February 2009 Newsletter
Hey Fellow Real Estate Investors, 2/20/09 11:33 am
Here's the newsletter that went out Monday. Since then the largest Building material supplier has asked to speak with us Tuesday evening concerning their bargains and cost saving programs!
Few folks have told me of their concern with the economy and how it impacts them. My son Lincoln (who'll be with Than for the next week) had a little insight: "Not that many know what's going on and sometimes people listen to someone with the worst outlook, who usually knows the least. There are people postisioning themsselves to take advantage of the economy, Watch Them!"
My outlook for Tough Times is Network! (Tuesday the 24th 6:30 pm with us at the SpringHill Suites) For EVERY situation, someone there has already been through it. Use their insight! See if you can get a little more exercise. I just ran to the Post Office and back. Try to eat a little less. Turn off any talk radio and listen to music or motivational tapes. and Let's roll our shirtsleeves up, see what's going on and make some money! Mike
PS I had lunch with another savvy investor last week who attended the Lord Branson (Virgin Air) meeting recently. He owns 400 companies, has 60,000 employees, $24 Billion in gross revenue. He just bought a fleet of the latest 787s for half price from Boeing in Seattle . He felt it's time to expand your business! This from a guy who just several years ago was looking at prison time in the UK for not paying his taxes on a Virgin record deal. His mother bailed him out. Good investment, ma!
Real Estate Insider (also Mortgages & Retirement planning)
www.MassRealEstate.net Massachusetts Real Estate Investors Association February 2009
1. How Landlords can avoid a Treble damage Lawsuit?
2. Don’t get thrown out of Court (when you have to go) for the wrong documents!
3. Stop a “Professional-Tenant” from the identity-theft of your apartment/house! Get Peace of mind about your next Tenant.
Landlord to Landlord – (2/15/09 Sunday, noon) just finished the paperwork with a new Tenant. Couple of changes I’ve made.
1.With prodding from the Housing Court Judge who speaks to us once a year (at the www.MassRealEstate.net meetings) – I now insist on a separate check for the Security Deposit, deposit it directly into the “Tenant Escrow” account and give the escrow paper and copy of the deposit slip to the Tenant ASAP. This avoids you/me/Landlord being sued for TREBLE damages!
2.He also lambasted me for not having all the Landlord forms on our site – They are now! And his eviction forms – They are now! Any problem finding these? shoot me a quick email MassRealEstate.net@gmail.com
3.For EVERY Tenant, after an extensive credit check (Credit, Arrest record & Housing Court record) I now INSIST on a photo ID (Massachusetts Drivers license or equivalent). I then photograph it on the application (of course it has to be them). One potential Tenant balked at this and my response was “When you buy an item for $100 with your credit card they want to see your ID. I’m renting you a house or apartment worth $300,000.00, 24/7 and you don’t want me to see who you are? Good thing I have a couple of applications before you!”
4.Do you know what 3 Inexpen$ive steps you can take to help keep Tenants?
How’s the Winter treating you?
Plenty of snow and cold here. This past weekend (so Tenants are home and will see us) I had guys Sweep the sand from the driveways and walkways, Vacuum the carpets in the foyers (entrance and stairs) and buy new trash barrels ($25. home depot). Just 3 inexpensive small efforts to show we care about the condition of the property!
_/_/_/_/ Today (2/15/09)
Now for my most important decision of the day. Will I cook Cuban-style shredded beef stew (ropa vieja) or the Tuscan-style beef stew with chianti? (in the Sunday Boston Globe magazine) I’m leaning towards Cuba! And I’ll do the Brain Booster Smoothie from Men’s Health that Lincoln likes so he’ll stop by for 60 minutes tonight!
Brain Booster Smoothie
The berries here aren’t just super food for your brain; they offer an important cancer-fighting bonus.
1/2c fresh or frozen blueberries
1/2c fresh or frozen raspberries
1c pineapple OJ
1/2c low-fat vanilla yogurt
1c ice
Just a hobby cooking on Sundays for family and friends, plus I get to eat what I want!
What’s your Hobby?
PS To the young gentleman, Steve, who’s buying his THIRD house since October 2008 when he came to his first meeting of the Movers and Shakers and began as a Part time investor. Since your girlfriend seems bored with your Real Estate interests and you feel like you could do it all day and night: What do you think your hobby or interest should be right now?
PPS Want to see how he’s doing it and you can too? Hint “In movement Man has a chance!” Norman Mailer
Mike Hurney Director, www.MassRealEstate.net
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Back to Real Estate & our BIG Presentation this month Tuesday February 24, 2009!
Now (Sunday 1-3pm) I’ll do my 10 Open Houses to keep pace with the market in my territory.
Some interesting things happening. I’m working on Credit, Mortgages and Retirement with Self Directed IRAs. Also gearing up for Joanne – “Get it SOLD before it’s OLD!” February 24 and our Bank-Owned Bus Tour Saturday February 28, 2009 This could be your Opportunity to buy into this Foreclosure mess. Imagine helping your$elf while you help others!
Where do you spend your money to SELL YOUR HOUSE in less than half the time your competition sells theirs?
5. Staging – Getting your house in it’s best possible condition for the least amount of money to show to willing buyers! The best stager I’ve met is Joanne, who’s staged two houses for me that sold ASAP and she’s staged 5 rentals for me with similar results. They rent quickly, in a slow market!
Here’s what Staging gets you:
* A fresh set of eyes to see more than you can! (as in, you can’t see the forest for the trees. Joanne picked up on the wooden chandelier in my Father’s house that I hadn’t noticed in decades and replaced it for $23.00 with good results!)
* Pride of ownership – Sellers often have deferred maintenance that they’re not even aware of BUT every neighbor knows about! So as you go to Plan B (rent it now and sell it when the market comes back) you can move fast in the rental market!
** With Staging, YOU Sell As Soon As Possible, often in half the time as your competition languishes and finally chases the market!
Find out how Banks keep you in a high rate to overpay on your Mortgage!
6. Credit
Want to increase your ability to borrow at a lower rate in the next 30 days? As a licensed Loan Officer I’m able to check your credit for a Mortgage or Refinance with you, Determine what should and SHOULD NOT be on your Report. Then show which items we can work on to increase your FICO (Fair Issac Company tri-merge credit report) to get the best increase for you. Often saving tens of thousands in a lower rate over the lifetime of your Mortgage!
Who’s the best person to come to our next meeting? February 24, 2009
Very limited to Active Investors who need contacts for contractors, money and deals. Contractors looking to work with Investors. Folks with money to lend to Retail Buyers and Investors. Brokers looking for listings and Buyers. Beginning Investors. Whatever you’re doing, Someone here has done it Better, Faster, Cheaper – NETWORKING!
Get in and take advantage of this Buyers Market!
7. Refinance & Mortgages
There are four programs I’d like to go through
* Real Estate Brokers - Show your Sellers how a Rate Reduction is better than a Price Reduction! Buyers can deduct the points! More Buyers qualify! when the “Income to Qualify” is much lower!
* Owner Occupied FHA with a low down payment and a great rate for qualified buyers to take advantage of this down market.
* An Investor only 20% down program when 90% of the investor lenders require 25%!
* Big investors! Cross collateralize when you borrow $1M to refinance or cash out!
Why should YOU pay for People on Welfare and Medicaid? when you could use that money for Your Own Retirement, Your kids and Grandkids! You’ve worked hard and been accountable, you desire your Prosperity!
8. Retirement
Tax Hostile IRAs will be the highest tax rate in the future as our government uses this money to support the programs (and Bailouts) they’re now implementing. Let them tap another source not YOUR retirement.
However if we convert now, to Tax Friendly Roths, we’ll be Tax-Free in our Retirement and able to pass along our legacies!
* Set up or enhance your retirement with Investments YOU know!
* Purchase Real Estate in your account unlike Stocks which take an analyst to understand and a turbulent market can decimate.
* Lend your Private money at your rate to well collateralized projects!
* Seek Private Placements from pools of investors eager to fund your next project!
Join us Tuesday, February 24, 2009 at the SpringHill suites for this and more information to further your Investing Career!
www.MassRealEstate.net Our 14th year! MREIA
Tuesday February 24, 2009 PO Box 307
Massachusetts Real Estate Investors Association Marblehead, MA 01945
6:00 pm Doors Open
6:30 Buy/Sell, Networking & FOOD
7:00 Credit Repair, Mortgage programs,
Staging Spaces, Retirement Opportunities
9:00 pm Recap and Adjourn.
SpringHill Suites 43 Newbury Street (US 1 North)
Peabody, MA 01960 978-535-5000
Members always come for FREE! Guests just $15.
Membership only $99/yr (781) 639-8616
Email MassRealEstate.net@gmail.com
I'm looking forward to seeing you soon! Mike
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Mike Hurney, Director MREIA
www.MassRealEstate.net Massachusetts Real Estate Investors Association
PO Box 307
Marblehead, MA 01945
781-639-8616
Mike@MassRealEstate.net
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December 2008 Newsletter
December meeting SURVEY (you may download and fax 781-639-8616, or turn this in at any meeting. Hard copies are available at the meetings. In order to plan our 2009 meetings in a responsive manner, please help us with a Survey.
We've put together a program for you to Buy, Fixup and Sell (Rent or Flip) by attending any 12 monthly consecutive meetings. We value and appreciate your input. Thanks, Mike
Where are you right now?
On these twelve components:
1. Find an area to invest in.
2. Find a property.
3. Open a Self Directed IRA account and Fund it.
4. Make an Offer.
5. Get your Financing.
6. Do your Inspection.
7. Purchase or Sell your Option to it.
8. Start improvements. Highest return/impact first!
9. Put it back on the market to Sell or Rent.
10. Finish it, the whole punch-list!
11. Sell it.
12. Increase your SD IRA or pay taxes.
13. Do it again.
www.MassRealEstate.net
Massachusetts Real Estate Investors Association
Please provide us with some feedback on our Speaker to be used for future meetings!
Date: __________ Topic: _______________
1. The Speaker’s overall Presentation was? (circle one)
Average Good Exceptional
1 2 3 4 5
2. What level Real Estate Investor are you?
Beginner Intermediate Advanced Donald Trump
1 2 3 4 5 6
3. Did you learn as much tonight as you expected?
I already knew it all Interesting & informative I can now go do it!
1 2 3 4 5 6
4. Did the Speaker devote most of her/his time explaining their techniques?
Average Good Exceptional
1 2 3 4 5
5. Are you planning to purchase the Speaker’s course or services?
Maybe later Yes
6. Will you be attending the Speaker’s follow-up All-day class or BootCamp?
Maybe later Yes
What other topics are you interested in?
Landlording (Finding tenants, Credit checks, Steering clear of Housing Court, Eviction Attorneys)
Foreclosures (Short Sales, Auctions, Forbearance, REOs)
Marketing (for Sellers, Buyers, Investors),
Flips, Buy-Fixup-Sell, Long term hold
Beginning in the Real Estate Investor Business,
Financing (A-borrowers, Subprime, Hard money, Private lenders, 1031 Exchanges, Self Directed IRAs for Real Estate)
Asset Protection
Finding deals
Contractors, (General, Roofing, Plumbing, Electrical, Carpentry, Concrete, Green)
Developing a Team, Master-mind group.
Any other comments:
Thanks, Mike cell 781-405-1845 email Mike@MassRealEstate.net. Fax 781-639-8616
WHEN RAISING RENTS, DO IT THE RIGHT WAY
One of the questions that occasionally arise among landlords is "How do I raise my rents?" This has become increasingly frequent as vacancies have gone down and rent levels are finally reaching their pre-2002 levels. The first and most important thing to be conscious of is that your tenant must be on a month to month agreement (Tenant-at-Will in Massachusetts) or have a term lease that will soon be expiring in order for you to raise your rents. This means no $100 rent jumps four months into a one-year lease.
Although not required, it can be a nice courtesy to your tenant to inform them of why you're increasing rent. Providing a brief letter along with the rent increase notice is a good way of doing it. Also issuing the notice with more than the required 30 to 60 days notice can also be a nice courtesy. In some places two sets of regulations exist pertaining to rent increases. For those whose cities do not have rent increase statutes, the process is very simple and straight forward. All that is required is a 30-day notice prior to the beginning of the rental period that you want the increased rent amount to take place. So, as an example, if you have a tenant on a month-to-month agreement and you'd like their rent to increase $50 effective June 1, all that is required is that you make sure your Tenant receives a Notice of Rent Increase a minimum of 30 days prior to June 1.
Hopefully with this information you can now go forward with confidence that you're doing things the correct and legal way next time you need to increase your rents. Genesee Landlords Association September 2008
(Editors note 1. Rick Connor, THE Eviction Attorney may still be offering a Landlord Special to review your paperwork for your tenancy as a Landlord for only $99. This is a bargain and like insurance, if you haven't done it, By the time you need it it's too late! 781-593-4146)
(Editors note 2. Sometimes we need to "sweeten the pot" to get someone into a vacant rental fast and THE WORST offer you can make is "First months rent Free" because you'll find every bum you've ever evicted or thrown out, lined up for the free month and you'll never get the second months rent.)
Tony Youngs had a GREAT DEAL for us at the last meeting The Complete Combo Systm plus his 3 day BootCamp call 781-405-1845 Mike's cell for the special pricing (ends December 25, 2008 at midnight! Merry Christmas).
| Tony's Complete Combo System |
$1294.99 |
|
This system includes everything. Its a combiniation of Tony Young's products.
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 |
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Merry Christmas and Happy New Year!
Will this Property Cash Flow?
$485,000 3 Family, Cambridge, MA
Monthly worksheet
1. Total Rent (1500 x 3 units) $4500.
Vacancy (-15%) (675.)
$3825.
2. Mortgage (75% LTV, 6%, 30 year)
$2170.
$2170.
RE Taxes 250.
Insurance 167.
Water & Sewer 67.
Electric 30.
Maintenance & repair 150.
Exterior (snow & landscape) 55.
Renting & ads (63. add to PM)
Property Manager (10%) 450.
$1169.
3. Net $486.
Yes!
If not, calculate this back to what it would “Cash-Flow positive” for and adjust your offer!
(Thanks to Tim Kanke, CPA Greater Dayton REIA and May Sun for the example.)
For instance if rents were only $1200 per unit, I’d only Pay $436, 500.00 Let someone else overpay and feed that Alligator (vernacular expression for negative cash flow. As in what can you do with an Alligator but feed it?) each month. After all you’re putting down 25% cash, in this economy!
November 2008 Newsletter
Identity Protection? I saw an interview this morning on a news show, as I passed through the gym to the pool (my 1/2 to 1 mile swim each morning which never gets easier). It was with Frank Abagnale Jr who's life story as a Con man was the basis for the Leonardo DiCaprio film "Catch me if you can?" He said with the Internet it's about 4000 times easier to get your identity and steal money from you. His advice:
1. Do not put letters with checks in them, in your mailbox with the flag up - Thieves see this, take the check out, place it in dry cleaning fluid to remove the "To" and "Amount" then place their name in that "To" part and of course increase the "Amount". His solution - Place checks in a local USPO collection box or a box at the Post Office itself. Also get a Uniball pen for 29 cents at the local store, that ink can't be erased the same way.
2. If you are doing any financial transactions online do not use a wireless connection he can drive down your street with his laptop and pick up your account and passwords. Use a hard connection to your computer for your financials.
3. If paying online always use a credit card. If something goes wrong on a debit card you eat it. Goes wrong with a check, you eat it. Goes wrong with a credit card the card company is completely responsible!
Parade Magazine November 9, 2008 excellent article about our (USAs) national debt. We hear how we owe 1/5 of our Gross Domestic Production to foreign governments. The Creditors of this $2.67 Trillion are Japan $586B, China $541B, UK $307B, OPEC (including Libya, Iran, Iraq, etc) $180B, Caribbean bank centers (including Bahamas, Bermuda, Cayman Islands) $148B. Source US Dept of the Treasury
Last night at our Movers & Shakers meeting (11/14/08) several deals were brought up and at first, folks, not currently investing, tried to shoot them down. However our intent soon became What would it take to make this a great deal and we worked on that. It did bring the following quote to mind, from Theodore Roosevelt (You can insert Person for man and it may make more sense since many of our successful (understandably) are women!
“It is not the critic who counts; not the man who points out how the strong man stumbles, or where the doer of deeds could have done them better. The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood, who strives valiantly; who errs and comes short again and again; because there is not effort without error and shortcomings; but who does actually strive to do the deed; who knows the great enthusiasm, the great devotion, who spends himself in a worthy cause, who at the best knows in the end the triumph of high achievement and who at the worst, if he fails, at least he fails while daring greatly. So that his place shall never be with those cold and timid souls who know neither victory nor defeat.”
Mike H - This is my second favorite story which I've been hearing in Real Estate circles since about 1982. Point is don't listen to the radio or bother reading the papers. Like Nike footwear company says:
Just do it!
The Man Who Sold Hot Dogs
There was a man who lived by the side of the road and sold hot dogs. He was hard of hearing so he had no radio. He had trouble with his eyes so he read no newspapers. But he sold good hot dogs. He put up signs on the highway telling people how good the hot dogs were. He stood by the side of the road and cried, “Buy a hot dog mister?” And people bought.
He increased his meat and bun orders. He bought a bigger stove to take care of his trade. He finally got his son home from college to help him out.
But then something happened.
His son said, “Father, haven’t you been listening to the radio? Haven’t you been reading the newspapers? There’s a big recession. The European situation is terrible. The domestic situation is worse.”
Whereupon the father thought, “Well, my son’s been to college, he reads the newspapers and he listens to the radio. He ought to know.”
So the father cut down on his bun orders, took down his advertising signs and no longer bothered to stand out on the highway selling hot dogs. And his hot dog sales fell almost overnight.
“You’re right, son,” the old man said to his boy. “We’re certainly in the middle of a great recession.”
Important Links
FDIC Insurance increase on deposits October 2008 $100k to $250k http://www.fdic.gov/news/news/financial/2008/fil08102a.html
FDIC site Consumer Protection, etc http://www.fdic.gov/
Consumer Credit Counselling Service recommended by the American Banksers Association http://www.moneymanagement.org/
Northeast Housing Court http://www.mass.gov/courts/courtsandjudges/courts/northeasthousingmain.html
Massachusetts state Government http:/www.Mass.Gov
Internal Revenue Service http://www.irs.gov/
We're Listed On The Boston MA Business List<a href="http://www.bostonmabusinesslist.com/business/1378283.htm" ></a>
| Tony's Complete Combo System |
$1294.99 |
|
This system includes everything. Its a combiniation of Tony Young's products.
|
|
|
|
Email Newsletter October 2008
Why I hate cellphones
Robert F. Tulloch Jackson areaLandlords July 2008
My first encounter with "radio phones was in about 1958 when I tried building a set of really crude devices. Telephone handsets and tubes. Good grief. You could almost pick it up. In the late 80's I got a really nice 5 watt Nokia moiunted in my car. Handset up front. Really powerful. Worked great down in Texas where I used it on the job. It was great as long as it lastedand I didn't mind the bill.. In the early 90's I went to work in Indonesia. Really BAD phone and electric service out in the villages. I got a 5 watt Motorola carry phone, put up a 60 foot mast and built a beam antenna pointed to a volcano 160 km away. Had to come back to the US to get some very low loss cable to reach the antenna. Worked great. Had 24/7 to San Fransisco voice and digital. Could not have done my job without it. What was different about then and now is that everyone did not have "cell phones". My phone in Indonesia cost $3500.00 and my bills were about $2500.00 per month in 1992. Very selective. So why would I hate cell phones? Well there are several reasons:
1. The landscape has been polluted with cell towers on 1 mile centers across the whole country. The only think I can imagine being more offensive to the landscape are wind generators on 300 foot centers across vast areas.
2. People
SubPrime Mess - I was listening to an "expert" that said This Mess occurred because the Liberals wanted Homeownership to rise from 60% to 70 in the early 1990s however it took awhile. Subposedly the restrictions that govern mortgage acceptance were relaxed. 6 years ago (2002) 1 in 50 mortgages were SubPrime. 2 years ago (2006) 1 in 3 were SubPrime. Wow, when I was writting a lot of mortgages the lenders I dealt with were very strict. If you had one of the 4 cormers of the Box which was weak you'd better show strentgh in another! The 4 corners were
Loan to Value 70% Max on a non-owner occupied property. 95% max on an Owner occupied.
Reserves - At least 3 months and more often 6 months of payments in your bank account.
DTI - Debt to Income, ratios 28/33
FICO score of 680+ - Fair Issac Company Tri-merge credit report using the middle score. And of course no mortgage lates in the past 36 months. Solid job history for at least 2 years. Mike Hurney
WARNING! Don't be swayed by These Words!
(from - March 2007 JALA, GLA October 2008)Deadbeat applicants have learned the right words to get amateur landlords to accept them as tenants. Here are the 5 prime examples:
1. Saying that they are a good Christian. There are landlords that still love hearing that and if you ask them about their tenants they'll say "Oh they're good CHristians, they will be fine." 2. Saying that they will do all the work that needs to be done to the house. There are landlords( mostly elderly, cheap or women) that love to hear things like that and will take them up on that in a heartbeat. 3. Asking if they can plant flowers. That line still works or they wouldn't keep saying it. 4. Offering the security deposit and rent in cash right on the spot. This works very often. Some landlords don't count rent on their taxes and offering cash gives them tunnel vision.
5. Offering two months rent in advance. Oh this must mean the have a good job, etc. I just hate the thought that some tenants are getting wiser and getting their landlorsds wrapped around their finger. I know this helps the playing field for me but the problem I'm having to put up with is they always try it on me
Mike Hurney The tricks that have been tryed on me, that I recall are.1. A bank Check written out to Mike Hurley for the Security deposit and first month's rent. Problem If I cash it or deposist it , that's fraud because it is not my name! 2. Also in Massachusetts the Security Deposit MUST be deposited into the "Security Deposit Escrow account for Cheryl Tenant" otherwise it's a misuse of the Deposit. 3. Bait and switch tenants - Perfect tenant (tenant checking of credit, references and housing court issues. All good.) moves in and out the first day. His sister, fresh from rehab, moves in. Continuous 24/7 parties and good adjacent neighbor tenants give notice.
Remember - I've never had a Bad tenant go Good on me. If you get that feeling in the pit of your stomach, pay attention, you've spent How many years developing your intuition? Mike
Email Newsletter June 2008 Good afternoon, Fellow Real Estate Investors
After next Tuesday's meeting we'll all have a handle on our insurance, with sold coverage, savings and an understanding of our limits, from Jim Tracey, (thanks for the referral Max)_/_/_/_/_/_/_/_/_/_/_/_/_/
Mike Hurney, Director MREIA
Massachusetts Real Estate Investors Association
PO Box 307
Marblehead, MA 01945
1. Main meeting next Tuesday, June 24, 2008
2. Last Fridays Midmonth
3. What's up?
4. Auctions
5. To be Removed.
1. Main meeting next Tuesday.
Here's the Post card that went out last week:
***
www.MassRealEstate.net Our 14th Year!
Tuesday June 24, 2008
Massachusetts Real Estate Investors Association
Talk about ASSET PROTECTION? As our insurance costs go up and our coverage actually Declines, how much do you really need?
Jim Tracey, Insurance Broker analyzes Mike’s coverage (now $12K/yr) to make specific recommendations! Correct yours & save money
Dawn Duncan, President of Homes That Change Lives is helping Matt, 27 with Muscular Dystrophy who is being evicted from a Foreclosed apartment. Let’s help Matt who’s “Paying it Forward”!
6:00 pm - 7:00 pm Members Only, Rehabbing for Profit Subgroup.
6:30pm - 7:30pm FOOD, Registration and Networking
7:30 - 9:00 pm Auctions, Dawn & Insurance
.
Springhill Suites 43 Newbury St(US 1 North) Peabody MA 01960 978-535-5000
Members always come for FREE! Guests pay just $15. Membership only $99/yr. (781)-639-8616 Email -
Mike@MassRealEstate.net
***
2. Midmonth.
Interesting meeting last Friday night.
John, Jim, Karen, Jerry, Beth and we missed Ruth.
Jerry & Beth are interested in a local property that has been reduced in listing price 6 figures and they suspect it's because of an underground fuel oil tank.
John's working two full time jobs and working on short sales. He's sent out 2 hundred letters and sat with 6 people facing eminent foreclosure. He seemed discouraged but 6 out of 200 letters is huge in the direct mail business! We worked a scripts, referrals and closing. I'm sure John will update us Tuesday!
Jim is interested in working as a buyer's broker not just RE brokering his own deals.
Karen's a graphic designer with ads and marketing helping some of our members define their campaigns.
3. What's up?
Started our Summer projects last week:
Paint 3 houses.
Put on 5 roofs.
Replace 2 sets of outside stairs.
Paint foyers.
Hot water to coin -ops.
Clean storage areas.
Install electricity to outside areas.
You guys get your Summer stuff going yet?
4. Auctions
Yesterday I went to 4 Auctions
617 Lynn St 1 PM
146 Timson 2 PM
35 Deer Park 2 PM
217 Euclid Ave. 3 PM
I only video taped Euclid. But with the bank there, the owner playing "..my Lawyer is coming!", The Tenants protesting. Roto Rooter waiting to get paid and two other potential buyers.
What happened??
I'll have the video for you Tuesday! Mike
See you in Peabody Tuesday, Mike
5. No longer interested? To discontinue hit Reply
type Remove in the Subject Box and Send.
Massachusetts Real Estate Investors Association
Newsletter May 2008
Meeting last Tuesday of each month,
SpringHill Suites, 43 Newbury Street (US 1 North) Peabody MA 01960 6:00 PM (978) 535-5000
Member – National Real Estate Investors Association Inc
Tuesday May 27, 2008
HOME BUYERS How to Avoid 5 Costly Mistakes!
Tiger Inspectors will show YOU how to UNCOVER What’s wrong with this Property? and How much to fix it?
ONLY 4% More to Build “GREEN”? & it’s paid back in 4 years!
John, Elizabeth & Jim introduce YOU to Crown and Arxx ICF system. Traditional stick building’s obsolete?
6:00pm - 7:00 “Closed Door” Subgroup on Robyn’s “Rehabbing for Profit”, Must have attended 5/10/08 Seminar (or bought her course) AND be a current www.MassRealEstate.net Member (or pay a $25 guest fee).
6:30pm - 7:30 FOOD, Registration & Networking
7:30 - 9:00pm Tiger Inspectors &
Crown Arxx ICF builders
.9:00pm Recap and Adjourn
.
Last Month:Great information with Robyn and 52 folks joined us for the ALL_DAY “Rehabbing for Profit” Seminar. In the Survey from Saturday almost everyone requested a follow-up Subgroup.
You asked for it, You’ve got it!
May 27 from 6:00 – 7:00 PM Robyn’s Buy-Fixup-Sell system "Rehabbing for Profit"
If you're one of the 52 folks that attended Robyn's class with us Saturday 5/10/08 or you've purchased one of Robyn's courses we'll see you before the main meeting. Must also be a current member of www.MassRealEstate.net or pay a $25 guest fee.
Participation REQUIRED. You must do something before the meeting that's in Robyn's course:
Buy, Fix-Up and Sell
Find the money, Motivated Sellers to buy from.
Contractors to Fix-up or Buyers to Market to.
Legislation
I Joined 60 group leaders from around the country for our “Day on the Hill” April 30. We met the Senior Senator from Ohio – “Look at this as a Meal and you are not at the Table. Someone is eating your Lunch unless you are there and represent your interests!”
We had (42) 30 minute sessions with our 6 teams in the Rayburn, Longworth & Cannon HOB (House Office Buildings) and the Russell, Dirksen & Hart SOB (Senate Office Buildings) to meet legislators enacting rules to save us from the mortgage crises. We focused on the Foreclosure Rescue Fraud Act and an Installment Sale Proposal. We learned we never try to “Kill” a bill only add amendments to help it.
Half way through the day, the Foreclosure Act was withdrawn by its author and Installment Proposal went into amendments. Success! You would not believe this system of our Government. Next time, don’t miss it. Let me know you’re interested and join us!
See you May 27! Mike Hurney,
Should You Lower the Rent to Fill a Vacancy?
Mr. Landlord, Jackson Area Landlords Association monthly newsletter
Should you hold out for your asking rent or lower the price to fill a vacancy? I’ll tell you what I concluded with my own rentals. First let’s clarify that this in no way refers to dropping your standards in order to fill a vacancy. No experienced landlord will dispute the fact that you’re better off with an empty apartment than having a full apartment with a bad tenant in it. But how long do you keep an apartment empty waiting for a good tenant to come and pay your price?
Over the past two years, I’ve had a string of vacancies that would make any landlord shudder. The local economy has been terrible and at any given time, I typically had 15-20% of my apartments vacant. I spent lots of time advertising and working to fill the empties but nothing I did seemed to help. Most of my empties stayed that way for months and months. As apartments sat empty, we’d try lowering the rent $25 per month and we’d increase the advertising campaign. After another month or two, we’d drop the asking rent another $25 per month. There were several reasons that we dropped the rents slowly and cautiously. For one, we thought our rents were fair and our whole budget was based on charging those amounts. Another reason was that other tenants living in those same buildings were paying those same rents and I didn’t want to deal with the turmoil of angry tenants who were paying $975 per month when an identical empty apartment was now being advertised for $950 per month or even $925 per month. So I tried to hold to my original asking prices (or close to them) for a very long time in the hopes that things would start to pick up.
After close to two years of fighting this battle, I decided to waive the surrender flag. I still had close to a 15% vacancy rate and the monthly loss of rents was killing me. I dropped all the rents on the open apartments by $125/month and started as advertising campaign that our apartments were affordable and the most reasonable around. Within a month, we had filled almost every vacancy. Even though these lower rents had lowered the combined monthly rent collection by around $1000/month, it was far better that the $7,000 plus that the empty apartments were costing. Now that they were full, our advertising costs dropped and we no longer had to pay the heat and electricity on these units that were previously empty. No complaints yet from the existing tenants who are still paying the original higher rents but I expect a few complaints will roll in over time. I’d much rather deal with a few of those than have that huge rent loss each month.
So what did I really learn from all this? Well. I’m not just going to drop rents any time a vacancy occurs. That would be silly and unnecessary. However, I’m not going to hold out for months and month to rent a place for a certain amount if it just isn’t working. If I can’t rent an empty apartment after a month of showing it. I’ll instantly drop the rent $50 to $75. If it still doesn’t rent after another couple of weeks another$50 to $75. If it rents at $150 below what I had originally planned, that’s a loss of $1800 a year. Comparatively, if a $900 apartment sits empty for four months, I’ll lose $3,600. So I’d rather rent it for $825 or even $750 if that’s what it takes to get it filled right away.
When the local economy improves, I’ll work at raising some of these rents up closer to normal. Also as the economy improves, perhaps I won’t be as quick to drop rents. But for right now, when apartments don’t rent, I’ll drop the asking rent and drop it fast.
MH – Last year as a vacancy occurred in my town I’d have to clean (immaculately) and lower the rent $100/month. I even had to Delead a unit (which is almost against my religion) actually it’s the law, just to fill a unit.
However in Salem, when a vacancy occurs all I did was put it on Craig’s List but then I had to take it off within a day, otherwise my phone would ring off the hook. This is a huge change for areas and I figured out why. Salem is closer to 128 shorter commute, commuter rail to Boston and there’s a lot things to do and places to go for younger people who are usually getting their first or second apartment before they buy a house.
Anyone check out the Sunday Boston Globe? 5/18/08 City & Region Section AT A LOSS by David Abel
The article tells how over 2.2 million Massachusetts natives left and live somewhere else. And 1.2 million people from other states now live in Mass. There are 1 million residents here who were born in another country! Since 2000. Out of a total population near 6.5 million. The current administration is placing $2 billion to upgrade the state’s public college and university system. 60% of state college graduates take their first jobs her in Mass vs. 30% of private institution graduates.
But the woes that got us here are Lack of good jobs, High housing costs and Inflation in the costs of living.
The reason I point out this decline in Population/Occupation is not for “Woe is Us” but that it’s a new market out there for us. You’ve got to be A+ where we could get by with a C+ before and have Appreciation do the rest. For instance with Real Estate we are now in an International Market. Don’t think so? Go to Costco in Waltham. Last Saturday I stopped there and it was wall to wall people. Only one in 20 were Americans with English as a first language and mostly couples shopping! Don’t get me wrong I don’t mean this is bad. No this is a fact! Use it to your advantage! Like Gravity, terrible if you have to lift something heavy but it sure beats flying off into space!
HOW LONG WILL THAT HOME SWEET HOME LAST?
By Joe Rizzo
President, Tiger Home Inspection
You're considering buying that home of your dreams--a federal Colonial dating back to the 1700's. All your life you've wanted to live in a genuine antique, and you're about to realize your wish.
When budgeting for a home purchase and upkeep, you should consider the expected life of systems and components of that house. For example, a furnace has a life expectancy of 15-25 years. If you're buying a house with a 22 year old furnace, the odds are good that you might need to replace it in the not too distant future--and that's a $1,000-$2,500 expenditure you might not have originally considered. Be sure to get a solid, candid appraisal of the condition of the furnace -- and other components of the house -- prior to "signing on the dotted line." This will help plan your expenses and may be a negotiating point on the sale price of the house.
A home inspector can provide a guide as to the condition (and remaining life span) of items in your house. While this isn't intended as the "last word" on life expectancy, it provides valuable insight as to what you might expect.
For your convenience, here are some average life expectancies for different house components. Our first article will address the exterior of the house; the next one will look at the inside.
Roofs. After the winter we've had, don't be surprised to see roofing contractors working overtime this spring and summer! There are a number of different type coverings used on roofs in New England. Asphalt shingles, a fairly popular option, are usually good for 15-25 years. Wooden shingles are good for 10 to 20 years, whereas wood shakes last from 20-40 years. The truly long-lived roofing materials include metal roofing, which is good for 20 to 60 years, and slate shingles, which can last anywhere from 50 to 100 years.
Chimneys. Your longest-lived chimney system is generally masonry construction with a clay liner, which can last from 60 to 100 years. Without a liner, the life expectancy is between 30 and 50 years. Metal chimneys are comparatively short-lived, usually between 10 and 20 years. "Pointing up" a chimney, or repairing joints, can add 10 to 20 years to its life.
Gutters. Some homeowners prefer the wooden gutters to seamless aluminum, although both are fairly good investments. Aluminum gutters last 15 to 25 years, whereas wooden gutters can be expected to last anywhere from 20 to 30 years.
Porches. Treated wooden porches can last up to 30 years, whereas untreated wooden structures are probably good for anywhere from 5 to 7 years.
Siding. Wood panel and wood board siding has a life expectancy of anywhere from 30 years to the life of the building. Wood shingles generally last 20 to 40 years, whereas asbestos-cement shingles are usually good for the life of the building.
Windows and doors. Double-hung wooden windows can last 40-50 years; and steel casements and jalousies, 30-40 years. Interior doors are good for about 10 years, and garage doors last 20-30 years.
Driveways. Asphalt driveways last 10-15 years; concrete 20-30 years and gravel, 10-20 years.
What is used in constructing the components of a home is a matter of personal taste, and availability. Wooden gutters aren't necessarily superior to aluminum ones (although they generally require more maintenance!). It really comes down to a matter of taste. As a prospective homeowner, however, you should know as much as possible about what maintenance and replacement will likely be required on the home you are purchasing. Help keep the house of your dreams from becoming a nightmare!
Typical Inspection
Condition of the roof surface
Exterior chimney
Exterior siding
Exterior trim
Exposed gutters and downspouts
Foundations and sills
Yard drainage and landscape
Basement entrance
Window wells
Exterior outlets and lighting
Any evidence of wood destroying insects
Ground pitch (making sure it is away from the home)
Exterior and interior of garage, decks, porches, walkways and driveways
Retaining walls
Accessible foundation and floor
Crawl area and ventilation
Windows
Load bearing girders
Support columns
Sill, sub floor and floor joists
Interior chimney
Bulkhead/walkout
Check for evidence of wood destroying insects
Inspect for water penetration, past or present
Fire grade sheetrock
Emergency shut off
Exposed flue and damper from heat plant
Burner/Gun
Fire box liner
Boiler
Circulator pump
Zone valve and pipes
Furnace, circulator fan and filter
Duct work (in basement)
Thermostats
Fuel Tank
Accessible wiring
Service panel box
Fuses and circuit breakers
Service panel box
Junction box covers
Switch plate covers
Supply and waste systems
Visual condition of accessible feed lines and connectors within structure
Visual condition of accessible waste lines/connections within structure
Main vent stack
Accessible well equipment
Laundry tub
Washer/dryer connections
Hot water heater
Interior sewer ejector pump
Doors
Fireplace/wood stove
Stairway and handrail
Halls
Skylight
Bathroom and all fixtures including tile/fiberglass
Kitchen and all fixtures
Appliances: stove, garbage disposal, dishwasher
Ceilings, windows, walls, floors, doors, electrical outlets, heat sources in every room
Disclaimer:
This newsletter is published by and for the members of the Massachusetts Real Estate Investors Association.
While designed to provide information that is both accurate and authoritative in regard to the subject matter covered, it is distributed with the understanding that the publisher is not engaged in rendering legal, accounting, investing or other expert advice. If legal advice or other expert assistance is required, the services of a competent professional should be sought.
MREIA disclaims all liability for the actions or inactions taken as a result of communications from or to its members, officers, directors and employees.
Subscriptions to this newsletter are available for $24. Per year and are sent First Class. Members of the Association receive a subscription as one of the benefits of membership.
Business ads will be accepted from anyone interesting in advertising to the readers of this newsletter. Please submit a business card or other camera-ready material measuring 3.5” by 2” (or enclose $10. for typesetting). The cost is $10.00 per month for members and $20.00 per month for nonmembers.
Line ads are available to current members and newsletter subscribers at no charge. They can be for any Real Estate related item for sale or wanted, money wanted or available, partnership offers, etc. but will only be accepted from principals.
The editors reserve the right to edit or reject any advertisement for space reasons or because it is not deemed acceptable. Acceptance of advertising in this newsletter does not constitute endorsement or approval of the advertiser or advertised product by MREIA. The deadline for all submissions is the first of the month for that month’s edition. They should be sent to MREIA, PO Box 307, Marblehead, MA01945-0307 or call/fax 781-639-8616
Gene Clements, Realty Group
Owner/Broker
328 Broadway 781-595-9600
Suite 213 Fax – 781-595-9610
Lynn, MA01904 Cell – 978-998-9600
2. Self Directed IRAs, 401(k)How about becoming your own bank? Financing your own Deals? Tax-Free & Tax Deferred will do it quicker for you!
Entrust New England, LLC
118 Pleasant Street, Suite 5
Marblehead, MA01945
781-639-1846
800-724-2312
RobertaH@TheEntrustGroup.com
3. Legal Tactics, Self Defense for Tenants in Massachusetts $45 Shouldn’t YOU know what your Tenants rights are? They know. Get this book!
4. How to Become a Real Estate Investor in 12 Tough Lessons
Revised and updated Lessons for Today and into the Future!
$599 for non-members of MREIA
$499 for Members
Call (781) 405-1845
Are you a member of the MREIA?
Your membership in the Massachusetts Real Estate Investors Association gives you the opportunity to meet and learn from experienced investors when you are starting out. Once you have started, membership presents the possibility of your becoming a more professional Real Estate Investor and property manager. In addition, the following benefits will be available to you:
*Free admission to all monthly MREIA meetings.
*Special discounts on the price of workshops and conventions.
*Subscription to the Newsletter.
*Free classified ads and discounted business ads in the Newsletter.
*Access to listings on the Multiple Listing Service.
*Participation in the Buddy System and specialized subgroups.
Membership dues are $99.00 per year and $20.00 for each additional family member at the same address.
To Join, see the chairman of the Membership Committee at any meeting or mail a check for your dues along with an application including your name, address and telephone number to
Massachusetts Real Estate Investors Association
PO Box 307
Marblehead, MA 01945-0307
Your continued support and participation in MREIA will help build a stronger Real Estate investment industry. There is truly strength in numbers!
Don’t let time run out!
Look at the label on this Newsletter. In the upper right corner there is a code that shows the expiration date of your membership and/or subscription to the Newsletter. The first four digits show the year and the last two show the month. If that date is this or next month, it’s time to renew! If there is no code or the code indicates that your membership has expired, you have received a complimentary copy of the Newsletter.
What’s Coming Up?
The planned Schedule of Future Meetings:
April 29– Robyn Thompson, Rehab Queen
May 10 - Robyn ALL-DAY Saturday!
May 27- Inspections & GreenBuilding
June 24 – Killer Deals
July 29 – Landlording
August 26 – Financing
September 30 – Than Merrill, Flip this House!
October 4 – Than ALL-DAY Saturday!
October 28 - Fall Deals & Winterizing
Tuesday May 27, 2008
Massachusetts Real Estate Investors Association
HOME BUYERS How to Avoid 5 Costly Mistakes!
Tiger Inspectors will show YOU how to UNCOVER What’s wrong? and How much to fix it?
ONLY 4% More to Build “GREEN”? & it’s paid back in 4 years!
John, Elizabeth & Jim introduce YOU to Crown and Arxx ICF system. Traditional stick building’s obsolete?
6:00pm - 7:00pm "Closed Door” Rehabbing for Profit” Subgroup. Only if Attended Robyn’s 5/10/08 Seminar (or bought her courses) & Member (or $25 guest fee)
6:30pm-7:30 FOOD, Registration & Networking
7:30 - 9:00pm Tiger Inspectors &
Crown Arxx ICF builders
.
SpringHill Suites 43 Newbury Street (US 1 North)
PeabodyMA01960 978-535-5000
Members always come for FREE! Guests pay just $15. Membership only $99/yr. (781)-639-8616
MREIA First
PO Box 307 Class
Marblehead, MA01945 Mail
Massachusetts Real Estate Investors Association
Newsletter April 2008
Meeting last Tuesday of each month,
SpringHill Suites, 43 Newbury Street (US 1 North) Peabody MA 01960 6:00 PM (978) 535-5000
Member – National Real Estate Investors Association Inc
Tuesday April 29, 2008
One time only, don’t miss:
Robyn Thompson The Rehab Queen
Whether you’re a beginning Real Estate Investor, no need to make mistakes to learn,
or a Seasoned Pro, this’ll be a good review from someone who does Rehabs RIGHT and Sells ‘em FAST
6:00pm - 7:00pm Members ONLY "Closed Door” meeting with Robyn Thompson, Rehab Queen
6:30pm - 7:30pm FOOD Buffet. Registration and Networking (Don’t forget YOUR Business Cards!)
7:30pm - 9:00pm Robyn Thompson
9:00pm Raffle ($200 GPS, Tom-Tom, driving direction system) Recap and Adjourn.
See you Tuesday April 29! Robyn
Last Month:I think we got the food right this time and Jeff Takle of “Renting Your Home” was the sponsor! Italian wraps, Turkey/Swiss wraps, a Veggie tray, soft drinks & cake all disappeared!
Asset Protection – Attorney Mario Rizzo 978-371-2500 was very informative so we won’t be wasting precious Time and Money setting up companies that won’t help our personal business models Tax or Asset Protection wise.
I’ve got a couple of quick articles inside for you, on the Raffle Prize a GPS Tom-Tom, The Market is where, our Midmonth, Dinner with Entrust Clients & Legislation!
Don’t miss Robyn Because – Today Contractors are vital to improving OUR living. When they respect YOU and work with YOU as Robyn teaches YOU How To, YOU not only get problem free work and upgrades but also an increase in the value, often 3 times, of your expenditure! Which of course translates to your eventual bottom line!
Legislation
I’ll be in DC for “A Day on the Hill” to meet legislators enacting rules to save us from the mortgage crises. Eventually I’m sure they’ll get it right, just like the lead paint laws. However there was a lot of unnecessary anguish in between w/lead, so I’d like to see these mortgage/bankruptcy laws done right this time.
It’s my opinion that if you are in debt and can’t afford it, the sooner you get out the better. Perhaps there’s some rewriting that can be done on the 1978 update of the bankruptcy law which made mortgages unforgivable?
Got some input on this? Talk to me before April 30 or join me, or contact reps yourself, which might do the most good. Mike
See you April 29! Mike Hurney,
Director www.MassRealEstate.net
Who Is Robyn Thompson?
Robyn Thompson is the nations leading expert on buying, renovating and selling homes for huge chunks of cash and is known throughout the United States and Canada as “The Queen of Rehab”.
After spending 9 years working a dead end corporate job, Robyn realized that her hard work and dedication for IBM was not going to provide financial independence. She walked away from her secure paycheck and never looked back.
Over the past 10 years since Robyn left IBM, she has bought, fixed and sold 200 homes with price ranges as low as $8,000 to as high as $4,000,000. She has spent as much as $2,100,000 in labor and materials in one year to renovate properties with more than 22 contractors working full time to take the ugly homes she bought and turn them into little castles at lightening speed.
Robyn will be sharing her strategies on: 1) How to find the profitable homes that need renovation, 2) How to find and control the contractors to get the job done and 3) Selling houses quickly for huge chunks of cash.
Robyn has taught thousands of students throughout the United States how to become financially independent. She has shared the stage with Donald Trump, Dr Phil, Mark Victor Hansen, Ron LeGrand, Marshal Sylver & many more legends.
Robyn uses her success in the real estate business to help those less fortunate. The most recent construction project that Robyn completed was an orphanage in Haiti for 165 children that opened on February 21st, 2007.
Nine Strategies for Growing Your Home Renovating Business
By Robyn Thompson Contd from last month
Key Strategy #3: Develop A Sound Educational Plan.
I started out in this business knowing nothing about renovating houses, so consequently I enrolled in HardKnocksUniversity. Now, with all the materials and home study courses out there, there is no reason for anyone to start this business blindly. I still go to seminars and buy books and tapes. I try to read one good book by a millionaire every month, and I listen to audio tapes daily to attempt to improve myself.
An investment in education is the greatest investment you will ever make, so you need to develop a sound educational plan to help you achieve your goals. Plan to spend one hour each day increasing your real estate knowledge base or improving yourself. In two to three years, you will see a huge difference in who you are and what you have accomplished. Always strive to better yourself!
Key Strategy #4: Obtain Access to Private Capital.
Growing my business to the point where I am able to renovate over 40 houses per year did not happen by accident. Using a hard money lender is what took me to the next level, and private capital can do the same for you.
Anyone who has completed one or two rehabs can tell you that they become very capital intensive. If you do not have a private source of money, these funds must come directly from you. You need to find a source other than your bank account for the funds to purchase and renovate your houses. Whether this money comes from a hard money lender, a line of credit, or a private lender, the sooner you find a good source of funds, the sooner you can accelerate your business.
Key Strategy #5: Develop An Efficient Office System.
Key Strategy #6: Learn How To Estimate Your Own Repairs.
When I am interested in a property, I go out and estimate repairs personally, and I recommend that you do the same. If you don’t know how, learn. By relying on someone else to estimate repairs, you are putting your profit in their hands. They will not lose one minute of sleep if they miss a bad furnace that eats up $3,000 of your profit.
Just as I do, I recommend that you bring a repair sheet with you to each property you inspect. Write down each repair and the estimated repair cost. After you add up all the repairs, add an additional 10% contingency to allow for anything you may have missed or underestimated. You should also allow an additional $2,000-3,000 for additional niceties and upgrades that will help sell your house. Ensure your houses will be gorgeous when they’re done by planning for these items in the budget ahead of time.
Beginning investors will often underestimate the repairs and will borrow $4,000-5,000 less than what will be needed to do a quality job. If you underestimate, you will be forced to cut back on important areas of the renovation process such as the kitchen and bath. It is much better to overestimate and lose a deal than to underestimate and have a low-quality rehab that you can’t sell.
7. Do Quality Work.
This may sound like a simple concept, but I have seen some students’ homes turn out looking as bad as when they started.
Today’s buyers are smart, and if they see that you have skimped on the carpet, vanities, and kitchen cabinets, they may get worried about the quality of the more expensive items: furnaces, roofs, and the foundation. On the other hand, if your house is gorgeous, it alleviates the buyer’s fears about these bigger items.
Most buyers don’t have much money left over after purchasing a new home. They want to know that they won’t have to replace a furnace or fix a structural problem two months down the road.
It is better to spend a little extra money on renovations to assure your house is top quality and will sell quickly. In the end it is actually cheaper since buyers will move quickly if your house is pristine, and you won’t have to carry your house for 6-12 months.
8. Get Your Real Estate License.
9. Develop A System To Sell Your Houses Quickly. The last strategy is selling properties at lightening speed. Buying a house at the right price and renovating it properly are two important steps, but to realize a profit you must be able to get buyers qualified and get to closing quickly. The faster you pull your money out of a property, the faster you can reinvest it in additional properties.
Finding a good mortgage broker is one of the most important aspects of selling your houses quickly. The mortgage broker I use is the most critical team member I have. She has thirteen years experience and closes over 100 mortgages per year.
It is very important to find a top quality loan officer who deals heavily in first-time home buyers. When you are looking for a mortgage broker, ask them the following questions: How long have you been a mortgage broker, How many deals do you close each month, and What kind of mortgages do you focus on? By asking these questions you will screen out the people you don’t want on your team and identify those you do.
There is nothing worse than taking your house off the market for two months and then finding out the buyers could never have bought it. By pre-screening buyers and using a quality loan officer, you will totally eliminate this problem. When I take a house off the market, I know it will close. Spend a little more money on marketing to attract “A” credit buyers to help accelerate your house-selling machine.
In conclusion by implementing these nine basic strategies, you will develop a more profitable and efficient real estate business. I wish you and your business much success in the coming years.
Robyn Thompson owns and operates Home Buyers, LLC, a real estate investment company which specializes in purchasing, renovating, and selling single and multi-family homes in and around Waterbury, CT. Under Robyn's direction, Home Buyers LLC has grown phenomenally over the last few years. Robyn purchased 50 homes in 1998. In 1999, only her fourth year of operation, she will purchase 52 homes! Robyn cashes out 97% of her houses to "A" credit buyers in record time. She has made retailing a science and knows every technique imaginable to reduce rehab time, minimize holding costs, attract and qualify good credit buyers, and expedite closings!
Raffle Prize– Tom-Tom GPS(Audio/visual Driving direction system) My daughter Al the redhead, more recently blonde, is back from Budapest for the Summer and has been working on a film with Kevin James (King of Queens) which was great except she was putting 650 miles a week on her new car (expenses paid of course). I know the areas around Boston extremely well but she was taking awhile. I bought her the Tom-Tom and tested it on the way to a marketing session in North Andover. I plugged it in, it programmed itself and got me there on time! Essentially idiot proof! She’s had it for several weeks with great results.
In the Real Estate business we often have to move FAST and I’m sure you’ll find this item is essential to your success. Good luck at the Raffle!
A friend, who moved South, recently asked me about the market here:
Mike,
Thanks for sending these news letters. I enjoy them a lot. We’re thinking about selling our condo. How depressed are the prices up there? Any info on recent sales? Tom
Hey Tom,
Thanks I appreciate that. By the way how did you ever figure out that Atlanta was going to be such a great place to live and work??
I'll send you the comps (comparable market analysis) on it. Here’s what I’ve seen in the RE Market, My experience and How:
RE Market
I just spoke at the Board of Realtors in NewportRI about using Self Directed IRAs for their clients to finance their Investment properties. What an optimistic group! I don't know whether the RE recession hasn't hit them yet or they're recession proof. They're on the "island" and it's all highly paid Raytheon software & torpedo Engineers or well-to-do second home owners.
Then this morning I swam with the head of financing at Carlson RE. John said “Prices are down, Inventory is up and financing rates are down. A lot of Real Estate is actually happening unless you read the papers.” Makes sense.
Keep in mind the Warren Group who publishes Banker and Tradesman, the paper of record for RE legal notices & Sales, has us ending a third year of declining values in Massachusetts. Last recession was 5 years of declining values. I think we're in for at least the same. So I'd be inclined to advise you to sell now or do it in 5 years.
My experience
Late last year a friend asked me to sell his house in Medford so I got Robbie involved. His price was too high and Robbie told him what it WOULD sell for. After a bunch of lonely Open Houses with one or two people there, I asked him how long he was going to let this languish. He said, Sell it now!We lowered the price about half way. I put together a marketing plan and implemented it on a Saturday. We had 25 people at the next day, Sunday Open House, got 4 offers and sold it in 25 days. It worked!
#8 Morgan Ave, Medford.
How
We put a brochure together with features and benefits not a standard listing sheet. I can read a listing sheet but most buyers take too long to figure it out.
On the back I listed 28 special reports that folks could get, by going to my web site. Things like:
HOME BUYERS, How to avoid costly mistakes!
BUYERS Savings thousands when you buy your home.
BUYERS Benefits of Owning your own home.
SELLERS How to easily increase the value of your house
SELLERS How to Prepare to pass the Home Inspection.
3 biggest mistakes buyers make. etc
Last item I put on the sheet that we put under 200 door mats (in 50 minutes) was that "It's the Brokers birthday, she is NOT happy to be there, so we're having a surprise birthday cake. Stop by for a piece!"
So if you're interested in Robbie selling your condo her cell is 781-258-5216 Mike
Midmonth Last Friday April 18–Good group, we covered interesting topics and put a Plan together. Want the short Summary? Email me 8:45 PM most people stayed until 10:30! Time for us to put a MasterMind group together.
Dinner with Entrust ClientsMost of the questions were about safety of Client funds when not invested and our answer was the same as before:
Because Entrust New England, LLC uses Several Banks with overlapping responsibilities and cross regulation (IBT, International Bank & Trust in Cedar City, Utah, IBT in New Hampshire and Wells Fargo, San Francisco) your funds, when not invested by you in specific investments are covered up to $1 million dollars.
The second dinner had a persistent investor that wants rental Real Estate that cash flows positive, in the Concord MA area. I feel persistence is the most important quality that I have seen in successful RE investors. Anyone with a Multi family near Concord?
Disclaimer:
This newsletter is published by and for the members of the Massachusetts Real Estate Investors Association.
While designed to provide information that is both accurate and authoritative in regard to the subject matter covered, it is distributed with the understanding that the publisher is not engaged in rendering legal, accounting, investing or other expert advice. If legal advice or other expert assistance is required, the services of a competent professional should be sought.
MREIA disclaims all liability for the actions or inactions taken as a result of communications from or to its members, officers, directors and employees.
Subscriptions to this newsletter are available for $24. Per year and are sent First Class. Members of the Association receive a subscription as one of the benefits of membership.
Business ads will be accepted from anyone interesting in advertising to the readers of this newsletter. Please submit a business card or other camera-ready material measuring 3.5” by 2” (or enclose $10. for typesetting). The cost is $10.00 per month for members and $20.00 per month for nonmembers.
Line ads are available to current members and newsletter subscribers at no charge. They can be for any Real Estate related item for sale or wanted, money wanted or available, partnership offers, etc. but will only be accepted from principals.
The editors reserve the right to edit or reject any advertisement for space reasons or because it is not deemed acceptable. Acceptance of advertising in this newsletter does not constitute endorsement or approval of the advertiser or advertised product by MREIA. The deadline for all submissions is the first of the month for that month’s edition. They should be sent to MREIA, PO Box 307, Marblehead, MA01945-0307 or call/fax 781-639-8616
Gene Clements, Realty Group
Owner/Broker
328 Broadway 781-595-9600
Suite 213 Fax – 781-595-9610
Lynn, MA01904 Cell – 978-998-9600
Posted by Paul Wells at 9:48 PM |
1. Low Mortgage Rates. Email:
2. Self Directed IRAs, 401(k)How about becoming your own bank? Financing your own Deals? Tax-Free & Tax Deferred will do it quicker for you!
Entrust New England, LLC
118 Pleasant Street, Suite 5
Marblehead, MA01945
781-639-1846
800-724-2312
RobertaH@TheEntrustGroup.com
3. Legal Tactics, Self Defense for Tenants in Massachusetts $45 Shouldn’t YOU know what your Tenants rights are? They know. Get this book!
4. How to Become a Real Estate Investor in 12 Tough Lessons
Revised and updated Lessons for Today and into the Future!
$599 for non-members of MREIA
$499 for Members
Call (781) 405-1845
Are you a member of the MREIA?
Your membership in the Massachusetts Real Estate Investors Association gives you the opportunity to meet and learn from experienced investors when you are starting out. Once you have started, membership presents the possibility of your becoming a more professional Real Estate Investor and property manager. In addition, the following benefits will be available to you:
*Free admission to all monthly MREIA meetings.
*Special discounts on the price of workshops and conventions.
*Subscription to the Newsletter.
*Free classified ads and discounted business ads in the Newsletter.
*Access to listings on the Multiple Listing Service.
*Participation in the Buddy System and specialized subgroups.
Membership dues are $99.00 per year and $20.00 for each additional family member at the same address.
To Join, see the chairman of the Membership Committee at any meeting or mail a check for your dues along with an application including your name, address and telephone number to
Massachusetts Real Estate Investors Association
PO Box 307
Marblehead, MA 01945-0307
Your continued support and participation in MREIA will help build a stronger Real Estate investment industry. There is truly strength in numbers!
Don’t let time run out!
Look at the label on this Newsletter. In the upper right corner there is a code that shows the expiration date of your membership and/or subscription to the Newsletter. The first four digits show the year and the last two show the month. If that date is this or next month, it’s time to renew! If there is no code or the code indicates that your membership has expired, you have received a complimentary copy of the Newsletter.
What’s Coming Up?
The planned Schedule of Future Meetings:
March – Asset Protection Atty Mario Rizzo!
April 29– Robyn Thompson, Rehab Queen
May 10 - Robyn ALL-DAY Saturday!
May 27- Spring thaw. Inspections
June 24 – Killer Deals
July 29 – Landlording
August 26 – Financing
September 30 – Than Merrill, Flip this House!
October 4 – Than ALL-DAY Saturday!
Tuesday April 29, 2008 & Sat May10th
Massachusetts Real Estate Investors Association
Do Not Miss:
Robyn Thompson The rehab Queen
Whether you are a Beginning Real Estate Investor, no need to make mistakes to learn.
Or a Seasoned Pro, This’ll be a good review from someone who does Rehabs right and Sells ‘em FAST
6:00pm - 7:00pm Members ONLY "Closed Door meeting with Robyn Thompson, Rehab Queen
6:30pm - 7:30pm FOOD Buffet. Registration and Networking (Don’t forget YOUR Business Cards!)
7:30pm - 9:00pm Robyn Thompson
9:00pm Raffle ($200 GPS, Tom-Tom, driving direction system) Recap and Adjourn.
SpringHill Suites 43 Newbury Street (US 1 North)
PeabodyMA01960 978-535-5000
Members always come for FREE! Guests pay just $15. Membership only $99/yr. (781) 405 1845
Website:
e-mail: Mike@MassRealEstate.net
MREIA First
PO Box 307 Class
Marblehead, MA01945 Mail
www.MassRealEstate.netMike@MassRealEstate.net with “Midmonth Summary” in the Subject box. Gene just emailed me that after I left at Permalink MortgageMike1003@yahoo.com or call (781)-405-1845www.NewEnglandEntrust.comwww.MassRealEstate.net
www.MassRealEstate.net
Massachusetts Real Estate Investors Association
Newsletter March 2008
Meeting last Tuesday of each month,
SpringHill Suites, 43 Newbury Street (US 1 North) Peabody MA 01960 6:00 PM (978) 535-5000
Member – National Real Estate Investors Association Inc
Tuesday March 25, 2008
6:00 PMFood Buffet! Networking so don’t forget your Business Cards.
6:15 – 7:00 PM: Subgroup – SYNDICATING We’ll speak about the AWESOME POWER of Syndicating money with Friends, Relatives and Fellow Investors. Several Investors looking to syndicate will share with us what types of Investments they are interested in.
6:45 Buy, Sell and Networking, Don't forget to bring your business cards - this is the most important part of the meeting! Prize for the Best Deal of the past month!
7:00 Attorney Mario Rizzo, Asset Protection How not to get sued and lose everything? Mario will be discussing everything from a Homestead Declaration on your Owner Occupied residence to Complex Business Entities along with examples and war stories of WHAT NOT TO DO!
There are 7 general forms of Business Organization in Massachusetts (listed on p 2)
Mario will also answer:
1. Should my new business be organized as a corporation, a partnership or some other form of Business entity?
2. What’s an S Corp and how does my business become one?
3. How much money should/must I put into my corporation for its initial capital?
4. Is a Business Plan really necessary? (cont’d p2)
Last Month: Hope you enjoyed the food at our meeting in January. I ordered Chinese for 60, 80 showed up and half was left over. I donated the leftovers to the Salem, MA homeless shelter. They were so appreciative it was a little embarrassing. If you think you’ve got it tough, drop by there with some canned goods. I don’t think you realize how bad off some people are.
Paul Wells was great Tuesday and the Saturday ALL –Day class. Banker and Tradesman (paper of record for all Foreclosure info) gave us enough copies for all of us. There were over 30,000 Foreclosures in 2007 and it’s expected to be over 42,000 in 2008 in Massachusetts alone! However there was a gentleman, Darren, that asked Paul’s help during the class Saturday on a Foreclosure in Atlanta? Hello? what about helping to clean up this mess in Mass – You help yourself as well as Owners when you work the Foreclosure market with Paul Wells courses!
Last Midmonth, February 15 I was surprised by the folks that came and ALREADY are using Paul’s foreclosure system!
Upcoming Schedule
March 25 – Asset Protection, Atty Mario Rizzo.
April 29 – Rehab Queen, Robyn Thompson!
May 10 – Robyn Thompson All Day Workshop!
May 27 – Spring Thaw.
June 24 – Killer Deals
July 29 - Landlording
August 26 - Financing
September 30 Wholesaling, Than Merrill!
October 4 Than Merrill All Day Workshop!
October 28 - Inspections
November 25 – Selling FAST!
December 30 - Holiday Party
See you March 25! Mike Hurney,
Director www.MassRealEstate.net
Mario (continued)
7 Business Types in Massachusetts:
1. Sole Proprietorship
2. Corporation
3. General Partnership
4. Limited Liability Partnership
5. Limited Partnership
6. Limited Liability Company
7. Massachusetts Business Trust
Mario will also be addressing:
Limited Liability, Management and Control, Continuity of Existence, Transferability of Interests, Ease and Expense of Organization and Sources of Operating Capital.
Questions #5-10
5. Should our investments in the business be structured as debt or equity?
6. Should I authorize preferred stock in my charter?
7. Should the founders sign a stockholders agreement?
8. Why are so many corporations formed in Delaware?
9. What are the Blue Sky Laws and do I have to worry about them?
10. Should I obtain director and officer insurance for my business?
Marc Garrison; 25 Mistakes & 29 Secrets
THE King of Emerging Real Estate Markets and Investing in them!
We’re anticipating a meeting with Marc in the Fall of 2008!
The 25 Most Costly Mistakes Almost Every Real Estate Investor Makes - Marc Garrison
Part 2 (first 8 were January 2008 issue)
9. Allowing your Real Estate Business to Run You.
10. Over-improving a Property bought to Flip or Rent.
11. Running out of Cash.
12. Forgetting about Asset Protection.
13. Over-analyzing Property.
14. Becoming friends with Tenants.
15. Overlooking Bad Houses in Bad Neighborhoods.
16. Underinsuring Property and Risk.
17. Ignoring Cash Flow.
18. Punishing Bad Tenants Without Rewarding Good Ones.
19. Permitting Tenants Problems to Spoil the Positives in Real Estate Investment.
20. Letting Rent Collection Get Personal.
21. Only Looking at Properties when there is a Problem.
22. Missing out on Special Loan Programs.
23. Getting Stuck with a Sweet Property that Turns Sour After Contract.
24. Inability to Sell a Rehab Property or to Rent a Rental Property.
25. Not Thinking of Tenants as Potential Buyers.
The 29 Secrets of a Self-Made Millionaire
Part 2 (first 9, January 2008 issue)
10. They treat everyone they meet like they want to be treated.
11. They commit themselves to constant improvement.
12. They commit themselves to quality.
13. They understand that Happiness is not based on possessions, power or prestige but on relationships with people you love and respect.
14. They are loyal.
15. They are honest.
16. They are self-starters.
17. They are decisive even if it means they will sometimes be wrong.
18. They don’t blame others.
19. They are bold and courageous.
20. They take good care of people they love.
21. They don’t do anything that wouldn’t make their Mother and Father proud.
22. They understand that children need your presence more than your presents.
23. They know that nothing on God’s green earth can replace a good night’s sleep.
24. They need hugs and kisses and to be told I love you… every single day.
25. They have traditions that keep the family tree alive and sprouting new branches.
26. They take quiet time to recharge their batteries.
27. They need nature and take time to appreciate the beauty.
28. They practice unconditional love for who people are and not what they do.
29. They know that people need security. They know that feeling safe is essential for growth and happiness.
April 29 – Rehab Queen, Robyn Thompson!
May 10 – Robyn Thompson All Day Workshop!
How to Prescreen Contractors to Build a Dream Team to Get the Job Done! By Robyn Thompson
Many real estate investors shy away from the ugly house business because they fear hiring contractors. We have all heard the horror stories of rehabbers who loose their shirt because a contractor took them to the cleaners.
I am here to tell you that contractors can be your worst enemy or your best friend, depending if you hire a good one or a bad one. So how can the beginning novice real estate investor make the correct choice- the hard working team player that gets the job done on time, on budget and at a high standard of quality? The answer is by following all eight of the critical prescreening steps below.
1. Ask the contractor you are interviewing, how long they have been in the business? I prefer at least five years of experience in the trades. I want a contractor who has seen and repaired every strange, odd, and crazy thing that could be wrong with a house. Experienced contractors know how to estimate all tough projects and experienced professionals can give an accurate price to fix any problem.
Inexperienced contractors, on the other hand, under estimate repairs to get the business, and then they try to push their mistake on the home owner by upping the price half way through construction. The investor needs to say NO. NO is the most powerful word in the dictionary, and a rehabber needs to use this tool. If they did not have the knowledge to make a good estimate, it is there problem not yours.
2. Ask for three references from the last three major projects that the contractor has recently completed. Once you receive the reference letters, make sure you call to verify the references and the quality of the workmanship performed. The quality of work should be satisfactory to the homeowner and should have been completed in a timely manner.
If any of the references don’t checkout, do not hire this contractor. If they gave you false information upfront, you know they can not be trusted. Move on to the NEXT quote.
3. Ask for a copy of the contractor’s license (if required in your state) and for a copy of their workman’s comp insurance. Once you receive a copy of their license, make sure to check that they are not suspended. Also check to see if any complaints have been filed against the contractor with the Better Business Bureau.
It is absolutely mandatory that a contractor prove that he or she has workman’s comp for all the employees that will be working on the job site, before they start renovations. Why is this so important? Well, if one of the workers has an accident, you do not want to be sued as a potential employer.
4. Make the contractor pull all necessary permits required by your local building department. The homeowner should NEVER pull the permits. The contractor should also be responsible to pass all necessary inspections required throughout the construction process so a certificate of occupancy (CO) can be obtained when construction is complete.
5. The real estate investor should make it mandatory for all contractors to buy all necessary materials to do the renovations. The investor should never waste their valuable time buying materials. If the investor buys the materials, the workers could be viewed as the home owner’s employees per the IRS guidelines. You do not want this.
6. The real estate investor should always demand a six month to one year warranty of all parts, labor, workmanship, and materials provided by the contractor. This warranty should be in writing. WARNING: If a contractor will not provide a warranty and stand behind the quality of his or her workmanship- DO NOT hire them!
7. Real estate investors should never agree to pay any contractor by the hour. You pay a fixed price for the complete job. Never pay the final payment in your independent contractor agreement until the project is 100% complete.
8. Ask for financial references (ex: where the contractor purchases materials). I will contact the supply houses to make sure the contractor is not behind on paying for materials because I do not want to give the contractor a check to payoff an old bill and they have no money for the materials they need to buy for my job.
The last words of advice that I can give to anyone beginning a renovation project is to make sure every agreement with a contractor is detailed in writing with an independent contractor agreement. A detailed list of materials required should be listed in comprehensive scope of work. The documents should have work completion time frames, penalty clauses for finishing late, require all permits be pulled and inspections completed before final payments are released.
Nine Strategies for Growing Your Home Renovating Business
By Robyn Thompson
I have become financially independent renovating houses, and you can do the same; however, if you aren’t prepared, the process can become completely overwhelming. To help you avoid the pitfalls that are out there, I have developed nine key strategies to assist you in growing your house renovating business. If you are willing to learn from my experience, you will employ greater success much sooner.
While I was able to renovate 17 homes during my first year in the business, by employing the following strategies, I have grown my business to the point that I can in today’s environment, renovate 40-50 houses per year. Keep in mind that I do an average of $26,000 to $50,000 worth of repairs to each of my house, so these are not quick carpet and paint jobs.
Here are the nine key strategies to help you take your house renovation business to the next level.
Key Strategy#1. Develop the Ability to take Action Quickly. One of the most important elements of my success is my ability to take action quickly. In my area, the competition is tough and if I procrastinate I will lose deal after deal. If you want to “steal” a house, you’re gonna have to be able and willing to act quickly when a good deal presents itself. If I go and look at a house that I feel is a good deal, I write an offer immediately, get to the point where you are able to do the same!
Key Strategy #2 Learn How to Find and Handle Contractors. Learning this skill will save you money, time and heartache. I used to allow contractors to move very slowly and I would accept their excuses. No more! I currently have up to twenty workers on my job sites and the renovation process on my investment properties is very smooth because I have learned to handle contractors well.
(Continued next month!)
Disclaimer:
This newsletter is published by and for the members of the Massachusetts Real Estate Investors Association.
While designed to provide information that is both accurate and authoritative in regard to the subject matter covered, it is distributed with the understanding that the publisher is not engaged in rendering legal, accounting, investing or other expert advice. If legal advice or other expert assistance is required, the services of a competent professional should be sought.
MREIA disclaims all liability for the actions or inactions taken as a result of communications from or to its members, officers, directors and employees.
Subscriptions to this newsletter are available for $24. Per year and are sent First Class. Members of the Association receive a subscription as one of the benefits of membership.
Business ads will be accepted from anyone interesting in advertising to the readers of this newsletter. Please submit a business card or other camera-ready material measuring 3.5” by 2” (or enclose $10. for typesetting). The cost is $10.00 per month for members and $20.00 per month for nonmembers.
Line ads are available to current members and newsletter subscribers at no charge. They can be for any Real Estate related item for sale or wanted, money wanted or available, partnership offers, etc. but will only be accepted from principals.
The editors reserve the right to edit or reject any advertisement for space reasons or because it is not deemed acceptable. Acceptance of advertising in this newsletter does not constitute endorsement or approval of the advertiser or advertised product by MREIA. The deadline for all submissions is the first of the month for that month’s edition. They should be sent to MREIA, PO Box 307, Marblehead, MA01945-0307 or call/fax 781-639-8616
2. Self Directed IRAs, 401(k)How about becoming your own bank? Financing your own Deals? Tax-Free & Tax Deferred will do it quicker for you!
Entrust New England, LLC
118 Pleasant Street, Suite 5
Marblehead, MA01945
781-639-1846
800-724-2312
RobertaH@TheEntrustGroup.com
3. Legal Tactics, Self Defense for Tenants in Massachusetts $45 Shouldn’t YOU know what your Tenants rights are? They know. Get this book!
4. How to Become a Real Estate Investor in 12 Tough Lessons
Revised and updated Lessons for Today and into the Future!
$599 for non-members of MREIA
$499 for Members
Call (781) 405-1845
Are you a member of the MREIA?
Your membership in the Massachusetts Real Estate Investors Association gives you the opportunity to meet and learn from experienced investors when you are starting out. Once you have started, membership presents the possibility of your becoming a more professional Real Estate Investor and property manager. In addition, the following benefits will be available to you:
*Free admission to all monthly MREIA meetings.
*Special discounts on the price of workshops and conventions.
*Subscription to the Newsletter.
*Free classified ads and discounted business ads in the Newsletter.
*Access to listings on the Multiple Listing Service.
*Participation in the Buddy System and specialized subgroups.
Membership dues are $99.00 per year and $20.00 for each additional family member at the same address.
To Join, see the chairman of the Membership Committee at any meeting or mail a check for your dues along with an application including your name, address and telephone number to
Massachusetts Real Estate Investors Association
PO Box 307
Marblehead, MA 01945-0307
Your continued support and participation in MREIA will help build a stronger Real Estate investment industry. There is truly strength in numbers!
Don’t let time run out!
Look at the label on this Newsletter. In the upper right corner there is a code that shows the expiration date of your membership and/or subscription to the Newsletter. The first four digits show the year and the last two show the month. If that date is this or next month, it’s time to renew! If there is no code or the code indicates that your membership has expired, you have received a complimentary copy of the Newsletter.
What’s Coming Up?
The planned Schedule of Future Meetings:
February – Cruise MIDMONTH ONLY
March – Asset Protection Atty Mario Rizzo!
April 29– Robyn Thompson, Rehab Queen
May 10 - Robyn ALL-DAY Saturday
May 27- Spring thaw.
June 24 – Killer Deals
July 29 - Landlording
Tuesday March 25, 2008
Massachusetts Real Estate Investors Association
6:00 PM FOOD! Networking don’t forget your business cards.
6:15 – 7:00 PM Subgroup – SYNDICATING. We’ll speak about the AWESOME POWER of Syndicating money with Friends, Relatives and Fellow Real Estate Investors. 6:45 Buy & Sell
7:15 Attorney Mario Rizzo, Asset Protection. How NOT to get sued and lose everything. Which Business Entity for you?
9:00 pm Recap & Adjourn
SpringHill Suites 43 Newbury Street (US 1 North)
PeabodyMA01960 978-535-5000
Members always come for FREE! Guests pay just $15. Membership only $99/yr. (781) 405 1845
e-mail: Mike@MassRealEstate.net
MREIA First
PO Box 307 Class
Marblehead, MA01945 Mail
