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  • Profile photo of aussieinvestoraussieinvestor
    Join Date: 2003
    Post Count: 67

    Hello all

    I have just finished writing a journal on my trip to the USA last month. I was originally going to send it to those who expressed an interest in the updates by email, then I thought I might post it and share the experience with everyone but it ended up four and a half pages long, probably too long for a forum post.

    If anyone is interested in such a long post, feel free to let me know and I’ll cut and paste it to the forum. Alternatively, I can email it to you if you send me an email on [email protected] if you are interested.

    I’ve tried my best to make it an interesting read, but I guess you will be the best judge of that.

    I look forward to any responses or emails.

    All the best…Giraffe

    “Real Estate – The Foundations of Wealth”

    aussieinvestor | Digital Revenue Pty Ltd
    Email Me

    Profile photo of Mortgage HunterMortgage Hunter
    Join Date: 2003
    Post Count: 3,781

    Post it mate.

    Simon Macks
    Residential and Commercial Finance Broker
    ***NODOC @ 7.15% to 70% LVR***
    [email protected]
    0425 228 985

    Comments may not be relevant to individual circumstances. If you intend making any investment, financial or taxation decision you should consult a professional adviser.

    Profile photo of DannyboyDannyboy
    Join Date: 2005
    Post Count: 60

    Agreed! You should post it. Im sure most people would appreciate the read.


    Profile photo of aussieinvestoraussieinvestor
    Join Date: 2003
    Post Count: 67

    Thanks for all of the emails and the couple of replies on the forum. Below is a copy of my journal, I guess now by popular demand. For those who emailed me, I will email you a copy in pdf format.

    My USA Adventure by Peter Lockwood (aka Giraffe)

    Hello all

    You may have read my previous post titled USA Adventure. In that post I mentioned that I would keep those who emailed me, up to date on how the trip went. Well, it has been about four weeks since my return and I have been working flat-out ever since to get this USA thing to happen.

    I have made numerous telephone calls and looked at many properties, both on the internet and whilst in Rochester. I have made many new friends and contacts from my visit. In fact, I am so happy about how things went, I would love to share my story with all of you, not just those who emailed and PM’d me.

    Whilst I have not completely purchased a property as yet, I am in the process of finalizing the first. My main focus up until now has been to get a reliable team together in the US, before taking the plunge. I believe that I have now achieved this.

    Anyway, now is a good time to grab a cuppa and settle in for a run-down of my USA Adventure. Here’s how it all unfolded…..

    After getting on the plane on the Monday morning, I arrived at Rochester New York on the Monday evening, only to be the last one standing at an empty baggage carousel. I had last seen my bag in San Francisco, so somewhere between there, Chicago and Rochester were all of my clothes and bits and pieces. Off to a great start huh, not to mention the fact that I had been awake for over 30 hours, so the patience was really put to the test.

    Anyway, two hours later I got a message from the hotel receptionist to say my luggage had been delivered by the airline, so it was time to get some shuteye as my first appointment was at 10am.

    My first appointment was with a Real Estate agent that I had been in contact with for a couple of months prior to heading off. He was a gentleman that used to work at Kodak, then started his own Real Estate firm about twenty something years ago. I really liked his warm and friendly nature, which not fake. He left a note in an envelope at reception at the hotel for when I arrived, welcoming me to Rochester. He was looking forward to meeting with me and to show off his assistants, who were absolutely gorgeous. One of them was away for the weekend at a wedding and was late for work. She arrived when I was there and he interrupted our meeting to go and say hello and give her a big hug, probably illegal in Australia these days!!!!

    We sat and discussed the issues of foreign national investing and some of the complexities we Aussie Investors face. He drew up a map indicating areas to avoid and excellent investment areas. We nutted out a bit of a strategy and came up with some properties that fitted my profile, in pretty good areas. I then took the list of properties to go for a drive-by (by taxi), to get an idea of which houses I would like to inspect, more so to get a feel for the neighbourhoods and tenants.

    I went from the Real Estate office and pondered where I should go first. I decided to grab a cab and have a look at the CBD and surrounding areas. Without much knowledge of the area, I decided to pursue some independent local knowledge. Where’s the best place to go for local knowledge? Where else but to a place where people work in the community, so I called into the City of Rochester Fire Department.

    Those reading my previous posts will be aware that my job is with a Fire Service in Victoria. The Fire Services around the world are just like a big family (brothers and sisters) and these brothers (there were no women on duty) made me feel most welcome. But what unfolded during the afternoon took me by complete surprise.

    When I pushed the bell at the front door, a man in a white uniform greeted me. In a gruff voice he said yes, can I help you? I said that I was over from Oz looking to buy some real estate and was wondering if the guys could give an idea of the local areas, good areas bad areas etc. I then told him I was from the Fire Brigade in Oz and with that his face lit up and he invited me in for a cuppa. This guy was the Deputy Chief of the Rochester Fire Department and he was answering the door because the guys were out training.

    We got talking about the fire brigade and comparing notes, coming to the conclusion that both of our services operated very similarly and our call statistics were very similar. He then insisted I go and look at the 911 centre, where all of the calls for police, EMS, fire and other emergency services were received and dispatched. Before we got there, he took me for a guided tour of the CBD and inner suburbs, explaining where the problem areas were and where the city was spending most of the millions of dollars to revitalize Rochester. I guess if there was a high crime area, especially where people were burning houses down, he should know about it!!!!

    After showing me around the 911 centre, we finished the rest of our downtown tour and headed back to the station. The rescue company crew were back from training and we sat down and ‘chewed the fat’ for while. What surprised me was that there was not a great deal spoken about the fire services, it was mainly about real estate investing. I think it may have something to do with the fact that I had flown half way around the world to look at buying their houses. They kept looking at me and saying ‘your crazy man’.

    It probably also had something to do with the fact that these guys were into investment properties and/or the building game themselves. Many of them ran or were partners in businesses on their days off and most had investment properties. To give you an idea, between the crews that were on day shift and those I met coming in early for night shift, there was an electrician, plumber and builder. There was also a guy who ran a building inspection and radon testing business. But to take the cake, one of the on-shift fire investigators was a licensed realtor. He gave me his fire brigade card and then gave me his realtor card. I caught up with him the next day.

    It was reassuring that I had established these contacts, because firies look after firies, regardless of where they are from. They offered their assistance if I needed it during my stay and also confirmed the areas on the map my real estate agent drew up for me. The value of this visit was excellent.

    Now I don’t expect that anyone can go up to a fire station and get the same treatment or information but I reckon a good place to visit in any new area is the local police station. If you tell them what you are doing and seek their advice on bad areas in particular, I’m sure they will tell you because they are out amongst the community on a daily basis.

    Not long after I got back to my room, the phone rang. It was my real estate agent asking how I went in the afternoon and if I needed any assistance with anything. We had a quick chat and he then offered some suggestions on where the best places were to have a meal. What I really liked about this guy was that he was genuine and at no time did he try to sell me.

    The next morning my fire investigator/realtor friend picked me up from my hotel and we went to his office. I showed him my map and he once again confirmed the details on the map in relation to the areas to look at and the areas to avoid. He rang a few finance brokers of his and got the general story about financing foreign nationals. He then searched his database for suitable properties and printed them out for me. I didn’t purchase any houses from him, but I will be glad to pass his details on.

    In the afternoon I went and met a property manager that I had been in contact with for some time. He runs his own guttering and property maintenance business to compliment his property management company and owns many houses, about 70 I think. We had a good chat and he certainly runs a very tight business.

    He explained to me his process and business system and went on to explain that he was selling a lot of his inventory to investors, because he just got married and wants to buy a big house to live in. He even offered vendor finance to me if I wanted it, at 20-30% down, depending on terms. He is selling 20-30 houses to pay for his new nest. I didn’t take him up on his offer for a number of reasons, however if anyone wants his details I’ll be glad to pass them on.

    That wrapped up another great day, but apart from finding an excellent Real Estate agent, my quest to find a ‘Dream Team’ still had a long way to go.

    The next day I had two more appointments, one with an attorney and the other with a finance broker. I saw the attorney in the morning and really all he did was repeat what he told me over the phone. He didn’t charge me for the privilege and it was nice to meet him face-to-face. He is my real estate agent’s own attorney and legal advisor on property and has been for many years. I am now his client and will be putting all of my New York State transactions through him.

    I met with my finance broker in the afternoon. When I arrived, he was busy on the phone making and receiving calls, still trying to get me finance. He can get me finance for commercial property (5+ apartments and shops etc) under an LLC but residential finance was still a drama, especially for the lower amounts.

    We got talking and he told me about several rehab projects he and his partner were doing in various areas of Rochester. He showed me one of the houses and I was amazed at how thorough the builders and project managers were with their rehabs. The house I looked through was a three-family and the builders had redone the roof, porch, all new furnaces, appliances, carpet, paint, kitchens, bathroom, a lot of the plumbing and electrical. The house was literally stripped, except for the walls, and rebuilt.

    These guys sell the houses as what they call ‘Turnkey Houses’, meaning that they sell them as a ‘hamburger with the lot’. You get the rehabbed house with a Certificate of Occupancy, clear title, tenant, property manager and if you live in the US and qualify, 100% finance. I said to the finance broker, ‘if you can give me 100% finance, I’ll buy as many of these beauties as I can’. He tried his hardest, but of course the same ‘ol same ‘ol occurred with the finance. So for Aussies, we get the hamburger without the egg. We still get fries however, because the returns are still around the 20-30-ish percent and some even higher. Not a bad return for a totally refurbished house.

    Since returning from the US, I have been in constant contact with these guys and I am now going through the process of my first purchase with them. I will, however, be receiving many future rehabbed housing deals via email and telephone, so if you’re interested, send me an email on [email protected] . If I can crack the 100% finance code for Aussies, I may buy them all myself, but at the moment that isn’t an option.

    By the way, I am not a bird-dogger so there is no bird-dog fee for forwarding the property info to you, even if you purchase. My only request is that you only send through your information if you are absolutely serious about investing in the US. I am conscious of these guys getting bombarded with enquiries from people with little or no intention to buy, so whilst I have no hesitation in sending the information out, I will only refer people to my team who are fair dinkum. It is important that these guys use their time to find great deals for the serious buyers. I don’t want to mess up such a good thing.

    Anyway, I headed back to the hotel and had a relaxing afternoon. Hurricane Katrina had continuous coverage and was leading the headlines, so I watched CNN and fell asleep…..I was absolutely Bushed (sorry).

    So the next day (Friday), I reevaluated where I was at. I now had a great Real Estate agent, an alternative source of houses, a property manager through my finance broker, a very knowledgeable attorney and an insurance broker (also through my finance broker). All I needed now was some finance. I know of brokers in Australia who can arrange USA finance, not 100% unfortunately, so I wasn’t that concerned about not finding anyone in the US.

    So I decided that it was time for phase 2 of the trip. Whilst I was in the USA at this time, I wanted to visit Ground Zero in NYC on September 11. Satisfied with my progress in Rochester, I boarded the train (sick of flying already), for a very peaceful, scenic and relaxing journey to NYC.

    The memorial service at Ground Zero was very sad and moving and not only gave me a real appreciation of what the firies, police and workers in the World Trade Centre went through, but more so the amount of pain and suffering still felt by those who lost loved ones and colleagues. People still find it extremely difficult to talk about the events.

    The rest of the trip involved the touristy things we do, so I won’t bore you with the detail that is if you are not bored already!!!!

    For those heading over, here are some of the logistical decisions I made:

    Accommodation: Diplomat (Best Western) Lyell Ave Rochester. Comfortable, USD $55 + taxes, including comp. breakfast (with omlette).

    Travel: Taxi, when not getting a lift by my new team and the Deputy Chief.
    Intercity: If you are not driving, I recommend the AmTrak rail service. It cost me about $80 to travel from Rochester to New York City, comfy seats, on-board café and powerpoint for laptop.

    Communications: I just settled for International roaming on my mobile.

    Structure: LLC

    Bank: HSBC Bank USA

    A couple of lighter moments;

    The hotel I stayed at use swipe cards for the room entry. On the night I arrived, I left my card in the room, so I went to reception and asked for another card. The guy at the desk said ‘yeah, that will be $10’. I said ‘pardon’? ‘That will be $10’, he said. I said, ‘mate I only need to borrow it for a couple of minutes and I’ll be right back’. He gave me a funny look and as I only wanted to go to bed and the fact that my luggage was lost I said, ‘fine, I’ll pay the $10 and sort it out in the morning’. The attendant said, ‘I’ll see you at your room shortly.

    So when I got back to the room, I noticed the door was ajar and I didn’t need the card after all. Next moment I heard what sounded like a trolley coming up the hallway. There was the attendant pushing a fold-up bed on wheels. I said, ‘mate, I don’t need the card because the door was ajar and I was able to get inside’. He gave me another funny look. I said, ‘it’s OK, I don’t need the card anymore’, and showed him my card. He then peed himself laughing and said, ‘oh you mean carrrrrd, I thought you said caaaaat (cot)’. He apologized and said he would credit the $10 back to my room.

    On another occasion I went into a restaurant for lunch. The waitress asked for my name for the order. I said, ‘Peter’. She said, ‘I beg your parrrrrdon’. I said, ‘Peter’. She said’ I’m sorry, I didn’t get that’. I said ‘Peter, here I’ll spell it….P-E-T-E-R.’ She said, ‘Oh Peeetrrrrrrr, I’m sorry’.

    Anyway, I hope you had as much fun reading this as I had in writing it. It really was an adventure in more ways than one and I had a great time to boot.

    Don’t forget, if you want me to forward the details of the turnkey properties and my team to you and you are absolutely serious about purchasing in the USA, please feel free to email me at [email protected]

    Thank you for taking an interest.

    Peter (Giraffe)

    Post Script:

    I spoke to my broker friend and his business partner for over an hour yesterday morning on various topics. He has been actively pursuing finance for we Aussies and I guess Kiwis, for those on this forum. Below is an extract from an email I received this morning. It looks as though the egg may be possible after all!!! I’ll include updates on this with the email distribution of the turnkey properties lists.


    I think we made some progress on the financing issue. This afternoon I met with a mortgage broker that says he has funded loans for investors from Britain. He claims that funding loans for investors from Australia and New Zealand won’t be a problem. I asked him to put together the pertinent info (rates, amount of down payments, min loan size, etc). After we get the details we can review them and possibly conduct a test run to ensure the process works. This sounds like great news for us, but I will take a wait and see attitude until he can supply some paperwork and specifics.

    I also met with our property manager today. We discussed the unique concerns that Aussie investors have. He is putting together a package containing his management contract, lease and testimonials.”

    All the best…Giraffe

    “Real Estate – The Foundations of Wealth”

    aussieinvestor | Digital Revenue Pty Ltd
    Email Me

    Profile photo of nazzysmithnazzysmith
    Join Date: 2005
    Post Count: 102

    Mate that post is outstanding, thanks for taking the time to share your insights, all the best…

    Profile photo of Richo1Richo1
    Join Date: 2004
    Post Count: 27

    Great read Peeeetrrrrr !!!

    You should keep the journal going its great

    good on you

    By the way are you doing the mentor program ?

    Thanks Richo

    Profile photo of kiwiduvetkiwiduvet
    Join Date: 2004
    Post Count: 92

    why would he need to when hes already doing it for himself, its not rocket science there is no magic formula, devise your strategy go for it and learn fron the inveitable mistake you may make but these can only happen if you choose your own path.

    Or put your money with a Fund manager the choice is entirely yours

    when the going gets weird the weird turn pro

    Profile photo of aussieinvestoraussieinvestor
    Join Date: 2003
    Post Count: 67

    Thank you everyone for the positive comments, both to those who posted on the forum and by email. It took some time to type, especially for a two-finger typist, so I’m glad the effort was worthwhile.

    Richo, I am not in the mentor progam. Although I support the concept for those who want that guidance and education, I agree 100% with kiwiduvet’s comments.

    I can also relate to kiwiduvet’s comments when I lost some 25 Kg’s a few years ago. The most common question people asked (besides “are you suffering from an incurable illness?”), was “What’s your secret?”. There’s no big secret with losing weight. If you burn more energy than you take in with your food, then you WILL lose weight. There are many ways to achieve this, but the basic formula for losing weight is the same each time.

    Just like investing in Real Estate, if you bring in more money than you pay out, you WILL make money. There are many methods and strategies to achieve this, just like losing weight, but the so called ‘secret’ is really not rocket science, as kiwiduvet says.

    My belief is that by setting a goal that is a burning desire, then the answers (and money) will come. Also like riding a bike, if you fall and perhaps get a little hurt, which is inevitable at some stage, get straight back on and keep riding. Don’t let it get in the way of achieving your goals and dreams.

    All the best…Giraffe

    “Real Estate – The Foundations of Wealth”

    aussieinvestor | Digital Revenue Pty Ltd
    Email Me

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