Second Chance Apartments

                                                                                                     

Hi Prospects & Friends,

Knowing what second chance apartments are, and where to find them will be what I discuss about in this post. First second chance apartments are apartment complexes that offer you a second chance to lease one of their apartments, by hearing your negative case. Every apartment complex is different and has different rules towards acceptance, but key is finding an apartment locator that has the experience in finding them for you. A negative case is something that may have caused your credit to be affected in a bad way or your background in a bad way, and it shows up in the public records, or on your credit report. Hardships occur, and finding the right way to explain them to the apartment complex will get you a better chance at renting again if the apartment complex is a second chance apartment complex. Once the second chance apartment complex gives you the opportunity to rent again, use them as your reference once you've stayed their long enough to build positive rental history, and then by then you will be able to go back to renting a apartment from anyone. So if you fall in the category of being affected in a negative way with your credit or background, it would be smart to lease from a second chance apartment complex. An example would be you're applying to different apartment complexes you like, but their all saying no. This example right here would possibly mean something is on your credit report or background in a negative way, and you need to find an apartment locator to help you seek out possibly second chance apartment complexes. The apartment complexes will notify you of why your application was rejected if you don't know why, but key is not to let it get to this point, and know beforehand what is going on with your credit or background so you don't waste money on application fees, and your credit being ran, because each time you fill out an application at a apartment complex your credit is ran, and it stays on your credit report as a hard inquiry for 2 years, which does also reduce your credit score preventing you from anymore possible opportunities of getting new credit. So follow my checklist and you should be ok with moving forward with your apartment. 

1. 1. Know what's on your credit and background before you contact anyone, by viewing your credit reports from TransUnion, Experian or Equifax. Alot of the banks offer free credit snaps and credit score if you have bank accounts with them, this isn't a full blown credit report, but it does allow you to get an idea on what's on their. For example Wells Fargo offers me a snap shot of my credit score, where Capital One, American Express & Discover offer me summaries of my credit report, along with free alerts and credit score. I use them all and its free, so your preference is up to you, but you need to know what's going on beforehand is my point from however you get the information.
2. 2. Hire an apartment locator who can locate you second chance apartments
3. 3. Make sure the apartment locator also has ability to locate second chance apartments who maybe offering specials for move-ins too.
4. 4. Once you find a second chance apartment you like give your case to the apartment locator, and allow them to discuss your situation with the complex and analyze their rules against your case, and wait patiently. if they say no key is finding a apartment locator that will find you a second chance apartment complex that will say yes, and this will be determined by the apartment locators experience, apartment database, and knowing what to ask the apartment complexes in first place about these kind of cases.

Happy Memorial Day everyone, and if you just happen to be a Texas resident needing apartment locating services, contact me, I will assist you. Everyone else I hope these posts will still benefit you in many different ways.

Thanks

 April

Real Estate Posts Update

Hi everyone! 

I'm back and here to deliver again posts about real estate, and my experiences as a small business. Last few years I was working on my bachelor's degree, and juggling my small business and took a leave of absence. Through the years I grew as a small business, as well as a real estate broker with more knowledge and experience. I appreciate all of you who were engaged with my prior posts, and hope you come back to join me for many more new ones. My next upcoming post will talk about "Second Chance Apartments" and what they are, and how to find them. So stay tuned. 

April

New Hampshire Relocation

Hi Prospects & Global Fans!

I just wanted to share a quick story about my first relocation client, and what I gained from the experience. Recently I was advertising my rental property and a prospect contacted me on the rental listing. I did my normal prospect phone screening, and as the conversation developed the prospects informed me they were moving from New Hampshire, because the husband got relocated to Texas for a job, and needed a place asap, and saw my rental property online which was 5 minutes from his job (remember key to real estate is Location/Location/Location), and they wanted to see it. So I showed them the property, and they both liked it, and wanted to immediately move in the place. I told them great, and would get them the TAR lease asap. So as I was typing the lease in ZipForms I discovered wow this is my first out of state prospect that will sign a lease with me, that will now be my tenant, and they will need to know everything about Texas! All in all the tenant screening I had to do to qualify them was the same except I had to contact "New Hampshire" contacts, and as I was actually doing all that I was gaining "Relocation Experience", and just realized it after the light bulb went off in my head. My new tenants from "New Hampshire" did inform me after their lease is up they may want to purchase a home, and will look forward for me to assist them, and I told them thank you for the continued futuristic business relationship. So fans the moral is, you never know what may come your way when you run into a business endeaver, because what ever the outcome is, if you do it right the first time, the continued success will continue there after. As for me I was able to gain:

1. Relocation Experience
2. New Tenants
3. Futuristic Home Buyers

ok will give another story soon, bye,

April

Apartment Lead "Jewel"

Hi Prospects & Friends,

About a few months ago I started typing up apartment addresses into my Microsoft Works database, so I would be able to mail to these prospects with my personalized postcards I created in Microsoft Publisher. I had some leads call me from my postcards I had created I sent by mail, and ended up getting a "Solid Lead". The "Solid Lead" was someone who had turned in her apartment notice and was looking for another apartment. I assisted her and found her a cheaper apartment, and she is moving in 8/1/2011. The apartment complex is paying me 100% commission and I will get $759.00 for referring her to them. So I was thinking after analyzing all this I sent out 90 apartment postcards and got some leads, and this 1 ended up being a "Solid Lead" which then turned into a forever "Client" for the future for me. I told my apartment lead now a client, congratulations on your new apartment, and if you ever decide to move again please contact me. I also told her she will definitely receive contact from me yearly, because she is now a "Client" of mine, and that I really appreciate her for hiring me to locate her another place. I call this lead a "Apartment Lead-"Jewel", because I sent out 90 apartment postcards by mail, and did get some calls, but this one was a "Solid Lead" because she had turned in her "Apartment Notice", and had to find another apartment quite "Quickly". After seeing the results from my first batch of apartment postcards I sent out, I'm now sending out 100/mth, it's only costing me $29/mth in stamps, and fits into my monthly marketing budget. So as I look back at all this all the typing addresses late at night I did (I now have 2,700 apartment addresses I've typed), and running to office depot to get avery labels on sale has paid off. As I'm sending out the 100/mth apartment postcards, I'm now coming up with another idea to add to it. I will market 100 postcards I will create in Microsoft Publisher to an elite subdivision I found that's doing quite well in this "Great Recession", if I get a lead out of doing this subdivision like I did with the apartment marketing, I will be "stunned", because the 100 homes I will market start at $500,000+ and generating a prospect in this category will at least earn me $15,000+ in a commission check. My goal for my small business is to have a great database of forever "Clients", and I know to get this I have to market, market, market, and keep doing it "forever". Ok have to go, and remember hard work will always and forever pay off in "The End".

April

Home Converted To Commercial Office “Non Conforming” Analysis

Hi Prospects & Friends,

 

I wanted to share a real estate endeavor that I'm in the process of doing in the future, and it all started off with me and a "Leasing Agent", so I will discuss my idea. Ok a few days ago I was analyzing office buildings for lease, because I was thinking about locating my office to a high "Traffic" location surrounded by prime buildings. So I decided to search my area with lease rates less than $14/sq.ft./year, and I came across 2 properties that ended up fitting my criteria. I contacted the leasing agent who was advertising the office space, and mentioned to her I was a licensed real estate broker who would be representing myself in the lease contract, if I decided to sign the lease. So she met me on Wednesday (5/4/2011) and showed me the suite I really liked. I new I liked the location because the office building was facing a high "Traffic" street, and sits right across the street from Home Depot, as well is 5 minutes from a subdivision where the homes start at $1M+. So I told her I "Love It", and could I sign a 3 year lease, she said yes, but asked me don't you want to think about this some more? I told her no not really, but she insisted on showing me another building with office suites right across the street that were more "Luxury & Exquisite", so I told her fine, and met her at the other building. When we entered the building it looked "ghostly" because there was no one walking around, and I told her so where is everyone? She mentioned to me the building was bought out of "Foreclosure" and the owner is knocking out walls and creating individual "Executive Suites", and leasing them out to "Small Business Owners" who are just starting off, and don't have employees yet, and who are growing like yourself. So I told her "How Interesting", and how does all this work, she said each tenant will get an "Executive Suite" which is a 1 room office, and then share the conference room, the kitchen, the receptionist area, and the waiting area to sit their clients. So I looked around the office, and decided all the executive stuff wasn't for me, and told her thanks for showing me this building, because you just gave me an even "better idea" to pursue an office. I told her I wasn't interested in the other building either I loved, and thanks for all the help.

***I know that after the tour the leasing agent gave me with the "Executive Suites" it was meant for me to see this building because it gave me and idea to add to my other idea I had already had in mine about 3 years ago****

Ok I really want a "Multi-Story Office" building, because I've always wanted to lease out office space, but these buildings are very costly and because I want a prime location, these buildings can start at $1M+, so since I don't have that kind of money, I've always just put this idea to the side till the leasing agent gave me an idea. I've come across to situations that have caught my attention:

1. Homeowners buying homes in unrestricted areas, and deciding to build their businesses on the same lot.

2. Builders coming in areas where the subdivisions are not deed restricted and building near these homes subdivisions that are deed restricted, and causing a "Build Out" to occur, and "Revitalization" to develop at the same time, this is very challenging and complex to understand, but this is very "Rewarding" if you spot this trend and act on it correct. I will explain how this occurs now so see in detail below:

I came across this home that was built as a home but converted to a commercial office it has:

Gross Sqft- 7,952

Lot Size- 36,758

Stories- 3

Parking Spaces- 33

Office Suites- 11

Breakrooms- 2

Bathrooms- 5

Conference Room- 1

This subdivision where this home is located was an "Unrestricted" subdivision, but because the builder "Built Out" his subdivision, and caused the buyers to want more from him and this subdivision sits down the street, and has older homes, the "Revitalization" has developed and the demand for the lots where this home is located are high, as well as the subdivision. This has caused some of the owners in this subdivision to sell their homes, because of the builder building the $1M+ homes on 1 acre lots down the street, the market value of the lots sitting in this subdivision has gone up, due to buyers wanting newer homes, and willing to pay a premium to tare down these older homes, to get these lots "Revitalization". Therefore this has allowed the builder to proceed with slowly turning this "Unrestricted" subdivision into a "Deed Restricted" subdivision. Here is where it gets tricky with this home, and so far each new owner has left it in it's "Non-Conforming" use. The original owner bought this home in an unrestricted subdivision, and decided 2 decades ago to convert it from a home and change it to a commercial office, nothing was violated on the owners part because, there were no deed restrictions at the time. Now that the builder has slowly built newer homes on some of these lots, and changed to a "Deed Restricted" subdivision, all the older homes that are not being used as "Residential" are categorized as "Non-Conforming" use, which means this home and any other home located in this subdivision that were converted to a commercial office has to stay that way because it isn't conforming with the new deed restricted usage, which is residential only. So if the owner decides to sell this building, and the new owner converts it back to a home or tears it down and builds a new home the deed restrictions come in play and this home will never be able to be a commercial office ever again, as well as no one will be able to build a commercial office on this lot, the new home will strictly be labeled as residential with conforming use. So all older homes in this subdivision that have been converted to strictly commercial are "Grandfathered" till someone changes the usage back to residential, which then will destroy the ability to convert back to a commercial office permanently. So here is where my idea comes into play:

I plan to monitor this subdivision, and any others I locate like this, and if I find a home that has been converted to strictly commercial usage like this one, then I will:

1. Keep it in it's "Non Conforming" use which would be commercial office.

2. Reap the benefits of the builders creating a "Build Out" and causing "Revitalization" to develop at the same time (you have to know the area is in demand from the beginning to be able to spot this very quickly).

3. Take the leasing agent's idea of "Executive Suites" and apply it. If I had this building I would rent the 11 rooms that were turned into office suites and rent them to businesses, and let them share the conference room, bathrooms, and breakrooms.

4. Since the lots are in demand in this subdivision, and I know these lots are on 1 acre, and the builder is splitting the lots into .5 acres I would wait till the price climbed high enough to where I could earn enough money to get the "Multi-Story Office" I really want.

5. Then finally after I'm ready to sell, bring the tenants with me to the new "Multi-Story Office", from the sale of this "Grandfathered Non-Conforming Home Converted To Commercial Office", that was a hidden "Jewel".

So after I look back at the trip with the leasing agent I had on Wednesday 5/4/2011, it's good I didn't sign that 3 year lease, because for some reason I sense my "Destiny" wants me to go this more challenging route I just explained in this article. Ok have to go, will write something else soon, bye!

April

Rural Vacant Land "Endeavor Analysis"

Hi Prospects & Friends,

 

I wanted to share a quick endeavor analysis I just came across while looking in the listing database for vacant land for sale. Listed below are current stats available:

Location- Texas

Listing Price- $46,400

List Date- 11/9/2010

DOM- 43 days (as of today)

Total Acres- 29

Land Use- Other

Water/Sewer- None

Road Surface- Dirt

Defects- None

Special conditions- None

So as I came across this vacant land tract in my search perimeters, I noticed immediately:

Total acres- 29

Land use- Other

Price- $46,400

+ factor- neighborhood near area of this 29 acres has new construction homes

So the seller is wanting $1,600/acre ($46,400/29) and to me this is an interesting price, I'm stunned. I know because the property is rural vacant land (not much population) this is equated into the price, which is very impressive to me still. So part of my "Endeavor Analysis" is I will look into more advanced stats with this property not given in the listing database. I want to know if the mineral rights are already retained, see a survey to identify any easements/encroachments/total number of acres recorded, if unrestricted or restricted, limit to subdivide, population, nearby shops/malls/churches and etc. I'm looking into diversifying my real estate and rural vacant land is where I want to endeavor next, because once vacant tracts like this come for sale it doesn't matter if their is no water/sewer or utilities or paved roads, the developer building around or near a rural vacant tract will drive up "demand" and this will eventually cause your land to be in demand, because "built out" will occur and then buyers will come your way and make an offer. My endeavor is to look into this vacant rural tract if it doesn't sell too quickly, because I would love to hold it till the developer "builds out" neighborhood close to this tract and then slowly subdivide the 29 acres when I feel like selling off. Who knows a power plant may decide to want to make an offer, and that would be the icing on my endeavor if happens, because now you got a developer wanting some or all of 29 acres as well as the power plant buyer! I've come to the analytical conclusion after carefully researching vacant land, the further you go out the land becomes cheaper, because the "others" (developers, builders, buyers, farmers, & etc) haven't found it yet, so therefore the "demand" for the price hasn't escalated yet. Trick is to get their before they do, and then enjoy your "demand" of price/acre go up. I'm even curious what are the sales prices of the new homes the builder is developing going for near this tract, because I would want to apply an advanced stat and dissect the new home sales price by subtracting out the cost of improvement (home) from the vacant land tract price, and see what is the cost of value of the vacant land as separate from the home. So I will be also analyzing those builder model sheets once I get my hands on them. Ok have to go, have a "Merry Christmas & Happy New Year" and much 2011+ success to you all!

April

Apartment Locating- "Project"

Hi Prospects & Friends,

 

I wanted to share my apartment project I'm currently working on right now that's due by 12/31/2010. Recently I had a prospect call me from one of my apartment flyer's she had received. She told me she wanted me to assist her in locating another apartment for her and her son. I immediately requested her to go ahead and give me the specifications on what she was actually wanting and she said:

1. 2Br/2Ba

2. Gated Community

3. W/D Connections

4. Zoned to her son's high school

5. Try not to go over too much from current rent of $760

6. Close to apartment currently living in

After she told me her specifications I told her I would immediately start work on the apartment project (job) and would get this all done in a timely manner. As I started to work on the apartment project everything was going great until I came across number 4 (zoned to her son's high school). I figure I could just cold call the apartment complexes that came available in my search that fit her specifications, by asking them what high school was zoned to their apartments, but in the end I found that very time consuming after 1 hour of calling. Since I knew the high school her son was attending, I decided to cut out the middlemen "apartment complexes" and went directly to the high school. I googled online the number and called the high school direct. I then said:

"Hi, I'm April with A. Colette Harris Properties, LLC and I'm trying to get some information"

The receptionist then said how can I help you? I told her I have a client that wants her son to continue to attend their high school, and that could she give me a list of zoned apartments? She told me she doesn't handle that information, and that would be the "Registers Office". I was then transferred to the registers office, and told them the samething, and they were very nice and actually sent me a list of all the zoned areas to their high school, it came out to about 50. This list made my "apartment project" go more efficiently, because I went to the school "direct" for their zoned list of apartment complexes, instead of going to the apartment complex and asking them what high school was their complex zoned too? So as of now I'm ahead of my 12/31/10 deadline, and should have this apartment project complete before then, thanks to my ability to rethink how to handle number 4. Once I'm finish and my client moves in, then the apartment complex will pay me for locating her to them. Ok I will soon share another endeavor I face/approach in my small business.

Thanks,

April

3 Story Office REO Rare Sale

Hi Prospects & Friends,

 

I wanted to share a rare moment I came across, recently about this office. First I remember this office when I was a little girl I was about 12 years old. I would always ask my parents why was this house sitting close to Krogers, and my parents told me this was no house and it was a unique office building. I then as a little girl started thinking wow I love it and want to explore it, well I never got the chance and time passed by. As I got older I would occasionally drive by it since my parents lived close to it when I would visit them. I always thought someday I would tour this office and own it myself one day, but I knew it was well worth over $1,000,000 since it sold for that back in 2002 and I would not be able to take on that kind of debt so I moved on and started investing in condos. My parents moved and I haven't been by this office in years. Well recently I was doing a search on Costar and came across this property being sold as a REO sale REO means (real estate owned) foreclosure by the bank. The property sold for less than about $500,000 and sold May 2010 of this year, I was stunned to see this. I had no idea this property would ever be a possible foreclosure, but my only conclusion was 'The Great Recession" caused it and the new buyer is quite lucky because of the office sitting in a main location with demanding real estate growth. This office has always been unique to me and listed below are some characteristics of this unique office:

7,232 square feet

3 Stories

Free- Standing Office Building

A+ Location

Year built- 1984

It's rare to see something like this and all I can say is I remember this property when I was about 12 years old. I'm not sure what the buyer plans on doing with this office, but every once in awhile I still think about running my company A. Colette Harris Properties, LLC out of it and making the 1st floor the reception area and my office, renting the 2nd floor and using the 3rd floor for files and etc for my company. As I look back maybe someday again I will cross paths with this unique office building.

April

Precious 1 Story Foreclosure

Hi Prospects & Friends,

 

I went by to see this foreclosure on May 16, 2010 and it's already in pending status as of May 20, 2010. I had my note pad with me as I took notes, and saw this house had alot of extras for the price, like wood floors throughout the home, patio with ceiling fans, 3 car detached garage, in gated subdivision, built in study and desk behind master bedroom, guess room, all for $170,000. This home came up in my foreclosure criteria search, so I decided to go and see it. Listed below are my stats from this precious 1 story foreclosure:

Listing Price- $170,000

Location- A+ (facing main drag from gates into subdivision, close to schools, churches,parks, etc.)

Gross Sq.ft.- 2,619

Level- 1 story Bedrooms- 3

Bathrooms- 3 full and 1 half bath

Garage- 3 detached

Builder- Dr. Horton

Year Built- 2003

Price/Sq.ft (last 6mth comparables to subject)- $77.36 Rental Rate (last 6 mths)- $0.64/sq.ft.

So this home has a market price of really $203,000, and it's listed for $170,000 which means $33,000 is already in instant equity, and it also has a going rental rate of $1,676/mth. I noticed this home needed no major/cosmetic repairs, so my conclusion is foreclosures making their way into the market like this one are rare, and that's why it didn't stay on the market too long. I've been site seeing foreclosures since the recession started and I'm noticing in the beginning I was seeing foreclosures in need of major/cosmetic repairs, now I'm noticing foreclosures coming into the market with no need of major/cosmetic repairs. So my conclusion is these types of foreclosures are possibly from homeowners who may have negotiated something with their lender to leave the property in livable and good condition, and in return the lender will probably give some kind of allowance or incentive for doing such. I call this property a precious 1 story foreclosure, because it's hidden in the market with the rest of the foreclosures, and finding them are jewels once they become noticed.

April

Developing Wealth From "Revitalization Subdivisions"

Hi Prospects & Friends,

 

I wanted to discuss a subdivision I came across that has the term revitalization occurring in it. First revitalization means old becoming new as well as impacting a new beginning/development for the future. Revitalization subdivisions don't occur everywhere, and when you find them they can add the development of real estate wealth to your portfolio. Listed below are 2 homes in the same subdivision, but 1 is old and 1 is new, as to where the supply and demand has caused this subdivision to do advanced revitalization's. Stats are explained below:

House 1 (grayish house) is pending for $375,000 and is expected to close March 18, 2010

House 2 (brown house) sold for $1,150,000 October 26, 2009

So let me explain the stats below:

House 1 (grayish house)- Gross Sq.ft. 1,142

Year Built- 1943

Lot Size- 6,000

House 2 (brown house)- Gross Sq.ft. 4,100

Year Built 2009 sq.ft.

Lot Size- 6,000 sq.ft.

Lot sale- 5,000 sq.ft. sold November 4, 2009 for $355,000 ($71/sq.ft.)

So to better understand the revitalization going on in this particular subdivision, I can conclude any home with a lot size of at least 5,000 sq.ft. will allow one to develop a brand new home equating to at least $1,150,000. So this means if you have an older home, its the lot the house is sitting on that will gain you the most wealth in this subdivision, because of the revitalization occurring. The demand for the lots in this subdivision for new homes will continue to cause the supply for the older homes to continue to be in demand which will continue to cause significant returns for the owners with the older homes. I was curious and ran this subdivision in the tax records and found 742 owners, I noticed a bigger lot on the tax roll had lot value at $792,884 and the improvement value was only at $4,379 totaling $797,363 for tax year 2009. The owner is actually still homesteading the home per the tax records and was built in 1943. So out of the 742 owners in this subdivision only 264 of these owners have older homes, all the others have newer homes. So yes all the owners sitting on older homes are quite wealthy right now because of the revitalization occurring in this subdivision. I can conclude from the revitalization stats that if I see a home hit the market like House 1 grab it, because I don't think many are realizing the house is listed for $375,000, but the lots are going for $71/sq.ft. So the average person would say why would I pay $375,000 for a home that is built in 1943 and has only 1,142 sq.ft. of space, when they could get a bigger home for same price? Well the trick is reverse all that thinking and realize the lot for this house alone is worth $426,000 without the home on it, and will continue to go up in lot price because of the demand for it for newer homes (revitalization). There are not many subdivisions doing revitalization so finding them is a wealthy jewel, because all you have to do is wait for someone to put an older home on the market that has been fixed up that is less than what the lot values are going for and reap the benefits once you sell. Many of these owners with the older homes in this subdivision don't realize the revitalization occurring, because House 1 has been totally fixed up and is pending for $355,000, this house has a lot currently worth $426,000 since a 6,000 sq.ft. lot recently sold for $71/sq.ft. back in November 2009. I'm watching this subdivision as of now, because of the advanced revitalization occurring rapidly.

Apartment Complex- Investment Analysis (10 Units)

Hi Prospects & Friends, 

 I discovered this property a few days ago as it came up in my search for investment perimeters for an apartment complex I'm looking to buy through a O/F Direct Concept. As of today it's only been on the market for 14 days, so this weekend I will drive by to see the true picture and attributes. Listed below are the investment stats for this property. Listing Price- $590,000 Total Units- 10 Gross Sq.ft.- 6,240 Price/Sq.ft Last 6mths- $127 Location- Prime and A+ Taxes- $8,908/yr. Insurance Proposed- $450/mth Rental Rate Last 6mths- $1.16/sq.ft. Layout- 10 units each (1Br/1Ba) Average Unit Sq.ft.- 624 Economic Life- 40 years Year Built- 1964 Current Landlord is renting 9 units @ $500/mth, & the other 1 unit is @ $425/mth. So the total rent is $4,925 as per the contract rents. After analyzing all this see my investment analysis below: Current Rent Contracts - $4,925 Taxes- $742 Insurance- $450 ($4,925-$742-$450=$3,733/7.34x1000)= $508,583 Market Rents- $7,238 Taxes- $742 Insurance- $450 ($7,238-$742-$450=$6,046/7.34x1000)=$823,705 ($7,238-$742-$450=$6,046/8.05x1000)=$751,056 So after analyzing the quick investment stats, and because the current seller/landlord said the property needs minor updates and that the rents are below market I would not pay more than $508,583 for this property. My investment stat range of $751,056-$823,705 says this is what this property is worth and would sell for based on similar stat properties in last 6 months. The median upward adjustment is $792,480. Conclusion is stated below: 1. My Buyer/Investment Hat- Says don't pay more than $508,583 for this 10 unit apartment complex 2. My Real Estate Broker Hat- Says I have a jewel because the recession has caused the current seller/landlord to list apartment complex for $94.55/sq.ft which is below what the true properties are really selling for which is $127/sq.ft. So I know based on my investment stat range I'm looking at least a resale between $751,056-$823,705 & factor in the median upward adjustment of $792,480 as the investment stat backup closure. Plus market rents are going for $1.16/sq.ft! 3. My Property Manager Hat- Says leave contract rents as is and when each tenant decides not to renew then rent @ market! "Caveat" don't ever run off a tenant by raising their rent to market when it's time to renew, because the whole idea of my don't pay more than $508,583 was based on contract rents and not market rents, so the investment numbers would fit into the current perimeters! Only raise contract rents to market when the tenants decide not to renew, and remember you have nothing too loose because you factored all the investment stats in the very beginning before the purchase. So once you do start to raise contract rents to market the additional income will be extra, and it will benefit you greatly with reserves for the apartment complex and even yourself! 4. My Seller/Interior Design Hat- Says since the economic life is 40 years and the property is already 46 years old I can conclude the plumbing and electrical are outdated as well as the quality construction of the apartment complex is too. So I know I would have to bring this stuff eventually up to date if required necessary. So not offering the seller $590,000 and offering below $508,583 would justify me to use the saved amount of $81,417 on all this if need too! 5. My Bookkeeper Hat- Says leverage the depreciation factor for the maxium of 33 years allowed as much as can. In my case I would fix up and then rent for about 5-10 years, then re-sale around the 7th or 10th year.

My point is I really like this 10 unit apartment complex, but if the seller can't accept less than $508,583 for this building then I will move on to the next real estate endeavor I find until someone agrees to what I want. So far I've bought 7 properties using my investment stats, so I know their are people out their who will honor what I want. The catch is I'm very ambitious/analytical and used that to my own advantage to gain the reasoning's to convince others to say yes to my real estate endeavors!

April

Office Condo- Investment Analysis

Hi Prospects & Friends,

First I'm trying to leverage a great location for my real estate endeavor I'm developing. I came across this office condo yesterday and analyzed these current stats:

Location- A+

Year Blt- 2009

Sq.ft.- 1,350

Rental Rate- $21.33/sq.ft./year or $1.78/sq.ft./mth

Taxes- $5,072/year

Maint Fee- $185/mth

Proposed Insurance- $250/mth

Listing price- $226,400

Depreciation Factor- 3.175 (31 years max)

So because this is a commercial property I will apply my investment analysis range stat to see if #'s work. I will use 8% & 9% since this is a commercial property & that's what rates are going for right now:

(1,350x$21.33/12=$2,400-$422-$185-$250=$1,543/7.34x1000=$210,218

(1,350x$21.33/12=$2,400-$422-$185-$250=$1,543/8.05x1000=$191,677

So my investment analysis range for this office condo equates to $191,677-$210,218. So I would not pay more than $210,218 for this office condo based on current stats. The current list price is $226,400 so it's not far from $210,218. Now I will discuss why this office condo caught my attention (besides the current stats).

*Currently has four large offices, restroom, reception area, storage closets, and kitchen. It also has an executive suite with it's own private entry and restroom*.

The office condo includes and "executive suite with it's own private entry and restroom" This highly factors in the conclusion me renting the other side out to another small business. Since my company is set up as a Single Member LLC, and I have no employees I really don't need the whole 1,350 sq.ft. of office. So this would be a great investment endeavor for me to prosper, I would setup as below:

Side A- Has 4 large offices, restroom, reception area, storage closets & kitchen. This would be where my company A. Colette Harris Properties, LLC would be.

Side B- Executive suite with it's own private entry & restroom. This would go to a small business I would rent too. My idea of a typical commercial tenant I would "seek" would be a Real Estate Attorney, Estate Planner, Insurance Agent, Accountant.

My investment stat gets tricky because I will be on 1 side of the building so I will not receive the full $2,400 just the $1,200 in rent per the rental rate/sq.ft. So I will have to reverse the stat to ($1,543+$422+$185+$250=$2,400 so my piti should not go over $2,400/mth instead of the $1,543 in this case. So now because the building would be considered owner/investor user & not 100% tenancy the investment analysis range would state do not pay more than still $210,218 for property and not have a piti of more than $2,400/mth. Applying the reversal with a down payment to the investment analysis range would now look like:

If you get property for $205,000 @ 8% with 25% down ($1,129+$422+$185+$250=$1986-$1,200 in rent=$786. So now the investment stat says instead of me paying $1986/mth (piti) for the office condo I would only pay $786/mth while the commercial tenant pays the $1,200 to equate to my total mortgage of $1,986/mth which falls below the $2,400/mth as noted earlier because of the owner/investor occupancy reversal stat. So the $1,200/mth I'm saving I can now apply to my small business with:

1. Gaining more & more skills

2. Invest in more real estate

3. Invest in stocks & index funds

3. Etc (get my point)?

Getting the right data to come up with my investment analysis stat range is quite tricky, because you have to apply the current facts and other stats, so if you don't know where to get such data to analyze from beginning it would be wise to not engage in this advanced kind of analysis with out someone with qualified skills to assist you. I will monitor this office condo, because it's a good small business move real estate endeavor for me to pursue once it falls in to my investment analysis stat parameters.

So as you can see applying these posts below I've written on this blog to this one can allow one to create wealth the smart way.

Investment Analysis- "Victorian Mini Mansion"

Investment Analysis- "Fourplex"

April

"Attracting & Keeping" Longterm Tenants

Hi Prospects & Friends,

 

I wanted to share how important it is to have the benefits of having longterm tenants. I recently called one of my tenants who has been leasing from me since December 2004 and asked him if he was going to renew his lease since it expires 12/31/2009? He said yes and to send the renewal, so I immediately typed the renewal lease form that same day and mailed it off, his new lease will expire 12/31/2010. As I typed his renewal I started to drift back to 2004 and thought about the hard work and skills I managed to learn that allowed me to "seek" him from the very beginning. He is now on his 6 renewal with me and I know many find it hard to find longterm tenants, but in my case I apply techniques I've created myself and tailor them to each individual differently by basing such on their situation. See my "Qualified Crafted Tenant Equation" view of http://www.youtube.com/watch?v=gdd_bhZ3bcY to see my point. Knowing the right skills to apply from the very beginning will land you a much better reward of a "longterm tenant" futuristically. This recession is very tricky and having "longterm tenants" will weather you through the storm. I've owned this property since October 2003 and have gained greatly from it. I've only had 2 tenants leasing from this property. The first tenant was from October 2003-November 2004, and the second tenant was from December 2004 to present. So as you can see I've leased this property with no loss time or rent between the leases from the tenants. I have a trick to that and it involves me putting a "special clause" in all my leases. My "special clause" is something that "keeps" the longterm tenant, while the qualified crafted tenant equation "attracts" the tenant.

April

Investment Analysis- "Victorian Mini Mansion"

Hi Prospects & Friends,

 

I noticed this mini mansion last weekend on the market and I will drive by it this weekend, because it's a beautiful home and also because it has nice home stats. It caught my eye due to the seller just reduced the listing price $50,000 and is including the furniture in the package. This is a subdivision I've studied over the years and many homes don't come available often. I did my analysis on this home so see the stats below:

Original Listing Price $349,900

Seller Reduced Just Last Week: $50,000

New Listing Price: $299,900

Year Built- 1982

Gross Sq.ft.- 4,294

Bedrooms- 5

Bathrooms- 3.5

Garage- 3 car attached Lot- 12,100 sq.ft.

Yearly Taxes With Homestead Exemption- $6,252

Yearly Maintenance- $500

Proposed Insurance- $250/mth

Rent/last 6mths- $0.54

Price/sq.ft./last 6 mths- $81.15

5 Year S.M.A. Low- Occurred 11/30/04 @ $58.92/sq.ft.

5 Year S.M.A. Peak- Occurred 4/17/06 @ $87/sq.ft.

Market in last 6 months says this home is worth $348,458, seller has new listing price @ $299,900 including the furniture. So it is an enticing deal, but as a broker/realtor I have to put my hat on as a buyer/investor first. So for me this home needs to come down to my range of $$268,886-$284,643 for me to touch it, because of the recession and market trends I've studied for this subdivision. So I will use rates of 4.8% and 5.35% since the market is saying that's what rates are going for right now at this point. See equations explaining:

(4,294 sq.ft x $0.54=$2,318.76-$521-$42-$250=$1,505.76/5.29x1000=$284,643)

(4,294 sq.ft. x $0.54=$2,318.76-$521-$42-$250=$1,505.76/5.60x1000=$268,886)

So since my range is $268,886-$284,643 and seller originally had it listed for $349,900 and now it's listed at $299,900, and the low was $58.92 and high was $87 in past 5 years. I can conclude right now the price is perfect, but because I like to build instant equity, home needs to fall in my range to make numbers work for me. So seller isn't too far from my $284,643 since it's now listed @ $299,900 and if they continue to reduce the price who knows it may get as low as my other part of my range which is $268,886. The 5 year S.M.A. comes out to for this home see equation below:

4,294 sq.ft. x $58.92=253,003

4,294 sq.ft x $87=$373,578

So I can analyze from the 5 year S.M.A. this home will hit back around $373,578+ when the recession is over and max of 5 year trend from that moment, and I can also conclude this home could possibly wonder down to $253,003 if the recession still lingers, but in this case trying to see a $58.92/sq.ft in this subdivision won't be possible since the price/sq.ft. last 6 months is $81.15. So the only way to win in this case is to watch for sellers like this one and realize they are listing it at $69.84/sq.ft but it's really selling for $81.15/sq.ft as per the price/sq.ft. in last 6 months. Remember this home isn't a foreclosure, so these are rare deals when you find seller doing this. This home is already fixed up and remodeled, so buying this home from the seller right now at their price would be $81.15x4,294/sq.ft. =$348,458-$299,900=$48,558.10 of instant equity which isn't including your down payment if you homestead this home for 2+ years and didn't sell until the price/sq.ft. reverts above $81.15/sq.ft.

If you use my range of $268,886-$284,643 & wait for the subdivision to peak back @$87+/sq.ft. it will calculate to 4,294/sq.ft x $87=$373,578 & instant equity ranging from $88,935-104,692. You would need to at least stay in the home and not flip, to gain this subdivision investment rewards, since it goes through troughs and ridges. I would stay @ least 5 years then roll equity over into another one like this till I landed $500,000 in equity and proceed with next project or till I'm satisfied with what I want. Some of you are thinking how can she get $500,000 in equity? Well lets just take a refresher course, my range is $268,886-$284,643, and seller has already marked property down from $349,900 to $299,900. The $299,900 isn't too far from my range of $268,886-$284,643 which equates to $88,935-$104,692 in equity. So once I see the seller lower close to $284,643 I know I already I got $88,935 in instant equity sitting pretty for me when I sell when the peak reaches back to $87+/sq.ft. Remember right now the price/sq.ft is $81.15 in last 6 months, not $69.84/sq.ft. which is what the seller is wanting right now. So understanding all of my analysis stats in advance will further you alot quicker. So yes finding 5 sellers like this one will land you $444,675 in instant equity ($88,935x5=$444,675, and that is just the high end part of my range for this house. Low end will equate to $373,578-$268,886=$104,692 in instant equity which is $104,692x 5 sellers=$523,460, and also remember I haven't factored in down payments. So if the house alone is giving you between $88,935-$104,692 imagine just adding a measely down payment of 3%+ to all that instant equity you already got? So lets use reverse psychology, my range of $268,886-$284,643 with a down payment of 3% which equates to a down payment range of $8,067 -$8,539, says: my analysis stat range of $268,886-$284,643 will only cost you as little as a down payment range of $8,067-$8,539 to gain a range of instant equity of $88,935-$104,692, which then equates to instant equity range of $97,002-$113,231 (down payment + the instant equity)

So for this to work you have to have the subdivision investment analysis already factored, and then the sellers are the "Jewels" when they do stuff like this in these kinds of subdivisions.

P.S. If you add this article with my "Investment Analysis- Fourplex" you could actually be quite wealthy, because the seller over at that article is doing the samething, but difference is this is a home you would homestead to live in, and the fourplex would be an investment property you rent out to generate monthly income.

April

Investment Analysis- Fourplex

Hi Prospects & Friends,

I came across a property I've been watching mid of this year and wanted to share the investment analysis to understand why I'm still watching it. Currently the Fourplex is listed for sale and see stats below:

Listing Price- $279,900

Gross Sq.ft.- 5,832

Fourplex Components- Has four 2br/2ba on each side

Year Built- 1984

Yearly Taxes- $6,017

Projected Insurance- $275/mth

Price/sq.ft last 6mths- $54

Rent/sq.ft. last 6 mths- $0.54

Calculate- 5% for reserves

Misc- Location A+ (Has main drag & inferior to schools/restaurants/parks/malls/churches/etc)

Market says property should be worth $315,000 ($54 x 5,832 sq.ft.)

Market says rent should be worth $3,149 or $787 per unit ($0.54 x 5,832 sq.ft. /4=$787)

Current Owner/Landlord is renting units at $695 & $625 with long term tenants in signed lease contracts. So $695 x 2 + $625 x 2=$2,640/mth in contract rent. Well since the market in last 6 months says this property is worth $54/sq.ft. & owner has it listed for $47.99/sq.ft I still will not settle for $279,900. Price needs to come down to my investment analysis range of $215,155-$235,967, because yes as a broker/realtor the $54/sq.ft is enticing since it's really worth $315,000 and seller is listing it for $279,900, but trick is my investor hat is on right now and not the broker/realtor hat (that hat will be put on when I sell). My investor hat says see investment analysis below:

Ignore the market rent at $0.54/sq.ft, since the current owner has tenant signed contracts at $0.45/sq.ft. (by law you have to honor lease contracts, until they expire) So I will work with the $0.45/sq.ft instead knowing I know as a broker/realtor the market rent is really $0.54/sq.ft in last 6 months. So I will demonstrate at a 8% and 9% since rates are higher on investment properties, and no points were applied/involved/factored ($2,640-$501-$275-$132/7.34x1000=$235,967)

($2,640-$501-$275-$132/8.05x1000=$215,155)

So my investment analysis range of $215,155-$235,967 on a property currently being listed for $279,900 and really worth $315,000 is a good real estate endeavor to understand and learn to apply to your investment properties. Since seller already has property marketed below market why not wait for seller to continue to reduce your "Jewel Investment Property" to your range? You cant loose in this investment scenario, because seller already has 4 plex listed at $279,900 and it's really worth $315,000. I like to build instant equity so that's why I like to use my investment analysis range equation, while I also apply these rules:

Depreciation Factor- 27 years maxium for this investment property

Maxium life Expectancy- 40 years (it can go beyond this if it's been well cared for with the plumbing & electrical)

Building is already 25 years old, so that leaves me to work with 15 years if I was to buy it now in 2009, and if it falls in my range of $215,155-$235,967 (I would keep it at least 2-5 years out of the 15 years, for capital gain tax rules and market subdivision trend analysis conclusions). So since I already know it's got $35,100 in equity (based on the $279,900 minus market) and can factor in the repairs once analyze the inspection report with inspector/contractor/electrician/plumber I wouldn't want to touch the $35,100. So if I'm told it will cost $15,000 to update the 4 plex eventually with repairs then you can see why my range makes since of $215,155-$235,967 from the beginning of analyzing the 4 plex. My range is also actually saying in hidden numbers if seller lowers to my range I can earn in equity a range between $79,033-$99,845 & that's not including my down payment, instead of the $35,100 which is based on the $279,900 which is already below market, but not below enough for me to touch. I've bought 7 properties using this investment analysis equation and it does build your equity faster if you apply your numbers correctly from very beginning. Also since I'm a broker and represent myself in my transactions I just take the commission and apply it to any needed repairs and deduct it as an expense against my salary for managing the property, as well as the maintenance expenses for the property. I will write a book in detail about this soon. 

Real Estate Endeavor Tip "Qualified Crafted Tenant" Equation

Hi Prospects & Friends,

I wanted to share with you all a preview video I created about one of my real estate endeavor tenant tips. The video talks about my equation I use for tenants. Enjoy and have fun, I've listed the links below and you may also subscribe to my Youtube Channel.

http://www.youtube.com/watch?v=gdd_bhZ3bcY

My YouTube Channel http://www.youtube.com/AchEmpire

April

My Amortization- Technique 1

Hi Prospects & Friends,

 

I wanted to quickly share one of my amortization techniques I use on some of my properties. As many of you know everyone at times faces hardship whether it's a job loss, medical crisis, loved one ill or etc these situations can sometimes cause us to be set back with in our own personal/business financial decisions if it happens sudden or unexpected. I always plan for any hardship and allow the planning in advance to assist me with bettering my decisions later down the road. One thing to address in your life is when you purchase a home if you want to pay it off sooner don't try and get a loan term that is shorter than a loan term that will benefit you better future wise, just because you feel you want to eliminate the monthly interest present wise. I say this because once you get a loan whatever term you choose you are stuck with it and will have to refinance it to get out. So to bypass all that I suggest consider choosing a term that best fits you future wise than present wise, then apply the shorter term payment to the longer term loan as please. I like to first do the amort tables for a 15yr, 20yr, and a 30yr on the choice of property I'm financing and compare the monthly payments. Next I will make sure their is no prepayment penalty on the loan I want and begin to do my technique. I create the amort tables for the 15yr, 20yr, and the 30yr, then I request the loan term that will benefit me greatly future wise, not present wise. Once I've chosen the loan term then I apply the shorter loan term to the longer loan term to cut interest for the first 2 years when I make my monthly mortgage payments. Since I have the amort tables already printed futuristically in front of me I can see many years in advance what the loan amount actually looks like. So then I apply my every 5 year rule "Technique 2" which will be eventually addressed in another blog post. See my example below of Technique 1:

I purchase a home for $215,000 and put down 20%. Loan amount will be $172,000 @ 5.5% interest. I then apply the next step to analyze the term payments. (Payments are not PITI they are only PI since I based it on 20%, if you have a PITI then just deduct everything except your PI and you can proceed) On a:

15yr payment is $1,405.38

20yr payment is $1,183.17

30yr payment is $976.60

I analyze the term payments and because the $976.60 appeals to me and I'm thinking futuristically if something happens I don't want to have to deal with being stuck with the $1,405.38 for 15 straight years and the only way to get out of the 15yr term is to refinance which is goal to avoid from beginning. So I accept the 30yr term and make sure there is no prepayment penalty and when the loan payments start coming I apply the 15yr term payment for the first 2yrs of the 30yr term. So for the first 2yrs of the new loan I apply the $1,405.38 to the 30yr term instead of paying the $976.60. Since I created the amort tables in advance for myself when the 24th month reaches I glance at the balances. I'm basing my example as if I closed in September 2009, so looking at the amort tables for September 2011 the loan amount for a 15yr will be payed down to $155,694.81, and the payed down amount for the 30yr will be $167,025.14. Remember the original loan was for a 30yr with a payment of $976.60 but I applied the $1,405.38 for the first 2yrs of the loan. Next thing I want to see is what is the price/sq.ft going for in my subdivision once I've reached the 24th month to see how much possible equity I've gained besides paying the extra payments I've already payed. If no hardship has occurred during the 24th month period paying the $1,405.38 then I glance at the amort tables for the loan amounts for the next 3yrs. So in September 2014 the loan amount will be payed down to $128,685.47 for the 15yr term and for the 30yr term for September 2014 the amount will be payed down to $158,784.33. So I go another 3 yrs paying the $1,405.38 and when September 2014 reaches my 30yr term will really be payed down to $128,685.47 since I applied the 15yr payment in advance. When September 2014 reaches I glance to see what is the price/sq.ft for my subdivision, then I proceed with technique 2 which will be discussed later. If you apply this technique 1 with the "Jewel Foreclosure", "Investment Analysis" articles in this blog you can really advance yourself with wealth/money/assets.

Post Cards "Blank Backs"

Hi Prospects & Friends,

For me marketing the right efficient way will help minimize my business cost and at the same time allow me to put more time with analyzing other business related stuff. Last week I decided to use a particular kind of post card, "blank backs". I ordered 200 post cards for $12.99, and the post cards I ordered I made sure the backs were blank. The front part of the post card had image/design of my choice from the store's selections , but the back was blank because I wanted the ability to leverage the backs with my own verbiage. I created a post card template with my software and customized it with my own verbiage about me and my company and the services I'm providing for this particular post card. When my post cards arrived I immediately starting printing the backs with my template I created. The post cards are brilliant and great, and because I customized the backs myself I was able to re-create thoughts generated as I brain stormed how I wanted the final customized verbiage to appear on the post card back before I printed them on my laser printer. Since the post cards were $12.99 for 200, and they are still $12.99 for 200, I decided to order 10,000 more post cards, which cost me a total of $649.50. So since my customized post card template is saved, all I have to do is order the post cards as I need them with blank backs and print my verbiage from my customized template I originally created. I recommend any small business or anyone in general trying to get the word out about their services leverage using post cards coupled with their brains creativeness.

Jewel Foreclosure- "Bank REO"

Hi Prospects & Friends,

I wanted to share a foreclosure with you all that just hit the market a couple of days ago. The property is a bank reo, and it is priced well below market for this subdivision. The price/sq.ft. for this subdivision is $173.24 as of 8/2009, but the property is currently being listed for $102.82/sq.ft. See data below for this foreclosure:

Listed for $940,500

Sq.ft. 9,147

Lot sq.ft. 37,608

7Br/5Ba/3half Ba

4 car garage

So for a 9,147 sq.ft. house listed for $940,500, that has a market price of $1,585,000 you can't beat that deal, the house stands with $644,500 in market equity just by being a foreclosure. Great deal for the person going to buy this house, they will be of great fortune. This is one of those deals where you have to analyze the estate tax laws also which if not renewed after 2010 will cause this house to be heavenly estate taxed on top of the capital gains and other required taxes. If I bought this house I would just never sell it and enjoy realizing someday who ever I leave the house too will be of great fortune, once the home is paid off. I would make sure I've analyzed every possible tax scenario to keep the prior wealth accumulated with this house.

Investing With Real Estate

Hi Prospects & Friends,

I wanted to share with all investing with real estate can provide valuable long term rewards, if you do your research wisely. I've been investing in real estate since 2003, but have been doing real estate since 1997. Real estate is only complicated to many when they realize the problems they run into require someone of expertise for such problems. It is always wise to learn the basics of real estate terminology first, then apply the advanced techniques afterwards, if your entering into this business as from the investment stand point. If you're just seeking real estate as a supplement to you're income, and don't want to leverage skills into your time, I would still suggest hiring a real estate professional & still learning the basics of the real estate terminology. Learning the basic terminology of real estate will lay down the foundation, and guide you to your valuable longer term rewards future wise. Once you've learned the basic terminology of real estate and characteristics, then get yourself familiar with what it is you want to invest in, will it be:

1. Condos

2. Single Family homes

3. Land

4. Multi-Family

4. High Rises

5. ?/Etc

All properties listed above come in the form of residential or commercial. Depending how you decide to structure the investment from the beginning will determine if it will be commercial or residential. Example I will note is land, will you invest in commercial land or residential land? Another example if you decide to invest in single family homes their classified as residential, but if you set them up in a corporation mortgage companies and banks will consider them commercial & treat them as commercial loans, as well as tax purposes will heavenly change also. So you can see real estate becomes more complicated as you engage in it more, but the key is continuing to learn everything it is to know that applies to your choice of investment. Feel free to navigate my websites listed on right of my blog under "April's Business Websites" to learn more about me and my real estate knowledge. As well as reading this blog, I offer posts I actually experience and apply investment techniques to help ones understand the principles needed to advance the situation.