Aussies you must read this…..most of you have no clue as to how the market was 7 to 20 years ago this will give you some light and what you can expect.
NOw from a word from the wise and I am not going to say the almighty up high… however if you get an offer to sell your property and ti has a tidy profit …………………….Sell baby Sell…………In the states you want to be a seller when there is pent updemand like wwhats coming down the picke… pick of ff yoru gains then look at your next deal
If I had followed my own adive in 2006 You very nice folks would have never met me on this site… YOu would have met me but in the nicest hotels and bars and resturants of your fine county drinking the top dollar shiraz'a and penfolds.
I have to be honest with you I actually had that converstation with my partners. In 06 we had Oh 50 mil plus in properteis of various types. and 30 mill out in hard money loans. If we would have just called all our loans and sold all our property and took 3 years off we woud have been MILLIONS ahead. but we did not and we are not….. So know we are just income averageing we are snagging every great deal we can get our handles on.
To summarise:)
You never go broke making a profit.And for those who may not have noticed, Jay has tugged his forelock to the ‘Aussie/French’ way of doing things by saying he drinks Shiraz.
Having spoken to people who live in Shiraz and pronounce it Shiraz it would come as a surprise to those who don’t know that a large proportion of the world pronounces it ‘Syrah’.
You are a Gentleman and Scholar Sir….
And… If you read this, heed the advice:)
I have to be honest with you I actually had that converstation with my partners. In 06 we had Oh 50 mil plus in properteis of various types. and 30 mill out in hard money loans. If we would have just called all our loans and sold all our property and took 3 years off we woud have been MILLIONS ahead. but we did not and we are not….. So know we are just income averageing we are snagging every great deal we can get our handles on.[/quote]
For all who might not believe Jay, he is being 100 % honest. I was one of the guys fighting to get HM loans from his company( I did not know Jay though). We knew their company was one of the biggest lenders that the radio guys in LA were using for all of their teams like my company( turnkey guys ) . Even though real estate crashed, we were still in good standing with his loans. We only dealt with David ( one of Jay's partners with the loans ). As for the story of me never wearing shoes that he told Jay about, yes I am barefoot, even to rehabs and looking at houses is 100 % true. Bare foot in my office as we speak. LOL inside Joke
So long story short always nice to have solid reputation .
Jay, I hate to see the losses you all went through. I am only glad though because of that situation I have had the chance to meet with you and form a working relationship. When I lost out on the million dollar properties in Charlotte, that was hard pill to swallow for me. That was a big jump. I so look forward to those days again. We were buying homes for $1.2m to $1.5 m with appraised values coming in at $2.3m to $2.5 m. The rehab on average was $250k and up, but man, lots of room in those deals. I got 1 % of sales price up front for putting deals together. On the back end received 20 % equity split in profit. Cash guys both were 40% – 40 %guys . Those were the days I look forward to getting back to. Already working on retail rehabs as we been watching the market, so looking for entry level starter homes. In Charlotte for rentals thinking of jumping up to next level 2000 sq ft or larger. Just seeing the demand for these types of homes is slowly increasing again.
lawsjs wrote:Promise I read it. I think alot of what some people here have been saying is coming to reality faster then any of us thought.
Hope all is well.
There is no doubt about it, things seem to be heating up. I just hope there is a couple more years for me to hit my goals. then time to convert to a new game
You guys need to learn how to hedge.
The Freckle
I have seen this effect with my investments currently in Florida. Countless times we would offer up to $5,000 over the asking price, typically for a $50,000 property, so 10% over the asking price, only to see us get out bidded, was never sure how many other people were going for the property, or what the final price was, all we knew that it was too high for us and at the price they would have paid it wouldn't have suited our criteria anymroe.
Also looking currently at the properties for sale, every day there seems to be fewer 'good' properties, and by good I mean ones that are not completely dilapidated or in war zone areas. The decent properties seem to be snapped up within hours of being put on the market. Not to mention the value of these decent properties also seems to have risen a couple of percent from the same time last year.
I just hope it does not get too out of control because we still hope to have a couple years to be able to build a great property portfolio in the US.
Eventually it will end, and we will have to come to a new strategy that matches the current economic climate.
streamlineinvesting wrote:I just hope it does not get too out of control because we still hope to have a couple years to be able to build a great property portfolio in the US.Eventually it will end, and we will have to come to a new strategy that matches the current economic climate.
A buy and hope strategy. If the market is hotting up it may offer opportunities to bank gains. The market is being driven by hot money looking for a home because the returns are lousy every where else. Buy and hope isn’t an effective way to invest nor is simply looking to grow a portfolio simply to have a truck load of properties even if it is to garnish regular returns. That was ok 20 years ago but there’s way too much volatility around at the moment to hang on to old strategies.
In the current market, and I think for the foreseeable, future strategies are going to require constant reappraisal. I see advantages and benefits to aligning strategies with “day trader ‘ type qualities albeit on proportionally longer time scales given the type of market property is.
The Freckle
Cash flow, cash flow, cash flow…get them to cover themselves and start making pure cash in 6-8 years, it’s the best you can hope for.
Ziv Nakajima-Magen | Nippon Tradings International (NTI)
http://www.nippontradings.com
Email Me | Phone MeZiv Nakajima-Magen - Partner & Executive Manager, Asia-Pacific @ NTI - Japan Real-Estate Investment Property
6-8, wow! I shoot for 2-2 1/2 years
Hats off, I’ve been reading about what you deal with for those returns
I dwell in zero maintenance, maximum occupancy land. We don’t get those returns here, but on the upside, deal with a lot less on a daily basis, and don’t need to rely on capital gain, finance or rehab of any sort. Just different.
Ziv Nakajima-Magen | Nippon Tradings International (NTI)
http://www.nippontradings.com
Email Me | Phone MeZiv Nakajima-Magen - Partner & Executive Manager, Asia-Pacific @ NTI - Japan Real-Estate Investment Property
Everybody makes it sound rough, it's really not that hard when u have good people and system in place.
kylermrice wrote:Everybody makes it sound rough, it's really not that hard when u have good people and system in place.I was watching a doco the other day about deserts. One part was about this 12 yr old kid in Mali herding cattle some 80km to water. He was racing against a herd of elephants to get there first. He slept on a mat near a fire over night and fed straight from cows with milk for food and liquids. When he got to the water hole several days later the elephants had beaten him. They blocked his herds access to water and actually charged the herd. He sheltered behind some fallen trees and brush but waved his stick and threw rocks at them to try and get access to water for his cows.
Another was about a 10 yr old girl learning to guide her camel train to a water hole 3 days walk into the Sahara desert. Only women in the tribe undertook this task. Her mother was teaching her how to navigate the great desert both day and night. The water hole was some 80km from any other known water. Miss it and you die because you can only carry enough water to get you there.
It’s all relative I suppose.
The Freckel
PS: I know you have an elephant gun under the bed for the more difficult hoods.Freckle wrote:kylermrice wrote:Everybody makes it sound rough, it's really not that hard when u have good people and system in place.I was watching a doco the other day about deserts. One part was about this 12 yr old kid in Mali herding cattle some 80km to water. He was racing against a herd of elephants to get there first. He slept on a mat near a fire over night and fed straight from cows with milk for food and liquids. When he got to the water hole several days later the elephants had beaten him. They blocked his herds access to water and actually charged the herd. He sheltered behind some fallen trees and brush but waved his stick and threw rocks at them to try and get access to water for his cows. Another was about a 10 yr old girl learning to guide her camel train to a water hole 3 days walk into the Sahara desert. Only women in the tribe undertook this task. Her mother was teaching her how to navigate the great desert both day and night. The water hole was some 80km from any other known water. Miss it and you die because you can only carry enough water to get you there. It's all relative I suppose. The Freckel PS: I know you have an elephant gun under the bed for the more difficult hoods.
I actually enjoyed this post been away from forum of late. We have had back to back clients from Singapore – and Australia. My theory is lot simplier then above. Real estate is a investment which means risk . You learn to buy and rehab right along with leverage. Yes the herd can block you but if you do your homework.You can always find another path. Life is full of challenges and road blocks ,or road maps. Just depends how your perceive them or take them on. One of my best friends lost 48 house and his personal house. My uncle lost out on his town home project 7.5M and both of his personal residences . Hopefully they can learn and have different paths to choose to get to that water again or pass the heard. Only time will tell but again life is full of risk and reward . Depends how much you can stomach or learn to be able to to get to the water or pass the heard.
So guess it is all relevant.
kylermrice wrote:Everybody makes it sound rough, it's really not that hard when u have good people and system in place.I deal with rental income from $350 yes $350 up to $1400 so it is what it is. Really comes down to how you make it work ,the people you work with and people you rent to. It is all relevant and seems to work the same for $1400 dollar month rental down to $350 a month. People are people and expect to be treated like people. Some times we focus more on money then the actual humane side of real estate and investing. This is still a people business regardless what side of the fence you are sitting on.
I have a great Tenant that rents for $450 single mother two kids lower end area. Went on a Sunday a few weeks back to meet plumber turned out this lady worked with my mother in law for 15 years. Even saw my wedding pictures and knew of me and my wife. Some people are just better then others dealing with people which in this business in a key for some one like me.
I guess I have never entered a true war zone but I deal in lower end homes in SC and great people in these houses. Do you get bad renters sure, but I also get bad renters in higher priced rentals as well. Being on the ground and being involved in these homes daily makes it much easier for people like Kyler , Cheeves, Emma and others who are on the ground. Doing this from far away always has its disadvantages. Take Jay he has to make sure people he deals with with who he already has had long term relationship still function. Which again still has its advantages over those who are not on the ground or have do not have direct long term relationships with the teams you deal with or choose to deal with.
again just my two cents….
Alex,
As we all know there are war zones in each city in the US.
In Portland we have ours,, Its called Felony flats… and then there is a section in NE portland.. However can’t buy a house for much less than 200k in any of these so called bad areas of Portland… There are sub 100k houses but those are really tear downs… Lots start at 50k and go up to 500k depending on the area…
Its the big Mid western cities that have the super low value housing,, and or war zones… One can go into any of these cities and buy sub 10k houses.
Detroit,
Chicago
KC
St. Luis
Memphis
Atlanta
Cleveland
Philly
Washington DC
Rochester
IndianapollisCA. war zones you bottom out more in the 50k range. in SOCAL its Compton, Watts, NORCAL is East Oakland, East Palo Alto… yet you cross Hwy 101 into Palo Alto and you have some of the most expensive housing in the World… 1,000.00 a sq ft. and up…
When you toured me through your lower end neighborhoods in Rock Hill they were just bread and butter type places.. No visual clues of Gang Banger activity, Or like Detroit with burned out houses.
I think by and large the more informed OZ investor has stepped up their game and is buying a nicer product than in years past… At least any that are reading what the core group posts.
PS
any one getting private messages on this site from the Nigerian and Phillipina spammers… Looking for your information in exchange for transferrring millions of dollars into your bank accounts??
I am waiting for 7.5 million to be transferred into my account anytime now… All I have to do is give them all my personal information
JLH
Freckle wrote:kylermrice wrote:Everybody makes it sound rough, it's really not that hard when u have good people and system in place.I was watching a doco the other day about deserts. One part was about this 12 yr old kid in Mali herding cattle some 80km to water. He was racing against a herd of elephants to get there first. He slept on a mat near a fire over night and fed straight from cows with milk for food and liquids. When he got to the water hole several days later the elephants had beaten him. They blocked his herds access to water and actually charged the herd. He sheltered behind some fallen trees and brush but waved his stick and threw rocks at them to try and get access to water for his cows.
Another was about a 10 yr old girl learning to guide her camel train to a water hole 3 days walk into the Sahara desert. Only women in the tribe undertook this task. Her mother was teaching her how to navigate the great desert both day and night. The water hole was some 80km from any other known water. Miss it and you die because you can only carry enough water to get you there.
It’s all relative I suppose.
The Freckel
PS: I know you have an elephant gun under the bed for the more difficult hoods.Frekle,
I was watching a Doco yesterday about SWAT of KC… I wonder if the rest of the world see’s these shows and what they must think of the US… Fully armed and armored tactical squads braking down front doors,,, throwing in Flash bang grenades.. The not so funny part is the house is someones prized rental in KC.. and its just got all its doors blown off the hinges… One house they had a Meth lab.. So that house will need to have a chemical rehab…. The bottom line is someone just lost their houses. Because the tenant let the boy friend in.
In this instance they broke down the front door… threw in the grenades and there was only a mother and baby in the house. Baby gets taken away by CPS.. Mother goes to jail… The majority of the tenants in these areas are single women.. the Men do not rent by and large..
the danger comes from who they let come into the house.Very Jerry Springer… But also very real…And all of national TV for anyone to watch.
jayhinrichs wrote:Alex, As we all know there are war zones in each city in the US. In Portland we have ours,, Its called Felony flats… and then there is a section in NE portland.. However can't buy a house for much less than 200k in any of these so called bad areas of Portland… There are sub 100k houses but those are really tear downs… Lots start at 50k and go up to 500k depending on the area… Its the big Mid western cities that have the super low value housing,, and or war zones… One can go into any of these cities and buy sub 10k houses. Detroit, Chicago KC St. Luis Memphis Atlanta Cleveland Philly Washington DC Rochester Indianapollis CA. war zones you bottom out more in the 50k range. in SOCAL its Compton, Watts, NORCAL is East Oakland, East Palo Alto… yet you cross Hwy 101 into Palo Alto and you have some of the most expensive housing in the World… 1,000.00 a sq ft. and up… When you toured me through your lower end neighborhoods in Rock Hill they were just bread and butter type places.. No visual clues of Gang Banger activity, Or like Detroit with burned out houses. I think by and large the more informed OZ investor has stepped up their game and is buying a nicer product than in years past… At least any that are reading what the core group posts.Jay you left out Charlotte LOL True story a few years ago me and Kevin were looking at houses in Charlotte. One street in all little brick cookie cutter homes. We thought we found gold mine. No one was buying these vacant brick 3 bed room 1 bath homes . Small pocket maybe 80 homes total 5 block radius. A few weeks later gang show on discover channel was speaking about worst gang in USA . Low and behold the area Kevin and I stumbled on was called hidden valley . One of Charlotte's worst gang areas. High murder rate and controlled most of the drug activity in Charlotte.
Only one street in and one street out so made it hard for cops to do anything about them. Here I am am barefoot wearing just my shorts and tank top just strolling around the area. ( with out a care in the world) Met some people their and spoke to a few groups of young guys. Did not realize how bad of an area it is.
Right now one of the only areas I don"t buy. I am sure area has gotten better. Being that was a few years ago but the reputation of hidden Valley still their . Yup you right on last house was for sale there was $19k some one paid $12k for it . Was making more of reference that I am buying the 67 house package .Yes cookie cutter but also low income but not a war zone. Impoverished yes ,war zone no. Meeting with the city this coming week they have first time home buyer programs. If I rehab to their qualification the homes would sell for $55k . So now I am more looking for equity partner for 1,250,000 for 5 to 10 years if not longer . If not through the city wanted to owner finance majority of the homes on 6 to 12 year plans .
Your thoughts?
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