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Well realistically every house is a slow flip in a healthy market……
They have put in laws to try to prevent the fleecing – but it is circumvented by using LLC’s – remember all those seminars where they say “asset protection in the same breath as LLC – or “we set up an LLC for you” or “we secured this great property” or or or….. …. LMAO…… the greatest scam on the planet that I have heard of….. laughable – THAT should be illegal but the best thing about the States is that for every law in place to protect people, there are 200 million trying to figure out how to circumvent them…..
It normally starts with a genuine concern for protecting YOU … yyyyyyyyeeeeeeeaaaaaaaaahhhhhhhhh right.
In essence, buying a house, putting sweat equity into it and selling it for more than the actual sweat is what keeps the building industry going – so it is tough to say people can’t sell for a profit – BUT, the real estate industry is LICENSED to specifically prevent fraud, unethical behavior etc – it is when people DON’T buy through a licensed real estate agent they lose that protection and THAT is the message that just HAS to get out there….
At any point, you could have sued, got your money back and sued some more if you had been dealing with a licensee anywhere…. and THAT is where this crazy loop hole in the law comes into play – you could sue ANY US person who fraudulently pretended to be a buyers agent in the US as that is a legal term. You can’t sue them if they sit in Australia and call themselves a US Buyers Agent?????? HOW CRAZY IS THAT?
Further, other forums have even allowed unlicensed people to actually PITCH to their members. It is ridiculous.
It is wrong but back to the matter at hand….Jay has some GREAT points – did you and everyone reading this who has bought in the US got a seller’s disclosure when you were buying these things?
Jay…….
Actually no, ………… – there is another “rent to own” scenario that is DEFINITELY not vendor financing and is quite clever…. it goes like this (and is pretty genius AND gets the property owner quick funds – but what you would buy with the $$ is another matter in a rapidly increasing market)
FHA loans exist right now with 0% down – these are the loans that go to low income people, first home owners etc…..
SOOOOOOOOOOO trick is to find an “almost” qualified low income person (in GA they are the $1k down loans)….
HYPOTHETICAL STEP THROUGH
Property owner buys with cash property at $60k – standard 3-4 bedder in ATL comps are all 90k – 110k for financed equivs
Property owner thinks… I would like $110k for this and I would be willing to flip this propertyProperty owner uses this play:
Property owner wanting a quick flip contacts expert in this field. R/E agent advertising house puts it on Craigslist – they are a mortgage broker or r/e agent….they calculate the LOAN REPAYMENT AT $110k at today’s rate (haven’t looked it up so humor me that it is ?? $750 a month) – THAT IS THE ONLY FIGURE ANYONE FOCUSES ON…
So now…
Advertisement reads”LEASE TO OWN FOR ONLY $750 PER MONTH – this 4 bedroom 2700 sq ft house is a dream waiting to happen – lease this property to own!!”
$750 per month is less than the actual rent on this house by about $450……
R/E agent and mortgage broker finds the “nearly qualified person”, verifies they CAN fix their credit (i.e. pay off a credit card etc) to raise it to qualifying level, moves the “tenant” in while the loan is being processed and then within 2 months the property moves from a $750 a month rent to closed and the homeowner has just flipped their house and made top dollar. So long as the property has GOOD comps so that the property will appraise for the amount being asked… the new home buyer doesn’t squabble over the asking price (OMG THEY OWN THEIR OWN HOME FOR ONLY $750 A MONTH!!!!!) and the property owner makes top dollar in the shortest amount of time….
Normally the R/E agent earns much higher commission for sorting this all out and inevitably paying off someone’s $2k credit card debt or outstanding $500 medical bill etc….. but that is fine if they are earning 10% commission instead of something around 6%… they have wiggle room…. just need an FHA loan specialist, a good friendly appraiser and an r/e agent willing to do it….
This is all absolutely legal and above board. Hinges on 3 matters in my mind:
1) you are giving up a yield generating property and
2) you MUST buy in an increasing market and one where you bought about 30k cheaper already than the neighbors and
3) that you use 1031 exchanges to avoid the cgt.My only problem is that if I sold out of any of my own properties, I wouldn’t be able to buy them back in anymore…..but if you were PURELY looking for a cash play….. great way with the right team….I have one property I will do it with which is a flip in the making anyway and that money will continue to be played as a flip…
The new get fit regime….! ; )
Every agent I know in Vegas is after inventory “by any means”…again…. Think even just 10 agents with standing orders for 200pkus properties a piece…. Or the wholesalers who KNOW they have 20k orders split 5 countries…..
It is FASCINATING to watch ..
Oh, if you do invest in Texas…. Just hope to god you never end up as a defendant….justice does tend to lean on the “don’t mess with Texas” rule.., NOT overly friendly to non Texans….and snail pace…. Although that was from a friend in Dallas and living through it.
San Antonio of course is fab… Just crazy prices… Ditto with Austin.. I was in there in 2002..
There is a lot to be said for lower yields and ” safer,” slower cap rates … But if your entry price is below 100k, you are going to be back to basics, tenants and location and who is lookg after your investment.
What can I say? Listen to Jay?
If you own a 1 mill house in th states, you aren’t likely to be on this forum or renting it. If you are renting and buying these deals you need to get away from statistics. You need to eyeball your tenant, eyeball your house and know exactly why you bought that house and chose that tenant.
NOW THAT is where the stats come in… Become a demographer…. Be your tenant… Work out who they are or will be. Mine will probably be casino workers, retired or Hispanic families. Draw from that what you will… My retirees don’t say boo to a cow and I barely remember they live here… Must take shoes off and refer to them as Mr and Mrs… 3 years and not a peep. My casino workers ditto and my hard working hispanic families just feed me.
My problem children??? Lol… Oh they exist …. Never buy a home with a pool! When a layoff happens, be ruthless… Get on top of it in the first month…
Oh and yes, every client I have bought 10times better than when I did which was when those in the US pounced and it was a feeding frenzy on the way down….Vegas will probably end up showing Jan – August 2011 as bottom….I was “bought out” by then but we were the only bidders and lowballs were poss.
WAAAY, and now the feeding frenzy is back.. You HAVE to expect 30 multiple offers… HAVE. If you are buying through someone who needs to factor in hyper inflated repairs???. You would be better off finding your OWN agent and bidding directly…..a private retail buyer will always be able to bid more… Just pick a house that is move in ready!
I went to the auction for giggles… Omg h prices are STUPID high… Ha, funny to see the pros of snakes prices…still better taking your chances on an REO as trustees are putting more faith back into the open market and raising opening bids.
I have my own stats… One zip, 3 streets in 89142… From 58k back in 2011 to now 80k….cash buys in both instances.
I look forward to thinking there is a double/triple dip but as you said yourself….the world is flocking and I don’t see that stopping and when I hear that by the time people are “done and dusted” at 20 – 30k over real prices with bogus repairs and fees etc????
In Atlanta I tell everyone budget 2-3k in repairs per annum…. Double, triple what you are told and then add 10% for good measure. Outside jay I don’t hear many people being concerned on hyper inflated repair costs down the line…you should be… We all are… My brother, myself, my clients… Everyone needs to understand what thousands of foreigners with rental repairs means to property management and contracting companies…… Kerching kerching
this is a Vegas take..
Having just gone through the usual mind numbing continuing education for RE … What I can say is that for Vegas, in a room with 56 agents, one lobbyist and the president of GLVAR (our R/E realtor association), there are entire classes on post AB284 … And I read some of the Internet posts from October 2011 and just find it humorous with all the 20/20 you can with hindsight….
Fickle Freckle… What is the expression? Lies , damned lies and statistics?
2 days ago I rushed to the first vaguely viable potential in Vegas in gosh, um, I don’t know.. A month? 7055 sawtooth drive… List price 68k, COMPS over 90 so obviously agent ploy but still…I was reticent either way as I HATE pools… HATE them. Assume $1100. – $1150 in rents done up, taxes not much and insurance usual $450 etc…
I have no idea what it will go for but there were 8 cars sitting outside it as though there was a block party… All the usual folks and international reps there…Israeli contingent, Chinese, Brits and yep, even one bonafide Aussie (yay me)… I took photos it was that hysterical…
I love and always invested in Vegas as it is tight and boom bust (mobile homes worth $250k in ’06… On OPTIONS lol) but I am miserly…
By the time I waited (now for giggles, there were 6 sight unseen offers already 10k over list if rumors that we all spread were accurate), this was more as a lesson to my guys than anything else.. This house was trashed,again, had a swimming pool (aka vegetable patch as Americans rarely swim in the middle of the desert), and anything that might have resembled electrical was gone… Think 12k repairs…. That bad.., new a/c, pool pump, all plumbing, all carpet, every door… Just a lot…
I actually agree with you Freck… Buying ANYTHING for the sake of the gold frenzy that is going on is litlerally laughable and dangerous but what these stats aren’t showing you are the 25 international and local buyers representing consortiums with new cash pockets in excess of 5 mill a piece and when the WHOLE Vegas market has 4500 active properties on it and psycho buyers willing to pay ????
Couple that with government supply constructions and I will show you a real time bubble that has no legs but 2004-2006 never stopped anyone..
These are not home buyers….it is fascinating. I used to think the 30k discrepancy in prices was a financed deal versus cash (still is sometimes), but check titles and geojet … A large percentage are gold fever..and genius title hiding (helllooooooo LLC buyers!!!)
Is there shadow inventory?? In Vegas they say there are at least 30,000 GASP homes in shadow inventory….. Oh, but wait, I was sitting next to one agent bundling Fannie and freddie homes into 5 mill parcels and another with two 10 mill consortiums….
Prices go up, incomes remain the same, rents can’t increase until the jobs/economy turns……..although LOADS of construction now!!
Stick to your own personal investment goals. I can’t, nor can Freckle say what will happen tomorrow so go with what you KNOW… What will it rent for TODAY, what are repairs, TODAY and what are you willing to spend all up, including everything…..? There is a finite point and a finite amount. Stick to them and don’t get gold fever… In Vegas especially, the house always win…make it your house though that wins….If you want to play futures… Be my guest I go with today’s variables and if it makes sense it makes sense.
The whole world is pouncing…. Don’t just pounce for the sake of it.
Several!!, what line of law or accounting are you needing?
Gavin… Given the story is as I know it, I would say that those that are sitting smugly may yet learn something about Andrew Allan’s lack of any real US real estate knowledge and literally understand why this isn’t just a story that highlights the flaws but a MUST for preventing them. Guys… Please let Gavin explain…. It takes a sugar load of courage and a year of exhausting EVERY other avenue to put your name and face to a TV show to try to help others…. Andrew Allan of My USAProperty is STILL out there advertising but what is dangerous is, as Gavin will reveal, was either completely incapable of helping Gavin with even the first THING about the basics or didn’t want to…. Which is it??
All I see now are 2 rushes… Those that think it is easy to SELL real estate agent as an unlicensed tourist flipping properties in the US because they have 15years of owning Aistralian property and have purchased a few US properties now….
The 2nd are those buying into it who in 2 years time will realize that they may well be in Gavin’s situation….. In either case, perhaps Gavin’s story will help especially on a forum with people about to embark on this journey or have already started it……??
I agree with most of what you say… Especially the simplicity in essence of real estate… I think for me the support stems from the absolute and I mean ABSOLUTE knowledge that he HAD in his mind done due diligence and that was and is what makes me furious… But for this forum and one other there is NO ONE out there talking about HOW to do due diligence… In fact, they roll out expert upon expert reassuring you they have done the due diligence!!! it is literally possible to go to a 3 day seminar on US property and not ONCE find out the basics…. How to do due diligence…. How to buy a property, that the information is even vaguely out there…. Zillow, Trulia, Redfin, county websites….
You live overseas, I do as well but as we both know…. In Australia that information, the information that allows you due diligence is
NOT readily available and VERY few foreclosures come on the market… Let alone ones that anyone can just buy.In other words if you knew 100% that you COULD NOT buy such properties… Could not get the information of who owns the property and how much they bought it for and how much the neighbours bought it for and how much it would rent for etc… And you had all the “experts” lined up telling you that….. I CAN see how you could get fleeced. This happened over 2 years ago ….it has been going on for 2 years. It is actually ironic that we have a veteran US GFC person able to tell the story with 2 years of knowledge and we can learn how to avoid the pitfalls.
I was SHOCKED when I first came to Australia hearing how little information was out there that is SUCH public knowledge… But you have to pay for RP Data in OZ…
Put it this way..ll if I were to ask you if I could look up by myself the title deeds of the neighbours properties to yours in Brisbane, or what the last 10 sales were in your building, could I do it? I wouldn’t have a clue on the properties I own in Oz….. ! To be honest the thought of paying experts to deal with it all isn’t that shocking…
What I can say is that VERY VERY VERY few people on this forum would have bought their US properties from the only REAL method that protects them….. Ie via a US licensed buyers agent representing them….And learning this market. Very few would even know where to begin.
I do concur that real estate is simple, really simple and my absolute belief is you are better going it alone than anything else..
It is CRITICAL TO YELL IT …. Anyone can buy these properties ANYONE via ANY licensed real estate agent.. You don’t need to be part of some spruiking club…….
LLC…. only method of avoiding title cooling periods set up by many states to stop flipping…. So, if you do not know who will buy the property that you are flogging, you simply purchase under an LLC, then find some gullible foreigner willing to pay your hyper inflated prices and cleverly even make them pay for the very LLC that allows you to flog the property and circumvent all the rules stopping title transfers…
Theme: LLC = asset protection (right up until lawyer pierces the corporate veil but they don't mention that bit)… Therefore we love and care so much about you, random foreigner we are screwing, that to protect your asset, we have set up an LLC for you and we will only charge you $900 to do so and give you a US bank account in the process… Even though you could set up an LLC by yourself for $350 in total including business license and articles of incorporation (just go to http://www.nvsos.gov and click under "how to start a new business)… And the US bank account is pretty damn useless and also something ANYONE can set up for free from Australia <moderator: delete language>!
Oh, they care deeply about you…. They are EXPERTS at screwing you…funny how they can all sell fear and that you need an LLC but not how to look up title documents or find who bought the properties next to yours or how much they paid……
All free information from your local county government websites…..
For Clark County Nevada…… Go to http://www.clarkcountynv.gov Click on assessor property search and see…… Oh my gosh, look you can see neighborhood sales within 1000 yards of your property….. You can see who owns them, when they bought you can see the original deeds…. Fab tool for whether you are buying in an investor owned enclave….. Obviously if all have been sold in the past 2 years… Think scary!
No, we won't tell you that…. Or that if you have an asset worth only 60k, and you have 500k of liability insurance and that is all you own in the states, the chances of being sued are tiny to infintessimal if you keep your property to code and seriously???? 500k is two brain tumor operations on a tenant directly paid by your insurance company due to your gross personal negligence of a well documented fault.
No, we just need to sell the fear that you MUST have an LLC that you MUST have set up for you because we are just so caring about your asset and the chances of being sued…….which sounds like 100% likely…. Not tempting fate here but I have managed to survive a bloody large number of properties over the past 13 years in the states without being sued…. I would like to think that prevention rather than paranoia would be a good consideration. Um, really silly question but of all those out there in this massively litigious society …. How many of you have actually been sued and was it EVER not handled by your standard landlords insurance? I actually can honestly say I know of ONE person who was sued in Nebraska (snow) by a tenant and that is only here say.
LLC's definitely have their place and I have several BUT BUT BUT… Just be aware there is more to the LLC route than meets the eye in this instance…
If you want an LLC, set it up for yourself in the name of your choosing… follow the operating agreement if you file one, make sure you understand YOUR obligations for it and what to do……. Then think… Hmmmmm, maybe umbrella insurance is a good idea…(ie they pierce the corporate veil they get to me, they then hit my umbrella insurance).
I know I used the word abhorrent and still haven’t made Internet fast enough to watch but I just hope that people realize If the person who is your GURU is only focused on the front end sale, has never lived in these cities (good point on legality to reside in the US) what on EARTH is their level of concern on the backend when the real woes start… Ie hyper inflated repairs that aren’t actually done? Properties not rented etc.
It is really really easy to see how people could go down this path though… They are consulting “experts”. Flip, they say things confidently enough and the worst thing for them would be someone buying from the open market…. Fear…. You have to sell fear… No one could do this alone… Yet that is precisely what ends up happening… You end up alone!
Calling it for what it is… How can that get you sued? A misrepresentation of promises of returns and guarantees etc…. Even with the disclaimer… Coupled with the statement of being a buyers agent is definitely something that, were he licensed in the US, THAT would have allowed full recourse to the buyers in this instance.
It is appalling, tragic and sorry but caveat emptor doesn’t cover all bases when someone is absolutely coming to you for expert advice and yet you can’t even tell that person how to look up title on his own property??? I would love to hear why Mr Allan feels hard done by in this instance but all I know is that he, like others, have professed a level of expertise to advise others with very very little backing and the shame is that most would think there are regulations to protect them. It is a HUGE shock in this day and age that isn’t the case.
BUYERS AGENT = protection…..l. LYING about being a US buyers agent from Australia AFFORDS NO PROTECTION… God forbid you thought it did when you googled buyers agent…. I can see how people might think that is confusing…… 888properties confuses me… Vince stated he was a buyers agent and I had to question it… Buyers Agent is a US licensed real estate agent… quite frankly question everyone.ll obviously there are no laws on it! Vince has under his signature US Buyers Agent…. I still don’t know if he is or isn’t…Apologies if you are
Maybe that should be the line of questioning??
Those of us stateside and those stateside but Australians would be appalled…. If you are US, it is REALLY hard to explain how easy it is for us Aussies to get sucked in…..
People ask about due diligence…but if you absolutely 110% KNEW that there was no such thing … (RP Data being a sign up and pay scenario for the few who have even heard of that) …. And had never (gasp) heard of Steve M orJan/Ian etc (i wouldnt have heard of Steve M.. I dont do seminars!) …….and the only thing you knew about real estate was this very very superficial knowledge of your Oz investments that just sit there ticking over nicely (albeit atrocious returns) with the same property management company for the last 10 years and rents always go in on time so you don’t even need to check…… And then you are sold what SOUNDS like the same……. I mean, where is the risk???? Seriously…..???
Put yourself in their shoes and then if you are in Oz and talking to anyone, just direct them to Zillow, Trulia and Redfin…….
Easiest thing in the world to sell is fear. Knowledge to decide for yourself is far far harder. I know one woman who spent 30k on advance courses studying how now to be ripped off in the US market she was so worried about it…. Hmmmmmmm…
Jason Paris was the other person from the interview. Gold Coast based and he is right up there if not higher than MyUSAProperty on who not to invest in… Again, not sure how many details were public… My Internet is too slow to watch it….
No but get specific addresses…plug them into zillow, trulia, Redfin and go to the county website nearest to you and look up who you are really buying the property from. If you are buying through an LLC you are buying a flip. Ask in writing what they paid for the property….then ask for all and any repairs to be itemized…. And just check that you fully know what you are buying….and from whom. Obviously a licensed real estate agent can be sued if the facts were misrepresented and they wereactingbas your agent. A buyers agent IS a licensed US real estate agent…..they must put client above self….
Who is the person that has seen your house? Who is this company? What level of rehab and expertise do they have? Why do they recommend that house?
Then repairs…..use these as a yardstick…
2200 sq ft 2 tone paint whole house and patching is $1500
Appliances for a full set = $1k
Carpet… Don’t pay more than ?? $1.5 – $2 ? a sq ft ( carpet style will matter, ask what price make and style they are using …. Google it)…..remember to get precise carpet measurements… Even if using lowe’s remember carpet is 63 cents a square foot up to crazy high …. With underlay at .49 cents and whole house install at $97 (plus stairs). Carpet contractors should do better!Just get before and after photos…..and, make sure they are on time and on budget…. Who is overseeing repairs? Are you paying extra?
The greatest concern I would have is anything bundled in…… There are companies buying at 30k and selling for 60k… Be very aware.
WHHHHHHAAAAAATTTTTTTTT Alex how COULD you?? Okay line in the sand…actually, joking aside,Home Depot for lumber and essential supplies and materials (price) but lowes for lighting/design….
However my paint for spraying just went from home depot and i could cry….speedwall/speedcote interior eggshell…. Gone!
Might end up valspar Olympic …. Waaaah. Makes a huge difference. We are looking now at us paying $1500 for the whole house 2 tone paint interior (all materials) up to 2200 sq ft….unless anyone else can get $48 a 5 gallon paint that sprays well?
Sigh….
Get photos of before and after. If over “x” build in 3 quotes……
This is where you just have to stand firm and we all battle it. PM’s may not even be bothered with how much it costs as they just want it fixed…… Why home warranty programs can work well with proper management. Ask for call out fees for essential services….plumbing etc and keep your list at hand.
Thanks everyone… I didn’t see it but I hope something got out.
Starts and stops for me with only buying through a licensed US real estate agent I guess if I can sum it up… Anything else is playing a very dangerous game with professionals either out to rape you or amateurs in over their head….and dangerous amateurs at that…. I hope Gavin and Alan’s stories got across…..
Vincent – FINALLY obviously a real US licensed agent online! Guys this is a BUYERS AGENT…. The only caution I make is that you mention multiple states – flip – I couldn't even begin to imagine which brokerage you hold your license with in all those states!
Welcome – FYI…..There have been crazy spruikers on here and seriously, some of those that said they are US Buyer's Agents haven't even VAGUELY got their US real estate license… let alone been US residents or even SEEN the properties that people are buying – (and this is laughable) ha, half of them haven't even been able to explain WHY you would buy that house over the one 3 doors down….or worse – they are selling flips…. BAD flips.
Thank GOD for licensed agents and I am so happy there is another now to join our midsts…., tulia, zillow, redfin, spotcrime, listingbook etc…. and for those not familiar……under his license that he holds as a US Buyers Agent, Vincent will provide to you and pull for you full comp sales, comp rents, comparative market analysis for each house that you are considering as his client……. SO MAKE SURE YOU AVAIL FULLY OF HIS SERVICES…..and finally as a true buyers agent he can really put honesty into these transactions… CLIENT ABOVE SELF – and boy is he risking his whole livelihood and the wrath of the US government if he broke that mantra….
Everyone – in case you didn't know – the only people who can state they are a US Buyers Agent is someone who is licensed and under a brokerage in the US and you have signed up with them to legally represent your interests in the purchase of real estate from the open market within the US…ie from the seller…. he owes you BY LAW:
CARE
DUTY
OBEDIENCE
LOYALTY
ACCOUNTABILITY
CONFIDENTIALITYIn EVERY transaction….
Make no mistake, this is NOT a spruiker…this is someone that affords you protection legally within the US…..it is someone who owes you, and can be sued if they didn't provide to you, a fiduciary obligation….they are legally obligated to protect you, represent you and your interests in the purchase of real estate within the US. They are licensed to sell real estate within the state that they are selling and MUST present proof to you and duties owed to you…..
ALTHOUGH PLEASE REMEMBER – NOT EVERYONE IS AS WONDERFUL AS VINCENT IS AND A BUYERS AGENT SO ALWAYS BUT ALWAYS ASK AND CHECK THEY ARE INDEED WHO AND WHAT THEY SAY THEY ARE AND ASK FOR A LIST OF THEIR RESPONSIBILITIES LEGALLY OWED TO YOU AS A US BUYERS AGENT.
For instance – if you feel that a buyers agent in ANY way misrepresented the transaction, acted unethically or even VAGUELY put their interests (whether monetary or not) above their own, YOU CAN AND SHOULD SUE…. every cent they make must be reported, documented and run through their US broker's license (so please make sure you DO verify their brokerage)… I mean it is just no small thing… so do check which brokerage they are with in the US…. or which real estate agent is representing your interests in the transaction as your buyers agent.
But, as those of us on here who are US agents (Vincent obviously included) would be the FIRST to say…….. ALWAYS make sure you do ask them and triple check – you are LICENSED as my BUYERS AGENT within the state that you are buying property from, right??? GET IT IN WRITING……… Vincent obviously has far more experience and multiple licenses in several states more than Jay or I do……Flip, it was tough enough for me to get my license – I can't even imagine how much knowledge Vincent must have being a US Buyer's agent in all those states
FLIPPING KUDOS…..
..
I know I have mentioned it already but it is just so so fantastic to finally see a TRUE buyers agent on this forum…UNLESS YOU BUY THROUGH A LICENSED REAL ESTATE AGENT WITHIN THE US – IE A BUYERS AGENT, WITH THE LEGALLY ENFORCEABLE FIDUCIARY OBLIGATION TO PUT YOUR NEEDS ABOVE HIS, YOU HAVE NO LEGAL RECOURSE IF YOU BUY A LEMON…. AT LEAST YOU COULD SUE VINCENT TO THE FULL EXTENT IF FOR ANY REASON YOU FEEL HE DIDN'T PUT YOUR DUTIES ABOVE HIS.
It is the most reassuring thing – but as Vincent mentions several states, DO make sure that you get the specific state's duties owed and just TRIPLE check that you get in writing that they are indeed acting WITHIN the state that you are buying, as your BUYER'S AGENT…
That being said, I don't personally know Vincent so I am not trying to promote his services so I INSIST that you make sure, just as he would with anyone that WHOMEVER is acting as your REAL ESTATE AGENT WITH ALL THE LEGAL RESPONSIBILITIES OWED, that you GET THEIR LICENSE NUMBER AND CHECK THEY ARE LICESNED IN THE STATE YOU ARE BUYING IN… they are the only ones that can represent you and will fight for your rights.
ASK THEM AND GET IN WRITING
When was the last time this property sold and to whom did it sell and for how much?
Are you a licensed real estate agent and do you owe me a fiduciary responsibility
What are the repairs that were done on this property – if any and by whom? Ask for a line itemed copy of the receipts of any item – a toilet in the US at Bunnings equivalent (Home Depot) costs $79 to buy – a whole house to paint in 2 tone up to 2200 sq ft could not be more than $1700?It is HIGHLY reassuring that FINALLY US licensed agents are represented here……. this will NOT be someone who sells you a flip, you will be buying DIRECTLY from the bank itself…….
Put it this way – as I happen to be doing paperwork today:
Article 2 of the Code of Ethics requires that a Realtor (and all states have the same in their licensing rules I am just not looking at that right now…) avoid the exaggeration, misrepresentation, or concealment of pertinent facts regarding the property or transaction…. (like they bought it for 40k and are trying to sell it to you for 60k – if they did, you have recourse). Client above self – legally enforceable if you are using a buyers agent (again = licensed real estate agent in the US – not idiot in Australia with a pretty brochure).
If you have a licensed real estate agent acting for you in the transaction, this applies. In fact ANY real estate agent – even if they act for the other side they will still have a duty of honesty to you- so ALWAYS ask – what did this last sell for and when (forget 2006 prices – that isn’t the point – you are just wanting to know it wasn’t sold in the last 3-6 months for 40k less than you are paying for it and if you are okay with that) – the follow up is… if you do not know, please find out for me from the seller etc, get it in writing and satisfy yourself – at least then you have legal recourse if misrepresentation occurs. Ask for comps – both sold and rentals that are within 500 yards and are the same square footage and bedrooms. You can cross reference these from the GIS located on any county website.
If you buy through an LLC – it is a FLIP – you are NOT protected on the purchase even if you end up with a lemon and there was GROSS misrepresentation of yield, repairs, location, condition etc.
“We have secured these properties” are the first words you need to be VERY VERY aware of – if they have secured it, it is a flip and heightened due diligence is required.
I can not emphasize enough – you are ONLY legally protected if you use a US licensed real estate agent and make DARN certain that you ask them – WHAT DUTIES DO YOU OWE ME AND ARE YOU ACTING AS MY AGENT ON MY BEHALF – even implied agency will get you some recourse. If you buy a flip (or an LLC) you are NOT protected if you find out that the house was bought for 40k, marked up by 40k and the whole thing collapses in 2 months time.
Steve
You are most welcome – I live and die work wise to make sure that as OZ, NZ, EUR investors we are all at least armed to make informative decisions based on transparency…. and avoid some of the very very costly basics… (paying to set up a bank account leaps to mind)I live equally in Vegas and Atlanta (I actually have a fab little home while there in "Emma"wood for now but will be in Conyers with my amazing brand new 2700 sq ft 45k Jessica Way property…- it is at 2nd fit off)… …all right, it ISN'T Emmawood but Ellenwood however everyone at Home Depot there and in the agency joke about. As there are always 3 or 4 projects, everyone knows they become a bit of a packhorse for any time with me…(we do all the supply shopping for the projects so that no one scams us on supplies – if you are running multiple sites you darn well have to…)… there is one person who was just with me in Atlanta for a few days who may be reading this who can attest to it!
BUT, this is like big game hunting, or gold hunting and is THE most incredibly addictive and HUGELY fun thing any person could EVER have – OMG…. the thrill of the chase, the looking at the lists of properties (which of course you can get free of charge sent daily to you from any real estate agent) – although sign into Listingbook for Atlanta (just say you are a buyer and you can use my "dummy" login – "selectusaproperty" and "atlanta" if you wish just to play – they are all live properties and you can call any real estate agent you want to buy them) – or use GeorgiaMLS – OOOOhhhh….. actually – you HAVE to do this…when you get to Atlanta – download Redfin App for your iPad or iPhone – click on "nearby homes for sale" – BRILLIANT – then use Trulia (Current Location) for the rental comps – ha, I ALWAYS forget to add spotcrime!
You will get addicted to the hunt, you will fall in love with the market but you MUST just not get emotional, stick to your guns on the buy and view finding the right investment for you as much a part of the strategy as it is fun. This is about the right buy, the right repairs, the right budget, finding the right tenant and using the right property management company. You can use as a yard stick 7% of gross rents as a rule of thumb.
Why ruin your fun if you are going to Atlanta – choose your OWN property… look at comps, ask your contractor for a bid of repairs as you go through it with your r/e agent (aka buyers agent aka someone acting FOR you on your behalf), make a decision and leap!
MUST MUST MUST FOR ANYONE TRAVELLING TO THE US WHO HAS ANY INCLINATION TO BUY A PROPERTY….
DEFINITELY walk into a Home Depot (or Lowe's) – why, it will arm you with enough to call <moderator: delete language> on start up repairs. Ask anyone in the plumbing department for a demonstration of Sharkbite (you can do that at Bunnings too I think), look at these line items: all-in-one toilet ($79), toilet seat ($5.74 – the Bemis SKU 400-000), the Glacier Bay Builders Chrome Faucet at $26 (tap for sink)… then go to blinds….$4.95 (YEP) for a 34" x 64" perfect home or Bali blind.GRANTED, these are not INSTALLED but they WILL adjust your head to the level of costings used in the US.
You can use these prices as yardsticks – a whole house painted two tone, using a licensed and bonded painter up to 2200 sq ft in Atlanta should not be more than $1500 – with serious sheetrock patching – um $1700??
Then look at the carpet selections and the whole house install price of $97… (I would actually use Lowe's for install if I was going mainstream on carpet)…. look at the carpet per sq ft (choose one you like from 0.63 – 0.90 sq ft), look at the underlay per sq ft… (0.49 for 6lb). THEN meet with whomever you are using in the US for your properties and look at them square in the eyes and ask them directly who THEY use and what THEIR prices are….. add it up but they will know that you know enough. If someone wants to rape me on costs, tell me my truck needs repairing at $2k – I know I am being raped but what can I do….?? Know enough to at least know if you need to question it.
Look at BRAND NEW APPLIANCES (not that people generally use NEW – they tend to use warrantied rehabb'd with 6 month warranties)… but if you went run of the mill NEW (think Roper/Westinghouse/Tappan etc) you could go for a dishwasher at $219 (new), Stove at $350, Fridge at $350, washer and dryer each $350… – THESE ARE INSTALLED ON SITE FOR FREE AND INCLUDE HAUL AWAY OF OLD ONES (although I always donate to the drivers – they can sell them).
People are entitled to make money – it costs a lot of money to do business, E&O insurance, be bonded and the like but when these prices are from Home Depot or Lowe's and you could pick up the phone and call them in ….. just be aware about what YOU are being charged for – ESPECIALLY if project management is ON TOP of a "facilitation" fee. HELLLLLOOOOO?
Transparency. Have fun and again, just be very aware of the addiction. Yummy properties await!
Quick rough Eviction process in Nevada goes like this:
6th of the month the tenant is in default – you either post yourself a 5 day pay or quit notice or pay the sheriff to do it (I think about $39)…
Even if they pay you 99% of the rent, you can take it and still evict – you can evict for a blissful myriad of issues in NV… love it – including – get this a NO CAUSE eviction….lol! Okay, I am sounding like evil slumlord here but I got so burnt in Alaska when I started that you grow old and wise very rapidly and in my case you stop dealing with multiplexes but I have always self managed every property so I have the war wounds.
On the 5th day, they haven’t paid, you go back to the Sheriff and say sigh, they haven’t paid (interestingly they take your word for it – how bizarre)…and the sheriff will then toddle off down there, do a lock out and you get your house back… and keep the deposit, and sue them for damages and $300 for the eviction process…
By Day 10 you have a new rental sign up and by the 1st of the next month you could have a new tenant in there!
OTHER STATES – you beg and grovel for the tenant to just leave, please please please, just leave, no harm no foul….. and work with them in any way possible to avoid an eviction as quickly as possible…….and hope to GOD they are willing…
