A discussion about Real Estate Investing in Auburn, Alabama, as well as general investing tips and strategies.
In this episode, I'm going to catch you up on a few things that we covered in previous episodes: The Rossmere flip condoTaxes and accounting, and what I've learned the hard wayRental trends and how more turnovers can actually make you moneySales price trends, and what to expect thereChanges we are seeing in local purchase contracts and the buying process in generalI had a slow week on the sales side and I can't work on my next turnover until next week, so I decided to get back in the podcast saddle after about 10 months off! I forgot how to mix some of the sound stuff, but overall it was good to be back!Links from this episode:Work with MeReal Estate Brokerage Services: AuburnInvestmentProperties.comReal Estate Investor Coaching: BetterREI.com
In this Episode, I'm going to take you back to a diner on Beale Street in Memphis, on a lonely night more than 15 years ago. I felt like I was drifting a little, and needed some wisdom in my life about dealing with success, not feeling needed, and being kind of depressed about it. Around that time, I started reading classic books and plays to keep my mind active, and this particular night I sat down to read The Glass Menagerie, not even knowing what a Menagerie was, or why the play was so famous. In fact, the play itself was not very memorable to me - I had to look it up again and do a google search to find remember what a "menagerie" was again just so I could do this podcast! Lucky for me, I came across something in the first few pages of the book, before the play even started, that was as memorable and influential as anything I've read before or since. It's not often you get life advice from someone so gifted with the written word, and I'm definitely talking about Tennessee Williams here, not me! Anyway, this is a super short episode with a very impactful lesson about your Real Estate career, and about life in general. I hope you enjoy it as much as I did!Links from this episode:Work with MeThe Catastrophe of Success, by Tennessee WilliamsReal Estate Brokerage Services: AuburnInvestmentProperties.comReal Estate Investor Coaching: BetterREI.com
In this Episode, I'll talk about the genius and the beauty of a coming up with a 5 Year Plan. They say that people often OVERestimate what they can do in 1 year, but UNDERestimate what they can do in 5 years, so I want to encourage you to look at where you are now and give yourself some goals and direction by looking 5 years out into the future.I'll tell you how my first 5 Year Plan helped me get out of the apartment business and reshape my life, and how my dog Bodie, helped me realize it was time to come up with another. We'll also talk a little bit about how Robert Kiyosaki (Rich Dad, Poor Dad book), and Dave Ramsey (Radio Show & Total Money Makeover book), and how their differing advice can help you see the big picture and choose a path that fits for your life situation.Links from this episode:Work with MeRich Dad, Poor Dad, book by Robert Kiyosaki (Amazon Link)Ramsey Solutions, (Dave Ramsey books, budget tools, and podcasts)Real Estate Brokerage Services: AuburnInvestmentProperties.comReal Estate Investor Coaching: BetterREI.com
In this Episode, you'll hear the second of two parts of an interview I did with my long-time Real Estate Attorney, Russell Balch of the law firm Akridge & Balch in Auburn. Besides being my attorney, Russell has also been my office landlord for a few years too. I met Russell through my first post-college employer (Fred & Miles of the Charter Companies) in the late 1990's, and when I started my mobile home sales business way back in 2000, Russell was my guy! Eventually, I moved on to single condos, and then started buying apartment buildings to turn around, or renovate and cut into condos. Later on, Russell helped me acquire a 50+ unit portfolio with a multi-million dollar "Lease-Option" type of contract. Well, that huge acquisition completely burned me out and I needed a break for a while, so I decided to sell all of my properties, and Russell helped me with that, too. He's started 8 or 9 LLC's for me, either as solo businesses or with partners, and I always felt prepared for what happened next, even when one of the partners in a 3 man group actually died and the other filed bankruptcy! The bottom line is this: a good Real Estate attorney is one of the most valuable members of your team, and Russell is a damn good one.Listen in as Russell and I talk about: (items in bold are in this episode, the rest were discussed in the previous episode)Various types of closingsThe differences between Residential and Commercial DealsThe finer points of contracts and how they can affect negotiationsContract and the review process for complicated dealsOptions, Due Diligence periods, and Hard Money clausesLLC's and how they are designed to be firm but flexible, and can be modified on the fly to fit your evolving projectsThree types of dispute resolution (Mediation, Arbitration, and Litigation)Parting thoughts and words of wisdomLinks from this episode:Work with MeExpert Legal Services for Real Estate: Russell Balch at Akridge & Balch, PCCall Russell or my go-to lady FB Henderson at (334) 887-0884Real Estate Brokerage Services: AuburnInvestmentProperties.comReal Estate Investor Coaching: BetterREI.com
In this Episode, you'll hear the first of two parts of an interview I did with my long-time Real Estate Attorney, Russell Balch of the law firm Akridge & Balch in Auburn. Besides being my attorney, Russell has also been my office landlord for a few years too. I met Russell through my first post-college employer (Fred & Miles of the Charter Companies) in the late 1990's, and when I started my mobile home sales business way back in 2000, Russell was my guy! Eventually, I moved on to single condos, and then started buying apartment buildings to turn around, or renovate and cut into condos. Later on, Russell helped me acquire a 50+ unit portfolio with a multi-million dollar "Lease-Option" type of contract. Well, that huge acquisition completely burned me out and I needed a break for a while, so I decided to sell all of my properties, and Russell helped me with that, too. He's started 8 or 9 LLC's for me, either as solo businesses or with partners, and I always felt prepared for what happened next, even when one of the partners in a 3 man group actually died and the other filed bankruptcy! The bottom line is this: a good Real Estate attorney is one of the most valuable members of your team, and Russell is a damn good one.Listen in as Russell and I talk about: (items in bold are in this episode, the rest were discussed in the previous episode)Various types of closingsThe differences between Residential and Commercial DealsThe finer points of contracts and how they can affect negotiationsContract and the review process for complicated dealsOptions, Due Diligence periods, and Hard Money clausesLLC's and how they are designed to be firm but flexible, and can be modified on the fly to fit your evolving projectsThree types of dispute resolution (Mediation, Arbitration, and Litigation)Parting thoughts and words of wisdomLinks from this episode:Work with MeExpert Legal Services for Real Estate: Russell Balch at Akridge & Balch, PCCall Russell or my go-to lady FB Henderson at (334) 887-0884Real Estate Brokerage Services: AuburnInvestmentProperties.comReal Estate Investor Coaching: BetterREI.com
In this Episode, I'll talk with Auburn Mayor Ron Anders about a variety of topics and a "State of Auburn" recap at this interesting and challenging time in Auburn's history. We'll tall about how his family got started in the school book business, and what's on the horizon for that location, as well a ton of other interesting topics. We talked about the smashing success of the "pop up" Covid vaccine clinic across from the mall, the impact Covid has had on local small businesses, the University, and the places those 2 worlds intersect. We'll also look at the health of the city revenues before and after Covid shut everything down, how we're doing now, and his projections for the future, and some big time news about healthcare in Auburn in particular. Other topics we covered were population growth, the AU President search, and how that might change student enrolment numbers, as well as an update on new apartment plans in both the student and "grown up" markets. We can't leave out the Short Term Rentals decision that is now set for a while, and what that looks like in reality. I'll outline the general concepts below:Auburn Short Term Rentals (STR's)Only allowed in certain zoning districts (many single family home areas near campus are excluded)Excluded Zoning Districts: NC, DDH, LDD, LLRD, NRDW - W of Donahue, CRDW-W West of DonahueClick here for City of Auburn Zoning MapIF Short Term Rentals (STR's) are allowed on your property, you have 2 options:Non-Primary Rentals:The owner DOESN'T live there full timeLimited to 240 days per year, maxThat means the other 125 days the owner can be there or it must remainNeeds Zoning Certificate and Business LicenseHomestays:The owner DOES live there, and files Homestead there with the Tax officeOwner lives there 180 days of the year, minimumOwner can rent a single bedroom 365 days (no limit)Owner can rent 90 days if they are goneNeeds Home Occupation PermitLinks from this episode:Work with MeCovid Clinic Volunteer Sign-UpAuburn Apartment GuideReal Estate Brokerage Services: AuburnInvestmentProperties.comReal Estate Investor Coaching: BetterREI.com
In this Episode, you'll hear the second of of two interviews with Jim Andrews, who publishes the Auburn Apartment Guide and the Tuscaloosa Apartment Guide. Jim got started as a Property Manager, did a little teaching on the subject at the college level, and has been in the multifamily business in one way or another ever since. He is also involved in the financing side of the multifamily business and an investor in properties and projects himself.The framework of the 2 episode series is a historical look at the multi-family and/or student housing options here and how they have evolved over time. We'll cover everything from trailer parks and duplexes to downtown redevelopment, and everything in between in roughly 10 year chunks. This first episode covered the 1980's through about 2005ish, and this episode picks up in the 2000's and goes all the way up until today's projects. Links from this episode:Work with MeAuburn Apartment GuideReal Estate Brokerage Services: AuburnInvestmentProperties.comReal Estate Investor Coaching: BetterREI.com
In this Episode, you'll hear the first of two interviews with Jim Andrews, who publishes the Auburn Apartment Guide and the Tuscaloosa Apartment Guide. Jim got started as a Property Manager, did a little teaching on the subject at the college level, and he has been in the apartment business in one way or another ever since. He is also involved in the financing side of the multifamily business and an investor in properties and projects himself.The framework of the 2 episode series is a historical look at the multi-family and/or student housing options here and how they have evolved over time. We'll cover everything from trailer parks and duplexes to downtown redevelopment, and everything in between in roughly 10 year chunks. This first episode is going to cover the 1980's through about 2005ish, and the second episode picks up in the 2000's and goes all the way up until today's projects.
In this Episode, I'll share 9 or 10 of the Real Estate books that I would recommend to someone no matter which stage they are in as an investor. Some are inspirational, some are more about urban economics, the history of cities, or even how to prioritize your work when you are feeling overwhelmed. I often say that our actions follow our philosophy, or in other words, we do what makes sense to us. If that is true, then it's helpful to see the bigger picture and understand the context of our decisions beyond just what we can see right in front of our face at the moment.Here are the books, with Amazon links:Rich Dad, Poor Dad, by Robert KiyosakiCashflow Quadrant, by Robert KiyosakiThe E-Myth Revisited, by Michael GerberThe Death and Life of Great American Cities, by Jane JacobsThe Option of Urbanism, by Christopher LeinbergerThe Rise of the Creative Class, by Richard FloridaWho is Your City? by Richard FloridaThe World is Flat, by Thomas FriedmanThe 7 Habits of Highly Effective People, by Stephen CoveyThe One Thing, by Gary KellerJim Rohn (various YouTube videos in a playlist)80/20 Sales & Marketing, by Perry MarshallMega-Trends, by John NaisbittOther Links from this episode:Work with MeReal Estate Brokerage Services: AuburnInvestmentProperties.comReal Estate Investor Coaching: BetterREI.com
In this Episode, I sit down with local Investor, Builder and Land Developer Andrew Parmer. This is the first of a 2 part interview, and in this part we talk mostly about his investment properties and how he has set up the rental side of his business with less direct interaction than I had, which frees up his time for looking at land deals and building subdivisions.In Part 2 (Episode 35), he'll go into much more detail about the Land Development business: process, schedules, financing, etc.Links from this episode:Work with MeReal Estate Brokerage Services: AuburnInvestmentProperties.comReal Estate Investor Coaching: BetterREI.com
In this Episode, we'll take a look ahead to 2021. The start of a new year is always a good time to take an honest look at where you are today, look at the things you could improve on, and come up with ways to do better in the coming year, so I'll do that in a few key areas...What I expect from the Auburn MarketMy Business and Investing Goals for the yearA Few Personal ResolutionsLinks from this episode:Work with MeSmall is Beautiful - E. F. Schumacher (Amazon Link)The Death and Life of Great American Cities - Jane Jacobs (Amazon Link)Real Estate Brokerage Services: AuburnInvestmentProperties.comReal Estate Investor Coaching: BetterREI.com
In this Episode, I take a quick look back at 2020. The episode covers the impact of coronavirus on the world, and investing in general, then we zoom down to the Auburn rental market, and then my own business. I also talk about my personal investments for the year, good and bad, and some lessons learned there. Also, I go into some detail on the financial things I needed to change this year after several years of not being very diligent with my record keeping, and I walk you through the way I was able to do that and how my accountant and I were able to work together to make it simple, quick, and easy to stay on top of. Links from this episode:Work with MeReal Estate Brokerage Services: AuburnInvestmentProperties.comReal Estate Investor Coaching: BetterREI.com
In this Episode, I go over my 10 Biggest Mistakes in my 20+ years of being a Real Estate Investor in Auburn. It's easier to for each of us to remember the mistakes that caused us to lose money or to be super stressed. They get embedded in our brains and come out as "common sense" from that point on, right? But if you haven't made these mistakes yet, then maybe they aren't common sense for you. So I'm here to pull back the curtain a little, and share some of my mistakes in order to help prevent you from making them yourself. Let's get real... making mistakes is part of this business. If you think you will get through a career as a Real Estate Investor without making them, you are either naive or arrogant, and I predict some expensive lessons in your future! So let me be your tour guide, and tell you how to get where you want to go with as little trouble as possible. Links from this episode:Work with MeReal Estate Brokerage Services: AuburnInvestmentProperties.comReal Estate Investor Coaching: BetterREI.comWebsites & Branding: EasyLandlordWebsites.com
In this Episode, I sit down with Auburn business man and former City Council member Brent Beard, and we talk about his experience as a landlord with multiple properties in Auburn. I've known Brent for over 10 years, and in early 2018 he came to me after selling a beach condo and asked me if I could help him find a few rental properties so he could put that money back to work right here at home. Brent used his 1031 Exchange money to buy 3 houses here, and he eventually picked up a 4th and 5th, which were condos close to campus. Despite his busy work and family schedule, he and his wife Lauren decided to do their own management, and he'll tell us how that's going. Brent bought a duplex when he was younger, right out of school, and he didn't have as much luck with his neighbor on the other side, but that was a long time ago. This time, he asked me a lot of good questions and we were able to set his screening and leasing process up to be smooth and effective right from the start. Links from this episode:Work with MeReal Estate Brokerage Services: AuburnInvestmentProperties.comReal Estate Investor Coaching: BetterREI.comWebsites & Branding: EasyLandlordWebsites.com
In this Episode, I'm going to take you behind the scenes of a rehab project I'm working on. I bought a small condo just off of N Ross & E Glenn at Rossmere Condos in November. The condo is currently rented, and I'm getting ready to do a major rehab on it at the start of 2021. Right there you should have already realized this is going to be an interesting project! Since I'm still at the beginning stage with this one, I'm going to talk to you about the decision process related to flipping it for resale or rehabbing it to rent for a year or longer. I'm also going to take you through the process of determining the rehab budget, from cabinets and flooring all the way to door knobs & light fixtures.And most importantly for first timers, in the Tips and Takeaways section, I'm going to share with you how I am handling the existing lease that goes through the end of July 2021. That may be the most important lesson in the whole project! This will be the first in a series that will take place over the next few months while the project moves forward.Links from this episode:Work with MeReal Estate Brokerage Services: AuburnInvestmentProperties.comReal Estate Investor Coaching: BetterREI.comWebsites & Branding: EasyLandlordWebsites.com
In this Episode, I'm going to talk to the woman whose office has handled all of my insurance for the last several years: Kathy Powell of State Farm in Auburn. I've had some small water leaks and some massive water leaks - the kind where ceilings have caved in! And who has gotten me through all those? State Farm. So I decided to bring in Kathy to answer some common questions I get about Insurance on Investment Properties, like houses and condos, but also things like Umbrella policies and we'll even talk about how life insurance can help you get a deal funded. Basic Topics:Rental Property Owner's Insurance: The differences between this and regular homeowner's insuranceConsiderations for Insurance on a place you just bought (an empty house with a rehab coming shortly)Renters Insurance: What it covers, costs / why recommend it or even require itCondo insurance: Unit owner policy vs Master PolicyVehicle insurance for showing properties or pulling a UHaul trailer (emptying a place out after buying it / hauling away landscaping debris)Umbrella or other Liability InsuranceAdvanced Topics:Borrowing against your whole life policy to come up with down payment funds?Term life to pay off a property or pay off investors (low tech version of "key man" insurance)Links from this episode:Work with MeMy Insurance Provider: Kathy Powell, State Farm (in Auburn)Real Estate Brokerage Services: AuburnInvestmentProperties.comReal Estate Investor Coaching: BetterREI.comWebsites & Branding: EasyLandlordWebsites.com
In this Episode, we're going to take a look Future Pacing, which was a concept I brought up a few weeks ago, maybe in Episode 14 or 15, and how we can use that tool as a landlord to make our lives easier and the make things easier for our tenants. Broadly speaking, Future Pacing is a concept that coaches, speakers, etc use to get their clients or their audience to see a vision of something in the future, and then motivating someone to take consistent action to get that result. We'll talk about how we can use Future Pacing and the concept of a timeline of actions steps to set up our leasing process for 3 important parties: you, your vacating tenant and your incoming tenant.A few weeks ago, I mentioned the idea of coming up with a "30 Day Checklist" for each party listed above, and decided to do this for my own rental business. Today we're going to look at why this is important, what we can learn from a Master at Future Pacing, Dr. Martin Luther King, Jr., and then walk through what ended up on each of my 3 checklists.If you want the Word or PDF copies for yourself, just click the Work With Me link or send me an email, and I'll send them out to you.Links from this episode:Work with MeMLK Speech: I Have a Dream (YouTube)MLK Speech: I Have Been to the Mountaintop (YouTube)Real Estate Brokerage Services: AuburnInvestmentProperties.comReal Estate Investor Coaching: BetterREI.comWebsites & Branding: EasyLandlordWebsites.com
In this Episode, we're going to take a look at the impact that Covid-19 and the Coronavirus has had on Real Estate Investing in Auburn over the past 7 months, focusing on 3 specific areas:Student HousingStarter Home RentalsStarter Home SalesWe're also going to talk about the type of mindset an investor must develop in times of uncertainty or upheaval, and why some of the traditional moves haven't presented themselves yet. We'll talk about the style of economic recovery happening in Auburn and how that might impact your rental performance. Lastly, we'll briefly touch on what makes a city and a renter financially resilient, and how Auburn scores highly on both categories. Links from this episode:Work with MeReal Estate Brokerage Services: AuburnInvestmentProperties.comReal Estate Investor Coaching: BetterREI.comWebsites & Branding: EasyLandlordWebsites.com
In this episode, we'll revisit the 3 ways to make money in Real Estate, and then take a look at the timeline for a typical Real Estate investor. We'll start at your first purchase and then your next purchase, and why it goes faster the second time around, and then we'll look further ahead and see where you might end up 5-10 years down the road when your role might change from "deal hunter" to "asset manager" or even the coordinator of a group of other investors. Tips & Takeaways:We'll look at how Warren Buffet makes a 50% return each year from just one of his investments, and how we can compare that to our returns as Real Estate Investors. We'll also look at the hidden metric of "Cash on Cash Return", which is often a better way to evaluate your Real Estate investments and especially how to find value in doing smart renovations. 3 Ways to Make Money in Real Estate:Surplus Cash Flow from the RentIncrease in Sales Price (or Appraisal Value)Paying Down a Loan with Someone Else's MoneyAnalyzing Your Cash on Cash Return:Add up all of your net income (surplus rent) for the yearDivide that number into the amount you put into the property for your down paymentThat number is your Cash on Cash ReturnYou will probably have a much higher return than you think!Can often be greatly improved (doubled?) with smart upgrades Links from this episode:Work with MeReal Estate Brokerage Services: AuburnInvestmentProperties.comReal Estate Investor Coaching: BetterREI.comWebsites & Branding: EasyLandlordWebsites.com
In this episode, I continue the interview Barry & Gleason Jones of Cross Country Mortgage in Auburn. If you missed the previous episode, you should definitely start there. It is a 2-parter, but you can see the breakdown of topics covered in each episode below...PART 1:Gleason's lessons from being a landlordARM's - are they still out there?How do THEY determine your credit score?Intro to Condo loansImportance of accurate details on loan applicationsHow do you determine if it’s a 2nd home or investment property?How are the loans different for a 2nd home or investment property?PART 2:Interest-Only & Construction LoansHELOC - what are the maximum limits you can borrow?Can you pledge other assets instead of / as a part of your down payment?Approved sources for down payment assistance?Let's talk about seasoningBuying as an LLC vs buying in your personal nameDeeper dive into condosWhere are we in the loan cycle compared to 2-5-10 years ago?A quick look at the reasons for so much development in Downtown AuburnWhat type of loan would you recommend as the best for an investor?Broker’s advice: How do I come into your office and get the best loan? Links from this episode:Work with MeMortgage Services: Gleason Jones, Cross Country MortgageUnderstanding Mortgages & the Great Recession: The Big Short (Amazon)Real Estate Brokerage Services: AuburnInvestmentProperties.comReal Estate Investor Coaching: BetterREI.comWebsites & Branding: EasyLandlordWebsites.com
In this episode, I share an interview Barry & Gleason Jones of Cross Country Mortgage in Auburn. Barry has been in the mortgage business in Auburn for a long time, and his son Gleason is following in his footsteps. Actually, Gleason worked for me one summer, about a year before I sold all of my apartments. He was a hard worker then, and I'm sure he is still a hard worker now. The information and wisdom we get in this episode is hard to beat, so if you want to learn about loans and the mortgage process, I think you'll get a lot out of this conversation. It went so long, it ended up being a 2-parter, but you can see the breakdown of topics covered in each episode below...PART 1:Gleason's lessons from being a landlordARM's - are they still out there?How do THEY determine your credit score?Intro to Condo loansImportance of accurate details on loan applicationsHow do you determine if it’s a 2nd home or investment property?How are the loans different for a 2nd home or investment property?PART 2:Interest-Only & Construction LoansHELOC - what are the maximum limits you can borrow?Can you pledge other assets instead of / as a part of your down payment?Approved sources for down payment assistance?Let's talk about seasoningBuying as an LLC vs buying in your personal nameDeeper dive into condosWhere are we in the loan cycle compared to 2-5-10 years ago?A quick look at the reasons for so much development in Downtown AuburnWhat type of loan would you recommend as the best for an investor?Broker’s advice: How do I come into your office and get the best loan?Links from this episode:Work with MeMortgage Services: Gleason Jones, Cross Country MortgageUnderstanding Mortgages & the Great Recession: The Big Short (Amazon)Real Estate Brokerage Services: AuburnInvestmentProperties.comReal Estate Investor Coaching: BetterREI.comWebsites & Branding: EasyLandlordWebsites.com
In this episode, I talk with Beth Witten of the Auburn City Council and Blue Turtle Creative, a marketing and event management company in Auburn. Here are the topics we discuss:Major Topics:City finances and issues 6 months into the Coronavirus pandemicStatus of (and moratorium on) new student housing developmentsPending regulations and policies related to Short-Term housing like AirbnbAdditional Topics:City's plan for the 2020 election2040 Comprehensive Planning processUpdate on plans for Samford & College, near the old Heart of Auburn hotel siteLinks from this episode:Work with MeMarketing & Event Planning: Blue Turtle CreativeReal Estate Brokerage Services: AuburnInvestmentProperties.comReal Estate Investor Coaching: BetterREI.comWebsites & Branding: EasyLandlordWebsites.com
In this episode, I interview another one of my clients, Derek Jackson. He and his wife Miranda had ties to Auburn, met while working in Atlanta, and after getting married and having a few kids, decided to move back to Auburn for the long term to be closer to family. Their primary goal was to diversify their retirement income, but they wanted to make sure that even their first rental property was going to put off enough cashflow to pay for itself and and build a reserve for future maintenance, etc. Derek sees himself as a "risk averse" person, and it's funny to hear how his perspective on owning investment properties has changed since we first met. Also, the Jackson's decided to self-manage for now, and Derek will tell you how & why they came to that decision and how they use some cool new technology to help them do it easily and affordably. Links from this episode:Work with MeTenant Screening and Rent Collection: Cozy.coRiver Bank & Trust, Loan Officer: Luke Madsen: Branch Contact InfoReal Estate Brokerage Services: AuburnInvestmentProperties.comReal Estate Investor Coaching: BetterREI.comWebsites & Branding: EasyLandlordWebsites.com
Description & Show Notes:In this episode, I interview one of my clients, John Edwards. John is an Auburn in his 40's, living with his wife and 3 kids in the East Atlanta suburbs, and he bought his first rental property with me in early 2020. We started looking at places during the fall, and just a few months later, he was doing some small improvements on his first rental and preparing for his first tenant. Right after that, he got it rented and it's been pretty smooth sailing since then. He actually bought a house right next to one of my rentals, so I was able to give him pretty realistic numbers on what to expect for rent, and now he was off to the races! This is my first interview that meets with a recent "first time investor" client and looks at the buying process and their first 6 months of this being their new reality. Sorry if it is a little choppy or redundant, I promise I'll get better over time. That is a lesson in itself - as John says in the interview... prepare as much as you can, and then before you're ready, start anyway! On that note, here we go!Links from this episode:Work with MeReal Estate Brokerage Services: AuburnInvestmentProperties.comReal Estate Investor Coaching: BetterREI.comWebsites & Branding: EasyLandlordWebsites.com
In this episode, I’m going to talk about the Airbnb / VRBO situation in Auburn as it currently stands today. We’re going to briefly talk about the pros and cons of these types of rentals, both from the investor point of view as well as the City and the neighbors too, which will help explain why there are some major changes in the works. I actually met with one of the Principal Planner in Auburn this week and I’ll tell you the latest info I got from that conversation. I’ll let you know how we got here in the first place, and give you the timeline of when these things are likely to take effect. Then we’ll talk about action plans for what you can do if you are interested in this type of investment property and/or you are looking for a few alternative ways to accomplish a similar outcome, and then we’ll finish the episode with some of my thoughts on the Auburn City government and how they operate around here. Links from this episode:Work with MeCity of Auburn Planning Department: https://www.auburnalabama.org/planning/ City's Latest Info and Proposals for Short Term RentalsReal Estate Brokerage Services: AuburnInvestmentProperties.comReal Estate Investor Coaching: BetterREI.com
In this episode, I will share some helpful and wise advice from a variety of sources, including my late father who made my Auburn journey a possibility in the first place, as well as successful local investors and others who have helped guide me on a path to success. I think our actions are a reflection of our underlying philosophy, and I hope these words of wisdom will help you see the big picture, take action, and be aware of risks & opportunities you may not have otherwise considered.In the Tips and Takeaways section, I'm going to share with you how a book with a simple title has has a profound impact on my life and business over the last few years, and helped me clear the clutter in my mind and my life, and make more progress in less time. If you find yourself saying, "I'm so overwhelmed, I don't know where to start!", then make sure you stick around until the end for some help getting past that.Links from this episode:Work with MeRich Dad Poor Dad (by Robert KiyosakiThe One Thing (by Gary Keller)Real Estate Brokerage Services: AuburnInvestmentProperties.comReal Estate Investor Coaching: BetterREI.com
In this episode, I sit down with Nick Hayes for an insightful chat. Nick is an experienced investor and Realtor in Auburn and we talk for an hour about strategy and real life examples of investments in Auburn. His "go or no go" criteria is different from mine and other folks I've talked to and he is definitely involved in more partnerships than most investors I know. But hearing from other successful people with different approaches is one of the reasons I decided to start recording these interviews and turn them into a podcast in the first place.At the time of this recording, Nick was an agent with Century 21 in Auburn, and he has since opened his own Brokerage, Roots Realty in Auburn. Links from this episode:Work with MeRoots Realty in Auburn: Roots RealtyReal Estate Brokerage Services: AuburnInvestmentProperties.comReal Estate Investor Coaching: BetterREI.com
In this episode, we'll wrap up our overview of the contracts and paperwork used in the leasing process by hitting the last 4 milestones: Renewals, Pre-Leasing, Move-Outs, and Deposit Refunds. I mean, lets be real - people are going to move out and you'll have to be ready for the transition, right? I'll introduce the concept of "Future Pacing" and how it will help your new tenants, your current tenants, and even you as a landlord. Yep, even with 20 years of experience, I've given myself some homework to do after recording this episode because we should all be on the lookout for ways to improve our business when we come across a good idea. We'll also talk about hiring a Property Manager, and what they will do - and not do - for you as part of your Management Agreement. We'll talk about what to expect when you are buying a property that is already under management, and what your options are at that time. And we'll end this section talking about how you might get stuck with a Condo Assn manager that you don't like if you aren't careful.In the Tips and Takeaways section, we'll talk about the best time to buy from a motivated seller - even in Auburn's relatively hot market. And we'll wrap up with some advice on the best times of the year to start a new lease to get the most Applicants and the highest rent - from my opinion, and how to structure your leases to give your tenants flexibility while still retaining control of the important stuff.Milestones in the Tenant Life-Cycle, as relates to contracts: (bold sections are covered in this episode)ApplicationLease + ClausesPaymentsRenew or Not?Pre-LeasingVacateDeposit RefundLinks from this episode:Work with Me"Family Truckster" Scene from "Vacation": YouTube LinkReal Estate Brokerage Services: AuburnInvestmentProperties.comReal Estate Investor Coaching: BetterREI.com
In this episode, we start with an overview of the leasing process, and then jump into the details on your Application and Lease. We'll cover a lot of things you should do and not do, things you should include and why they are important. It's a close-up look at how we screen our prospective tenants and automatically collect our rent, but we'll also look at the ways use specific terms and language in our leases to reduce the risk, uncertainty and confusion in our process and our lease to smooth out bumps in the road before they happen. I'll explain how using specific contract terms like "Joint and Several Liability" can help you avoid problems later by starting with clear expectations from the beginning.In the Tips and Takeaways section, we'll look at the companies I've been using for tenant screening and rent collection for years and a new alternative out there. We'll also look at how the "Three Most Valuable Word in Real Estate" (not Location, location, location) can be tied into our discussion of leasing contracts.Links from this episode:Work with MeTenant Screening Services: TenantReports.comAutomated and Inexpensive Rent Collection via ACH: PaySimple.comReal Estate Brokerage Services: AuburnInvestmentProperties.comReal Estate Investor Coaching: BetterREI.com
In this episode, we talk about buying in your name vs buying in an LLC, and some advice on partnerships and other types of "corporate" organizational structures. If you are just buying 1 house as 1 person, you have plenty of options available. But if you are joining forces with another investor or moving up to commercial property, then there are organizational contracts that are better then just buying in your name, and sometimes the bank will require something called a "single purpose LLC", so we'll talk about that a little bit, as well as how these things affect your taxes and even ways to do some wealth/estate planning for your family too. As you may have already picked up on, I think that having a good Real Estate attorney is important to give you guidance but also peace of mind.Then we look at the financial side of things, starting with a bank or mortgage company, and moving on from there. What are the 2 main parts of a mortgage - and why is that important? Well, sometimes you may need - or want - borrow from someone you know, either for the down payment or a rehab or just for a large unexpected expense. And if you understand how that is done, then you can do it without the bank as well. We'll talk about using IRA's, both yours and other people's, as a source of funds as well, and that can be Roth IRA's and Traditional IRA's. Another option would be a margin loan on stocks, and you have to know what the pros, cons, and consequences are to using all of these more "exotic" money sources. Lastly, we circle back to refinancing, and we talk about how you might use it to get a better rate, of course, but also to shorten or extend your payoff period, depending on your goals. In the Tips and Takeaways section, I'll compare investing in Real Estate to playing LEGOs, and how the real fun begins once you've got some experience under your belt and you can create the deals you want instead of just buying off the shelf. I'll also tell you how, why, and when we used different LLC's over the years, how we named them, which ones are still around today, and I'll introduce an inexpensive tool to help ease the fears of your private investors if you are out there trying to raise money. Links from this episode:Work with MeReal Estate Brokerage Services: AuburnInvestmentProperties.comReal Estate Investor Coaching: BetterREI.com
In this episode, I interview my friends and local investors, Bryan and Erin Waits of The Backyard. We talk about how they got started, how they run their properties from day to day, what their big picture strategy is. I was Bryan's Real Estate broker for many years, until his wife got her license, but we've known each other for almost 20 years, since I was selling Mobile Homes at Ridgewood Village trailer park in Auburn. Now his business, The Backyard is the best place in town to go for an awesome outdoor kitchen, firepit, patio, or any other type of outdoor living space. Somewhere in the middle of those 20 years, we all hit some tough times during the recession, and those scars have shaped our moves going forward. For us, that wasn't a reason to get out of Real Estate, but it has definitely influenced our moves since then.The conversation was great, and frankly, it is conversations like this that Bryan and I have all the time that led me to start recording them in a more formal way, which eventually evolved into this podcast series. A few years ago, we were on 2 completely different investing paths, and we kept debating both strategies, trying to poke holes in the other guy's plan. Those debates with Bryan are the origin of the question I often ask my clients: "All things considered, would you rather have 20 units paid for, or 100 units with a 20% down payment on each of them?" I'm curious as to your thoughts on that, but whatever the answer is, you can make it work for you. Also, I thought it was interesting how they both answered the "Are you playing Offense or Defense" question. Take a listen, I think you'll enjoy this one a lot!Links from this episode:Work with MeThe Backyard of Auburn: BackyardAuburn.comReal Estate Brokerage Services: AuburnInvestmentProperties.comReal Estate Investor Coaching: BetterREI.com
In this episode, we look at various types of contracts you may come across as you get started and grow as an Investor. We start with basic Purchase & Sale Contracts, and how you can use an Addendum to keep things clear as the deal evolves. Beyond those basics, we also look at Right of First Refusal, Pre-Sale Contracts, Options, and my Favorite: Lease Options. I also explain the concept of "Hard Money", in terms of the stages of a contract, but NOT in terms of a "Hard Money Lender", which I definitely DON'T recommend using.In the Tips & Takeaways Section, I'll give you 3 "real life" examples of Lease Option deals I did in Auburn, with the prices, rents, and addresses so you can drive by or look them up on Google Maps. The point of the Tips & Takeaways section is that you need to understand there is a difference between owning a property and controlling it, and then using the right method for to accomplish your goals with a particular property.You may never use these more exotic types of contracts to build your Real Estate holdings, but just in case you need them they can be very valuable things to have in your dealmaker's toolbox.Links from this episode:Work with MeReal Estate Brokerage Services: AuburnInvestmentProperties.comReal Estate Investor Coaching: BetterREI.com
In this episode, we go through a Skills & Time Assessment to help us narrow down the right property for us to buy at this point in our Investing Career. It doesn't mean our capabilities are the same as they were a few years ago, and it doesn't mean that we won't be able to handle more extensive rehab work or bigger properties in the future, either. It simply means we need to take an honest look at what we can handle NOW, and still meet our goal of getting each property we buy ready for a tenant within 30 days of our closing. And I don't think "how much can I afford?" is the #1 constraint that so many beginners think it is.I'll help you separate each item on your TO DO List into one of three categories:Things I can do myself or with unskilled helpThings I can hire outThings I can't do or delegate effectively right now.We also look at how we can plan our work and the work of our contractors and helpers to meet that 30 day schedule. How many things can we do before we even close? You want to think about this as a valuable way to compress your rehab timeline and hit the 30 day goal. YOU are the driver here, so the success of a project is ultimately our responsibility. It's important to stay positive and proactive, and not become frustrated and disinterested. Every project has hiccups along the way.Links from this episode:Work with MeReal Estate Brokerage Services: AuburnInvestmentProperties.comReal Estate Investor Coaching: BetterREI.com
In this episode, we go through the numbers of a typical investment property in Auburn, a single family house similar to what our clients often buy. We look at rent, common expenses, and give you an easy and quick way to do "back of the napkin" math while we are out looking at houses. We;'' see how that one house can help us in the 3 main ways that you can make money from Real Estate:Positive Cash Flow in your PocketIncrease in Property ValuePaying Off Loans with Someone Else's MoneyIn the Tips and Takeaways section, we go down a different path with a quote / challenge:- Be someone no one thought you could be… even yourself.We are often quick to accept labels related to our families, our careers, and those that others put on us. But we are slow to expand our identity to include new things we want in our lives. Our brain's are wired to help us SURVIVE, and expanding our comfort zone feels directly opposed to that survival. So we need to make a conscious effort to do what investors do, and take the steps to make that new thing part of our reality. Instead of "fake it til you make it", why not try "do the work and you'll get better at it"?I also talk about how my similarities to the Anal Retentive Chef from Saturday Night Live has held back my business for 20 years, and how I am putting that behind me by creating systems that work for me and finally eliminating roadblocks.Links from this episode:The Anal Retentive Chef from Saturday Night LiveA Great Online Mortgage CalculatorWork with MeReal Estate Brokerage Services: AuburnInvestmentProperties.comReal Estate Investor Coaching: BetterREI.com
In this episode, we focus on Commercial Properties: how they are valued and 3 ways to increase their value as an owner. We look at the ways that the Net Operating Income (NOI) and Cap Rates work together to determine the value of a Commercial Property, and easy ways that you as an owner can improve both of them to have a major impact on the value of your property in just 2-3 years. There is a simple recipe for success in this part of the Real Estate Investing world, and I'll introduce it here.The 2 Components of Commercial Property Valuations:Net Operating Income (NOI): Take all the income and subtract out all the costs associated with running the property. (usually everything but your loan payment)This number is a FACT.Cap Rate:The desired return a new buyer would want (or need) to get if they are buying a propertyThis is an OPINION.The Value of a Commercial Property is found like this:NOI / Cap Rate = Value$100,000 per year / 8% return = $1,250,000100,000 / .08 = 1,250,000Commercial Property Quick Tips:Renovating the Management is easier & cheaper than renovating the "property" itselfGive yourself 2-3 years to implement your plan on an apartment turnaround and longer for retail or office spaces Links from this episode:Work with MeReal Estate Brokerage Services: AuburnInvestmentProperties.comReal Estate Investor Coaching: BetterREI.com
In this episode, we talk about how Residential and Commercial Properties are valued, what makes them different, and how to improve your property's value. And where do apartments fall - are they residential or commercial? How are the appraisals different? We also talk about how the same characteristics that make single family homes safer for the new Real Estate investors wind up making things tougher for the more experienced investors, and why those factors push many of the pros to trade up to Commercial Properties eventually.I'll also introduce some new terminology that you need to become familiar with when it comes to commercial properties and values. We'll also look at a realistic renovation budget for various aspects of a typical 1,500 sf single family rental in Auburn, using my own historical costs from the past few years.Links from this episode:Work with MeReal Estate Brokerage Services: AuburnInvestmentProperties.comReal Estate Investor Coaching: BetterREI.com
In this episode, I interview Josh Davis of 256 Realty in Huntsville, Alabama. Josh and I met when he was in school in Auburn over 15 years ago, and we have been picking each other's brains about Real Estate ever since. Join us for this hour long conversation that covers how he got started, what he does now as the Owner and Broker of 256 Realty, and what advice he has to share with Investors just getting started. It's the first interview I've ever done, so I'm not sure how the audio will come out, but the information is great!Links from this episode:Work with Me256 Realty in Huntsville, AL: 256Realty.comReal Estate Brokerage Services: AuburnInvestmentProperties.comBadger Properties, Auburn: BadgerProps.comReal Estate Investor Coaching: BetterREI.com
Description & Show Notes:In this episode, we wrap up our 3 part series on The Basics with our third part: Basic Management Stuff. We're going to talk about what role a Property Manager plays on your team, and how to decide if you want to self-manage or hire someone else to do it for you. We'll talk about the rates they will charge and what you will get - and not get - for that monthly fee. The middle part of the episode is about tenant screening and Federal Fair Housing laws you must be aware of if you choose to self manage. Then in the Tips and Takeaways section, I'll make my case with 4 points in favor of self-management as well as give 3 different options I could have (or should have) done instead of selling off my apartments and we'll talk about how to use a scoring system to get the best tenants possible for your rentals. Duties of a Property ManagerAdvertisingScreeningLeasingRent CollectionFinancial ReportingCoordinating RepairsNot Included: Making Repairs (billed hourly for labor, plus materials)Typical Rates for Property Management in Auburn:1 Unit: 10% of rent collectedMultiple Units: 7-9% of rent collectedApartment Buildings: 6% of rent collectedSome managers are doing 4% on apartment portfolios, but that's not sustainable, so don't budget for that.7 Protected Classes for Federal Fair Housing:RaceColorNational OriginSexReligionFamily StatusDisability (within Reason)States may also include protections for:Marital StatusSexual OrientationLinks from this episode:Work with MeReal Estate Brokerage Services: AuburnInvestmentProperties.comBadger Properties, Auburn: BadgerProps.comReal Estate Investor Coaching: BetterREI.com
In this episode, we continue another easy 3 part series on The Basics with our second part: Basic Property Stuff. We're going to look at different property types you can choose from as an investor, the pros and cons to each, and recap our Classes discussion from Episode 003. Each investor is better suited for a specific type of property at any certain point in their career. The second part of the episode goes through the 5 major changes I've made in my own investing journey over the past 20 years, so you can see how your own career might evolve over time.Major categories or property types:Single Family - DetachedSingle Family - Attached (twin home or town home)Duplex (or tri-plex or 4 plex)ApartmentsCondos (differences in financing & cycles)Commercial PropertyAuburn Specific Differences:Student or Non-StudentUnrelated Occupancy RulesMajor changes in my own journeyBuy a condo for me turn it into a rental later. add 1 more condoMobile home sales, "buy here, pay here" - bad idea!Mobile home broker for students - better idea!Condo conversions and multi-family projects - big money, big responsibilityReal Estate brokerageSingle family rentalsDifferences in Property Valuations:Residential: based on the prices of similar properties nearbyCommercial: based on the net income coming out of the propertyLinks from this episode:Work with MeReal Estate Brokerage Services: AuburnInvestmentProperties.comReal Estate Investor Coaching: BetterREI.com
In this episode, we kick off an easy 3 part series on The Basics with our first part: Basic Financial Stuff. I look at average returns, what makes a hot or cold market, and different loan options. Then I go into 5 different ways to buy - or control - properties without the traditional 20% down and give examples of properties in Auburn where I've used each of the 5 ways I mention, so you can drive by and check them out for yourself if you would like to do so.5 Ways to buy or control Investment Property without the typical 20% down (examples given in podcast audio):Seller FinancingPartners / InvestorsPrivate LendersOptionsLease OptionsLinks from this episode:Work with MeReal Estate Brokerage Services: AuburnInvestmentProperties.comBadger Properties, Auburn: BadgerProps.comReal Estate Investor Coaching: BetterREI.com
In this episode, we wrap up our 3 part Foundation series and look at Property Classes, what separates them from each other, and how to use that ranking system to help you know what to buy and what to do with it. I also go through an example of how I used the "classes" framework to decide on renovations for a 12 unit apartment building and how things went totally sideways with this project during the recession and what I had to do to keep it from falling apart.Property Classes:Class A: Best properties, best floor plans, best neighborhoods, but may be too costly to hold as rentalsClass B: Nice, clean, & safe. Nothing flashy, but easy to rent and maintain.Class C: Obsolete floor plans, declining neighborhoods, less financially stable tenants.Class D: Lowest income tenants, but often these have the highest rental returns.Which is the best class for long-term holders to end up in and which is best for flippers to shoot for?Links from this episode:Work with MeOverlook Apartments, Auburn: OverlookAuburn.comReal Estate Brokerage Services: AuburnInvestmentProperties.comBadger Properties, Auburn: BadgerProps.comReal Estate Investor Coaching: BetterREI.com
In this episode, we continue our 3 part Foundation series and look at the second of 3 Big Decision that every investor needs to make to develop the strategy that works best for them in their current situation: Are they going after Cash Flow, or Capital Gains?Cash Flow Investors:Slow and steady rent coming inLonger term holding period but less workUsually meant to supplement current income from a jobEasier to manage yourself or hire a Property ManagerStick to timeless designs to save moneyLower risk AND lower tax bill, but you must be patientMore likely to succeed given a longer time horizonCapital Gains Investors:Make money from profit when sellingUsually buy, renovate, and sell in a few weeks to a few monthsMany people try to use this to replace current income from a jobManagement isn't usually a factor because there are no tenantsAim for current styles and trendsHigher risk AND higher tax billIf it goes right, you make money faster3 Big Decisions Investors Need to Make to Develop their StrategyAre you playing Offense of Defense?Are you going for Cash Flow or Capital Gains?What class of property is best for you, to buy and also to rent or sell?Links from this episode:Work with MeReal Estate Brokerage Services: AuburnInvestmentProperties.comReal Estate Investor Coaching: BetterREI.comMore info on 1031 Exchanges: Auburn1031Exchanges.com
In this episode, we talk about the 3 ways to make money as a Real Estate Investor, and we start our 3 part Foundations series on the 3 Big Decisions that investors need to make to come up with a strategy that works best for them in their current situation.3 Ways to Make Money in Real Estate:Cash Flow, or monthly income from rentCapital Gains, or profits from sellingBorrowing money and letting other people pay off your debt!3 Big Decisions Investors Need to Make to Develop their StrategyAre you playing Offense of Defense?Are you going for Cash Flow or Capital Gains?What class of property is best for you, to buy and also to rent or sell?Links from this episode:Work with MeReal Estate Brokerage Services: AuburnInvestmentProperties.comReal Estate Investor Coaching: BetterREI.com
Description & Show Notes:Welcome to the Auburn Investment Properties Podcast! This short episode will introduce your host, Chris Kearns, and tell you what to expect from this podcast in the future, including our goals.Based in Auburn, AlabamaWeekly episodes, 30-60 mins longMix of strategy, tips, and interviewsLinks from this episode:Real Estate Brokerage Services: Auburn Investment Properties.com
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