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Victoria
Real Estate
Investors Club
Newsletter
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 Hi Folks!
Summer's Here! (I think).
We've put our Langford investment property up for sale (link to listing). You may ask why we're doing that? Is it because the market is good for selling, or are we losing money on it, or is Langford a bad place to own investor properties? No to all of those. This is a decent property in an appreciating market in an ok location that pulls in over $3,000 a month. We choose to sell to support our partner's need to get out of the property.
After its initial showing, I asked my realtor what they thought we should improve or fix-up to make the property more saleable. They didn't want to give any specific advice AND said that one of the folks who checked it out said "it needs lots of work".
This surprised me a bit because I thought the place was in OK shape. Hearing an outsider's perspective caused me to take a fresh look around and I then saw plenty to improve. I'd been looking at the place for 3 years and all the imperfections had sorta disappeared. So now there's fresh paint, new stair treads, pressure-washed deck, new grout, etc, etc. Lesson: get a fresh opinion on how a property looks before you put it on the market.
Of course, replacing the broken toilet that a rambunctious tenant fell on was an easy decision.
You may note the ads for services in this newsletter. All those folks have worked on the above property over the last few years. I endorse them because I've seen their work, become friends with them and trust them. They are key members of our power team ie: that group of people who help us achieve success as RE investors. Who's on your Power Team?
Come out to our next monthly meeting on June 29. Julie Broad will enlighten us on how she attracts motivated sellers. She loves marketing, social media and has a passion for sharing what she knows. See article below for details.
Cornell has a couple of Opportunities. Check below for more info.
Hey, don't forget to pay your property taxes! Unless you don't really want to, them come out to the meeting and talk to Dave V. He told me he's gonna skip that step so ask him how that works.
Take Care!
Gord Knox
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| Tuesday June 29 Meeting
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Finding the Elusive Motivated Seller
Speaker: Julie Broad (see http://lifeasrealestateinvestors.com/).
Julie will talk about farming for real estate leads ... her yellow letter
campaign, their bus bench ads and some of the other Direct Marketing they're
doing to generate new real estate deal leads. Her and Dave are very modern in
their approach and have tons of energy and ideas. Comfort Hotel 3020 Blanshard St Victoria BC 7-9pm $15 at the door (no charge for annual members) after meeting meeting down the hall at Redd's Restaurant |
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| Discover Two Ways to Get Rents Paid Early
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By Dave Dinkel
The problem of getting rents paid early, or at all in some cases, is an age-old problem for landlords, but there are at least two solutions. Every landlord has heard unbelievable stories of why tenants can't pay their rent on time and many seem to be willing to pay a penalty instead of just paying on time.
Some landlords might view these late payers as a benefit because they are actually getting more rents that they planned on when they rented the apartment. However, the next step is for the tenant to pay later and later and eventually stop paying. This leads to an eviction which ultimately costs more than the few extra dollars of late payments the landlord received.
The cost of filing an eviction varies greatly from state-to-state but can easily be from $190 to $500+, and this does not include attorneys' fees. A shrewd landlord will process his own eviction notice and process the case himself through the court system. This works well, especially with practice, until the tenant gets himself an attorney who only represents tenants and who "murders" the landlord in court. Many states allow the tenant to be paid many times their monthly rent plus attorneys' fees if the court rules in their favor. If you haven't heard this already, "Tenants have more rights than landlords", so be careful out there!
So let's look at the problem and two possible solutions. First, the landlord should heed the warning signs of late payments - something is wrong and it may be resolved short-term, but the end result will likely be an eviction. If the tenant is always paying late, work out a bi-weekly or weekly payment plan so the tenant pays as he goes. This generally keeps him from spending his money as quickly as he gets it, and it will give the landlord an early warning signal if there is trouble in paradise. This method actually takes a great deal of stress off the tenant because he doesn't have as much time to be irresponsible as when he only pays every 30+ days.
The other option to get the tenant to pay timely is to give him a discount for paying early. This is a more common practice when investors do lease options, but the rent payment concept is identical. With a lease option, the tenant gets a credit at closing of the purchase of the property for paying timely, or early every month - if he exercises his purchase option AND he has paid timely every month. This money is actually given as a reduction in the purchase price or as a seller credit at closing.
However, when a landlord gives a tenant a rent credit or reduction, the funds come off the amount of the rent due each month. For example, if the rent you want is $850 and due on the first of each month, then your discount program should charge $900 with a $50 discount for early payment, but only if the tenant pays by the 25th of the previous month. If the tenant pays by the fifth of the month the rent is due, he loses his discounted rent completely and starts paying $900 for the rest of his lease. Most tenants like the idea of saving the money more than they worry about paying a late fee or a higher rent.
If you find that an incentive program isn't working and the tenants are paying late, try re-working their payment frequency because they may have a problem with when and how often their employer pays them. If this re-scheduled payment plan isn't working, start serving them with eviction notices as soon as the rent is one day late. Above all else, get any new payment program in writing because the tenant should be evicted if he violates the new terms of the lease addendum and should be evicted.
Dave Dinkel has been a real estate investor since 1975. Dave's focus in the past few years is educating the public in a manner that doesn't' amount to paying for a master's degree. Dave's recent contribution to this end is his e-course called "48 Ways to Create a Massive Buyers List" which can be seen at http://www.MakingaBuyersList.com
Article Source: Discover Two Ways to Get Rents Paid Early |
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Mike Patterson When you need a trustable, reliable, and reasonable
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| OPPORTUNITIES |
Note: if you send money to Cornell just because I mentioned the unsubstantiated info below and fail to do proper research and end up being his personal assistant for 3 years to work off the huge debt you end up owing him, skype me at h2hvictoria so I can use you as an example of what NOT to do for a future newsletter article.
I was on the phone with Cornell as he was on the way to the bank with a tidy sum of loot from his latest deal and he told me that:
He has two opportunities - 1) looking for an experienced investor with $40k - $50K to help buy a property in Cumberland with good potential to double your money and 2) a house in the Cedar area that overlooks a beautiful meadow that an investor can buy as Rent-to-Own and for use as a long-term hold rental.
He will likely be at the June 29 meeting to provide more details.
His contact info:
Direct: 250-756-9239 Toll-Free: 1-866-756-9239
Fax: 1-866-756-0150 cornellp@4pillars.ca
www.4pillars.ca |
| Commercial Property in Nanaimo
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 Annette Roehlig says:
The property is strategically located at a high traffic road with superb visibility
and accessibility.
To the best of my knowledge: The land is 22855 square feet.
The building is about 9000 square feet with about 8000 of that being lease-able
space. C4 Mixed Use Commercial Zone. The building and grounds are well kept.
In the last couple of years we have attended to substantial upgrades on the
roof and we have done some work inside the building. These repairs/upgrades are
not regular and therefore, I have deducted them below from the Expenses. For
consistency I have also deducted the 2007 repairs. The new owner might want to
allocate his/her own amount or percentage for annual repairs/upgrades.
Gross Income -->owners use included
In 2007 $72,000 -->$90,000
In 2008 $75,000-->$93,000
In 2009 $88,000-->$106,000
In 2010 (October 1, 2009 through 1. March 2010 - ½ yr.) $44,000--> $51,500
Expenses (mortgage excluded) were approximately:
in 2007 $38,000 minus repairs $4,000 = $34,000
in 2008 $56,000 minus repairs $20,000 = $36,000
in 2009 $70,000 minus repairs $28,000 = $42,000
in 2010 (1/2 year) $12,000
Current monthly income about $7000.
I would be interested to lease back for half a year at $1500/month.
The potential Rental Income per month is over
$10,000 - $120,000/year. With total expenses of $50,000
(including allocation for upgrades/repairs). The potential net income is
$70,000/year.
I offer the strip mall for $899,000.
I will send photos asap via e-mail. I have Financials for the past 3 ½ years,
rent roll, and drawings of the building available in my office. If you have any
further questions or wish to preview the property please call me.
Sincerely, Annette
250-740-3948, annette.roehlig@shaw.ca
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