Your Most Troublesome Aspect?
Hi all,
I was wondering if I could do an informal survey here. I would like to know what about your Real Estate investing do you find most troublesome? With what aspect of you investing do find you have the most trouble? Is it finding leads or financing? Getting property owners to call you back? Doing your due dilliegence? Please feel free to anwser in your own words!
For myself, I have the most difficulty with determining the FMV of a property.
How about you?
- Jody[ Edited by JodyDawkins on Date 03/31/2004 ]
Realtors... they're busy, houses are selling quickly..... if agents aren't on top of things, you lose.
By Realtors do you mean the listing agents? Do do have trouble with your own agent?
FMV is quite a challenge... In some areas that I invest in there are many rehabs going on. So you see listings of houses going for $77,000 all over the place but when they sell - they sell for $150,000+... Just have to keep your eyes open and your brain working!
Another thing that is tough and frustrating is finding property owners of vacant houses that aren't listed with Realtors! Trying different methods to finding these people!! (any suggestions are welcome)
Last but not least - I have been blessed with good realtors. BUT I only use them as an additional source of leads/info... They help reinforce my thoughts/offers/etc. I can't base my business on them!
Just my input!
Matty Kling!
Insurance has been my biggest hassle. The agents are incompetent and the policies end up getting canceled because the agent never follows through with the correct information to the insurance company. They tell you it is written with liability but it is not. They tell you there are no animal waivers, but then one gets sent to you in the mail. They misspell your name and the property name. When you do get cancelled the check goes to the property address, not the mailing address, so you could have gone months without insurance. And one of my favorites is that the check has no property address on it nor does it have a policy number. So you have to guess which property got cancelled. Of course you can not call the insurance company directly and the agent tells you that you were not cancelled but can not explain the check. Oh yes, and the renewel notices always seem to get lost in the mail.
I am still activity acquiring rentals. With each new rental I see the the policy amount increase and the coverage decrease.
Brenda
I/m just a "baby" in this game, but so far my toughest challenge has been getting the listing agents to keep up! Two, three, and sometimes four calls are necessary to get a call back! As you all know, the good deals aren't around that long!!
I just lost a sweet deal(would have been my first) this week because the listing agent didn't want to drive "all the way back down here" from his office(not even 45 mins away). The next morning I called my realtor friend to get the code to go through the house and found out their had been someone through the place that morning and submitted an offer! It was less than 20 hrs after I called to get in the first time! I was the first one to make contact on the prop.
Lesson learned!! When you find the real good ones, DO NOT wait on the listing agent!!
Sickdog
The only problem i have is getting deals, Jody, I wish I had your problem. Im great at figuring out FMV and have my system down to a T to find it. Right now Im gearing up for a marketing blitz, witch should get me some leads.
But Relators would be second on my list of the most "Troublesome Aspects". You have to call and call to get a hold of them, they rarely contact your back, and I know many a deal has been lost because of them.
But good luck to all,
James
If you assemble the right "team" you could possibly eliminate the agent's failure to call you back. Your team should be top-notch, not middle-of-the- road. My team includes an agent who has been a single parent in the business for 18 years, who is recognized as one of the top producers in the area, and has provided excellent service to me before when I sold my brother's house by power of attorney while he was overseas. The agent was magnificent - that's why I went back.
I also have what is considered to be the best real estate attorney in town. Yep, these folks aren't cheap. But regardless of what I pay them, you just lost a possible ten grand - that's what you paid yours, whether you know it or not.
And I have a four-year degree in Real Estate Management. What that means is that I am educated in the business. And I still take courses and read and research and learn.
My central heating and air guy is always available because I take repeat business to him. He does not sell famous brand name equipment but he sells an adequate product with a five-year warranty, and he does the install himself. Just an example of another member of my team.
My opinion is that if you are trying to do this solo, you might want to reconsider. Having the wrong team members will cost you money, as you have learned. Having the right ones will make you money, even if you pay a bit more up front. As an old Commanding Officer of mine used to say, "Pay now, or pay more later."
8-)
I've had to go through about 20 or different re agents to find the ones worth building a relationship with. Interstingly, the agents who sold me my first property thought I was a one-hit wonder. So they didn't bother leaving a particularly positive image to remember them by. Then I ran into them when I was scouting my fourth property. They were shicked to see me. When I told them that i was on property number four, they nearly fell all over themselves trying to provide me with leads.
But my most troublesome aspect right now, is time. Because I spend most of my time working overseas, I end up having very little time to actually search for proerpties to invest in. Hopefully this will change in a year or so. But for now, nearly all myn searching is through the internet and through a few reliable agents.
So, lots of problems with Realtors so far!
I'd like to hear from others on this subject. Can anyone else weigh in?
- Jody
yes finding a good agent is tuff. i just found one that is on the ball, only problem is he talks my head off. i had to hear the whole story of his life (he's older) and still listen to everything going on in his life every phone call. BUT he sends me listings everyday! he's great for that.
my biggest prob has been hard money. luckily for me i dont need it anymore, i have a great team of investors that step up now. but geez, for people who are supposed to be quicker and easier than banks, they sure do have a lot of loopholes. one reason they won't deal with me, in particular, is very common - but i won't go into it. let's just say that people only want to really deal with certain kinds of people. you know, kinda keeping the wealth in the "family", so to speak.
welp, too much cash out there to keep me from eating well! hahahaha.
I am just sarting out but my biggest problem so far has been finding tenants for the rental property that I own. For some reason, Tenants are not easily found.
Does anyone else have similar problems and if so, How are they dealing with it?
Thanks,
JS.
My 1st problem is time wife and I hold down full time J.O.Bs plus raising a family really cuts into the quality time needed to research good deals.
My 2nd problem is funding cant get enough of it to fund deals already in the works.
M 3rd problem i love it to much to give up all the bumps and headachs along the way...
Ed
I firmly agree with bogie7129. You have to have a strong “Right Team”. Beside that, I have an “Outside Team”. Some are people who are looking to find me properties to invest in. They know in what and how I will invest. Some are selling my investments. If I see a Listing, I make one call to the Listing person and numerous calls to my Outside Team. The one who brings the final information needed to invest in that property will present my Offer to Purchase. My Outside Team is constantly evolving. Some become non-productive, others join because they are productive, not necessarily being able to close an investment. No limit as to number of Outside Team members.
My biggest frustration, is when I have to convince my Partners (sometimes I do Partnerships) to invest in a certain property. I have access to people who want to invest to make money (they call constantly), then when a investment presents itself, they want to analyze it to death. These are people I have constant contact with, not strangers. They know what I do.
"The hardest door to get thru is your own."
before even that is, "mind over matress", or getting started
all the hidden costs that show up after the deal is in progress, never before!!!!!
Wow...I am surprised that no one has mentioned my biggest trouble---FINANCING. I could make $75,000 a week if I had the available funds to take advantage of what I find. Sure that can be taken the wrong way but I could find a deal a day that would make me $10k+ These are all on SFR's too so that doesn't even consider half the investing market.
I've tried partners but I cannot find any that give me the type of control I am after. I need to literally need access to funds in hours sometimes. I've tried private money but haven't gotten anyone yet...
Any ideas would greatly be appreciated. THANKS
Jody:
For me determining FMV of a property is the easy part. You simply run title company comps backed up by MLS comps and then check the MLS to see what that type of property is selling for.
The hard part is getting a "retail" deal closed! I deal in the first-time buyer market with people who dont have the
best credit. Can be very stressful at times.
Best Riches,
Jeffrey Adam
[addsig]
I think I must have every problem that was ever invented. Thank god they do not all come at once.
I have the buy of a lifetime. Has to go fast like close in three days. I have a private investor all lined up to front the original
investment. I am paying him 8% and a point. Will probably utilize his money about two to three months. The buy is at about 50% of True Crazy Market Sale Price Right This Minute. In other words at its correct price for today.
I wait for a half an hour at the escrow where my private lender is to meet me. Then, in he walks with another Broker who he introduces to me as his Brother in Law.
He wants him to represent him for another two points on the loan. I smile to hide my nausea. Pick up the phone and place a call to my bank. I get a telephone comittment, hang up the phone and say as would Trump, "You are fired!"
Screams yells and intense profanity. They finaly leave. I have the escrow officer call the bank confirm transfer numbers account to account. The deed is done. Having gone into title myself to hold the deal and having funded it with my bank line. I now must replace the bank line as I use it to guarantee my ability to give a full recourse, so I search for another lender. Cannot find one, start dialing. At the end of a frantic two hours I have three lenders joining together and depending on my offer of full recourse, they are wiring funds into my account at the bank.
The transaction is under control and will close. I shall hold the title order open and get a discount on the escrow cause this will feed to the ultimate future investor in the property.
What would have been a smooth effortless transaction, has become clumsy with unnessary assumption of title and replacement of the original designated lender.
It is time to go home, take a hot shower and then get on line with TCI. Yes, yes, that is what I am doing. I shall try to forget the bad technique. It was clumsy I am sure I could do better.
Cheers Lucius