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EXECUTION Build a real estate company in a D area

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JohnD Realestate

JohnD Realestate

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Took a vacation from my 9-5 this week. Used every minute to get ny stuff in newburgh in shape.

First day I loaded up my truck with sticks from my yard and went to dump. Then I got to newburgh and worked out a discount for volume pricing on LVP with Home Depot. Quote wasn’t so low so o called andoth HD and it was about 30% less. Noted. Call multiple Home Depot for bid room. Saved about 1250. But it means we can afford to do better quality materials in more apts.

6 druggies broke into one of my vacants this week. Kicked a door in on two of them. Three them out. One said take it easy i lost my temper. Shook him up a bit. I almost bit his face. Broke into my building and tells me to take it easy. My bad tho. Not his fault. Need to secure my properties better. And stay calm. Been doing better with anger mostly.

Got new elec service in a long vacant 150 year old brick building, elec gave me a really good price. Things are looking up.

took out 10,000lb of debris from one floor same house. By hand of course. Loaded up a 20’ trailer twice. Got two flat tires on the way to dump with 5k in the bed. Jacked it up and changed the tire 500’ later spare blew out. Went the rest of the way on 3 wheels. Got it to the dump and once it was empty was a breeze. Except that I can’t back up a trailer very well in snowy hills with cars blocking my driveway. People watching calling me an idiot. Who cares got it done. Laughing, sore glad to have carefree time with the kids now that things are on track.

Someone crashed into the trailer in a snowstorm. No biggie. Not too much damage My bad for Parkin it there. Couple of 14-15 hour days. Wife was very helpful.

Blew in insulation in another gut renos we’re doing. Tried out a few new guys this week. Every day I had at least 10 guys working between subs and my guys. Two of the new guys are fantastic. Good people make things way easier.
 

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JohnD Realestate

JohnD Realestate

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Things are good. About two weeks should be closing on sale. Profit is in the 40s. Bought only have about 7k in the house at this point.

Meanwhile I finally got rid of a few really bad tenants. The last of the worst. When I bought those houses those tenants were what I considered keepers at the time. They all were drug addicts which wasn’t apparent in the beginning but later became clear.

Waiting on plans from an architect for a big project. Have all the contractors lined up probably start in a week or two. Starting to see real progress in a 3 bedroom and a 4 bedroom renovation right now. Hvac being finished this weekend and Sheetrock is taped. Painting flooring and trim is up next. Oh yeah and windows. I’ve been waiting to find a good installer with a good price and I finally found one. Usually windows go in first I let the historical approvals slow me down and more of a problem I procrastinated.

The building I’ve been doing most of my work in is stopped. The neighbors sewer is backing up and it’s backing up into my house. So when he flushed the toilet it comes to my house. Been working on getting it fixed. Getting ready to make a complaint if he doesn’t get it fixed today.
 
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JohnD Realestate

JohnD Realestate

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Sold that house. Exactly 40k profit. Not too bad percentage wise but not what I was planning.

Started up a meetup a while ago to help other investors get going in newburgh.....so I’m not the only crazy guy fighting drug dealers in the ghetto. Had a bit of success with it. Def helped me get leverage with contractors. Anyone trying to do a lot of work long term
Should consider it. It gets me major discounts....

Got two projects that are coming to completion.
 

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WJK

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Sold that house. Exactly 40k profit. Not too bad percentage wise but not what I was planning.

Started up a meetup a while ago to help other investors get going in newburgh.....so I’m not the only crazy guy fighting drug dealers in the ghetto. Had a bit of success with it. Def helped me get leverage with contractors. Anyone trying to do a lot of work long term
Should consider it. It gets me major discounts....

Got two projects that are coming to completion.
Have you looked into the new Opportunity areas created by the Federal Tax changes? They look like an excellent way to go.
 
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JohnD Realestate

JohnD Realestate

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@WJK My area is an opportunity zone I have contemplated getting involved with some people to start one up I believe they call it opportunity fund. But right now I’m a little busy maybe down the road
 

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WJK

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@WJK My area is an opportunity zone I have contemplated getting involved with some people to start one up I believe they call it opportunity fund. But right now I’m a little busy maybe down the road
The Opportunity Zones are based upon long-term plays rather than for flips since it deals with long capital gains and profits from hold periods. Next time you sell something, it's something to have your tax preparer review for you. One would have to decide to follow the investment pattern required in the legislation in order to get a benefit.
 
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JohnD Realestate

JohnD Realestate

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Got some money and chugging along with renos.

Rented another apt today. Have 4 coming in line in the next month. 2 the month after that. Getting closer.
 

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JohnD Realestate

JohnD Realestate

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Getting somewhere on this one. Bought it for 16k. So far put in about 100k in Reno. It’s with about 225 or so.

Took a while to get permits plans money in order. Two contractors screwed it up in the beginning but it’s swinging now.
 

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JohnD Realestate

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This guy stole some copper from me the other day. He was working for me. No biggie. Small setback. Not stopping for a second.

Passed a framing inspection on a 4 family Reno of the big bad building. A few weeks more and I’m in the clear. All down hill on this one now.
 

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Michael Burgess

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This guy stole some copper from me the other day. He was working for me. No biggie. Small setback. Not stopping for a second.

Passed a framing inspection on a 4 family Reno of the big bad building. A few weeks more and I’m in the clear. All down hill on this one now.
Sorry to hear about that guy stealing from you - it's a shame, but good you're just moving on and chuggin' along.

I'm curious about the last two photos in your post - are you basically building a new subfloor on top of the previous material? Just putting some strapping down, plywood on top, and creating a new level and flush surface to work on?
 
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JohnD Realestate

JohnD Realestate

Making Real Estate Great Again.
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Sorry to hear about that guy stealing from you - it's a shame, but good you're just moving on and chuggin' along.

I'm curious about the last two photos in your post - are you basically building a new subfloor on top of the previous material? Just putting some strapping down, plywood on top, and creating a new level and flush surface to work on?
I caught him doing the deed so I took what I needed from him. I don’t feel like I got the short end. He’s a big kid. Ex marine but I carry pepper spray when I caught him I was applying that generously.

That’s exactly what we’re doijg on the floors. Usually we level them
With jacking but in this case the first two floors of the building are occupied. So we take 2x8 and rip them down from 0-2.5 inches to make up for the uneven sub floor. Then we put the new wood floors on top of that.
 

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JohnD Realestate

JohnD Realestate

Making Real Estate Great Again.
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16k house We are 100k in on Reno. I have held it for close to two years. When I bought it the arv was 150k. .

Took much longer than planned few things went wrong

I couldn’t pass this one up even tho I was fully invested at the time into a big project. Really should have let it pass. But I took on partners and they wanted out almost right away. Second we didn’t have a great plan with this one. It was a drug infested area and I only had one building. I do t like a single property in a bad area. Secret of drug area investing is Control the block.

Six months later I bought half the block...but now I was into a bigger project so money was still tight. The framer screwed up and we had to get new plans and redo that.

Then came a new partner. The plumber pulled a Houdini and I couldn’t get a new plumber to take over. Now all that is passed and we’re getting close to the finish line.

In the meantime the crime in the City and this block went down noticeably. The house prices in the area jumped. Now it’s worth 220k So despite my self it’s a good deal. Maybe more if I find the right owner occupy.

2 X 1500 a unit. 36k. 5k Taxes -2k garbage/water -1600 insurance -2400 vacancy -2400 management 1400 maintenance


9D50EBAD-0C2B-48CD-AD8D-D0E1F77E861C.jpeg E7F8B554-3725-43A5-8963-95528B732FBA.jpeg
 
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JohnD Realestate

JohnD Realestate

Making Real Estate Great Again.
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Bam. Rented a commercial space that’s been vacant for 10 years. 5/1 occupancy. 18k a year hipster Furniture.


Closing on a refi Friday, commercial
Loan 7.3% fixed for 10 years adjustable every 2 years after that. 30y amortization.

140k that’s been at 12%. Bought the house for 168. Put in about 40k appraised for 200k. I don’t agree with the appraisal think it’s more like 240k but NP. I can live with it. Saves me a few hundred a month. Most importantly tho it gets the loan balance for 2 last properties down to 315k. Bought them for 360 but they are in the area where the market is got so they will appraise much higher. Prob 250k for the 3 unit and 650k for the 8 unit.


Looks like I did it. Turned a slumlord portfolio into a real business. Will be in the black in a month or two. No time to stop now but I’m feeling good.
 

MHP368

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JohnD Realestate

JohnD Realestate

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Heh heh. I don’t know exactly what it is. The guy next door to me does architectural salvage....so if your demoing an old building and find stuff like corbels or tin ceilings, lead pan glass windows, pocket doors even whole staircases they buy them for a bit and resell.

His store is doing crazy biz and he wants to expand into furniture. Think it’s all vintage. But I’m not sure.
 
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JohnD Realestate

JohnD Realestate

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Things are really rolling now. Seems like the wind is at our backs now. That’s good because before it felt like my back was against a broken window and a pice of glass against my neck.
Been looking around for financing for a while. I’m about 45/55 debt to equity right now conservatively. And possibly 50/50.


So I reached out to a company a while ago that basically told us come back when you when 18 months of on time payments....which we now have so they came out to do a Spence meeting and the guy almost fell over when he saw how much work we had gotten done. They are hedge fund that loaning at 8.5 as long as you have alot equity. I’m thinking it’s too good to be true. We’ll see.
 

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JohnD Realestate

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Some of the guys in my area and I are speaking at free event Douglass Elliman is sponsoring probably trying to drum up some biz. Could be helpful to those trying to get started in RE. Details to follow. May 3rd 9-1130 at the icehouse in Poughkeepsie NY.
 
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JohnD Realestate

JohnD Realestate

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Here it is. I’m not getting compensated for speaking and as far as I know they are not pitching anything....but there is no free lunch so I would expect at the very least some sort of ...give and take like asking for emails etc.

I’ve been to a few of these some good some horrible. I know these guys they are successful and def doing this for real. Vinny has a big portfolio Dwayne is also legit. 30 or 40 units from nothing like me.

Heads up:
If I don’t like the vibe at these things I tell them I’m out of cards and give them johnny1234@hotmail.etc 555-1212.



I’m thinking to start moving toward a residual income coaching type model. Dwayne does this already. Maybe I can teach better than do. Making headway with my portfolio. I like the coaching stuff. At any one time I’ve got 1/2 dozen newbies that I’m coaching and it’s starting to get cumbersome....at least doing it for free is. So I was going to start reading up on how the guys here did it...instead of my usual MO of just starting from scratch, learning as I go and beating my head against a wall.



FE16C8A5-7A91-471C-8D9C-3AD00DB82D0E.jpeg
 
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JohnD Realestate

JohnD Realestate

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Meetup I created to protect my investment.

Edit. Date changed.

I invited one of my friends to the meetup. He’s a really sharp guy. Created a big company out of nothing. He went to NYU and started out a club promoter. Now he’s got like 20 or more restaurants. So anyway I asked him to come and he goes “are you kidding? You go to the ghetto and buy property get in over your head and now you asking me to come stand next to you and guarantee your losses aren’t total” funny. Exactly what I’m doing.
 

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Tommo

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Might see if we can change this posting title to watch this guy get a haircut.

This is ugly. The six months on the sheet below are the better 6 of 10 months. There is none of the Reno money I brought to the deal or money that borrowed lately on this sheet. to keep things moving along. When you factor in that money It’s creeping up on a 230k loss for 10 months. I owe about 1.5 m on loans on 2.7 in property right now. I also owe about 150k in Personal or cc. Mostly biz stuff. If I was a professional RE guy this would be a hiccup. But my 9-5 i take home about 750 a weak.

Closing on a sale next week fingers crossed. That one will be a small profit for me. I had partners. Percentage wise it’s sick deal but small so it doesn’t matter too much.

I had 4 properties on the market. But the market is getting soft right now. My broker called me last week. Good News! I had a cash offer 500k. no contingency on the rooming house. I would have lost about 50k (I paid 464k and did some Reno) selling at that price. I’m selling for 3 reasons. It’s a major PIA. I couldn’t refi the SRO, and it’s (62% occupancy) losing money every month bc I’m strict with new tenants. Heavy duty background checks no Sex offenders, no social service tenants. Only tenants with verifiable income. If I wasn’t strict I’d have 100% occupancy.

When I got the offer they were putting down 10% with a financing and inspection contingency. So i told them to get the cash they said they had together. I had major trouble doing a refi with the sro. That’s why I put it on the market.

So I’m taking a beating financially. I’be been a bit depressed and anxious again hard to sleep. Have to take deep breaths and calm myself sometimes. Getting anxiety a bit.

So I stopped to take a look at what I’m doing wrong. Of course this is all my fault. I made the wrong choices to get myself here.


Working on a way back to success. Been on a diet. Low sugar, low alcohol( I was drinking a ridiculous anount a day for a few months) getting a bit of focus lately.

My retreat plan had been to sell about half what I hold in portfolio. Then pay bills, taxes etc.


The soft market killed that plan. There are son many properties on the market mine are not even getting many showings.

Working on the new plan.
Man you have balls of steel. I admire your tough mindedness,keep on keeping on
 
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JohnD Realestate

JohnD Realestate

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Man you have balls of steel. I admire your tough mindedness,keep on keeping on
Thanks man. I don’t tho. Just set high goals dive into the deep end and figure it out. Def have tested and proved my theory that you can gentrify an area at will.
 

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JohnD Realestate

JohnD Realestate

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Q. I know this sucks but I’m not a tech guy. That’s a cop out of course. Looking to do something a bit more purpose driven. I’d like to be able to send banks here to see what I’ve done. And also send investors for private money. Here is my crappy website. Any advice? Newburgh Renovation Co
 

Merging Left

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Q. I know this sucks but I’m not a tech guy. That’s a cop out of course. Looking to do something a bit more purpose driven. I’d like to be able to send banks here to see what I’ve done. And also send investors for private money. Here is my crappy website. Any advice? Newburgh Renovation Co
Hire one of the guys out of @Fox 's web design course to build you a beautiful website in exchange for building up their portfolio. I think he teaches that you should do 1-2 projects for free to show prospective clients. Win-win?

NewburghReno.com is an available domain as well.
 
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levijean

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I've never seen buildings like that, outside of crummy parts of big cities. Is that typical for the area?
 
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JohnD Realestate

JohnD Realestate

Making Real Estate Great Again.
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Hire one of the guys out of @Fox 's web design course to build you a beautiful website in exchange for building up their portfolio. I think he teaches that you should do 1-2 projects for free to show prospective clients. Win-win?

NewburghReno.com is an available domain as well.
That’s a fantastic idea not sure anybody was doing Free but I’m game. I do More business referrals than anyone I know. I’ve learned over the years that one comes back in spades. So I could offer that and a bit of cash or real estate mentoring. I’ve gotten big into the mentoring lately.
Thanks for the tip
 
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JohnD Realestate

JohnD Realestate

Making Real Estate Great Again.
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I've never seen buildings like that, outside of crummy parts of big cities. Is that typical for the area?

There is the one I attached and copies of the brick one that you saw in wood but yeah that’s pretty typical for Newburgh and as far as it being a crummy area where I buy it is the crummiest area I always buy in the crummiest areas and then I try to fix them up I’ve had lotta success lately.
 

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Merging Left

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How long does it take you to rent these units? I recently purchased a small condo in a seedy part of Cleveland that I've been having trouble getting rented. People who are interested aren't qualified, and people who are qualified aren't interested. It's a narrow intersection of people who would be interested and qualify. It is listed on Section 8's website, but there hasn't been a ton of interest from there.
 

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