• The Entrepreneur Forum | Startups | Entrepreneurship | Starting a Business | Motivation | Success
  1. Join 50,000+ entrepreneurs
    who are kicking butt and
    winning their dream life.

    Unscripted™ Entrepreneurship:
    A Business That Pays More Than Money, It Pays Time.

    "Fastlane" is an entrepreneur discussion forum based on The Unscripted Entrepreneurial Framework (TUNEF) outlined in the two best-selling books by MJ DeMarco (The Millionaire Fastlane and UNSCRIPTED™). From multimillionaires to digital nomads, the forum features real entrepreneurs creating real businesses.

    Download (Unscripted) Download (Millionaire Fastlane)  Register
    Registering for the forum removes this block!

Real Estate Building a Team & Finding Properties

Discussion in 'Real Estate Investing' started by JScott, Sep 17, 2007.

  1. JScott
    Offline

    JScott Legendary Contributor FASTLANE INSIDER Speedway Pass LEGENDARY CONTRIBUTOR

    Messages:
    3,808
    Likes Received:
    6,205
    Joined:
    Aug 24, 2007
    Rep Bank:
    $44,592
    Around the beginning of this year, I decided I was going to devote the next chapter of my professional life to real estate investing. Since I knew I wouldn't be able to devote serious time to actually putting together a team and looking for investments until early next year (I'm on the west coast, not planning to invest in my local area, and working full-time until 2008), I planned to spend this year learning, reading everything I could get my hands on, deciding on a geographic area to focus on, and putting together my investment strategy. Basically doing everything I could until I had the opportunity to start buying...

    I've spent the last several months studying, talking to other investors, and this past weekend, I finished writing my RE business plan. It was a great exercise, as it forced me to consider every detail about geographic area, what types of properties I was going to invest in, my entry strategies, my exit strategies, how I'd deal with investors (I have a lot of friends and family that want in on my plan :3some:), etc.

    In short, I've decided to invest in the Atlanta Metro area, and will be focusing on small apartment buildings (8-25 units) at first. I'll split my investments between long-term buy-and-hold (where appropriate) and short-term "value plays" (when opportunityies presents themselves).

    So, I'm now at the point where the next logical steps are to put together a strong team and start looking for properties. And while I'll have the opportunity to spend a couple months a year in Atlanta starting early next year, I'm currently 3000 miles away. But I'd still like to take the next steps (I'm not a big fan of waiting around)...

    Which brings me to my questions:

    - Does anyone on here invest in the Atlanta area and have any feedback on the current market (specifically for apartments or more generally)? I've read plenty of market data, but would love some first-hand info...

    - I'd love to start interviewing potential team members in the Atlanta area; can anyone recommend a lawyer, broker, or accountant around there? If not, can you recommend a good resource for finding these folks?

    - Can anyone recommend some good resources for finding properties before I actually head east and start talking to brokers? I've spent plenty of time on Loopnet, but I'm not convinced there are any great deals there (at least not without serious face-to-face negotiation time with the sellers)...

    - Any other suggestions on next steps between now and the first time I head back east to start interviewing potential team members and looking for properties?


    Thanks!
     
  2. andviv
    Offline

    andviv Gold Contributor Read Millionaire Fastlane FASTLANE INSIDER Speedway Pass Summit Attendee

    Messages:
    5,403
    Likes Received:
    2,160
    Joined:
    Jul 27, 2007
    Gender:
    Male
    Location:
    Washington DC
    Rep Bank:
    $3,345
    May I ask why Atlanta?
    What are the current economic conditions in that city to make you want to invest there? Is the RE market for multis soft and will improve soon? What is the current cost per unit in that area? current rents per unit?
     
  3. JScott
    Offline

    JScott Legendary Contributor FASTLANE INSIDER Speedway Pass LEGENDARY CONTRIBUTOR

    Messages:
    3,808
    Likes Received:
    6,205
    Joined:
    Aug 24, 2007
    Rep Bank:
    $44,592
    Here is how I narrowed my decision on geographic location:

    - First, I decided that I wanted to invest on the east coast, as that's where I'll be living come next year (I want my investments to be within an hour flight of wherever I was living). I also decided that I preferred a relatively-large or large metro area, where resources (airports, investment team, property management companies, etc) were plentiful. These were the "personal" constraints before delving into more economic drivers;

    - From there, I looked at the regional apartment demand drivers -- population growth, job growth, and immigration/internationalization. Atlanta is the fastest growing metro area in the top 10 largest metro areas, is on the short-list of "Gamma world cities," has undergone large urban expansion in the past 10 years, and ranks third in the number of Fortune 500 companies headquartered within a city. Other cities that qualified in this category were New York, D.C., and parts of North Carolina.

    - From there, I looked at cities that ranked high on the 2007 National Apartment Report. The east coast cities in the top 30 included New York, D.C., Boston, Atlanta and a number of cities in Florida. For the types of properties I'm looking for, I believe New York, D.C., and Boston are likely overpriced, and I'm just not interested in the Florida market based on current economic trends.

    - Next I looked at other economic and housing indicators that led me to believe that Atlanta had a good market. I found that Atlanta has the second highest number of foreclosure filings of any city in the nation, Atlanta is one of only 25% of metro areas that hasn't seen year-over-year home price declines, and in general, the housing market hasn't kept pace with a number of other large metro markets over the past 5 years, making current prices more reasonable than other areas (though you could also argue this is a bad sign).

    - Lastly, and purely empirically, I've noticed a lot of people who seem knowledgeable and participate on various RE boards who invest in the Atlanta area and seem to have positive things to say about the market.

    So, that's how I narrowed down the location...though I've also considered some areas of North Carolina and Maryland as well.

    Would love to hear any thoughts you might have on either my rationale or my ultimate decision. I'm certainly not locked into investing in this area, and if I had indications (or recommendations) that it wasn't a reasonable location to be investing, I'd happily take other suggestions.

    Should I infer from your response that you don't believe Atlanta is a good area?


    Thanks!
     
  4. ProInvestor
    Offline

    ProInvestor New Contributor

    Messages:
    82
    Likes Received:
    10
    Joined:
    Aug 15, 2007
    Location:
    Australia
    Rep Bank:
    $65
    The only person I know in Georgia (GA) is guy called Matthew Chan, he lives in Columbus, but I'm sure he could help you out with GA generally - http://www.matthewchan.com/

    He's also getting into Commercial/Multifamily, apparently his company owns 60+ houses....

    Rgds.
    ProInvestor
     
    JScott likes this.
  5. andviv
    Offline

    andviv Gold Contributor Read Millionaire Fastlane FASTLANE INSIDER Speedway Pass Summit Attendee

    Messages:
    5,403
    Likes Received:
    2,160
    Joined:
    Jul 27, 2007
    Gender:
    Male
    Location:
    Washington DC
    Rep Bank:
    $3,345
    NO.

    My question goes directed towards understanding what research you have done about the area. Why do I ask? Cause I know from several sources, that I believe reliable, that you should invest in areas that are starting to grow, so you can maximize your returns. I actually do right now what I am saying, investing out of state in order to find those areas that have the best potential.

    I don't know anything about Atlanta, so it is not that I have anything for/against that or any other city. I just ask to try to understand your reasoning process.
    How much research had you done? That was basically the question. Do you know the expected population growth, job growth for the area for the next 2, 5 and 10 years? What type of people are coming to the city? who is leaving? Average cost per unit? average asking rents? Those questions you can answer from reading reports, and I assume you have done that.

    Sorry, I know that is not the intention of this thread. I don't know anybody in that area, but I now know you and soon you will be investing there :D
     
  6. JScott
    Offline

    JScott Legendary Contributor FASTLANE INSIDER Speedway Pass LEGENDARY CONTRIBUTOR

    Messages:
    3,808
    Likes Received:
    6,205
    Joined:
    Aug 24, 2007
    Rep Bank:
    $44,592
    Certainly no offense taken! I appreciate the reply and the advice you give is definitely important and sound.

    While it's difficult to get a "feel" for any area without actually spending a lot of time there, I've done the best I can to research various potential investing areas on the east coast. Based on what I've been able to gather, Atlanta has a very strong market, and all demographic and economic indicators would point to it continuing to thrive.

    That said, I'm sure I'll be able to gather plenty more data once I'm able to spend a few weeks/months in the area, and if indicators lead me to believe it's not a good location for investment, I have no problem going "back to the drawing board."

    Thanks again...
     
  7. SteveO
    Offline

    SteveO Legendary Contributor FASTLANE INSIDER Speedway Pass LEGENDARY CONTRIBUTOR Summit Attendee

    Messages:
    3,435
    Likes Received:
    13,480
    Joined:
    Jul 24, 2007
    Rep Bank:
    $93,253
    I have heard some information on Atlanta although I have not confirmed it through data.

    It is a city that is suffering through some of the fallout from the housing bubble. The vacancy rate has been increasing with all the houses and condos that are coming on the market as rentals and taking away from apartments. This is a good thing for me as this is likely a temporary function.

    What I don't know is whether the prices have come back to reality yet from the last few years of buying on proforma. I know that job and population growth is going the right direction but don't know the rates. It is the future job growth that is the important factor.

    It sounds like you are looking at a lot of the correct data though.

    The apartment report that you are referencing, is it the Marcus and Millichap report? If so, I feel that they do look forward some but have a heavy rank influence from current financials.
     
    iiinvisi0n likes this.
  8. JScott
    Offline

    JScott Legendary Contributor FASTLANE INSIDER Speedway Pass LEGENDARY CONTRIBUTOR

    Messages:
    3,808
    Likes Received:
    6,205
    Joined:
    Aug 24, 2007
    Rep Bank:
    $44,592
    As always, thanks for the great info, Steve...

    Yes, the apartment report was Marcus and Millichap. And I definitely have some additional due diligence ahead of me once I have the opportunity to spend some time in the area.

    While I had always expected that I'd want to pursue a buy-and-hold strategy, Berges' book definitely got me thinking about shorter-term value plays, and I agree that with the housing bubble bursting (or at least letting out some air), the next year or two or three may prove to have some great value-play opportunities. I'm definitely planning to mix those into my strategy when the opportunities arise.
     
  9. SteveO
    Offline

    SteveO Legendary Contributor FASTLANE INSIDER Speedway Pass LEGENDARY CONTRIBUTOR Summit Attendee

    Messages:
    3,435
    Likes Received:
    13,480
    Joined:
    Jul 24, 2007
    Rep Bank:
    $93,253
    The real question is (and I don't have the answer) whether Atlanta has had enough air taken out of its sails in the apartment market. While I believe that it has backed of a bit, it in not clear if it is truly a buyers market for apartments.

    I am not doubting that it is a good place to invest. It clearly has some of the desired elements.
     
  10. GoldenEggs
    Offline

    GoldenEggs Contributor

    Messages:
    321
    Likes Received:
    37
    Joined:
    Sep 4, 2007
    Location:
    Silicon Valley, CA
    Rep Bank:
    $85
    I only had access to the free portion of Loopnet and did not have much success with it either. I have been able to find properties that meet my criteria by searching for commercial brokers in the area and looking at their website listings. It takes more time but that is where I had some success.
     
  11. reipro
    Offline

    reipro Contributor

    Messages:
    156
    Likes Received:
    42
    Joined:
    Sep 27, 2007
    Location:
    Lincoln, NE
    Rep Bank:
    $71
    We used to buy quite a few single family houses in the Atlanta area. You really need to be careful in that area, because of the large amounts of mortgage fraud. About six months ago we looked at entire pool from one bank and the values of all of the homes were about 75% of what was loaned on them.
     
  12. JScott
    Offline

    JScott Legendary Contributor FASTLANE INSIDER Speedway Pass LEGENDARY CONTRIBUTOR

    Messages:
    3,808
    Likes Received:
    6,205
    Joined:
    Aug 24, 2007
    Rep Bank:
    $44,592
    Thanks for the warning...

    Do you believe this was fraud perpetrated by home buyers/investors on the banks, using fraudulent appraisals? Was the goal to get around existing loan requirements?
     
  13. REI
    Offline

    REI New Contributor

    Messages:
    21
    Likes Received:
    6
    Joined:
    Oct 2, 2007
    Rep Bank:
    $55
    JScott,

    I live in metro-Atlanta (Marietta to be exact) I would be more that willing to help you (research and analyzing properties, take pictures of properties, analyzing local market trends, etc.). Currently, I would be willing to commit 5 hours a week to the project. My reward would be learning as we go through the process. Let me know if you are interested. Good luck!
     

Join 1000s of entrepreneurs who are rewriting life's script and winning financial freedom.

---- ----

You must be a member to join the conversation.

Create Account

Join the community fast and easy!

REGISTER

Log In

Already have an account? Login here.

LOG IN

Share This Page