It may be genuine, but Emma started helping people because it is VERY upsetting seeing people being ripped off. these scams are VERY prevalent. And the Australian scammers are also on the receiving end of US guy's thrilled to bits they have found idiot foreignors to offload unsaleable junk onto. Reeco is a pretty cluey guy – read some of his posts. I know this thread is VERY long, but every page has enough information to save you tens of thousands.
They paid $32,000 – probably spent $1500 on it and are now selling for $54,000. To an uneducated foreignor – even better. $22,000 might not sound like a huge amount of money as a profit, but in percentage terms it is. A 68% fee for selling a house???? In Sydney it is 2.2% including GST. Or in other words, in Australia the sales cost (GST Incl) is $704. But you are paying $22,000. THIRTY ONE TIMES TOO MUCH!!!
there is a $500 joining fee and then you pay $3750 per property. They emailed me some info videos and they say upfront the cost for dealing with them. Funnily enough they also say that THEY own the propertys that they are selling to us aussies and that they have already reno'd them and have a 3month rental guarantee.
I figure with all of the questions I have written down after reading this thread they will either put me at ease of set off alarm bells.
Received and email with this offering
9832 michelle dallas texas
myusa offering for sale @$120 000YOU HAVE GOT TO BE JOKING!!!!
THEY ARE CHARGING YOU $FOUR THOUSAND TWO HUNDRED AND FIFTY DOLLARS FOR THE PLEASURE OF CHARGING YOU A FURTHER MASSIVE FEE (68%) FOR A DEADBEAT TENANT FOR THREE MONTHS?????
UTTERY DISGRACEFUL!!!
I can cut and paste the first bit though…
I have been to your very early (1st??) seminars Steve (had some great debates with you 10+ years ago – not that you would remember me:) but I am sure you would agree with me that everyone is entitled to ask questions. You and I disagreed on a couple of minor points and back then you were what I considered a 'newbie' but I have never, ever had any reason to think of you as suspect. Unlike this little episode with Ms Boholt. My post from another site is pasted in full below. I wont go so far as to say say I am warning people, but I am not a fool and do not like anyone being treated as one. I would urge people if they have any interest in the amazing US property market to read it.
I have been investing in US property since '98. I wrote some posts on it years ago on this site (somersoft) so you can check up on it if you wish. It has done me very well and interestingly my portfolio hasn't dropped in value since the peak in '06. Depends what you have, but I digress.
Some years ago (and it took a while) I managed to convince my sister to start buying income property in the US – as a complete coincidence the guy she was with lived there and she had a green card etc. If I could do it (and it WAS hard as a non resident alien) then it HAD to be easier for her… Eventually she did, buying a few multiplexes in the state she was then living in.
Recently she has had a very busy time getting serious and buying foreclosures in LV. She has bought something like 15 in the last 9 months. $40-60k stuff, reno'ing and then generating a net 20++%. I don't know the specifics – but those are the general numbers. I am not involved directly as we don't often speak and I buy in LA, but she has been doing very well which is great.
So when Dymphna Boholt (who insists on frequently sending me seminar information) had a seminar on the US property market I thought it would be an interesting thing for my sister to go to. Its always good to hear what other people have done and you meet like minded people at semnars. My sister isn't often in Australia (too busy rehabbing foreclosures
) so it seemed a good idea all round.Long and short of it was that at the first break she got talking to a couple of people who were sitting near her about her experiences and that DB was a) a boring seminar presenter and b) long on teasers and short on detail, but it IS a good thing to do and she had done it, so lets see what is presented next etc etc. Usual first break seminar chit-chat.
What happened next was not normal.
Emma was approached by someone who immediately threatened legal action and accused her of trying to steal customers from Dymphna. She was escorted off the premises and in no uncertain terms told to stay away.
Emma had absolutely zero intention of doing anymore work than she is with her own stuff, but (as I would do) if someone treats me like that when they are trying to milk tens of thousands of dollars out of people I will take it further.
I haven't posted on this site for years, but I will now make it very public everywhere I can that Dymphna Boholt should have treated at least one seminar attendee with a lot more appreciation and respect than she did. If she was smart, she would have used Emma as an example of a real person who had actually gone out there and done it. Threatening legal action (especially to someone like my sister) is neither a friendly move, nor particularly intelligent.
If anyone is at all interested in US property then please respond to this post or PM me and I am happy to pass on what I can, or if you are interested in the amazing foreclosure market, yes it is very good, yes it can be done, and yes it is real and achievable. It is not for everyone and takes real organisation and work, but it can be done. I stress forclosures are not a pond I myself have paddled in, but my sister has lived and breathed it now for 2 years and has all the contacts.
I am confident Emma would be happy to help anyone interested in US foreclosures, and if any money ever changed hands at all, it would be a LOT less than would be spent attending one day with Ms Boholt.
I have attended seminars of most well known 'investment gurus' over the last 15 years or so. I have never seen or heard of this type of thing happening before. And I include Henry Kaye in that collection. As this seminar was my recommendation to a sister I see about once every 2-3 years I take it very personally she was dealt with the way she was.
I have always been amazed that people only value information when they pay for it. I have learnt an incredible amount through people's generosity and it pisses me off no end when one over zealous speaker takes offence at someone actually attending a seminar to see if they can learn something new, rather than falling over themselves to help buy that speaker a new Ferrari.
Methinks Ms Boholt is convinced the entire US property market exists merely for her own exploitation.
California is bankrupt and Arizona is anti immigration… People are moving to Vegas.. It was in the 2009 Uhaul ( massive moving rentals van company) top inbound rental destinations… Significant.
