Real Estate Journal - Winter 2017

Page 1

Real Estate Journal

Winter 2017

2. Crowdfunding - The Time Has Come: The Promise

7. Let's Take the Opportunity to Reform HUD

3. Success Will Never Be a Place for Us, it is a Path

8. A Crystal Ball

4. Four Simple Things You Can Do to Grow Your Business in 2017 5. NREIA Legislative Update "Vacation with an Education" on National REIA's 19th Annual Cruise

How to Buy Good Investments, Not Trophy Houses 10. 7 Reasons Why Online Real Estate Leads are Like Gold $$ 11. Prepare Investment Properties for Winter Weather

6. Managing the Information Barrage

Circulated To Over 40,000 Real Estate Investors Nationwide


Member Spotlight

Uniting Investors and Engaging the Future

A John Triplett


Vol. 2 Issue 1

new online community for real estate investors is raising the bar for collaboration and engagement by connecting investors, industrywide, with opportunities & resources that can only be found in one comprehensive online platform. It is called Uniting Investors and its mission is to be the online community for the real estate investment world by helping investors not only be successful, but add value to their lives as well as the places where they conduct business. It can be found online at The online community was founded through an alliance of

ohn Triplett is a founding partner of Desert Path Marketing Group, an Arizona-based digital media and content marketing company, which has a strong focus on real estate investing content. Desert Path Marketing Group helps clients grow audience to their websites to increase leads and gain new members and customers. He By Chris Kuehl, Ph.D. is a member of the Austin REIA. here were many elements Please tell us a little about involved in the recession of 2008-2009, it can be difficult who you are and what you to sort out which elements were did before getting into real responsible for what. There was estate investing: a credit crunch that prohibited John Triplett spent more than manufacturers from buying the 20 years in the corporate world machines and inventory needed, continued on page 13 the banks were in crisis, exports fell like a rock and so on. At the heart of much of the decline was the housing sector. The boom in the years prior to the decline inflated the market and created an unsustainable situation as the entire sector seemed dependent on sub-prime lender. It teetered and finally collapsed with home prices falling by 27% between 2008 and

the National Real Estate Investors Association, American Rental Property Owners & Landlords Association, the Real Estate Investors Funding Association, and the National Note Buyers Association to create an environment where their members can both connect with one another, as well as learn from those with more experience. Representing the combined interests of over 40,000 members nationwide they believe Uniting Investors will be the best place to learn, share, develop and grow with other like-minded investors. Members come from all areas of the real estate investment

UNITING INVESTORS industry. They include both passive & active areas of investing - such as rehabbing, landlording, financing, flipping, notes and many more. There is a place for everyone, at all levels of investing to engage, collaborate and grow stronger together. The stated goal of Uniting Investors’ leading partner, National REIA, was to create a secure, private online community for NREIA chapters and local associations continued on page 17

The Market is Still Not Robust

Professional Publishing Inc., PO Box 6244 Beaverton, OR 97007

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2012. Some nine million people lost their homes as foreclosure rates reached levels never seen before. The fact was that housing had gone from being the driver for the economy to the drag that

Published In Conjunction With

was taking it to new depths. It has taken a long time but the sector has finally recovered and house prices are back to where they once were but this time without the hysteria continued on page 15

Real Estate Journal

Crowdfunding The Time Has Come: The Promise by Scott Whaley


he idea? “Give everyone the

1. The demand from investors with opportunity to invest in high small sums to invest in rehab/ quality real estate without revitalization projects was large the middleman”. enough to fund modest “under $5,000,000” projects. Washington D.C. real estate developers, Ben and Dan Miller, 2. Investors of all sizes, many with worked with local regulatory as little as $100 wanted the agencies and the SEC to offer opportunity to invest in the to anyone, accredited and relative safety that real estate non-accredited alike, the first offers due to the fact that their Crowdfunded commercial project investment is secured by real under the following terms: “Invest property. The added bonus as little as $100 in the rehab and to investors is the knowledge renovation of this run-down they are participating in the mixed-use commercial building”. renovation of a dilapidated The investors lined up and the building and revitalization of a property was successfully rehabbed neighborhood. in addition to the neighborhood 3. The costs of regulatory and legal being revitalized and an increase in compliance make smaller projects tax basis to the city. The building impossible to do economically was a successful renovation adding because they are unable to absorb revenue to the cities’ budget, while and cover the regulatory and legal investors made a positive return. compliance costs and fees and The lessons learned, while costly, still provide a reasonable return could lead to the realization of a to owners and investors. great idea whose time has come. 4. Without relief from compliance Upon review the Millers learned and regulatory costs that are the following lessons. designed and intended for


large institutions, smaller independent investors and owners will continue to struggle to find access to funding for smaller projects and the secure returns those projects can provide to investors and owners.

The Solution? Simple.

Provide a common-sense exclusion for the under $5,000,000 equity secured, crowdraising and crowdfunding investors to the current regulations designed for nonequity secured and large institutional players and their investors. We now know that… To this end, language for inserting A. Investments secured by real this into an upcoming bill affecting estate, as an investment class, equity-based crowdfunding has are inherently more secure been submitted by National REIA than investments that are not. & REIFA to Representative Patrick B. Investment capital is shut off McHenrys’ office in Washington, when too heavy a cost burden D.C. For more information on how is applied to projects that are you can play a role and support our not large enough to support efforts go to or that burden. C. Investors with small amounts of capital to invest in real estate secured projects have few, if any, options. D. Owner/Developers wanting to renovate and rehab relatively small properties are prevented from doing so due to the high cost of regulatory and legal compliance.

Real Estate Journal · Fall-Winter 2016-2017

Real Estate Journal

Success Will Never Be a Place for Us, it is a Path By Rebecca McLean, Executive Director, National REIA


he United States, as it enters

the last quarter of 2016 is a remarkable, amazing, strange and deeply troubling place. A good deal of the wonder and the worry of this place at this time can be attributed directly to the still relatively recent arrival of the new economy and its impact on our way of earning a living-and on our way of just plain living. The resilience, creativity, and vibrancy of today's U.S. economy is mind boggling. As we look back on past trends it seems that we cannot draw direct parallels with any other times. This uncertainty is disconcerting as people look for answers about what the future holds. No matter your political affiliation the time leading up to the election and the election itself were not comforting to say the least! So many unexpected events are sure to rock your world. Between the election, Brexit, and the like, we have to ask ourselves if this is a wave of change

that will mark the advent not only of a new era but also of a global economic revolution. At the individual level the potential for personal growth and


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personal expression-as well as for mind-boggling personal wealthmake this a time of opportunity to create the kind of work life that previous generations could not even have imagined: The Organization Man (I956), William H. Whyte's take on corporate America in in the Age of Conformity, has been turned upside down. For entrepreneurs, like many real estate investors, this is a time of great optimism. If the legislative landscape does indeed relax this could be a time of unprecedented growth for independent and creative investors! And yet: With so much to celebrate, so much to appreciate, so much to anticipate, it is impossible to ignore the troubling evidence that so much plenty provides the prospect to trade opportunity for a sense of being overwhelmed. We know, for example, from the Industrial Revolution of the I9th century, that technological change creates social change: In fact, social tremors continue to be felt long after the technological upheavals of an era have subsided. We are still in the mid stages of the social restructuring that the Information Revolution has set in motion, and already there are legitimate concerns that the most critical impact of that revolution may not be on the world's financial institutions-it may be on the social fabric of the United States. Today's economy may have irreversible consequences not only for companies that are too slow to

adapt to the expanding marketplace but also for individuals. That’s why REIAs are such an important resource. We inform people about the changes in the industry and equip them to anticipate, keep up with, and profit from these changes. We also provide our members with a community. A community of like-minded people that provides support for each other can offer a huge amount of certainty in a very uncertain world. This may be our most valuable benefit of all. Those who are excelling have a different challenge in the new economy. They must answer this perplexing question: How Much Is Enough? When you can win sizeable economic rewards, gain enticing lifestyle comforts, and even ensure the future economic well-being of your children, and when you can achieve all of this in a few short years of late nights and lost weekends-well, what exactly is the problem? One answer to that question is another question posed in many magazine articles and blogs lately, "To get rich, do you have to be miserable?" Several movements exist to help investors navigate the waters between traditional outward measures of success and your own internal measures of success. At some level, most of us know that "more" is not only a promiseit's also a promissory note that lays claim to our time, to our families, to our energy, and our peace of mind. continued on page 14 3

Real Estate Journal

Four Simple Things You Can Do to Grow Your Business in 2017 By Alex Goldfayn

The election is over. The holidays approach. And the new year is just around the corner. Let’s talk about your plan to grow sales in 2017. Do you have one? How much time have you spent thinking about how you will grow your revenue next year? Because here’s the thing about revenue growth: it’s a proactive pursuit. We must make time for it. Sales might grow if we go through our days and weeks reactively, from one incoming customer inquiry to another. But we can’t plan for this kind of growth. If the right customers call, we might grow. If the wrong inquiries come in, we won’t.

The only planful, strategic, repeatable way to grow is to be proactive and purposeful about it. So, here are four specific actions you can implement to grow your business in 2017. Which ones will you do? In general, pick up the phone. Call instead of email. Call instead of text. We don’t like to use the phone because we do everything we can to avoid rejection, and rejection on the phone is intimate. It goes into your ear. We’d rather not call, and not know, than call and risk rejection. Want to stand out? Pick up the phone. Default to the phone. I have to say, it’s somewhat embarrassing how much I get paid to tell people to use the phone. But what do you think happens when we implement systems that double or triple your salespeople’s phone hours per week to each sales person’s phone time? Sales have no choice but to go up!

Specifically, Make the FollowUp Phone Call: Tom, it’s Alex. How are you? How’s it going with that thing we talked about (or that quote I sent)? Just like that. When we follow up, we show people that we are interested, that we care. We are not bothering them, or imposing on them, or taking their time. Do you think people get a lot of follow-up phone calls during their day? Do you? Exactly. Most people don’t get follow-up calls because most salespeople don’t like following up! Ask For Referrals: Tom, who do you know like yourself who would enjoy working with me like you have? Then, let Tom answer. Be quiet and listen. Blink if you have to. Sing a song in your head if you must. But don’t talk first. Tom wasn’t thinking about your referral for hours, like you have been thinking about asking him for it. So, let

Tom think, and come up with a referral for you. One note here: people love giving referrals. Because it makes them look good to the person they’re referring, and to you. If our customers would love to give us referrals, why don’t we ask them for them? Because they would if we would. We don’t ask because of fear. It overwhelms us. What if they don’t give us one? What if they don’t like us as much as we think? What if I make them uncomfortable? What if I lose the customer! It doesn’t work that way. People want to help their friends and colleagues, and you are of tremendous value to them. Of course they’d refer you, if only you asked. So, ask! Write Hand-Written Notes: Not thank you notes, but personal notes. Thank you notes are easy. But personal notes, which mention continued on page 20


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Real Estate Journal · Fall-Winter 2016-2017

Real Estate Journal

NREIA Legislative Update Dr. Ben Carson to lead HUD! unparalleled.


December 5, 2016, President-Elect Trump announced that Dr. Ben Carson has accepted a Cabinet Position as Secretary of the Department of Housing and Urban Development. With an annual budget of almost $50 Billion, over 8,000 employees, responsibility for insuring 16% of new home purchases, and housing over 1 million American families, the impact of HUD domestically is n

Recent changes and vacillations in fair housing enforcement have called into question the direction and consistency of HUD. The April 4th ruling by HUD regarding the universal ban of criminal background checks was softened when even the San Francisco Chronicle called out the hypocrisy. Additionally, the blatant social reengineering occurring through a federal override of local zoning by means of the Disparate Impact Analysis has caused communities across the country to galvanize in response while also questioning the need for participating in Community Development Block Grants. The CDBG funds have long been a staple seed-fund for redevelopment in transitioning communities. Now the grants are being called in to question due to the strings attached: Westchester, NY is a prime example of the federal overreach. These and many other issues including, insufficient funding of housing authorities, an antiquated housing infrastructure, and

partnership with the Seller Finance Coalition has helped raise the profile of HR 5301, which would increase the number of sellerfinanced transaction that could occur in a rolling 12 month period from 3 to 24. This expansion is critical at a time when banking credit is tight for all but the most well heeled, and provides the first rung on the ladder of homeownership to many Americans. HR 5301 would also have the Treasury study the number of such transactions to determine what percentage of home purchases are American Dream in fact seller financed, and how Speaking of opportunities, many of those were un-bankable. National REIA continues our Ongoing advocacy will be commitment to provide housing necessary to push this issue forward options for seller financed housing. and National REIA members Most of this housing is un- will be critical in notifying their bankable due to redlining (ooops, Congressmen and Senators. not supposed to say that out loud) or because the individuals are not Advocacy deemed credit worthy, often due Reaching out to our state and to non-standard employment, federal elected officials has gotten a i.e. entrepreneurs! The housing lot easier at National REIA thanks typically is sub-hundred thousand to a new advocacy platform that in value and is either urban or rural continued on page 20 in working communities. Our

programming that tends to create generational housing rather than short term safety nets with opportunities for improvement, are all politically at odds with the policy perspectives of the Presidency, and the ruling majority in Congress. Dr. Carson has a vast policy and implementation battleship to turn around, and every day of delay results in more Americans losing out on the American Dream. At National REIA we wish Dr. Carson the best and look forward to working with HUD as resource.

“Vacation with an Education” on th National REIA’s 19 Annual Cruise


et’s face it, the majority of

conferences take place at some convention center in some far off place, which may or not allow you to relax and have a good time while attending. That’s where National REIA’s annual cruise is completely different. The theme for 2017’s cruise is “A Vacation with an Education” and it is all that and much more. This year’s cruise takes place on Royal Caribbean’s Adventure of the Seas. Enjoy a rock-climbing wall

that overlooks the sea, or challenge yourself on the basketball court or even go ice-skating. Achieve perfect zen poolside or relaxing at the Vitality Spa. Liven up your nights on the Royal Promenade, with dancing and duty-free shopping deals. The ship departs from San Juan, Puerto Rico on February 25th for a one-week journey with stops in the St. Maarten, Bonaire, Curacao and Aruba. Along the way will be a variety of educational programs

Real Estate Journal · Fall-Winter 2016-2017

& events geared toward the real estate investor. These include roundtables, panel discussions, networking, games and social activities. In addition, there will be industry & legislative updates from National REIA staff as well as nationally renowned speakers. We are very excited about our sessions at sea this year. We will be covering topics that are both innovative and include some valuable updates and insights into the traditional investing topics.

Through a special arrangement, National REIA has options available starting at $1079 per person (double occupancy). For more information or to sign up, please visit Space is limited so please act fast.


Real Estate Journal

Managing the Information Barrage

By Jeffery S. Watson, Esq.


think you would agree with me that we live in the “information age.” We have more information at our fingertips than ever before. For example, long gone are the days of driving up to a hotel, looking to see what the vacancy sign says, and then going in to inquire about the room rates. I can now cross-reference information from my GPS driving app with my Marriott hotel app to determine where I want to spend the evening and get a hotel booked.

The downside to having instant information is that when it comes to real estate investing, we are hit with a barrage of information every waking moment of every day from multiple sources all around us. Because of this information overload, it’s important to develop systems to help us block out the information we don’t want to hear and pick through the remaining information to determine the relevant, actionable intelligence upon which we can

act. Knowing what to do with that information takes it from being merely information and makes it valuable wisdom. I want to share with you some tactics I use to filter and manage the information streams I receive on a daily basis. After all, being able to filter information and make it into usable knowledge and wisdom is what the information age should really be about. First of all, I limit the sources from which I receive information.

For example, when I choose to spend time receiving information from the “electronic income reducer” (a.k.a. the TV), I only go to the channels that will give me good information and avoid those I believe are biased, duplicative or sensational. In the morning I want data – just simple, pure data without filtering or comments – so I turn the TV to CNBC, turn the sound off, and watch the crawl at the bottom of the screen. Based on continued on page 21

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Real Estate Journal · Fall-Winter 2016-2017

Real Estate Journal

Let’s Take the Opportunity to Reform HUD By Charles Tassell, Chief Operating Officer, National REIA


n early

December, Howard as someone who has been in the Husock, The Vice President for trenches for over 20 years. research and publications at the “Time Limits for Public and Manhattan Institute, a contributing Voucher Housing: Sending editor to City Journal, and author a signal to new subsidized of the Trillion Dollar Mistake, tenants that they shouldn’t published an articulate summary expect lifetime housing of five key initial fixes for the support—to which they are U.S. Department of Housing and entitled at present—would Urban Development. Among those be the best way to change following up on the summation the culture of public housing. was the venerable Wall Street A time limit, moreover, is Journal. The article points out that not fanciful. As a result now is the time for action and Dr. of discretion permitted Ben Carson is precisely the man by the Moving to Work to transform a nineteenth century demonstration program, eight housing hand-out and hammer public-housing authorities the institution into a 21st century have already adopted time helping hand organization. For limits, with promising Mr. Husock’s full story please see results. In San Bernardino, “Laying a New Foundation at California, incomes among HUD; Five things Ben Carson can those subject to a five-year do right away to improve public time limit—call it short-term housing and reduce government assistance if that sounds dependency,” at more compassionate—rose Listed below are Mr. Husock’s by more than 12 percent since remedies along with my thoughts 2008. Employment rates


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among those in the timelimited program rose by 17 percent. Time limits also free up housing units for those who’d otherwise be stuck on a waiting list. Carson should extend the discretion to impose such limits to all 3,000 of the nation’s public-housing authorities.” The 1990’s welfare reform effort fell short of addressing the generational sand trap of housing programs. While the Housing Choice Voucher program, often simply referred to as “Section 8” was a step toward reform, the institutional management, archaic rules and underfunding of the program has resulted in communities of able-bodied residents becoming entrenched in generation housing. Having worked with U.S. Rep. Steve Chabot (OH-1) to draft housing reforms, I grant that the layers are complex and many individuals are exempt - with good reason, however, a first rung of the ladder of success is needed for those languishing in poverty. Without the existence of these programs folks needing assistance would either be homeless or holed-up in one of those housing-of-last-resort options – which would not be part of the road to self-sufficiency. “Stop Work Disincentives for Subsidized Housing: Under current law, a public or subsidized housing tenant must pay 30 percent of his income in rent. That may

Real Estate Journal · Fall-Winter 2016-2017

sound like a good deal, but it means that, for every $100 that a tenant’s income increases, his rent goes up by $30. This creates an obvious disincentive to work, and sends exactly the wrong message to those at the bottom of the income ladder. Moving to Work has allowed 20 housing authorities to treat subsidized tenants like other citizens by letting them sign a fixed-rent lease. This approach, too, should be expanded across the publichousing system.” As a property owner and a former property manager, I have seen this disincentive in action many times. An even more subtle form of the disincentive to work is the standard work hour demands by inspectors and programs on the residents. These demands are notorious for requiring recipients to take timeoff from work, and then often having to reschedule because of housing authority inefficiency. This is especially disrupting for entry-level workers and can mean the difference between making and breaking a budget - or, quite frankly, keeping a job. “Privatize Management of Public-Housing Properties: There may once have been good reason for government to build low-income housing, but there’s no reason why it should also manage the continued on page 17 7

Real Estate Journal

A Crystal Ball by Jane Garvey


have been asked several times since the recent election what I expect to happen in the real estate market. Some of these questions come from other investors or industry professionals and some from curious friends and neighbors who are more than likely looking to strike up a conversation. It seems to me that this is a question worth addressing on many fronts. The answer is complicated by many factors. Let's start off recognizing that real estate is local, very local. And real estate markets are both seasonal and cyclical. Our property values are affected by the push and pull of politics, taxes, population change, jobs, regulations, crime, neighbors, weather and many other things. Some of the things that affect our values and our rents are things we can control and other things we have no control over. We also need to recognize that change is a given. There will always be changes that affect values. I am located in suburban Chicago. Even within this one city there are

neighborhoods that are popular and others that aren't. Prices in some areas are being driven up by demand, others are holding, and others are going down. So, huge sweeping generic statements about how one factor is going to affect the real estate market are misleading at best, and about as accurate as I can be consulting a crystal ball. What I can tell you, safely and accurately, is that you should be paying attention and prepared for change. This is one constant of investing. Two of the biggest hits to the values in the national real estate market that I have seen have had their underpinnings in changes in national tax laws. Our tax laws provide incentives, sometimes known as loopholes. These incentivize certain actions or investments. When the incentives change, the game changes. The "savings and loan crisis" in the late 1980's was rooted in a change in the tax laws. Prior to the Tax Reform Act of 1986, which was signed by President Reagan

in October 1986, high-income earners could write off unlimited negative cash flows against other income without playing an active role in the investments. Syndicators bought up properties for long-term growth with current negative cash flow. To do this, they found partners who would pay the negative cash flow in exchange for the tax writeoffs. Lenders provided loans to help them buy the properties. When the write-offs went away, the high-income partners quit paying for the negative cash flows and the loans went bad. Of course, the huge volume of foreclosed properties had a cascade effect bringing down values throughout the market. The savings and loan industry was blamed for making bad loans and regulated out of existence. As a real estate investor at the time, the root of the problem was very evident. Politicians and the press never really seemed to get, or else they didn't want to admit what happened. The second round of legislative tinkering that had a devastating

effect on the markets came about because of attempts by the Clinton and Bush II administrations to bring the rate of homeownership up so that more families could experience the American Dream. This was achieved through the mass extension of low or no down payment home loans without adequate underwriting, much of which was backed with government guarantees. A buying frenzy followed with the added demand and easy credit pushing prices up. The stated goals of increased homeownership were met, but we all know the disaster that was to follow as the slightest problem in the economy had a cascade effect. Values fell as the huge volume of foreclosures devastated the market. The pendulum has now swung in the opposite direction. The Homeownership Rate is at the lowest it has been since they began tracking it in 1965. This is great for landlords, but it will likely shift over time. continued on page 19

How to Buy Good Investments, Not Trophy Houses By Chad Carson


ack Miller was one of my favorite

real estate teachers early in my career. He passed away in 2009, but I still reread a lot of his old books and newsletters, like the short books Success Secrets and Wealth Without Risk. They are classics. Jack always taught to buy good investments, not trophy houses. This is a tough task for many of us because real estate ownership can bring immense pride. Part of the allure of real estate is that it’s real, it’s tangible, and you (and your friends) can drive by the investment to ooohh and ahhhh at its beauty. But in reality the best longterm income properties are rarely the ones with the beautiful trim, complicated roof lines, and stunning architectural design. Investing is an objective, financially driven sport. In my experience, the most profitable real estate will not be the building that wins someone the architect of the year award. 8

The profitable rental work horses are often boring, normal, and rectangle shaped houses. They are working class. They are nice but not exceptional. Ironically, these average houses bring above average safety and profit.

Why Boring Properties Make Good Investments Why do the boring properties out-perform the fancy house as good investments in real estate? First, because houses with complicated roof lines, interesting layouts, and beautiful finishes are desirable but often less than functional. There are too many things to break and to replace. The extra benefits cost money over the long run, and in many cases they don’t bring in enough extra rent to compensate for that added cost. Second, rental investments don’t usually make financial sense as the neighborhood and the house get

fancier. The rent usually does not continue to increase at the same rate as the price. And this means you make less investment income for every additional dollar you spend. For example, let’s say you find a beautiful, larger home (house #1) worth $600,000 that you can buy cheap for $450,000. The monthly rent is $2,500, which leads to a yearly rent of $30,000 before expenses. Your price-to-rent ratio for house #1 is $450,000 / $30,000 = 15. So the price is 15 times larger than the yearly rent. But another home (house #2) worth $200,000 can be bought for $160,000. This home rents for $1,600/month, which leads to a yearly rent of $19,200 before expenses. Your price-to-rent ratio for house #2 is $160,000 / $19,200 = 8.33. So the price is only 8.33 times larger than the yearly rent.

House #1 may make a great flip, but it’s income ratio is much worse than House #2. House #2 may not be as desirable or as fancy, but it will put more rental income in the bank over the long-run per dollar invested.

Find Your Sweet Spot For Good Investments In the end the goal for buy and hold rental properties is to maximize long-term profitability and minimize hassle. You’re looking for the sweet spot where the maximum rent intersects with the lowest purchase and maintenance costs and also the lowest hassle. As you can see, low-end properties produce a lot of cash flow but also produce a lot of hassle and little appreciation. High-end properties have high hassle, low cash flow, and sub-par appreciation. continued on page 14

Real Estate Journal · Fall-Winter 2016-2017

Real Estate Journal


Real Estate Journal · Fall-Winter 2016-2017


Real Estate Journal

7 Reasons Why Online Real Estate Leads are Like Gold $$ by Cyndy & Tom Dumire


enerating leads is the life blood

of all businesses. Without leads and customers there is no business. Unless you have been living under a rock during the past decade you know that the shift to online marketing and online communication is the major source of real estate leads. Have you noticed that every place you go everyone is on the internet with their face plastered to their phone? As an investor if you want to get a consistent flow of great leads you must change what you are doing. There is a saying, "If you keep doing the same thing you are going to keep getting the same results". You need to ask yourself: Am I in a rut? and Have my leads been dwindling? Or are all the new investors paying top dollar for properties in my area making it difficult for you to find good deals? Do not get left out and miss all the hot buyer and seller leads generated online, an increasingly common and often costly mistake among investors. Without online leads you

are limiting your business’s growth and are missing out on great deals. The majority of online leads come to you delivered on a silver platter and with no competition most of the time. Interested in getting leads that other investors are missing?

The Scoop on getting great buyer and seller leads 1. Internet presence is crucial. Did you know that 9 out of 10 home buyers rely on the internet as a search tool and more than half use the Internet as their first step in selling a home? There is a reason why Google has become a common phrase in our language! The vast majority of home buyers don’t just use the internet throughout the process of selling a home, they rely on the internet. This is huge and if your online presence is weak then your business will suffer and that means your leads will

dry up. Period. There is no way around this truth. You need to ramp up your online presence to get those hot leads! 2. Mobile devices are your connection to your leads. Did you know that half of all page views happen through cell

phones? If your emails and websites are not optimized to be mobile friendly then you’re turning away potential clients without even realizing it. The folks that are viewing pages on a mobile device are more continued on page 18

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Real Estate Journal

Prepare Investment Properties for Winter Weather By Cameron Mickey, The Home Depot


very smart property owner

Also, be sure that your “top” weather barrier is in mint condition. Inspect the roof, soffits and fascia boards of your property and check for damage to shingles, nail pops and wood rot.

knows how important it is to protect their investments, especially from damage due to harsh winter weather. Whether you are gearing up for the winter months ahead or have already experienced your first snowfall, you need to make sure your property is prepared. Here are a few tips to reduce power bills and ensure protection on investment properties to make life easier during the winter months.

Avoid water damage Check pipes at your properties to ensure they are insulated and not showing any gaps. In addition to reducing the frequency of burst pipes, insulation also reduces heat loss and prevents moisture buildup during warmer months. If a pipe does rupture, new quickrepair products from brands like SharkBite can speed up repairs and minimize damage if plumbers aren’t immediately available.

Keep drafts out

Make a conscious effort to observe areas prone to water damage. If leaks are caught in a timely manner, you can save tens of thousands of dollars in repair costs. Install Wi-Fi connected water-sensing devices so you and your tenants can track leaks in real time. Water leak detectors can also alert you to temperatures that may freeze pipes and humidity that could cause long-term damage.

Another important step in winterization your investment property is to clean gutters periodically. Incorrectly channeled water can cause severe damage over time, including to the foundation and sheetrock inside. If it is not immediately addressed, water damage can also lead to mold growth, which is a health hazard to tenants.

Inspect doors, windows and siding for cracks and holes on your property. Weather stripping and caulking are easy solutions to fill air seals and insulate small gaps. Adding weather seal to doors is a great way to keep the cold air flow out by blocking drafts and dust. Drafts can significantly increase utility bills, so let tenants know how to identify a problem and tell them to alert you for needed repairs. Installing attic insulation is a project that pays for itself and is a simple space to improve the comfort and energy efficiency during colder months. Update continued on page 19

As a member National REIA, you will have access to The Home Depot’s Pro Xtra Loyalty program where you will receive a 2% rebate on your Home Depot purchases, on top of their already low prices. You will also be able to take advantage of the Home Depot Appliance program that allows you to easily order the appliances you need from the exclusive catalog designed for NREIA members.

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51 Ways to Increase Your Rental Property Cash Flow (And 10 Ways To Ruin It)

“51 Ways to Increase Your Rental Property Cash Flow is full of great advice on how to get the most out of your rental properties.” –Sam J, Smart Property Management Real Estate Journal · Fall-Winter 2016-2017


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Real Estate Journal · Fall-Winter 2016-2017

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Member Spotlight ...continued from page 1 of digital media while becoming a part-time real estate investor. He founded for Cox Interactive Media then managed a network of city sites, including In addition to many years with Cox, he has worked for Belo Interactive and Gannett in various digital business development, sales, marketing and content roles. During his corporate career and moves around the country, he acquired a small portfolio of rental properties which he manages today as a buy and hold investor. He is interested in helping the part-time real estate investor who tries to juggle a day job with real estate investing.

Nicklaus golf course community outside Austin, when my employer promoted me to a new position in Phoenix. The development still had many vacant lots and Toll Brothers was just coming in to start new building, so we were unable to sell the house at that time. I engaged a top quality property management company in the area to take over the rental of that house. That property management company then led me to find other How did you get started? investments in the area such as the The accidental landlord I guess duplexes I mentioned. you could say. My wife and I had built a custom home in a Jack is tight in this rental range for these properties. So despite being older properties requiring continual maintenance and upkeep, the investments still perform very well. I have many long-term tenants who have been in my properties more than 10 years. Job growth is steady in this area with nearby employers like Garmin and BNSF (Burlington Northern Sante Fe) Intermodal Logistics Park.

Where is your current market and what is your focus or area of expertise?

I sold my duplexes outside Austin, Texas as they were more geared to an appreciation strategy. With out-of-state buyers coming in and prices going up rapidly, it was a good time to move out of that investment in Texas. I now hold a small portfolio of working class, cash-flow properties on the Kansas side of the Kansas City metro area. These are a long-term, buy-andhold investment. The rental market

Describe a typical work week for you as a real estate investor:

My actual investments only take part time right now, but some weeks are busier than others. I recently met my main contractor at Home Depot to go over some plans and purchase supplies to upgrade the ceilings in an older duplex I own. The plaster eventually gives way and moving to use sheetrock instead is kind of an on-going project for us. It seems like every week something needs paint, a roof has a leak, a tenant wants a sidewalk fixed or another tenant wants a new front door before winter. That is fairly typical of what goes on. I have a great property manager and good contractor so my team is in place to handle what is needed. I spend most of my week talking with real estate investors and members of real estate investing clubs around the country discussing digital content that will best serve the education of real estate investors.

How long have you been investing in real estate? A recently rehabbed rental unit with a fresh coat of paint on the house and porch. Note the pumpkins from the tenants who moved in around last Halloween.

I started investing in the late 1990s and have owned property in Texas,

continued on page 23


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Success Will Never Be ...continued from page 3 With growing success, sometimes people forget where it all started and what “more” meant to them originally. Ultimately, there is no single answer to the question ''How much is enough?" Ceaseless striving is indelibly stamped into the American character, and I for one got a double dose. I am only happy when I am making progress. Success will never be a place for us. Success is a path. Only you can determine where that path leads but your REIA can help guide you along that path so that you can reach the destination you really want to reach. The American Dream - an old engine that's been installed in the new economy - says that we can have it all. The American Reality whispers that when you do get it all, you'll only want more. The new economy is as much about the high jinx of the Oklahoma land rush as it is about the high stakes of the Web's cyber rush. Part of the mystery-and, perhaps part of the misery-of this era has to do with its polarities: on the one hand, a sense that external rewards are plentiful and powerful; on the other, the knowledge that the only meaningful answer to the question “How much is enough?" must come from within. Many REIAs spend the month of January hosting meetings that center on goal setting and business planning. The end of one year and the beginning of another is the perfect time for you to evaluate what you REALLY want and to adjust your strategies to reach that level of success.

The truly great news is that when you answer that question you can still know that whatever your answer, real estate investing can be there to support your very own level of success. It is a business that will allow you to grow to be as big as you’d like. It also works great as a supplement for whatever standard of living you choose to create for yourself. That is the ultimate beauty of what we do. My favorite thing about real estate investing is that it actually expands my family time now that my children are older. They both participate in the business and it gives us more than football to discuss at holidays. I love sharing this part of my life with my kids. During these holiday times as I count my blessings I count my freedom to be a real estate investor as one of my greatest blessings. This also renews our spirit here at National REIA to keep the industry free from unnecessary regulations and full of opportunities for you, our members. We are truly dedicated to supporting the industry and you, our members, in this era of opportunity. We constantly strive to find more ways to provide resources, information and networking opportunities. We look forward to an even more prosperous 2017 for all investors!

How to Buy Good Investments ...continued from page 8

Somewhere in the middle is the sweet spot. But unfortunately there’s no magic formula to find it for your market. You’ll have to test and observe the actual numbers in your target rental market. Every location is a little bit different. As a bit of short cut, I do recommend that you ask questions of long-term landlords and property managers in your area who already have an intuitive feel for their own local sweet spots. The result of all of this testing, observation, and questioning will be to develop a set of property criteria that guide your hunt for new rental property purchases. These criteria tell you, and those helping you, the types of locations, price ranges, lots, buildings, layouts, and amenities that are a good fit in your target market.

When you find properties that meet your property criteria and also meet your minimal financial criteria, you move fast to buy it. Plain and simple. Your best properties may not be trophies that impress your friends and family. But that’s ok. Just watch your bank account and net worth grow, and you’ll sufficiently impress yourself. The financial independence you’ll achieve as a result is what really matters. Chad Carson is a member of the Metrolina Real Estate Investors Association in Charlotte, NC. He is a real estate investor, world traveler, husband and father of two children. Learn more about him at

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Market is Still Not Robust ...continued from page 1 and dependence on the most unstable of the consuming public. According to the latest edition of the Case Shiller US National Home Price Index the average home price is now 0.1% above the previous peak set in July of 2006. This is certainly good news but is tempered somewhat by the fact when adjusted for inflation the price of a home is still 15% below what it was in 2006. The point is that there has been steady and even spectacular growth with a gain of 5.5% in just the last year. Although this is seen as a very positive signal as far as future economic growth there are plenty of caveats. The market is still not robust and seems vulnerable to future economic disruption. The rate of new home building has slowed considerably this year and

the rate of homeownership is lower than it has been in five decades. This slump in buying is far more significant than a recession alone can explain and many assume there has been a sea change in the way that people look at homes. If this is a real trend and the development of a “new normal” the implications for the housing sector are serious and largely negative. The factors that seem to have contributed to the reduction in home ownership range from temporary reaction to mortgage rates to more long lasting decisions about where one should live. The rates for a mortgage remain very low from an historical perspective but are higher than they were last year and even earlier in the year. The fact that home prices are up is good news for the existing

homeowner but not so good for the buyer as they will be required to come up with more down payment at a time when the lenders are still tending to manifest caution. The new buyer is the millennial, the most indebted generation in decades and it has already been noted that this cohort is slow to enter into home ownership due to that debt. The bigger concern is that this may not be the only reason for their reticence. The millennial is generally less committed to a given community and is prepared to move a lot. This is partly due to the fact that employment can tend to be short term as compared to their parents and that makes them less willing to settle into buying a home they will only have to turn around and sell a year or two later. They are

Strengthening Our Foundation

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more favorably inclined towards the notion of living in multifamily situations for years and we all know that a certain percentage of millennials are content living in their parent’s homes for an extended period of time. Beyond the usual challenges in the housing sector (mortgage rates, home prices there is a new one these days. In many markets there are severe shortages and high demand. This would seem to suggest that rapid house building would take place to close that gap between demand and supply. It is not happening at the rate one would expect as there are too few people available to do the building. There are major shortages in every skill and this has been forcing projects to stall for months. At varying points construction in Texas has been off by as much as six to nine months. The shortage of workers has been building for some time as there have been major changes in the old patterns. The construction worker was once part of a fairly fluid system which allowed people to float between construction, manufacturing and transportation according to the demand. Today these sectors are sufficiently specialized that people are required to make a choice and settle into that career. The construction sector can’t recruit as it has in the past from these other areas. There are severe labor shortages in all three as there are not as many people training for these occupations. There were considerable numbers of workers from Mexico and elsewhere in Latin America in the housing sector some ten years ago but recession meant that many returned home. The immigration policies in the US have become tougher and that further limits the ability of these skilled workers to return to the US. The upshot is that prices for new homes will rise that much further and faster and that accelerates the problem of matching wouldbe buyers with sellers. As with anything in housing there are major differences from one part of the country to another with very hot markets on either coast and slow ones in the central parts of the nation. The fastest growing segment remains multi-family and especially developments that cater to the older population – senior living and assisted living. The millennial likes the urban loft experience and generally speaking the older homeowner is unlikely to leave their home to relatives as the kids don’t want the old homestead.


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Uniting Investors ...continued from page 1

that will drive collaboration and engagement among members giving them ability to communicate and share information, experience and best practices. Ultimately producing a knowledge-culture that maximizes membership value and association vibrancy across a wide spectrum of opportunity. This is primarily driven by a strong sense of community, which is the hallmark of any successful organization. By injecting the desire for membership and collaboration into an online community market forces will be unleashed providing for new outlets of investing & networking that were previously out of the reach of the ordinary investor. Got a question about that potential deal? How about an area of investing that you’ve never tried before, but have always wanted to learn about? Or maybe you are just getting started in the business. That’s where the knowledge base behind Uniting Investors’ online discussion forums and resource libraries prove their value. Jump right into the discussion forums and post a question where you will receive answers from your peers that are rated for accuracy by the community. Do you know of a specific expert in the field who is a member? Connect with them and ask them directly via the platform! Did you see something published in the resource library that you have questions about? Simply comment on it and the author will be notified to provide you with an answer. Uniting Investors is all about effective communication and networking. In addition to these areas, there are exclusive benefits with select industry partners. One such example is HouseCanary – a company that provides the most accurate and comprehensive data in the real estate industry. The HouseCanary app does dealevaluation with higher than 90% accuracy across the nation for an extremely affordable price ($5 per report) with loads of statistical and easy to read analysis. For a beginning investor, that should be

extremely useful when learning to assess a deal. Not only that, but Uniting Investors and National REIA members receive their first five reports for free! There are also articles and commentary from industry experts about issues affecting your bottom-line. The site currently features two blogs that are updated with useful and timely information about the real estate business, as well as published weekly resources from National REIA for our users’ to use to their advantage. Are you curious about home winterization? You can learn from an expert in that field about best practices and much more. How about all the benefits of being a member of National REIA? You will find that as well as information about upcoming events and activities taking place all across the country. Let’s say you’re travelling to another city and want to see how they conduct their REIA meetings? Groups now have the opportunity to share their meetings on the Uniting Investors site-wide calendar for all REIA members to see! After all, investing in real estate is the safest and surest way to financial security – that’s why you’re in this business. Furthermore, fostering a vibrant, strong and dynamic community of real estate investors, at all levels, is not only a benefit to the entire nation but the economy as a whole. Check out Uniting Investors today and add your name to the many who have already joined up. Full membership to Uniting Investors is free & open to all members of National REIA chapters & affiliates, however non-members can join with limited access. To get started, simply visit www. today and click the “Join” button located in the upper right-hand portion of the screen. Next, hold on, because you’re on your way to an engaging in a more prosperous future with Uniting Investors.

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Opportunity to Reform HUD ...continued from page 7 properties once they’re built. Private management firms can undertake capital repairs through expansion of another fledgling HUD program already on the books. The Rental Assistance Demonstration (RAD) program lets HUD subsidies be used as bondrepayment guarantees for private investment capital. New York’s public-housing authority has considered upgrading its antiquated heating systems, but fears seeing its federal support reduced if it lowers its utility costs. The RAD program can change that, and should be expanded.” The Public/Private partnership needs to be refocused at HUD as the goal rather than a limited, sidebar experiment. A true reform would include third-party inspectors for HCV voucher holders, or even better, a requirement for a 360 degree video upload of the unit by the resident – because most already have smart phones. “End “Affirmatively Furthering Fair Housing”: The Affirmatively Furthering Fair Housing rule is premised on the wrongheaded idea that the best way to encourage upward mobility among minorities is simply to relocate poor inner-city households to wealthy suburbs. The rule should be done away with. At the same time, the Community Development Block Grant, designed to support physical improvements to lowincome neighborhoods, should come without strings attached. Let localities decide how best to put that money to use.” The federal over-reach into every US city and county with this CDBG mandate is mind-boggling. The arrogance that drives the displacement of low-income communities from service-rich areas to isolated communities, based upon the value of property completely overlooks the needs and benefits derived by the residents in a service-rich area. The results are similar to the disincentive to work discussed above, and show a complete disrespect and lack of understanding of the communities’ true needs.

“End Affordable Housing Mandates: Fannie Mae and Freddie Mac, the secondary-mortgage market giants supervised by HUD, are charged with fulfilling the federal government’s affordable-housing mandates. They must demonstrate that large percentages of the mortgages they purchase have been made to low-income buyers or neighborhoods. These mandates contributed to the 2008 financial crisis and continue to send the wrong message to banks, which are essentially told to fulfill mortgage quotas even when loans aren’t repaid. It’s time either to scrap the mandates or require Fannie and Freddie to report on the performance of such loans.” Industry jargon refers to the HUD preferences as NINJA’s: No Income, No Job Applications. The losses to Wall Street were nothing compared to Main Street where there was no bailout. Eight years later housing values are returning, and yet the U.S. housing market, highlighted by the Economist article Nightmare on Main Street (August 2016) has potentially become the largest and most dysfunctional asset class in the world. One that is currently being guided not by legislation or free markets, or even by well-known policies but rather the internal demands of NGO’s like Fannie and Freddie – similar to the Fed, BUT without a true audit trail. In summary, here are Mr. Husock’s final words: “HUD has made many mistakes over the years. Instead of pursuing yet another scheme to rebuild America’s inner cities, HUD should instead do what it can to make poor neighborhoods safe and attractive to private investment. The agency should cease ordering banks to make such investments and roll back disincentives for upward mobility. Ben Carson is just the man for that job.”

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Real Estate Journal

7 Reasons Why ...continued from page 10

likely to go to a website, contact you, and view your properties for sale themselves without contacting a Realtor. Most millennials use their phone for everything from shopping to looking up information to even opening their hotel room doors. Your business needs to be on the front line of mobile devices and it is imperative to structure your online presence in a way that engages people while they use their mobile devices. Isn't this what we all want? People are no longer tied to their desktop computers to access the internet or receive your emails. They can access your business 24/7 literally in the palm of their hands, whenever, wherever. You must be mobile friendly and if you are not it is costing you lots of leads. Don’t believe me? Go to any public place and watch people. They are glued to their phones and ignoring everyone around them. You must take advantage of this new trend to stay ahead of your competition. 3. Online leads are quick and motivated. You get online leads much earlier than other leads and the real key is that they are much more motivated. At least one out of three online leads I receive are converted to a signed contract. There is a huge difference when someone takes action and contacts you versus you contacting them. They come to you ready to communicate to see what you have to offer. They are motivated to get down to business and they have checked you out on the web. Most of the time when I meet a seller and tell them to Google me they say, "I have done that already and that is why I called

you". The Internet has already convinced them that you’re one from whom they want to buy their home. How cool is that? 4. Converting online leads is very much in your power. Give them what they need whether that means listings, market information, or articles with tips. Be helpful and consistent. You want to build trust. Calling leads that you obtained from a mailing and then having your VA ask for personal information is not the way to build trust. Positive reviews on the internet are also a key part of building trust. This again shows how crucial a strong web presence is to your business’s success. Be certain that people will Google you and will read all your reviews! Online leads who contact you are much more likely to convert and when I walk in the door they feel very comfortable with me and I am usually the only investor they have contacted. In my experience, if they contact me I put 1 out of 3 under contract. You should be doing that also! 5. Managing online leads is very easy. You may have some anxiety about how to keep track of all those online leads and staying organized. Trust me it is much easier than having papers all over the desk and notes written on napkins. Admit it, we all have done this! • Landing pages. Start the interaction off right by getting all the information you need. I normally only talk to motivated sellers and to buyers that are qualified. My time is valuable and spending time with a buyer that has no money is the biggest time waster. It

is the same with unmotivated sellers. Only work with those who want to work with you. • Integrating landing pages with forms that request information ensures that you can effectively log the right information to make that initial quick contact with your lead. Make sure the form captures all the specific data you require and that you have all the information you need to make an offer on a house or know if it is really a good deal before picking up the phone. Make this your New Year's Resolution to only talk to those that are ready to sign a contract. Your time is very valuable and you need to be spending time cashing checks. • Because 35-50% of sales go to the investor that responds first, it is essential that you follow up quickly. Be honest, how many great deals have you missed out on because you did not follow up in a timely manner? We all fall short here from time to time. Make an effort to improve in this area and you will be paid handsomely.

conversion rate so make sure you know your numbers and how visitors interact with your site. When they take action, your website will capture the vital information that is needed for you to make an offer. 7. Generating online leads is easier than you think. Simply by using a symmetric and congruent online marketing system, the leads will flow to you. Now is the time to dominate your area and get those Golden Leads! We’ve talked here about how the market is changing and how a strategic online presence is key to your business’s success. In light of the reasons I’ve given for why online real estate leads are like gold, you need to ask yourself: • How many houses did I do last year? • How many would I like to do in 2017? • What are my goals for 2017? • How can I transform my business of Real Estate Investing from a job to an automated system?

Now is the time to re-evaluate your marketing system, develop new strategies and take action. 6. A well designed website is Now is the time to make your your work horse. No need paradigm shift. Now is the time to for VA’s because your website tap into the online market and turn handles the grunt work and those Leads into Gold for 2017! does not require a paycheck. Your website must be attractive Cyndy & Tom Dumire are members of the and designed in a way to Diversified Real compel visitors to take action. Estate Investor Group Most buyers and sellers make (DIG) in suburban their mind up in seconds whether to browse your site or Philadelphia. Learn more at www. move on to another site more appealing and user friendly. Remember another investor's website is just a click away. I average approximately a 45%

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A Crystal Ball ...continued from page 8

Prepare Investment Properties ...continued from page 11

Going from the national stage to the hyper-local stage, we often see a problem-home making it nearly impossible for neighbors to sell without significantly decreasing their prices. We have also seen whole neighborhoods turned around by a few urban pioneers taking their rehabbing skills and capital into a troubled neighborhood. This sort of growth is the result of someone accepting risk and taking action rather than waiting for the tide to lift all boats. All we know at this point is that things will change. New administrations always promise to change things. And, anytime there is change, there is increased risk. If you can position your investments in a way that minimizes your risk while still offering you the opportunity to profit on the change, you will do well. Using options to buy will offer you the potential for capitalizing on the growth without as much risk of loss. Adding some extra margin in your purchase formula for the added risk is a good idea when you expect change. Plan more than one exit strategy when you buy property. For instance, when buying properties to rehab, make sure that they would make sense as a rental as well, just in case you have to change the game plan.

your property by adding additional insulation with an easy-to-use system that will help significantly reduce heat loss.

In any market you can actively change your outcome by improving property. There are always at least a few buyers and renters looking. Offering your property at a price that is cheaper and better than the competition will bring them to you. You can still benefit locally, even if the market is not helping you with growth. Most importantly, stay informed. Join your local investors association and go to the meetings. Read the articles that National REIA offers in Watch legislation that will affect your industry at the local, state, and federal level. And, talk to your team of industry professionals - accountant, attorney, title professionals, contractors, lenders, real estate agents, etc about what they are seeing in the marketplace. Change will be noticeable first to those in the trenches, so make sure you stay connected.

Real Estate Journal ¡ Fall-Winter 2016-2017

snow removal products such as salt and ice melt early in the season as store supplies run low as well as a sturdy and ergonomic shovel to keep walkways safe. Monitor with smart It is imperative to do inspections technology on your investments regularly. Installing programmable Check for leaks, cracks or insulation thermostats helps save money problems now, because once all year long. Wi-Fi enabled winter weather arrives, property thermostats offer a handy maintenance can be challenging experience by letting owners and and expensive to fix. tenants control the temperature Cameron Mickey is the Senior National from their smart phones. Smart PRO Manager for The Home Depot, where thermostats can also learn resident he manages the company’s national patterns and be programmed accounts and oversees the businessto send updates on extreme to-business relationships with partners in property management, property temperature alerts and filter investment, specialty restoration, changes. These updates will government and e-commerce. During his help you make your investment 28 years with The Home Depot, Cameron property modern and sustainable, has held a variety of roles including which will impact the bottom director of capital projects, capital projects manager and store manager. dollar in the long run.

Stock up on snow removal tools Check your snow removal machinery and make sure it is working properly before winter weather hits. If the blower is outdated or having difficulties, invest in a new one like the EGO 56 Volt Snow Blower, which is quiet and will avoid bothering tenants and neighbors. Also, stock up on


Real Estate Journal

Four Simple Things ...continued from page 4

Legislative Update ...continued from page 5

something you’ve recently talked about or experienced with the customer or prospect, are truly rare. I have to say, I hear from nearly every single person who gets a hand-written note from me about how grateful and appreciative they are. Why? Because people don’t get hand-written notes anymore. Ask The Did You Know Question: Your customer only knows about 20% of what they can buy from you. Isn’t that tragic? They need much of what you can do for them. In fact, they probably buy it elsewhere, from your competition. And both you and the customer know they’d be better off if they bought from you. So ask them, Did you know we also do X? Ask them. Even if you’ve asked them before, ask again. Just because we’ve told customers we do something, doesn’t mean they know!

has been put into place. Now REIA members can email letters directly to their representatives through the addition of the Voter Voice technology in our Action Center on the Legislative tab of National REIA’s home page. Periodically, email blasts will be sent out to members asking for participation where you can simply follow the links, “sign” your name and send the pre-drafted email. Through the Voter Voice system, emails go to the legislator and are not stopped by firewalls or spam filters. Usually a response from the legislator acknowledging the missive is received shortly after it is sent. If you have not participated in the HR 5301 letter request for co-sponsors, please do so now by visiting


Now look over this list of techniques to grow your sales. Does it cost a lot of money to execute these techniques? No. It costs no money. Does it take a lot of time? No. It takes mere moments to make each of these communications. Revenue growth is easy. The more that people hear from you, the more they buy from you. Here are five ways for your customers and prospects to hear from you. Which of these actions will you take now, today, and in the new year? Alex Goldfayn runs The Revenue Growth Consultancy which helps companies and sales departments grow revenue quickly and easily by implementing a system of simple communications techniques. To discuss growing your business in this way, email or call Alex at 847-459-6322. His latest book, The Revenue Growth Habit, was named the 2015 Sales Book of The Year by 800-CEO-Read.

Short Sale Tax Waiver – expiring at the end of 2016 The Mortgage Forgiveness Tax Relief Act of 2015, which was extends through 2016, expires at the end of the year. Those who participate in Short Sales need to be aware of this expiration. Until a 2017 bill is introduced (and passed), hopefully with at least a 10 year timeframe, all forgiven funds from the bank will be treated like income for the seller. National REIA was instrumental in implementing the last waiver and is dedicated to address the issue yet again.

Department of Energy rule on Furnaces National REIA is supporting a second request of the Department of Energy to oppose the rulemaking on Energy Conservation Standards for Residential Furnaces. The rule proposes a mandate that all furnaces over 55K BTU meet a 92% efficiency rating by 2021. Yes, that means all. The cost of complying with such a regulation could be very costly for many property owners. The prospect of retrofitting to current standards all of those furnaces in older buildings is monumental. Needless to say, the wastefulness of removing and throwing out all the perfectly fine furnaces can only be described as governmental in its sheer capacity for wastefulness. Additional signers include the National Multifamily Housing Council, the National Apartment Association, the National Association of Housing Cooperatives, the National Leased Housing Association, and the Leading Age. As this rulemaking process continues, please consider participating in an advocacy effort to modify this rule in the near future! Until then, we’ll keep working on your behalf.

Real Estate Journal · Fall-Winter 2016-2017

Real Estate Journal

Managing the Informaiton Barrage ...continued from page 6 what they do (and don’t) show, I have an idea of what is going on in current economic matters, sports and some news. To save time, I don’t get news by watching video clips online. I’d have to wait while I’m directed to another website (like YouTube) or have to wait for a video to load. I can read about five times faster than people can speak, and written text downloads much faster than a video. When it comes to reading an article online, I avoid reading the comments people make about it. The vast majority of the time, those comments are snarky attempts at one-upmanship that offer little or no relevant information. Remember, I’m looking for the “who, what, where, when and why” relating to the information. I’m not interested in why other people feel a certain way after reading the article.

That brings me to what wastes more of my time than anything else – Facebook. At the same time, however, with the vast array of friends I have networking all across North America, Facebook provides me with better insight into what is going on in real time. It’s all about managing the amount of time I allow Facebook to take from me. One of the ways to control that time and get the most out of Facebook is to avoid clicking on or “liking” many comments or posts because Facebook then thinks I want more of that kind of information. What I’m really looking to do is glean information from that huge smorgasbord of data. If there is something in particular that I want to go back and read at a later time, I may “like” that article or post in order to be able to find it more quickly by searching my recent “likes.”

A tactic I employ with Facebook that is still a bit challenging to me is that when I see something someone else has posted in a realestate-related group that I believe is flat-out wrong, I generally ignore it rather than comment on it. I usually don’t have the time to commit to the resulting debate and comments, and there are also a few admonitions in Proverbs that remind me how to handle those individuals I believe are spewing erroneous information. One such admonition is, “Let a bear robbed of her whelps meet a man, rather than a fool in his folly.” What about all the information that comes to us through our ears? We’ve all heard the saying “use it or lose it.” I believe that also applies to our ability to critically listen and understand. Critical listening involves not only the ability to pay attention to what other people are

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saying, but the ability to assess the validity and value of the information they are conveying. For most of us, however, it’s a skill that must be learned. That’s why I challenge myself by listening to extremely gifted speakers. It’s pretty easy to find someone to talk with who doesn’t stretch your mind as you listen to them. Just think about the lack of complexity of the lyrics in the typical songs we hear, or think about the vocabulary used by the average person speaking on the radio or TV. By listening to someone who is intellectually superior to you and has a larger vocabulary, it forces you to expand and use parts of your mind that you don’t frequently use. The more you work at developing the ability to evaluate and understand what is being communicated, the easier it is for you to sort out what is and is not relevant information that requires your attention. I read a statement from Jim Rohn (a similar statement is also credited to Zig Ziglar) who said, “Poor people have big TVs, and rich people have big libraries.” As a real estate investor or entrepreneur, make sure you are doing things that will help expand your mind and give you the ability to understand what information is important to your life and business and what information is just bogging you down.

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Real Estate Journal · Fall-Winter 2016-2017

Real Estate Journal

Member Spotlight ...continued from page 13 Arizona, Georgia and Kansas and I continue investing today.

Tell us about your first deal:

The first deal was actually just getting a good property management company to handle the rental of my primary residence after a job promotion and relocation from Texas to Arizona. So my first experience was really interviewing property management companies.

We installed new Allure wood plank flooring in this rehab. It looks fantastic.

Realtors who know investors and what we are looking for. I have been fortunate to find some good ones over the years and they can be a great asset for your real estate investing business.

What do you like most about Insider's Account of the Obama Administration's Emergency what you do? The people I meet and get to know. I enjoy all the members of my team and even what the tenants are up to on a regular basis. It keeps me in touch with the real world.

Rescue of the Auto Industry. Reading about business other than real estate can be very helpful.

education. Keeping up with latest information is a key to success. This week I am at the Information Management Network, singlefamily rental investment forum (West). It is three days of the best information out there for investors on what is going on in the industry. I also write and keep up with landlord and tenant screening issues such as renting, or not renting, to felons which is an issue now for many landlords.

Get your real estate education in the right places and be careful with who you trust and don’t trust – especially when buying rental property.

football. As a former sports editor I am still hooked on sports.

Do you have any interesting How much time do you hobbies or something unique put into your real estate Do you have a tip or advice that you like to do? education? I try to play golf when I have the that you would pass along to It is a constant, on-going other investors? time and enjoy watching college

How do you fund your Has coaching or mentoring investments? played a part in your success? My investments were very

Most of my coaching or mentoring traditional 10 percent to 20 percent down payments with either 15-year has come from working with a great fixed or 30-year fixed loans. I work property management company closely with a small local bank and and Realtors who taught me a have for a number of years. They great deal. I was also influenced by have worked with me on a working Gary Keller’s book, The Millionaire line of credit and in the past I Real Estate Investor. have helped them with some nonWhat are your current and performing properties and issues. future goals? So it is a good local relationship. The current goal is to grow the Do you have a real estate business of Desert Path Marketing Group and engage more clients. The license? No I do not have a real estate future goal is to pay off the rental license. I prefer to work with great properties for long-term cash flow.

Does your business have a website?

Social media accounts?

The kitchen rehab for this unit included new paint and flooring. My primary social media is LinkedIn and I recommend it for everyone in business. And also what email newsletters to you subscribe to? Email is still the best way – in my opinion better than social media – to keep up with everything in this space.

How important is joining a local REIA to a new investor?

It is a great way to meet other people like yourself and learn and hear about new ideas. I would highly recommend it – especially for those just getting started. It’s really an invaluable experience and you’ll be glad you made the effort.

What is your favorite selfhelp or business book?

I am currently reading Steve Rattner’s book, Overhaul: An


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Real Estate Journal · Fall-Winter 2016-2017

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