- CL1706 wrote:Like a couple of people here, I am heading to the USA in late March with a view to spending two weeks in a city, and purchasing two or three properties as a starting point. Are there people here who had genuinely done this and made it work, and are willing to talk about it? Please direct message me if you have experiences (positive or negative), or are heading to the USA and would like to form a bit of a 'discussion group' prior to your trip. Please don't contact me if you're trying to spruik your business.
Hi CL1706,
Unless you are going over to the US and staying for good I doubt you will be able to establish a good team in such a short time. To find trustworthy people can take a while. Most of the boys replying to your post have fantastic teams on the ground and know there preferred areas like there back pocket. I havent used there services but I wouldnt have any problems paying for there margin as long as I know the invesment is a good one. The no margin $$$ can be made when going there to live and doing it all urself but even then it takes time to set up the right people and systems.
Donald Trump said " Business is easy, people are difficult".
EngeloRumora | Ohio Cashflow
http://ohiocashflow.com/
Email Me | Phone MeF@#$ THE REST WORK WITH OHIO CASHFLOW TO INVEST
worldinvestor wrote:"Jay has an interesting concept which I quite like, you in effect 'partner' the building and get a lower return, but his group solves the day to day problems for you. The more experience you have I think the more you will realise what a good deal that actually is.".
Lawsjs
So would you personally buy this product?
I have no real idea whether it is good or bad, however as an investor what I do not like is that I have no control on what is purchased, also I expect there are upfront fees inbuilt in the purchase price of the property.
I become the bank and fund the deal and this company gets a share of the equity when the property is off loaded.What happens if the deal goes sour, the property actually loses money, no growth, do they also wear or do they walk. My money, my risk……
WI
Karina,
Damn right I would! The way I see it you are being killed on repairs because a) you aren’t a US resident & know nothing about building and b) you should at least learn to drive a car so you can at least see your buyers repairs – being in the US and all, but my story is this….I was taught the ins and outs of wrapping years ago by someone doing exactly what Jay was doing. I knew better however and went out and did it myself – I met Steve M doing his very first wrapping course to nail the finer legal points. I ended up with 20+ properties in Newcastle, all VF’d, none of which worked as VF deals but I ended up with huge CG. Which led me to a restaurant which is now at the pinnacle of restaurants in this country (feature story when it relaunched on the front page of a major national newspaper) but it nearly sent me broke doing it. And I mean very seriously broke – until I got an expert involved.
Two things saved me, a lack of greed and being very creative. Interestingly this sent me in another direction entirely. Those that may know me would understand why it happened, but I got interested in boat storage. I haven’t yet, but it seems I will be able to sign a multi million dollar deal on a storage facility using someone else’s expertise – and the finance arm of their business. The agent involved with this deal thinks I am insane for throwing away $2-300kpa in income, but having had to learn and work a business from the ground up I promise I will never make that mistake again. Get the best in the business to help you and leave you with the time to explore other concepts – and/or fishing or skeet shooting, or stamp collecting.
Then there is my 15 odd year US property experience. I finally found a great manager. GREAT. Everyone who gave me advice on this said she was worth maybe $10kpa to run this one building I have. Its an old hotel. And a catbox of filth though I didn’t realise when I bought it. So my plan (again ignoring greed and helping obvious talent achieve) I spend $200k on the place and lease it to her as an hotel. She is making $80-100, but I get for no effort $70+.
Now I have only bought low yield places in SoCal and not yet bought any foreclosures (probably won’t) because I work too hard to keep what I have.
Starting out, there is no way I would consider Jay’s efforts as worth the money. And its harder to argue with knowing what I used to be like. However, as you get older I think you value time more, and my time makes your (advertised, but unrealistic) 20% returns look like chicken feed.
Its horses for courses. Time/Value. I am in an amazing position in this field that you are commenting on because of my sister. I can 100% promise anyone that she will get (as a matter of principle) the best deal going on any property anyone might want (she doesn’t buy and sell she is a buyers agent) and – this is the biggie – she will reno a place ridiculously cheaply compared to anyone else (like 50% off) and to an Australian Master Builders standard (for the US guys read ‘super custom’) BUT I haven’t taken the opportunity. WHY? Doing so would probably involve me taking up huge amounts of time criss crossing the globe and setting up new knowledge bases and trusting a whole new team. It would also risk a delicate family relationship, but that is another issue. Emma can get me net (over five years history on multiple properties) 16-18%. But its cashflow only. And it is cash to buy (although she has come up with a lender doing 50% at 8%I/O recently) so it is expensive. The hotel I bought on an LA beachfront was $150k down and $200k in repairs for a net $70kpa and a refi and a recent cash out of twice my cash input.
So, in summary I will say if I was starting out then my sisters stuff is massively attractive. But I am not and I see things differently. I see things _personally_ very differently. There is a lot to be said for Jay’s concept from my point of view. A LOT. Currency, returns (8% when most peoples super went backwards last year) and above all lack of worry. I know enough about this to pick the eyes out of what people are saying. Jay is the real deal and I would look at his stuff very closely. I have had a few ding-dangs with Alex as he is very American and I am most definitely not, but I like and respect his attitude as well. Both those guys know their markets inside out and backwards. They LIVE there and grew up singing about rockets every day they went to school. My sister lived with a guy who played with rockets for the US Govt for years, but I digress:) These guys ARE the experts in this market and yes I see a lot of value in using their help – IF you feel you can afford it. I can argue both ways, but if you had $500k to spend I would say look at Jay’s concept very closely (you can afford to be lazy) if you had $50k I would say look at Alex, Emma, Kyler and Karina/WI (though you should change your name). Fortunately, with none of you will you be ripped off, but on the face of it (and if anyone listens to me) find one of these guys that you like and deal with them. In the scheme of things the buyer has the choice and no one wants to deal with someone or some system they don’t like. I will add that neither Jay, Alex or Emma (I don’t know how you are financially Karina so I won’t comment) have to sell properties, they are independently financially secure so they are doing this for fun and for the long term. They are not fast buck merchants and that is a huge endorsement from me. Buy from someone who wants to be in the business, not someone who HAS to be in the business.
CL1706 wrote:Alex SC wrote:CL1706 wrote:Like a couple of people here, I am heading to the USA in late March with a view to spending two weeks in a city, and purchasing two or three properties as a starting point. Are there people here who had genuinely done this and made it work, and are willing to talk about it? Please direct message me if you have experiences (positive or negative), or are heading to the USA and would like to form a bit of a 'discussion group' prior to your trip. Please don't contact me if you're trying to spruik your business.God to love the last line of his post.Sorry had to take a rip at you. Their would be some Legit teams that can actually send you clients that are currently buying from them who are from Australia. No offense but that is not spruiking if it comes from an Australian client that is happy with the team they are dealing. Sorry not sure what you call it in Australia but we call it solid referrals here.
Coolest thing about owning a investment company is that we can pick and choose who we want to do business with as well.It usually takes one email or call to make that choice.
Food for thought, the ship runs both ways my friend ..
Alex
Alex, You've taken my post the wrong way, or maybe you are just trying to protect the business you do there. I'm looking to do this on my own, and was posting, in the hope of hearing from others who feel they can do this without the assistance of teams based in the US. I'm sure you do a great job, for the people who you assist. Not sure exactly what you mean about the 'ship running both ways' in reference to my post. Its just like having a 'No Junk Mail' sign on your letter box. Doesn't mean I don't want to consume – it just means I would like to do it without turning my Inbox into a sales conference.
Met some great people on this forum who are doing exactly what you are asking. They will find you and help out I am sure.
Alex
"Jay is the real deal and I would look at his stuff very closely"
Lawysjs
Firstly, I am not Karina, you are jumping to conclusions.
Perhaps he is providing a good product that suits a certain type of investor who knows…. as I mentioned – there is no way I would want to be the "Bank" for any business, and what if the deal goes "belly up", negative equity do they wear the loss???
I am surprised that you endorse a product and by all accounts you have not looked at it closely, ie "nuts and bolts" etc.
WI
WI – no you aren’t but you may as well be, so I used the nomenclature deliberately** and with some knowledge:) I do not believe you don’t speak for her, so lets leave it at that and we can all go on and watch Mary Poppins sink slowly into the Western sky very happily:)
If I was staring out and didn’t know as much as I did about the US, I would be hammer and tongs into buying directly. Lets make no mistake about it, that is what I currently do. And there is no doubt it would be more profitable. And more educational and I enjoy tremendously that challenge. I read my comment this morning and thought I was probably wrong with the $500k. I think Jay’s concept is more suited to $1m cash +. I think his stuff is probably what Mac Bank would buy. Laws of averages and all that.
What I thought I was doing was endorsing a methodology for shared risk. Which for a major investor is analogous to laziness. I am talking about the boys who buy billions of 10 yr t-bills available today at 1.3%. That type of stuff. With the benefit of hindsight I should have made clearer the distinction between the smaller guy who wants to know EXACTLY where his/her money is going and how much it is going to get and control it as he/she sees fit, versus the more institutional style investor who plays averages and doesn’t really care all that much about the hows and whys as long as the cheque (check) turns up each month….
Again it is horses for courses. I promise you an ‘institutional’ style investor is not going to want the hassle of being asked what type of RC unit / water heater he wants on 50+ houses when his investors just want a check (cheque – must be balanced:)) each month. That is what Jay offers – and I like it. if that is what you are after then it offers a lot of benefit. If you are chasing every last dollar then I would go with Alex in his areas he grew up in, or my sister who makes it a point of pride to make sure you get what you want and will almost certainly save you 50+% on the rehab costs – because to her that is the challenge…. To all intents and purposes they are different, local and very experienced. Horses for courses.
Your comment regarding ‘belly up’ is interesting. I think it stands as much for the M/Karina wholesaling/LLC model as for Jay. Or do you offer a money back guarantee? Do you cover any losses your LLC buyers experience?? I would applaud that if you did – be a first in the world of the RE industry.. I am confident of the US property market, but if you did that, it would be extraordinary!!!
I am glad you asked that question above, because you are right, I haven’t bought through Jay’s system, but I would look very closely at it if you aren’t after every last dollar, or hell bent on control. I had an offline PM with him a while ago and I described what arrangement I had come up with with one of MY Ca PM’s and he said it was exactly (more or less) what he did with his investors. I thought I was a genius (again!) and there was someone who had a whole website devoted to MY idea!! Pretty rude I thought:)
** Although it is way past the time she should learn to drive – How anyone in the US can manage to do what she does without driving is beyond me! I trust you specifically make an effort to help her in that regard:)
Hi Lawsjs, you have once again managed to write a book and you forgot to answer my question "why do you endorse a product that you obviously know nothing about"???
Would welcome feedback from Jay?
Cheers
WI
As above the answer – once more ‘for the dummies:)’
I am glad you asked that question above, because you are right, I haven’t bought through Jay’s system, but I would look very closely at it if you aren’t after every last dollar, or hell bent on control. I had an offline PM with him a while ago and I described what arrangement I had come up with with one of MY Ca PM’s and he said it was exactly (more or less) what he did with his investors. I thought I was a genius (again!) and there was someone who had a whole website devoted to MY idea!! Pretty rude I thought:)Details of your money back guarantee please??
hahaha, this forum is the best one i use hands down. You don't get this good of content in the States. I agree a lot with what lawsjs is saying and Jay's type of investment is a good deal. If i could get over the fact that i don't get to hold the note for the property. If I'm wrong on some stuff i say, Jay u will have to cover for me. I read over your investment you offer a while back. The ROI isn't what some people wanna see but the risk to reward is the factor. It's safe and pays great numbers compared to anything else investment wise. Especially with the sharing of the appreciation at the end of the investment. Same with Alex, that post he did of a local deal is sharp and looks solid. Both are good investments, but i would take what Alex's is offering cause that's the type of deal i would do myself. 50,000K (rough numbers, i don't wanna go back and reference, ha) with excellent rents and great potential for appreciation to at least be double in 7 to 10 years. I defiantly agree on the time frame with Alex, the gov pumps the media to make things look rosey here, lol. I am thinking i will have to stop in Charlotte on my way back from Florida sometime and get one of those 67 that you have for sale
I'm still sticking with San Antonio over Houston or Atlanta
Ha ha ha…. as they say CASH IS KING
kylermrice wrote:hahaha, this forum is the best one i use hands down. Me too alot of good feed back and activity. You don't get this good of content in the States Their are some good USA forums as well. I agree a lot with what lawsjs is saying and Jay's type of investment is a good deal. If i could get over the fact that i don't get to hold the note for the property. If I'm wrong on some stuff i say, Jay u will have to cover for me. I read over your investment you offer a while back. The ROI isn't what some people wanna see but the risk to reward is the factor. It's safe and pays great numbers compared to anything else investment wise I like Jay system but as I told Jay and others I am not sold on 5 year return. For any Charlotte deals I commit to jay program I want 8 to 10 year note.
.Especially with the sharing of the appreciation at the end of the investment. The down fall to me if appreciation does not come back you are stuck with note for face value. Easier to sell an note then sell a turnkey property that you will pay more for.The best part of the system is for the investors who wants hands off type of transaction. I feel people who tried the rental game and lost. This could be a safer way to put some money back into the real estate markets with less head aches. Again speculation is what alot of us are doing. I speculate that my renters will pay me 10 months out of the year on our homes. Jay is guaranteeing a payment, which not 100 % to say it will work. Stronger option then playing with rental. As some one else noted why would they want to give 25 % equity up. Again this is for the person who wants to cash in with little to no work involved( complete passive investing ).
Same with Alex, that post he did of a local deal is sharp and looks solid. Both are good investments, but i would take what Alex's is offering cause that's the type of deal i would do myself. 50,000K (rough numbers, i don't wanna go back and reference, ha) with excellent rents and great potential for appreciation to at least be double in 7 to 10 years. I don't think doubling in value will happen. I think all of us here in the USA , have learned a valuable lesson. Over inflated homes values and banks will be smarter this time around. Wall street will always be wall street no telling what product they will help create. Greed will always be a factor in real estate. From the big boys like the banks , wall street and clue less investors.
I defiantly agree on the time frame with Alex, the gov pumps the media to make things look rosey here, lol. I think alot has to do with who is next in office. Then how much trouble wall street and banks get in ( LOL ) that was meant as a joke. Our debt is increasing by the minute and we still invading countries. Some how in there we can solve the debt and hope values rise. Not optimistic as others .So to me cash flow is cash flow..
I am thinking i will have to stop in Charlotte on my way back from Florida sometime and get one of those 67 that you have for sale
Doors always open come on buy. Love to show what we have going here in Charlotte . The 67 house going to another post so I can enlighten every one with the facts on the deal. So every one can see that deal from start to finish. Being the banks is still not releasing and negotiating with me.
talk soon
Alex
Alex – can you explain why you see little growth inside 10 years? I cant see the Fed doing anything other than forcing money into the system – sooner or later people will be able to borrow again, if for no other reason than if they don’t Detroit will not be selling cars which is politically unpalatable of course. I can easily see a settling in the short term of cap rates down to the 10-12% mark based purely on rent return – surely that would put a floor in the market at some level? I get the volume issue, but at its worst the US had only 4% of total inventory in foreclosure, not such a huge number really. Localised, but overall not massive. NYC and certainly LA has seen rises (big in high end in NY) so money is moving – why not in sub prime areas? Even on population growth logic would suggest with no real building to speak of there will be some demand increase, maybe not huge but certainly some… Thoughts??
"hahaha, this forum is the best one i use hands down"
Kylermricet
I am enjoying this thread too, there is also another forum you may want to check out Somersoft.
I wish I could say the same for Biggerpockets, I have found this forum hopeless, I think they now charge you to become a memberl. Any good US forums??
Cheers WI
biggerpockets is still free and i'm not a big fan either. There site is down, there server crashed the other day. I'll have to check out somersoft.
lawsjs wrote:worldinvestor wrote:"Lawsjs Both those guys know their markets inside out and backwards. They LIVE there and grew up singing about rockets every day they went to school. My sister lived with a guy who played with rockets for the US Govt for years, but I digress:) "
someone who HAS to be in the business.
its gotta be this………. Yes ?
http://www.youtube.com/watch?feature=player_detailpage&v=1GAKOLOnfV4#t=60s
NIce video, but no. I was referring to something much more deeply embedded in the US psyche…
lawsjs wrote:Alex – can you explain why you see little growth inside 10 years? It's not that I don't see any growth, I just feel that everyone is under the impression that anything you buy in the USA will double in value within that time period. I am just afraid too many clients are on being sold on buy now in the USA because of 20 % cash flow returns and huge appreciation down the road.I cant see the Fed doing anything other than forcing money into the system – sooner or later people will be able to borrow again, if for no other reason than if they don't Detroit will not be selling cars which is politically unpalatable of course. I agree that banks will lend again, but the average American middle class is shrinking at an alarming rate. Not seeing many of them being able to qualify for bank loans, depending on how tight the lending requirements are going to be. Detroit is selling cars ( Ford is coming back strong) still has no affect in the war zones international clients are buying. Stable, nicer areas sure will and can help.
I can easily see a settling in the short term of cap rates down to the 10-12% mark based purely on rent return – surely that would put a floor in the market at some level? Realistically, that is where we are at now. I am afraid that if the economy takes another hit, this to me is the blue collar job market. Rents, in my eyes, should be lowered so we can help keep people in homes. I see it as my duty as an American to help the problem not, continue the problem. So I have a different mentality than an international client looking for cash flow and future appreciation. Hope that is not confusing to anyone.
My thinking on that is if this country has four more years of Obama (not seeing any one run against him) then we have Syria , Iran , oil and gas prices shooting up. Middle America can not afford any more increases. If gas goes to $5 dollars a gallon this could be very hurtful to those struggling to make it. Another war our country is still digging out of the holes we created in both Iraq and Afghanistan. At some point our government is going to have to <moderator: delete language> the check book and just stop printing money.
I get the volume issue, but at its worst the US had only 4% of total inventory in foreclosure, not such a huge number really. Localised, but overall not massive. NYC and certainly LA has seen rises (big in high end in NY)( True, but a lot of these buyers are international or left over wall street crooks) so money is moving – why not in sub prime areas? The lending in these areas like sub prime, I just don't see it coming back in the near future. If you were a bank or mortgage backed security would you enter this area again? I think things will be more regulated this time around. The big key will be international funding for international clients. That should have a huge affect on sales.
Even on population growth logic would suggest with no real building to speak of there will be some demand increase, maybe not huge but certainly some… Thoughts??
Correct; building is slim, foreclosure inventory is high. Sure, there will be supply and demand factor. In general speaking on paper that all makes sense. The problem with everything going on today , from our government (open check book – ridiculous debt) to the wars we keep starting , to the disconnect between our government and our people. So nothing really makes to much sense.
Again, not trying to paint a horrible picture, but a lot of uncertainty in our government and banking system ( it is like going back to 1960 as you said in another post sad but very true by the way ) , and our crooked Wall street. My dad retired from Paine Webber years ago spending over 30 years on Wall street and the last few years he is just embarrassed and amazed on what is going on there.
I know this is not as detailed as you or Jay would have done but again I am a simple person . Grammar and spelling are just horrible at times.
Talk soon
kylermrice wrote:biggerpockets is still free and i'm not a big fan either. There site is down, there server crashed the other day. I'll have to check out somersoft.Was looking into being one of speakers at the next main even .instead going to go and be a paid guest.,
No that impressed with them always been a CRE-ONLINE guy
Where is the next event at?
Just to get the original topic back on track…….Atlanta or Houston ??
Only two U.S. metro areas have had increases in home values since the peak of the housing market in 2007, and they're both in Texas: Houston and San Antonio.
According to Oxford, Miss.-based FNC Inc., Houston reported a 4.8 percent rise in home values, while San Antonio reported a 2.7 percent increase.
Nationally, home prices were down 3.5 percent at the end of 2011 compared with prices reported in December 2010.
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