October 2022 KREIA Newsletter

President’s Letter

Main Meeting: 3 power investors make their 2023 real estate & economic forecasts

Welcome, New Members!

Mike Butler: Move-ins by Halloween prevent tenant nightmares

John Mays: Conquer anxiety & unreasonable expectations

REIA News Briefs

Affairs Links

Musgrave: AI could be driving dramatic rise in rents

Brett Grigsby turns Merriwether house into Airbnb moneymaker

Ian Hooper: Home of the Inno cents’ most-requested items

Rob Bergeron: Resources! Tools you need and where to find them

Holiday Party Preview

KREIA Directory: Please verify your contact info (Not a drill!)

of Events

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Kentucky’s premier investment club for landlords, rehabbers and wholesalers Meeting the 4th Thursday of every month (except November & December) KREIA.COM • facebook.com/groups/kreiaky • twitter.com/reiaky

Monthly Newsletter for KREIA Members

Dear KREIA Members and Friends,

In case you missed it, Tennessee beat Alabama! The party has neither stopped in Knoxville nor in at least one home here in Louisville. At the risk of offending anyone on the Crimson Tide bandwagon, this month’s newsletter is dedicated to learning investing from this win.

Erik Hitzelberger

Celebrating wins is important. As small business owners and investors, it’s easy to focus on the things that we’d like to do better, the things we haven’t achieved yet, or even the failures we’ve had. I encourage you to celebrate every deal and every milestone. Board member Alexis Fentress reminds everyone on a near daily basis that “Happiness begins with Gratitude.” Both are key to having and maintaining the abundance mindset required to keep winning. Celebrate as often as possible!

Maintaining perspective also matters. As much as I’d love to pronounce Tennessee the National Champions, the fact is this was just one game. Hanging 52 on Alabama is the equivalent of closing a big deal. For some of you, that might be your first. For others, it is the largest, most complicated or most impactful.

Regardless, the season isn’t over. It’s unlikely that any single deal is going to create financial freedom. Take the time to celebrate and then get back to work. Even bad deals (like huge losses) have to be tempered. Alabama (unfortunately) still has the ability to accomplish all of their team goals for the year. Don’t let one setback keep you from pursuing your dreams. Surround yourselves with the advocates. The Vols literally had 102,000 people screaming support during the game, and the energy was impactful. While we don’t normally have a band follow us around playing fight songs when a contract

Board of Directors

Get involved with KREIA. You can help with the monthly meetings, L.O.T.S. program, this newsletter, Saturday workshops, Government Affairs roundups, marketing, the KREIA website & more. Work alongside active investors! Ask for someone to direct you at the check in desk at the main meetings.

Advertise With KREIA

Put your message in front of the most active rehabbers, landlords and wholesalers in the state! KREIA offers five membership levels for businesses. Go to KREIA.com and join at one of these annual advertising levels to get your ad in every issue of KREIA’s newsletter and be invited to make ad pitches at meetings:

Business Card Membership

Includes your business card sized ad. Admis sion at monthly meetings is $20.

Premium Levels: These four advertising levels include your ½ page ad in each issue.

Bronze Membership

Includes free admission to monthly meetings for one person.

Silver Membership

Includes free admission to monthly meetings for two people.

Gold Membership

Includes free admission to monthly meetings for two people and gives you a skirted table in the vendors area.

Platinum Membership

Includes extra promotion. There can be only one advertiser at this level. Our current Platinum Sponsor, FlippinLoan.com, holds exclusive renewal rights until 2023.

Questions? Catch up with KREIA Sponsor/ Advertiser Chair Dennis Erhard at the meetings. Or email support@KREIA.com.

Join KREIA

KREIA's newsletter is published monthly and serves to educate you and to remind you of upcoming monthly meetings.

About KREIA: The Kentuckiana Real Estate Investors Association is a nonprofit organization focused on education, networking and resources for today’s investor. Whether you are just starting out in real estate investing or are working on your hundredth deal, KREIA can help you learn more, earn more, and have more fun doing it. Group discounts are available.

Contact us at support@KREIA.com if you: Want to advertise on KREIA.com • Need help • Have a question

Copyright MMXXII KentuckianaReal Estate Investors Association

P.O. Box

Joining KREIA is easy: Go to KREIA.com and click the "JOIN" option on the menu. Tell all your investing friends.

The cost to join as an individual member is $125 per year, with a door fee of $20 at our monthly meetings (which covers the buffet meal and rent on the hall).

Click JOIN at KREIA.com to find out about all the benefits of membership for both individ uals and businesses. Too many to list here!

Louisville,

DISCLAIMER:KREIA does NOT pre qualify, evaluate, endorse, guarantee or warranty any particular deal, service, company, or person. The KentuckianaReal Estate Investors Association recommends you perform your own due diligence & seek appropriate legal, accounting, or other professional advice before making any investment. KREIA is a Member of National Real Estate Investors Association.

Secretary Jordan Pohn

Treasurer Mike Grinnan CPA Treasurer Elect Wally Kallbreier

George Foree Rue McFarland Hampton Scurlock

Michelle Rawn Parliamen tarian

Frank Miller

Lauren Willoughby Media Manager

Rob Bergeron

Greg Nalley

Chris McCarty Past President

Vice President Christopher Jaquith

Duna Bolotte

Ian Hooper

Alexis Fentress

President Erik Hitzelberger

Dennis Erhard

Karen McKnight

John Mays

Powerhouse Investors Forecast the Future

KREIA’s October 27th main meeting gives us an economic outlook for 2023

What’s the economic outlook for the coming year? Will home values still be on the rise in 2023? Or have we tipped over the peak? What about interest rates — will the Fed keep directing the steady upward progression?

More importantly, what steps should landlords and house flippers be taking now to best position themselves?

We have so many questions. And no wonder. After more than a decade of relative stability, the market is in flux.

In our October main meeting, three local investors are going to give us their answers. Get forecasts and an economic outlook from Erik Hitzelberger, John Mays and Jay Bowman.

Meet Erik Hitzelberger

Erik is an engineer who, in the early 2000s, decided to flip a house. His interest and experience in real estate grew from there, and now he's a many doored landlord.

Along the way, Erik picked up a Realtor’s license. He also now heads up the turnkey rental company Freedom Property Group, which rehabs houses and manages them for hands off investors.

And he's the current KREIA President! One who, if you happened to read his President’s Letter on Page 1, is a Tennessee Vols superfan. (Read the article for Erik’s per spective on why it’s so important to celebrate our wins.)

Erik said that in this main meeting he’s going to address:

• Sensationalism and market pessimism

• Louisville as a market we’re hyperlocal and still hot

• What market indicators to watch as we move forward

Meet John Mays

John is currently a full time real estate investor, business consultant, and multi territory franchisee of Unleashed Brands’ Premier Martial Arts. After achieving a master’s degree in Business Administration from the premier HBCU, Tennessee State University, John spent 20 years in corporate America in numerous roles and continues to be a requested speaker, panelist, trainer, and equity consultant for multiple organizations nationally and internationally.

A former adjunct professor of business, John is now heavily involved in the non profit world, specifically within underrepresented communities, serving as vice president of Master Builders Academy, an organization that helps people build their dreams into businesses through education in the areas of financial solvency and personal development.

Continued on Page 26

Mayoral Candidates Craig Greenberg and Bill Dieruf to Address KREIA

Would you like a preview of how Louisville’s next Mayor plans to approach real estate and local investors? Both candidates will be in the house at October’s main meeting. Be sure to arrive at Woodhaven (or tune in on Zoom) before 7 p.m. to hear them answer our questions.

October 27th Meeting Agenda

5 p.m. Doors open at Woodhaven

5:30 p.m. Early Meeting with James Kovacs of Tax Corp Inc.

6 p.m. Member Orientation with Jordan Pohn & Alisha Higgs

6:15 p.m. The buffet line opens! Also, at the mic, there will be announcements, property pitches and sponsor pitches

7 p.m. Feature Presentation with Erik, John and Jay. But first, a special Q&A with Louisville mayoral candidates.

Remember Your Lanyard!

If you’ve been to an “in person” KREIA main meeting lately, you’ve probably picked up one or more color coded lanyards that identify what kind of investor you are. Please remember to bring your lanyards with you to our main meetings!

Color Key: Blue = Buy and Hold Investor; Orange = Flipper; Yellow = Real Estate Agent; Red = Wholesaler; Green = New Member; Purple = KREIA Sponsor; Black = Board Member.

5:30 p.m. Early Meeting: James Kovacs

Tax Force President James Kovacs is going to give us a focused look at bookkeeping and offer tax tips. If you’ve been wondering about the savings you’d get as an SCorp, you can’t miss this!

Copyright MMXXII KentuckianaReal Estate Investors Association • P.O. Box 91225 • Louisville, KY• 40291 www.KREIA.com

DISCLAIMER:KREIA does NOT pre qualify, evaluate, endorse, guarantee or warranty any particular deal, service, company, or person. The KentuckianaReal Estate Investors Associationrecommends you perform your own due diligence & seek appropriate legal, accounting, or other professional advice before making any investment. KREIAis a Member of National Real Estate Investors Association.

Illustration by Nina Musgrave

Welcome, New KREIA Members!

Sarah Armstrong

Ursula Boehnert

Michael B Brown

Braian Da Silva

Clint Dickens

Stacey Dickens Michael Ford

James Harlan

Madeline Ledbetter

Morgan Parrott

Roland Puryear Justin Robbins Alex Robertson

Zach Schwager

Ayran Sherman Marcus Todd Angela Toler

Uzma Uppal Tom Vessels Caleb Vittitow

KREIA’s New Member Orientation

Jordan Pohn will give a short presentation of the bene fits of joining KREIA at every regular monthly main meet ing. We offer many educational and cost saving oppor tunities! Join him in the small conference room at 6 p.m.

Online Presentation: You can view a recent session by visiting the Intro to KREIA page at kreia.com (About/Intro to KREIA on the menu).

On the Member Benefits page (Join/Member Benefits), you’ll learn how to secure your discounts and bonuses.

Erik Hitzelberger: President’s Letter

Continued from Page 1

gets signed or a deal closes, that doesn’t mean we cannot or should not have raving fans and a strong support team.

One of the greatest benefits to being a member of KREIA is the ability to network with like minded people who want to see you succeed because making the pie bigger benefits us all. Find your people and let them cheer you on.

Winning isn’t an accident. Before they ever took the field, the players and coaches spent hours and hours in the film room, workout facility and on the practice field. When they walked out of the tunnel, they were prepared.

There is no better ROI in the investing world than that of education which leads to taking the correct actions. KREIA’s mission for over 40 years has been to provide you with knowledge so that you can confidently take the field. Show up, learn, plan and execute.

Speaking of which, this month John Mays, Jay Bowman and myself will be breaking down the evolving market and discussing the playbook for winning under new economic conditions.

Forget all of the sensationalism you are hearing. Real estate is hyper local, and the Louisville market is still very hot. Come learn what to expect next and what indicators to watch as we move forward.

There’s a sign above the locker room door that reads, “I will give my all for Tennessee today.” The players all slap the sign on the way to the field as a reminder of their commit ment to being the best versions of themselves.

As important as sports are, they pale in comparison to your efforts to create a legacy for yourself and your families. Giving your all starts by showing up each and every day.

I hope to see you on Thursday in person or on Zoom.

To your investing success!!

Erik Hitzelberger KREIA President

Association.

By Mike Butler

Did you know many investors actually create their own tenant nightmares by ignoring the Halloween Rule?

You hate vacancies in your rental units. Not only lost rent, but you have a boatload more expenses when you have to pay for

Move-ins by Halloween Prevent Tenant Nightmares! utilities, lawn service, snow removal and more. Pretty ugly.

Now, how does Halloween play a role in this? From my huge school of hard knocks and lessons learned…

Let’s assume you want great responsible residents in your units, people who stay forever. Perhaps a resident like “Aunt Bee” on The Andy Griffith Show.

Would Aunt Bee ever consider moving in during November or December? Nope. Her mindset is focusing on making the holiday season the best for her family and loved ones.

In reality there are many great residents out there just like Aunt Bee, and ALL of them would never consider moving during the holiday season.

You’ve heard me talk about how finding great residents can be like shooting ducks in a barrel; however, you want to do this when the barrel is full of ducks. This happens every year in the springtime.

Jump to November and December: What does your barrel look like? Pretty ugly. In fact, there is no “cream of the crap” because most of the folks looking to move during the holiday season are crap. Sure, there are a few exceptions. My point is that, by far, the holidays make the worst time of the year to find great residents.

Over the years, many investors (myself included) have lowered their qualifying standards on applications just to get a vacancy rented during the holiday season. When they do this, investors learn they have made a huge financial mistake by renting to almost anyone to fill their vacancy. Many of these new tenants turn into nightmares.

Now try this on for size. Here are your markers on your calendar regarding your vacancies:

1. Before School Starts is your first date to get all vacan cies filled. You still have a great number of great ducks in your barrel.

2. State Fair and/or Labor Day is your next deadline to get all vacancies filled.

3. Halloween is your absolute last deadline to get all vacancies filled. Never lower your qualifying standards to force a square peg in a round hole. It’s 10X better to offer creative incentives to get a great resident like “Aunt Bee” to rent your unit at the last minute.

Some creative incentives could be discounted rent for the first month or two. Discounted rent for December is always a home run. And the offer of Amazon gift cards, etc., can put your rental unit eons ahead compared to your competition. Remember, you do NOT lower your qualifying standards.

If you still have vacancies after Halloween, be more creative with your incentives to find a great resident.

Believe it or not, most experienced investors would bite the bullet with a vacant unit during the holiday season before they would lower their qualifying standards.

Experience has shown over and over again that it is a lot cheaper to bite the bullet than to put a nightmare in your unit. That’s just the damage to your bank account and does not factor in your frustration and headaches, including code enforcement giving you fines for bad tenant behavior.

If you have apartments and you slack on lowering your qualifying standards, your great residents who live near this bad tenant will move faster than you can evict the nightmare tenant.

Happy Halloween! Get’em Rented Now!

To Your Continued $uccess,

P.S. Sign Up for Your FREE Investor Training Every Tuesday at 12 noon: MikeButler.com/PowerLunch

Also, catch Mike’s real estate investing podcast: www.5hrRealEstateWeek.com

Mike Butler is a KREIA Past President, a recipient of the Ed Melton Award, a property manager, a high volume landlord, a principal in Tenant Finder Service, a retired Louisville undercover police detective, and the author of the best selling real estate book “Landlording on Autopilot,” now available in its 2nd edition.

Copyright MMXXII KentuckianaReal Estate Investors Association • P.O. Box 91225 • Louisville, KY• 40291 www.KREIA.com

DISCLAIMER:KREIA does NOT pre qualify, evaluate, endorse, guarantee or warranty any particular deal, service, company, or person. The KentuckianaReal Estate Investors Associationrecommends you perform your own due diligence & seek appropriate legal, accounting, or other professional advice before making any investment. KREIAis a Member of National Real Estate Investors Association.

123rf.com stock photo

Conquer Anxiety & Unreasonable Expectations!

By John Mays

Fear stops many of us from starting or moving to a higher level in real estate invest ing. No matter who you are or what you have accomplished in life, at some point fear has limited you from a desired achievement.

With rising interest rates and the threat of a global recession looming, we have every reasonable excuse to allow fear to make us back up or even back out of buying in today’s real estate market. Let’s be real (I mean real fo’ real) and answer a few questions for yourself:

• Are you thinking longer and harder about which way to turn with your investment strategy?

• Are you second guessing properties you’ve already purchased and are thinking of selling quickly to get your money out?

• Are you more likely now to run away from oppor tunities you think are higher risk?

• Are you just holding on at the sidelines until you see how things go?

• Are you finding yourself slightly less motivated and less hopeful about your real estate dreams and future?

These are all reasonable questions that a reasonable person, with reasonable life expectations, would struggle with. It’s OK to have reasonable expectations and desire reasonable outcomes. If that is you, much success to you on your journey, and God bless you and your family. This ends your portion of the article. See you next month.

For everyone else!!!… I have some good news for you: You are not a reasonable person, you are a real estate investor!!!

So go woman up or man up and go get your self some real estate to achieve all your dreams and goals.

Not to oversimplify, but this is that simple.

Just GO and DO.

Right now is the biggest wealth transfer that has ever existed in the history of United States of America, and this Kentuckiana market is prime for you and your family to benefit with the fruit that is dropping bountifully off of our beautiful trees.

Now is the time to go BIG for those who are in growth mode, get great deals, and financially free yourself and your family.

As you close out the year, make a decision that analysis paralysis and fear are not gonna stop you. Set some big goals for 2023 and make a plan to exceed them.

And for all those who are waiting until 2023 to get started … WHY??? Shut up the negative voices in your head and just do it! If the numbers work, just do it, keep it simple, and JUST DO IT!

Me and my family have chosen NOT to participate in the recession and have added an additional digit to our long term financial target. Who’s gonna join us?

Come on in, the water is nice.

John Mays is an investor and current KREIA board member. John and his wife, Joy, are passionately in love with each other and unapologetically obsessed with real estate investing. They enjoy supporting and coaching other couples on their journeys to build generational wealth while putting love and family first.

Copyright MMXXI KentuckianaReal Estate Investors Association • P.O. Box 91225 • Louisville, KY• 40291 www.KREIA.com

DISCLAIMER:KREIA does NOT pre qualify, evaluate, endorse, guarantee or warranty any particular deal, service, company, or person. The KentuckianaReal Estate Investors Associationrecommends you perform your own due diligence & seek appropriate legal, accounting, or other professional advice before making any investment. KREIAis a Member of National Real Estate Investors Association.

“Anxiety in a man’s heart weighs him down, but a good word makes him glad.”

123rf.com Stock photo

National REIA News Roundup

National REIA, of which KREIA is a chapter, reports on issues affecting real estate investors and also links to stories of interest from other organizations. Here is a sampling of recent news and resources that Brad Beckett, NREIA’s Director of Education & Outreach, has compiled. For more news, visit RealEstateInvestingToday.com

U.S. Construction Spending Up 8.5% Year Over Year

The U.S. government is reporting that total construction spending in August, 2022, was at a seasonally adjusted annual rate of $1,781.3 billion, which is 0.7% lower than July’s revised estimate but is 8.5% higher than one year ago.

Read the full report PDF: bit.ly/k2210construction

Self-Storage Use by Generation

A new report from RentCafe says the growing share of renters among American households have increased both the interest and use of storage space. Interestingly, members of Generation X are the most likely to need extra space for their stuff, followed by baby boomers and millennials.

Read the full report: bit.ly/k2210storage

Theft-Proof Rehabbing

Pete Youngs says one of the most common things he runs across, no matter where in the country properties are reno vated, is theft or vandalism. From neighborhood kids tagging with spray paint to full blown breaking & entering and burg lary, you need to take steps to avoid this if possible. Here are Pete’s suggestions.

Read the article: bit.ly/k2210theft

CoreLogic’s HPI Says Home Prices Up 13.5% in August

According to the latest CoreLogic Home Price Insights (HPI) report, home prices nationwide, including distressed sales, increased year over year by 13.5% in August 2022.

Read the full report PDF: bit.ly/k2210corelogic

Stock of Occupied Homes in the U.S. by Decade Built and Building Type

A recent “chart of the week” from the Mortgage Bankers Association illustrates the current stock of occupied homes. Basically, it shows that America’s housing stock is steadily aging with the median age of occupied housing stock in 2021 being 42 years.

Read the report: bit.ly/k2210stock

Pending Home Sales Down 2% in August

The National Association of Realtors says rising inflation and higher mortgage rates are driving the numbers.

Report: bit.ly/k2210pending Land for Housing is Short Supply

A recent article in the Wall Street Journal says land for housing is in short supply because of land use restrictions and lack of infrastructure. They say land use restrictions and a lack of public investment in roads, rail and other infrastructure have made it harder than ever for developers to find sites near big population centers to build homes.

Read the article at Realtor.com: bit.ly/k2210land

Flipping Profits Up in Q2

According to the latest U.S. Home Flipping Report from ATTOM, 115,198 single family houses and condominiums were flipped in Q2, 2022, representing 8.2% of all home sales in Q2. Interestingly, ATTOM points out that profit margins improved in Q2 as median resale price trends on flipped homes greatly improved.

Read the article: bit.ly/k2210flipping

GOVERNMENT AFFAIRS LINKS

State Government Roundup

Kentucky Realtors Legislative Updates. Read weekly updates on bills in play in Frankfort at the Kentucky Realtors’ site: bit.ly/KYR_LEGU

Local Government Roundup

Louisville Metro Government: Get a summary of local affairs (and state) by the Greater Louisville Association of Realtors (GLAR): bit.ly/LRGAU

KREIA’s Government Affairs Board Chair: Rue McFarland

Copyright MMXXI KentuckianaReal Estate Investors Association • P.O. Box 91225 • Louisville, KY• 40291 www.KREIA.com

DISCLAIMER:KREIA does NOT pre qualify, evaluate, endorse, guarantee or warranty any particular deal, service, company, or person. The KentuckianaReal Estate Investors Associationrecommends you perform your own due diligence & seek appropriate legal, accounting, or other professional advice before making any investment. KREIAis a Member of National Real Estate Investors Association.

AI Could Be Driving Recent Dramatic Rise in Rents ProPublica looks into effects of RealPage’s algorithm based pricing

Full disclosure ProPublica states it is a “nonprofit newsroom that investigates abuses of power.” I have found its reporting to be factual, with a “Power to the People” lens. This is a summary of ProPublica’s article here: bit.ly/k2210airents

In 2017, federal regulators approved a merger between two tech based real estate companies, RealPage and Lease Rent Options (LRO). They use an algorithm to help their clients comprised mostly of Wall Street REITs, private equity and larger corporations to set rent prices.

Today RealPage is a Texas based company with over 31,700 customers. In some markets, RealPage is responsible for setting over 70% of the rents. In Seattle, the majority of the rental units are owned by a consolidated group of companies that use RealPage. Seattle has seen some of the largest rental increases in the United States.

In answer to a question from Jay Parsons, a vice president of RealPage, on how much the software is driving up rent prices, Andrew Bowen, another RealPage executive, said, “I think it’s driving it, quite honestly. As a property manager, very few of us would be willing to actually raise rents double digits within a single month by doing it manually.”

According to ProPublica and the way algorithms are

designed, as more property managers sign on to RealPage services, more data rolls into the database. That in turn aids its pricing service, which the company says “leverages multifamily’s largest lease transaction database.”

Over the last few years, RealPage has created work groups that meet privately. The groups include landlords who are otherwise rivals, which could be a red flag of potential collusion, a former federal prosecutor said.

RealPage also uses private data to show what competitors could charge in rent. Does their aggregate data artificially inflate rent and restrain competition?

As an investor, I think it’s obvious we have enjoyed the benefits of RealPage’s software. As rents go up, more money goes in our pockets.

I also find that it begs the questions to what end? and when do we reach the top?

If we know computers want to win (and at this time cannot account for all human and economic factors), how much more can the rental market stand until the government takes a closer look at antitrust factors they may have put in play?

Nina Musgrave, KREIA Volunteer

P.O.

• Louisville, KY• 40291 www.KREIA.com

DISCLAIMER:KREIA does NOT pre qualify, evaluate, endorse, guarantee or warranty any particular deal, service, company, or person. The KentuckianaReal Estate Investors Associationrecommends you perform your own due diligence & seek appropriate legal, accounting, or other professional advice before making any investment. KREIAis a Member of National Real Estate Investors Association.

Copyright

Copyright MMXXII KentuckianaReal Estate Investors Association

P.O.

Louisville,

www.KREIA.com

DISCLAIMER:KREIA does NOT pre qualify, evaluate, endorse, guarantee or warranty any particular deal, service, company, or person. The KentuckianaReal Estate Investors Associationrecommends you perform your own due diligence & seek appropriate legal, accounting, or other professional advice before making any investment. KREIAis a Member of National Real Estate Investors Association.

KREIA Photos

Silver,

Right: Jordan Pohn pulled double

by Karen McKnight)

Left: Jason Crask

below by

Merriwether Rehab House: A Closer Look Brett Grigsby turns 2/2 house into 4/3 Airbnb moneymaker

By Lauren Willoughby

The house at the corner of Preston and E. Lee streets hits a couple of sweet spots for investor Brett Grigsby, who’s looking to do more Airbnb properties.

For one thing, it was commercially zoned, which means he didn’t have to deal with the city’s red tape in getting a CUP (Conditional Use Permit).

For another, it was in one of his favorite locations in the Merriwether neighborhood, just east of I 65 near U of L. He said it’s easy to get downtown, to the Expo Center and the the airport from here. In fact, he has another house three doors down from this one that’s also an Airbnb and commercially zoned. That house, a 2 bedroom/2 bath, he says brings in $40k to $45k

The house at 1701 S. Preston St. before Brett Grigsby completed the rehab. He finished the attic to turn it from a 2 bedroom, 2 bath house into a 4 bedroom, 3 bath house that he says should sleep up to 14 people. Watch our video (to be posted soon) for a look at the gorgeous interior. (Listing photo)

gross a year on Airbnb. He estimates that this house, with double the bedrooms, will do much better.

Brett said he found this house on the MLS. (Yes, sourcing deals on the MLS is still possible!)

“Honestly I wouldn’t have paid so much if it wasn’t going to be an Airbnb.”

“When we bought this, it was already drywalled. They had started the renovations on it. So all the outside was sided new roof, new windows, all that was done. Some of the electric was done.” Brett continued the rehab by adding the kitchen, adding plumbing for a new bath, finishing the electric, and turning the attic into living space.”

Brett got funding from Chris McCarty of FlippinLoan.com to buy the house, and he said he had a refinance planned for the week following L.O.T.S. (held Sept. 27) and would cash Chris out. This was his first loan with Chris now he’s up to 5! The garage out back? He’s converting it to a studio that’ll rent for $900/month.

THE NUMBERS

Purchase Cost: $195,000

Rehab Cost: App. $55,000

All in Cost: App. $250,000

Appraisal: $350,000

Refinanced Loan Amount: $275,000

Est. Gross Profit/Year: $65k to $70k

Est. Net Profit/Year: $25k to $30k

Find the video from this L.O.T.S. event available soon on our Videos page. Take a tour of the house with Karen McKnight!

Why do we call it “L.O.T.S.”? Because we Learn On The Site!

service, company,

appropriate legal,

The

Copyright MMXX KentuckianaReal Estate Investors Association • P.O. Box 91225 • Louisville,

Investors Association.

Brett Grigsby answered questions from the KREIA crowd while Karen McKnight livestreamed to Facebook. Kay Ohta was at left.

for 2023

from

John also serves on the board for the Kentuckiana Real Estate Investors Association, NOIR Black Chamber of Commerce and is a Trustee of Christ Temple Christian Life Center where he is actively walking in ministry and his purpose.

With a huge heart for creating affordable housing, John actively supports his wife of 15 years, Joy, with revitalizing and redeveloping vacant and depressed houses in his own neighborhood of West Louisville, Kentucky. John and Joy have three wonderful children, each of whom have entrepreneurial aspirations.

In October’s main meeting, John plans to talk about:

• Evaluating the state of your personal economy

• Understanding your personal Fear and Greed Index

• Taking advantage of historical lessons

• This important question: What are you waiting for?

• Developing your plan to be up in a down market

Meet Jay Bowman

Jay is the co founder of Beyond Storage. He leads the finance, acquisition and market ing departments. Jay has been an active real estate investor since 2001.

Jay is married to Jacquelyn and has two children Nash and Penelope. Jay has been a real estate broker in multiple states, has extensive knowledge in the evaluation and purchase of real estate investments, and personally holds a portfolio of long term, short term rental and commercial properties.

In his presentation at October’s main meeting, Jay plans to talk about:

• Successful investing in a downturn

• The power of leverage

• Knowing your numbers

All three of our speakers are students of the economy and are going to share their investing plans for 2023.

We hope you'll join us for KREIA's last main meeting of 2022!

Quotable Quote

Donate ‘Most Needed Items’ to the Home of the Innocents

By Ian Hooper

In addition to KREIA’s raffles and cash donations to the Home of the Innocents, let’s donate in other ways by helping them source their “Most Needed Items.”

You can find an updated list of the Home

of the Innocents’ requests by following this menu path at their website Help the Home / Donate / Wish List. Or you can go there directly using this URL:

https://www.homeoftheinnocents.org/help the home/donate/wish list/

Here’s the current list of most-needed items:

1. Bluetooth speakers

2. Young adult sports bras/comfortable bras

3. Sensitive skin detergent

4. Dry erase markers

If you bring any of these items to KREIA’s Oct. 27th main meeting, I will deliver them to the Home of the Innocents. Look for a box on your way in at Woodhaven.

Another way to help is to buy requested items through HOI’s Amazon Wishlists at the same website link above.

And to help KREIA reach its goal of donating at least $50,000 to the Home this year, please consider donating at this link on the Home of the Innocent’s website (secure credit card payment accepted):

https://www.homeoftheinnocents.org/kreiafundraiser/

If you have had a good year investing, and if KREIA has helped you achieve your goals, please give generously to help the children.

Copyright MMXXII KentuckianaReal Estate Investors Association • P.O. Box 91225 • Louisville, KY• 40291 www.KREIA.com

DISCLAIMER:KREIA does NOT pre qualify, evaluate, endorse, guarantee or warranty any particular deal, service, company, or person. The KentuckianaReal Estate Investors Association recommends you perform your own due diligence & seek appropriate legal, accounting, or other professional advice before making any investment. KREIA is a Member of National Real Estate Investors Association.

“Always looking for my Who to get me through the How. All for the sake of my Why.”

Jay Bowman (from a recent Facebook post)

By Rob Bergeron

What makes knowledge, resources and growth so important? Well, when you know more about the resources you have available you tend to get better results, which leads to multiple things such as: tax savings, less upfront costs, and lo and behold more

This is the value in attending events like KREIA’s main meeting, L.O.T.S., Frank Miller’s Believe Investment Group course, and the Rhubarb Pickers Breakfast, of course.

All these events and people can open a plethora of doors! Today, I’m going to tell you about a few things I’ve learned that you can now share with others to offer them value!

The Louisville Tool Library

https://www.louisvilletoollibrary.com/

This is a resource to help you not only get the tools needed to complete projects, but they also have classes to teach you how to do basic things!

This is an incredible resource that we should all look into. I feel helpless around the home sometimes, and these things can be empowering and fun! Just invite some other people you meet at KREIA.

First Build

Knowledge! Resources! Growth! value to give to others, which you will also receive!

https://firstbuild.com/

This is a community collaboration with GE Appliances! It allows you to co create with GE engineers, as well as having access to plans, on site helpers, and elaborate tools such as 3D printers and other technical things that I don’t know how cool they are yet. We are so fortunate to have resources like these locally!

Louisville, KY Real Estate Investor Toolshare

https://www.facebook.com/groups/718821838993058

This is a resource I put together for investors to share tools to cut down on expenses. It’s not extremely active, but collectively we can change that! It’s free, and agreements are made between collaborating parties.

Know something else cool we don’t know? Reach out to newsletter editor Lauren Willoughby and YOU TOO can bring value to members in the club!

Rob Bergeron is a licensed agent in the state of Kentucky with Housing Associates, owner of The Louisville Network (a tool for wholesalers and buyers), and a member of KREIA’s Board.

DISCLAIMER:

is

Copyright

Tools you need and where to find them

KREIA’s Holiday Party Preview

On Thursday, Nov. 10, KREIA is closing out* another year of investing with what will be a spectacular Holiday Party. What’s the featured entertainment? We don’t know yet.

Frank Miller, aka “Holiday Party Organizer for Life,” is keeping the details close to his vest for now. And if his ward robe choices follow on from Holiday Parties of years past, it'll be a very festive and colorful vest indeed.

Will Santa make an appearance? We don’t know that either. But here’s what we do know:

• The party is free for KREIA members. (Free, free, FREE)

• There will be free food! Apps + Cheese & Fruit Trays

• There will be drinks! An open bar will be dispensing wine and beer (free!) during the early part of the evening. And of course Woodhaven’s bar will be open for those with a taste for stronger spirits.

• There will be raffles and free prize giveaways! (Really, with Frank and Tommi Miller, who needs Santa?)

If you’re a KREIA sponsor and would like to fund some of the fun and get some grateful recognition from KREIA and its members please contact Dennis Erhard at (502) 639 7496.

* But there will be more KREIAactivities in November & December

123rf.com photo

Who: You!

What: KREIA’s Holiday Party

Where: Woodhaven Country Club

When: Thursday, Nov. 10, 5 p.m.to 9 p.m.

Why: Because KREIA loves giving back

How Much: Free for members,$30 for nonmembers

Please Help Us Finish the 20222023 KREIA Member Directory

This is not a drill! We’re in the home stretch of preparing the 2022 2023 KREIA Member Directory, but we need some help. Could you:

► Verify that your contact information is correct?

► Fill out a quick Yellow Pages form?

Here’s How to Verify Your Contact Information

1. Log into your account at kreia.com

2. Go to your Dashboard (My Account/My Dashboard)

3. Scroll down until you see “My Profile Information”

4. Check to see if the values for First Name, Last Name, Email, Company (optional), 1st Phone and 2nd Phone (optional) are accurate and are what you would like other investors to use in order to contact you.

If any of these values need changing, scroll down and click the Edit button to make the fields editable, make your cor rections, then click the Save button.

The values above will be included in the directory’s Member Roster unless you take the step of opting out.

If You Choose to Opt Out, Here’s How

In the Dashboard, scroll until you see the menu option called “About Me,” and select it. At the “About Me” page, scroll down to the bottom and click the Edit button. Now scroll back up and UNcheck the “Allow Members to Find Me” option. Then go back to the bottom and click the Save button. That’s it, you’ve opted out.

Here’s How to Fill Out Our Yellow Pages Google Form

Go to http://bit.ly/kreiayellowpages and follow the prompts.

If you have a business or side gig that helps other invest ors, a Yellow Pages listing is free advertising for you. You can also use it to let wholesalers know you’re looking for deals.

How to Get Your Copy of the Directory

This time we are planning to mail out copies of the directory to all active members, so you do not need to attend a KREIA event in order to pick up yours.

MMXXII KentuckianaReal Estate

DISCLAIMER:KREIA does NOT pre qualify, evaluate, endorse, guarantee or warranty any particular deal, service, company, or person. The KentuckianaReal Estate Investors Association recommends you perform your own due diligence & seek appropriate legal, accounting, or other professional advice before making any investment. KREIA is a Member of National Real Estate Investors Association.

Market Value of Owner-Occupied Real Estate Up $1.5 trillion in Q2

A recent report from the NAHB’s Eye on Housing says the market value of owner occupied real estate increased $1.5 trillion to $41.2 trillion in Q2, 2022, on a non seasonally adjusted basis. In addition, they report that, while the current rate of growth has declined, last year saw the largest year over year percentage gain since 2001.

Read the full report: bit.ly/k2210growth

Delinquencies & Foreclosures Remain Near 20 Year Lows in June

According to the latest CoreLogic Loan Performance Insights Report, in June 2022, 2.9% of mortgages were delinquent by at least 30 days or more including those in foreclosure. This figure represents a 1.5 percentage point decrease in the overall delinquency rate compared with June 2021.

Read the full report: bit.ly/k2210foreclosures

Wells Fargo to Pay $94 Million to Settle Mortgage Forbearance Class Action Suit

HousingWire is reporting that Wells Fargo agreed to pay $94 million to settle a class action lawsuit that placed more than 200k mortgage borrowers into forbearance during the pandemic, unlawfully and without their consent. According to the report, customers who inquired about forebearance, but did not formerly request it, got it anyway, damaging their credit scores and making it more difficult to refinance.

Read the article: bit.ly/k2210wellsfargo

Rising Inflation Causing Hardship for Majority of Households

This graphic from Statista illustrates how inflation is causing hardship for the majority of U.S. households.

View full size: bit.ly/k2210inflation

Building Materials Prices Up 14.3% Year Over Year

The NAHB’s Eye on Housing recently crunched the numbers from the most recent BLS Producer Price Index, where they found building materials prices have climbed 4.9% through the first eight months of 2022 and 14.3% year over over.

Read the full report: bit.ly/k2210materials

Two-Thirds of Millennials & Gen Z Who Moved Back Home Still There

CPI Says Food Prices See Highest Increase Since Carter Years

The U.S. Bureau of Labor Statistics is reporting that the Consumer Price Index for All Urban Consumers (CPI U) was up 0.1% in August of 2022. However, the all items index was up 8.3% for the 12 months ending in August.

Read the report PDF: bit.ly/k2210foodprices

MBA Says Mortgage Applications Continues Downward Trend

A mid September “Chart of the Week” from the Mortgage Bankers Association illustrates how overall mortgage application activity continues to trend lower.

Read the full report: bit.ly/k2210applications

A recent report from LendingTree says 32% of young adults moved back home during the pandemic two thirds of which are still there. Slightly more than half (51%) of those who moved home said it was out of necessity.

Read the full report: bit.ly/k2210noemptynest

Trusting Your Trustee

Jeff Watson says many real estate investors consistently use what he calls a “grantor revocable title holding trust,” which is a more accurate term than “land trust,” to take and hold title to a piece of real estate they buy for investment purposes. Such trusts can be used whether the property is being held as a long term rental or being bought as a buy, fix and resell or being resold as a quick flip. The most important component of such an arrangement is the capacity and integrity of your trustee.

Read the full story: bit.ly/k2210trustee

Copyright MMXXII KentuckianaReal Estate Investors Association • P.O. Box 91225 • Louisville, KY• 40291 www.KREIA.com

DISCLAIMER:KREIA does NOT pre qualify, evaluate, endorse, guarantee or warranty any particular deal, service, company, or person. The KentuckianaReal Estate Investors Association recommends you perform your own due diligence & seek appropriate legal, accounting, or other professional advice before making any investment. KREIA is a Member of National Real Estate Investors Association.

Copyright MMXXII KentuckianaReal Estate Investors Association • P.O. Box

Louisville,

www.KREIA.com

DISCLAIMER:KREIA does NOT pre qualify, evaluate, endorse, guarantee or warranty any particular deal, service, company, or person. The KentuckianaReal Estate Investors Association recommends you perform your own due diligence & seek appropriate legal, accounting, or other professional advice before making any investment. KREIA is a Member of National Real Estate Investors Association.

PO Box 91225 Louisville, KY 40291

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THE Local Resource for Landlords, Rehabbers & Wholesalers Meeting the 4th Thursday of every month (except November & December) at Woodhaven Country Club, 7200 Woodhaven Road, Louisville, KY 40291 KREIA.COM • twitter.com/reiaky • instagram.com/reiaky • youtube.com/reiaky facebook.com/reiaky (public) • facebook.com/groups/kreiaky (private)

UPCOMING EVENTS

3 Investors Forecast the Future

What will the real estate market look like next year? We’ve invited three investors Erik Hitzelberger, John Mays and Jay Bowman to make their predictions, describe their own investing plans, and share an economic outlook during KREIA’s main meeting. Oct. 27th, 5:30 p.m. 9 p.m. ► 5:30 p.m. Early Meeting: James Kovacs of Tax Force Inc.

Q&A With Mayoral Candidates at Main Meeting

Would you like a preview of how Louisville’s next Mayor plans to approach real estate and local investors? Both candidates Craig Greenberg (D) and Bill Dieruf (R) will be in the house to answer our questions.

❖ Nov. 1st Noon 1 p.m. L.O.T.S. event. Tour Joe and Kim Worth’s future Airbnb in the Irish Hill neighborhood.

Nov. 9th Noon - 1:30 p.m. Lunch & Learn. Duna Bolotte hosts November’s guest speaker, real estate attorney Michelle Rawn. Members only.

Nov. 10th 5 - 9 p.m. KREIA’s Holiday Party. Members get in free at our Holiday Party blowout! There will be wine and beer at the open bar, cheese trays, appetizers, and lots of prize giveaways.

Nov. 15th – Noon 1 p.m. Tool Tip Tuesday With Tamara West. Investor/broker demonstrates resources.

Dec. 8th – 5 p.m. 7 p.m. KREIA Happy Hour. Networking at Woodhaven. Everyone is invited. Bring a friend!

Main Meeting Preview

January 26th 2023: Topic TBA (We take December off)

February 23rd: Tax Update with Mike Grinnan

Greenberg Dieruf