Build a real estate company in a D area

[WJK]

View attachment 27175

Sold these three today. Bought in 2017 for 560. Sold today for 895k. More to follow.

Good going! Keep it up!

 

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[Dianne Cohen]

Nice!!!

 

[JohnD Realestate]

Partners usually suck.

Yeah. That pretty much sums him

 

[JohnD Realestate]

Newburgh.....Brooklyn is game compared to newburgh.

Not a Humvee. kinda looks like a tank on wheels.

180grams of cocaine I forgot how much heroin and a .38 so no Scarface’s but they were def dragging my property down.

I had video of the cops in that hallways with m16s but I gave it to the cops.

 

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[JohnD Realestate]

Closed out the last of the big hard money loan at 12% today.

Sold 3 properties this month. Paid about 1.1 for them and sold them for 1.7 def not fast lane tho.

Reading MFL right now trying to figure how To find the fast lane in my biz. Looking for needs. Listening. Good times.

Nice not to have 12k in mortgages due next week.

I still have 4 properties only one needs work. I’m at 70% occupancy and cash flowing pretty well now after I sold everything.

Still planning to sell the rest.

But I did come up with an idea.

Kind of a buying service for other investors. The guys that bought me out asked me to find them other stuff. Found them a deal today at 10:15am. By 10:30 it was done.

Did all the work over the phone in 15-20 minutes and made 4K....had to pay another guy the other 4K. More to follow on that.

Oh yea that was the Scarface building I sold today. Bought for 664 sold 825. Not a home run but the other deal I sold this months the one I bought for 560k sold for 895k so not a bad month after all. Still not fast lane tho. Working on it.

 

[JohnD Realestate]

Closed two deals this week. 103 renwick Newburgh NY. Bought for 69k reno 95k and sold for 250k. Not bad but it was a lot of work for that profit.

Did a wholesale deal on 22 renwick. Mentioned it above 4K for me and another guy that found the house.

Almost completely out of Newburgh RE.

Still toying with some ideas on what to do next.

Been thinking about a hair loss product company. Been doing some research.

 

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[WJK]

Hey man I see your a wholesaler, I'm 15 in Massachusetts eager to run and scale a wholesaling operation soon. Any tips for me to get started and become succesful in wholesaling?

Have you thought about learning to walk before you try to run a marathon? RE is a whole world into itself.

 

[Guest-5ty5s4]

At 15, you cannot contract. You are barred due to your age. You might want to start with learning about buying, selling, escrowing, fixing, appraising, locating, and making contracts... and that's just to start. Just jumping in is a dangerous leap! You may need an apprentice situation with someone who is doing it. Actually, you need a whole string of different experiences before you try it on your own.

PS. How do I know that? 37 years of experience in the RE business.

The good news is that since you are 15, you have 3 whole years that you can't even do it yet and you can dedicate all 3 of those years to pure learning and education! That means at 18 you should come out swinging, full steam ahead. @Kevin.o Read some books about buying fixer uppers under value, what makes a good deal, then figure out how to market to sellers and get those deals. And learn about the transaction process.

 

[WJK]

I dont want to overstep my place as a newbie but I'm sure someone often the 18 can legally sign a contract for me. But besides that thank you for the advice and I'll continue to learn and educate myself on the topic. Also how would I find an apprentice ship with someone who is already doing it?

You must hang out in the business. You must be humble and hungry for knowledge. Go to work in the business. Go find someone that is doing something interesting and start asking your questions. Start by educating yourself from books and hands-on experiences.

Here's an example: My little office is located on our highway. When we were constructing that building, we built a classic post and beam cordwood structure. It's unusual. That's a log building where you can see the ends of the logs. We had some people from our community who were interested in that kind of construction. A couple of them came and worked side-by-side with us... for free. We showed them what we were doing and how we were doing it.

I hear you saying, Uh? Why talk about building a log building? You may not wish to build a building, but you do want to build a business. But, RE is based on 2 components -- land and improvements. Improvements are all kinds of buildings. You must understand both. And then there's the business part of it. People occupy those buildings as owners and tenants. RE has very basic elements.

For the business part, start with questions. Who around you is doing that kind of work? How do they find their property prospects? How many prospects does it take to get a face-to-face meeting? How many meetings does it take for you to be able to make an offer? How many offers to get one accepted? And if you do get that offer accepted, who is your buyer? Buyers have a type of deal they will do -- both financial and property type.

 

[JohnD Realestate]

John, you do need the shoes down from the power lines next to your building -- as noted in these posts. You're right, your building is marked, both figuratively and literally. Remember, those are live wires and the companies who own those lines have to take them down.

Good idea. Help the visuals. I’m working on filling vacancies right now and one of the things I’m trying to do is make sure no dealers get in.

 

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[JohnD Realestate]

Great job! Keep up the good work.

Thanks!

 

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[WJK]

Working on a store now. It’s my last unrented store. I have had it listed on CL for 6 months. I’ve showed it to a few people but it needs a lot of work. I was hoping to get a tenant then do some work on it once I had a customer. But at this point I decided I had to do something. I posted it in Instagram as a free pop up to anyone that would take it for a week. Got 3 interested freeloaders. Just kidding at this point I need some action there. At least get some feedback.

For some reason I don’t have a good shot of the front. It’s looks different now. Windows are cleaned up and all signs are down. Started gutting today. Except for a sinus headache feels better already.

You have the magic formula. You are relentless! Keep going. You are making your own good luck.

 

[WJK]

@WJK @ZCP thank you. Thanks for following this.
Made some mistakes. I rented to a bad tenant a few months ago. Apt came back to me from a long term inherited tenant. The apt needed lots of work but I was broke. I had a known bad tenant come in with cash, I showed it they would take as is. Filled with garbage and they would clean it out. I had 10 vacants apts at the time. Dumb but, I rented to them.

So had a fire in that building today. The bad Tenant threw a cigarette in the garbage. In the bathroom. So had my first bathroom fire ever. Ive has dead tenants in the bathroom but never a bathroom fire. I have a rule. If the cops or FD come to my house i usually evict that tenant. This time is no different. FD gave me a stop work order on my store below bc they came to the house.

Got another tenant headed for eviction too. He called the health Dept instead of telling me he had bed bugs. Argh. I have an Extermintor. Tenants don’t call me they call health Dept. Then HD calls me give summons. Then I call Exterminator. Them HD comes to inspect problem solved. But first I call lawyer to evict that idiot tenant. Sorry venting.

This idiot tenant was no good either and I rented to them also. I knew I shouldn’t. I could tell he was that type. Always trust your instinct. But I was broke and I was weak.


Good news. I passed a City inspection today for a unit that was condemned and illegal when I bought it. Got it really cheap bc it was a disaster. It was renting for 560$ to current tenant. One women. Apt was in shambles City did and inspection and failed it right after I bought it.

I Kept the tenant in place did repairs and the tenant had gotten a S8 voucher. Rent goes up to 1100. Tenant called to say they love the new floors, paint and apliances and thanks. That’s good for now. We’ll see.

Better news. Had a legal rooming house the city had condemned it neeed repairs. I did some repairs. Now it’s not easy but they could take me to court revoke my CO then I would have to gut and redo whole building. Return to single family. I asked them to help me out and reissue CO. The city hates rooming houses. I don’t like them either ...but my mom was a drug addict. My Dad was in prison. So I’ve lived in some rooming houses. I know what to do with them. Fear and RULES. Make them afraid to break the rules and they will abide. Be a dictator about the rules. Cleanliness. Garbage where it’s supposed to be. No visitors. No BS or you get evicted. I could write a book on rooming houses but I think someone did. If your game it’s $$$$$

Anyway It’s 4 rooms. I can rent the rooms 500-625 each. So all 4 for 2000-2500(tops but I can dream).....as an apt it’s a 4 bedroom it’s 1250 a month tops in that area. It’s ghetto. The Inspector said OK. That’s huge.

So next month I’ll probably do 25k. That’s black. Way in the black. Thanks for the support. Just getting feedback here has helped me. Thanks.

One more thing. I’m on BP. Been there for a few years. Great site for RE knowledge. Not so much for get it done as how to. So I joined a meetup last year of 4-5 people. They faded away....I kept it up. Once a month. This month I had 40 attendees. Banks, hard money guys, RE agents, insurance guys and other investors.

I mentor a few guys they show up it’s a fun thing. Coffee and BS. Some of my guys own a few houses. A few own 3-4. So it’s done something already. We do it at 8am. Today people said that I’m helping change the city......that’s big. I’m not finished yet but that’s my goal. I want to turn newburgh around. I’m pretty sure I never mentioned that before but that’s what started the whole thing.


Almost last. I was in retreat last month. I dug up Grant cardones 10x. I’ve listened to it a bunch of times. Good for rah, rah, rah. Listened to it and realized I was in retreat. I decided to attack instead. I’m coming up with some plans for attack.

Last and WJK will like this. I’m selling one house. I bought it for 47k last year. Inherited a tenant. They were paying 1066 a month they pay all utilities. So I’m December they stop paying. Now this house is a 2 family but one family had both floors. I told them “hey I have another house like that one inremt it for 1250 per floor. Pay your rent. They BS I evict. I asked a realtor today that I trust what do you think it’s worth. As is. She says 125-150. Market is hot. So I’m listing that one. It’s got the plywood on the windows...copper lines throughout and the thieves are still out there.

John, just keep swing... don't quit... don't retreat...
What I like about your current plan and actions right now, is that you are back to business. When you started writing this thread, you were in an emotional straight jacket. Now, you're just taking everything issue by issue. It's time to crunch your numbers again -- you're coming out of your "cash cave" and back into the black. Congratulations. Check your plan, made adjustments, and keep getting one foot in front of the other.
FYI -- I go on BP too.

 

[JohnD Realestate]

That guy broke into the room the night after the drug bust.

Things have changed in that building. It wasn’t easy.

 

[21elnegocio]

This will be my progress thread. I’m getting my head kicked in right now. Feel like I jumped off the boat with cement floaties. I have been meaning to start writing for a while but with things getting worse every day I found it hard to get out of bed. Let alone document my weakness and failures. It’s definitely my problem. I have made a lot of mistakes.

I’ve been a real estate as hobby investor for 12 years. Done mostly live in flips. I’ve bought and sold 4 houses and currently own 12. Started out with one three family in 06. I sold that last year and did a 1031.

In the 1031 I purchased a package of buildings from a slumlord. It’s comprised of 37 stores, apartments and rented rooms. They need a ton of work.

I bought these houses knowing that they were in a depressed area of NYS. I knew the city had a reputation as the “murder capital of New York State. I looked for the worst part of the city. There I found a building that seemed worse than those around it. Luckily for me the owner was easily convinced it was time to sell.

Edit: If this sounds like a complaint that’s not how I mean it. All of my complaints right now would not exist if I had not handled executed better.

What is your plan with these units/stores ? If you got a good deal on them you can try wholesaling them to investors who buy them and fix them ? I do this here in Arizona and it works pretty well

 

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[JohnD Realestate]

What is your plan with these units/stores ? If you got a good deal on them you can try wholesaling them to investors who buy them and fix them ? I do this here in Arizona and it works pretty welll


I usually buy distressed and fix up. This house is extremely distressed it’ll probably cost at least 150k. But it’s in a rally up and coming area. We bought it for 45k but shells like this are selling now for 100k or more.

I’m only going to do limited work on it.

I’ll ask for the variance going from single family to three family...that’s tonight. Go before the Architectural Review Board and ask permission to paint the House and change the windows, fix the roof (already), fix some structural isssues (working on it)run the service electric for the Building and clean out the garbage(took out 7 tons)

Long term goal is to build a large portfolio But in the meantime when I see a property that’s a good deal but I can’t hold it long term I don’t mind fix and flip or in this case do the haeavy lifting and when it’s ready for interior work sell. There is def money being left on the table but the 150k budget isn’t there.

I have a long term strategy for the city so Depending on where the other houses are located I will fix up and hold or sell.

 

[JohnD Realestate]

Got the variance. Building is worth way more tonight then it was this morning. What a relief. I was banking it would happen but it could have gotten voted down.

That was a huge gamble. If it hadn’t been approved I didn’t really have a way out except to flip it but that’s more cash in then I had. Lucky again.

 

[JohnD Realestate]

You're upside down on every thing. I know how you feel. Bail out on as much red ink as you can. Is there anything that you can turn around?

Agree with that. Been working on it. Trying to ready the properties with the least amount of work needed for sale.

 

[JohnD Realestate]

Sold a house last week. Bought it for 47 sold it for 159. Had some partners in it and still settling few Accts payable but we did make some money.

So I have 13 apts under renovation or about to begin renovation. I’ve got just about 30 in total so almost 50 vacant. Not what I planned on. I wanted to do 1 or two at a time.

Dealing with it.

 

[WJK]

@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.

 

[MHP368]

hipster Furniture

Explain

 

[JohnD Realestate]

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.

 

[JohnD Realestate]

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.

 

[JohnD Realestate]

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]

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

 

[JohnD Realestate]

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

 

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[ljean]

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

 

[JohnD Realestate]

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.

 

[JohnD Realestate]

Beautiful building! I love the black windows and ornate woodwork just beneath the roof.

Thanks! Gets better every day. Working on it.

 

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[Merging Left]

Usually 2-3 weeks but sometimes longer.


What are your goals with the property. Are you planing to buy more units in the same development? I’m not a big S8 guy. I have a 5 or so but I don’t plan on getting any new ones and when they move out I’ll look for market rate tenants.

Do you live nearby

I don’t pay too attention to how long it takes. I focus more on getting the best tenant for the long term. Ex. Right now I’m trying to convince some of my tenants to.break his lease in one of my buildings and move to my new property. It’ll cost me money to get him to move. I’ll rent it to him for less. But he’s like the Arnold Schwarzenegger of the neighborhood do I don’t mind losing a bit of cash flow.

We've been advertising it since early February, so it's been almost 3 months vacant. Just want to hold for cashflow. If the numbers work out like how we projected, we would buy more in the same development, since they're dirt cheap. If it's going to take 6 months or longer to rent, though, we'll move on to a different area.

We are not local. We're priced out of the market we're in (NorCal) so we turned to the midwest for investment opportunities. We're using a property management company who has a solid tenant screening process and requirements, which is why it's taking longer than I imagined it would.

I've heard a lot of different opinions on S8. Some people swear by it and others don't go near it. I'm open to experimenting. Thanks for your advice!