multifamily investing

3 Property Management Trends 2020

February 26, 2020 by Team RE Mentor Leave a Comment

Millennial Tenants

Millennial tenants are becoming more of the tenant market and what they want often requires high tech solutions. Without that technology, they consider you backward or irrelevant, even though you’ve got everything else nailed.

Without technology and growing property portfolio’s you may not be able to keep up, nor satisfy landlords and owners that you’re capable of growth and efficiency.

They’ll likely know from their first visit to your website or conversation on the phone that you’re old school.

Renters love the ease of doing things when they can via their smartphone, on the bus or subway, at work, on the road in their car or at home.

Rental Market Demand

Housing construction starts will grow in 2020 and for the next 5 years.

Renters are weighing the buy vs rent decision, and some will make the choice to buy a home. That will in turn lower rents and raise vacancies.

Your costs will go up and your revenues down.

Large Multifamily Properties

Large multifamily buildings are the trend, due to so much pent up demand for units. Big developments near key transit locations will receive priority from the government.

Their Plan To Building A Legacy Through Real Estate

February 12, 2020 by Team RE Mentor Leave a Comment

Their Plan To Building A Legacy Through Real Estate

Sherry and Laird describe why they came to the Ultimate Partnering Event and how the event surpasses their expectations. They share what their biggest fear was when it comes to investing in multi-family real estate and how they overcame it. Sherry and Laird tell you why they have a favorite training from RE Mentor and what RE Mentor means to them. They offer advice for anyone who is on the fence about getting started investing in real estate. ____________________________________________

5 Signs Of A Real Estate Market

January 22, 2020 by Team RE Mentor Leave a Comment

1. Local government funding

A hefty amount of dollars spent by the local government on local development is a sure sign of the revitalization and further development of an area which means that real estate is about to take off in terms of supply and demand.

2. A jump in commercial funding

The relocation of large businesses, the opening up of offices and an influx of new business in an area is also a clear indication that domestic real estate will take off as all those workers, office personnel and managers will need somewhere to live.

3. Expansion of local transportation

An upgrade of the local transport grid, local transport network and or building of new access routes is an indication of the revitalization of an area.

4. A rise in the local population

An influx of new visitors, a rise in the number of 'out of towners' and a jump in the people who normally live in an area is a sign that the particular market is about to become a real estate hot spot.

5. A rise in investment projects

Any jump in investment projects or any large-scale investment in an area, even if it has nothing to do with real estate is one of the signals that the area is about to become a hotbed of real estate activity and you had better get in there fast.

Want to learn more about real estate markets? Go here.

3 Ways To Determine The Value Of An Apartment Building

December 6, 2019 by Team RE Mentor 1 Comment

There are three ways to determine the value of an apartment building:

Replacement Cost Approach
Sales Comparison Approach
Income Approach

Replacement Cost Approach

The Replacement Cost Approach determines value by calculating how much it would cost to replace an existing structure. This approach is very time consuming to complete as you must obtain pricing for all materials (from 2×4’s to outlet covers) used in the construction of a property and then calculate replacement cost. Because of this, it is very rarely used.

Sales Comparison Approach

For single-family houses and 2 – 6 unit apartment buildings, the most common approach to determining value is the Sales Comparison Approach. This approach compares similar properties that have sold within the last six months, within a certain geographical radius from the subject property (usually no more than two miles, the closer the better) to determine value.

If you’re buying a 3-family apartment and a similar one on the next block oversold for $220,000, then your property will be valued around that area.

The Income Approach

For six units and more, you would use the Income Approac h to determine the value of the property. This means that you would determine how much income the property is generating and determine its value based on that number.

There are several formulas that investors use to determine value, though one is more prevalent than others; that is the Cap Rate.

You’ll hear people talk about the “Cap Rate.” It’s what most investors use when comparing one property to another.

The Capitalization Rate is the rate at which the Net Operating Income (the income that is left over after all the expenses are taken out) repays the purchase price on an annual basis. Sounds technical, doesn’t it? Don’t let it scare you.

Cap Rate = Net Operating Income/Value (selling price)

Allowing Your Real Estate Business to Run Your Life

October 9, 2019 by Team RE Mentor 1 Comment

We all get so wrapped up in the thrill of real estate investing (once you start buying, selling and cashing those big checks you will know what I’m talking about), that it begins to become all-encompassing. We have cell phones, so we don’t miss a call. When the phone rings at our home office we go running like a bat out of hell from the dinner table because this could be the Next Big Deal.

We take calls from contractors and suppliers at all hours and somehow especially on Sunday nights. We allow tenants to have us at their beck-and-call because we fear that if we don’t say “how high” when they say “jump”, they might move out.

Before we know it, our lives are consumed with nothing else. We left our jobs so that we could stop working for The Man, and be our own boss. Now we’ve come to realize that we are working for a much worse boss, a tyrant. That tyrant is ourselves.

How does this happen? It happens because we don’t effectively plan our businesses. I talked about planning earlier in this report. One of the benefits you will achieve from planning is you will be able to create systems and checklists to control your real estate investing business.

Once these systems and checklists are in place, you will know what needs to be done in any situation. You will look at the checklist daily, to review what has been accomplished and what still needs to be done.

You should have checklists for every aspect of your business. Here are some key checklists:

Property Evaluation: Buying right, market analysis, property analysis
Property Inspection: Estimating repairs, formula worksheets, room-by-room analysis
Contractor Management: Bid process, contracts, and agreements
Renovation Management: Cash flow, required activities, scheduling, and contractor management
Tenant Management: Application process, move-in process, leases, and contracts

These are just a few of the many checklists and systems that you’ll need to create and use on a day-to-day basis. Then you’ll be running your business and your business will not be running you.

One of the benefits of systems and checklists is that—as you grow your business and hire people to work for you—you’ll train them by teaching them how to use the checklists and systems. You will train them to complete the tasks associated with each system and checklist. You will supervise them by revising the systems and checklists that they are working on.

This is the fastest way to grow your business.

To get help on systematizing your business, read this book, The Multi-Family Manifesto. It’s a great book that will teach you how to look at your business in its proper perspective.

If you don’t want to create all of those systems and checklists yourself, find someone who already has a successful real estate investing business and find out what they are using. The sooner you systematize, the sooner you will be free to make choices based on what you want to do, instead of what your business needs you to do.

Syndication Is The Secret To Making Big Money In Real Estate

September 18, 2019 by Team RE Mentor Leave a Comment

Are you interested in syndication?

First let’s focus on something important: every investment entails some risk and successful investors are great at minimizing the risk not just for themselves but also for everyone else involved with them.

This means that as a real estate investor you must be quick at putting together deals using syndicates.

Syndication Is The Secret To Making Big Money In Real Estaterementor.com

Essentially, a syndicate is a group of investors representing an interest in breaking into the real estate investment market who put up a certain amount of cash and get fronted by a professional.

If you are clever about it…

And have begun to establish your credentials, built up a reputation and can talk the talk in a way that convinces people to trust you with their money you are then off to a flying start.

It means that you will bring credentials, the ability to close profitable deals and expert negotiating skills to the table.

For the investors who form the syndicate the benefits are twofold:

First they gain a foothold into the competitive real estate investment market without having to put up a whole lot of money to begin with and this means reduced exposure for them and fewer risks for their money.
Second they gain someone who will do all the legwork and close the deals and work for their profit. All they have to do is sit back and enjoy it.

Provided you are diligent in your work, capable of paying attention to every detail and good at working under pressure and, hopefully, working at more than one deal at a time then your earning potential should only be limited by your ability to put deals together.

Creating syndicates and using other people’s money to invest in real estate without risking your own allows you to create win-win scenarios which benefit everyone and that is the best way to build a career, a reputation and a personal fortune.

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