Wednesday, March 31, 2010
Monday, March 29, 2010
I liked his personal post so much the other day that I decided to bring over to the big board.
Brett and Chris were giving me a hard time the other day as we sat in a restaurant over the fact that a few gray hairs have popped up on both sides of my temples. My reaction, of course, was to point out to Chris that if he would quit sending out emails to our entire mailing list with typos in the headline, maybe my hairline would still be all the same color. You can say things like that to your boss when you also consider him a good friend.
The more I thought about it, though, the truth is that over the last three years I have earned a few of those gray hairs. Having worked in every division of our company at some point and currently serving as the Director of Sales, I realized that the experience that I have accumulated in my tenure here at MI is really helping me explain to our clients see why there has never been a better time to invest in cash flow investment property.
The main reason I think now is the perfect time to buy is the quality of the properties at the various price points. A $45,000 home on our website is miles ahead of a property at the same price in 2007 in terms of quality and the amount of rent that the property will command. That $45,000 house bought 3 years ago was probably bringing in $550-650, and creating a nice return for its investor. Today there are several houses in our inventory at the same price point bringing in as much as $800 per month in rent. Now those are some serious cash flow and cash on cash return numbers, aren’t they?
And it’s not just the numbers. It’s the quality and size of the house, and the attributes of the neighborhood that are going to command the rent. Following my example of a $45,000 house, it’s safe it to say that a home purchased at this price point today is going to probably be a 3 bedroom house in a solid, working class neighborhood near good public schools. It’s going to be a bigger, nicer, and in a better location than house brought at this price point 3 years ago.
When you’re on our website this week checking out the available properties, keep in mind that this isn’t going to last forever. Brett told me last week that he is seeing some prices slowly creep up in some areas, and there’s no one more willing to help you pick out your next property than David and I.
My goal is to buy 5 more properties before Christmas. I’m going to hit my goal. Will you?
Sunday, March 28, 2010
Friday, March 26, 2010
Tuesday, March 23, 2010
One of the ways that we have achieved our success is surrounding ourselves with great people and holding them accountable to do great things. Recently we filmed a short 1-minute clip showing how we are able to rent and manage so many properties and filter all of the pertinent information back to hundreds of Memphis investment property owners around the country. Check it out here:
Sunday, March 14, 2010
Thursday, March 11, 2010
Tuesday, March 9, 2010
Friday, March 5, 2010
Thursday, March 4, 2010
Tuesday, March 2, 2010
Memphis property management companies, as in most cities, are often hired to do all of the leg work of promoting, showing, renting and managing an investment property which leads investors to believe all the hard jobs are done and the income in passive. Either way, the passive part comes in to play because the investor does not have to actively market or actively manage the property. This is where the breakdown in terminology occurs.
Being involved in the day to day operations of your property is the responsibility of your property management company. But you are still responsible for keeping them accountable to the management of your portfolio. Investors set out their goals for number of investment properties that they want to purchase, the style, location, desired number of bedrooms and baths and most importantly a minimum monthly cash flow. These are clear cut criteria for purchasing properties and building a portfolio. After purchasing your property, do not simply assume that your property management is operating your property and sending you a monthly passive income check.
Carefully maintaining your properties, including monthly drive-byes, quarterly interior inspections from your management company, review monthly maintenance records and work being performed are all actions that a successful investor will implement to watch over his "passive investment". Monitoring your monthly costs and statements for incidental charges is an often over-looked, but very necessary task that an owner must perform each month. Those include the interest rate, opportunity buy-downs (where you can pay additional principle early), monthly insurance premiums and keeping an eye out for lower cost property management. Each of these can lead to lower monthly notes and higher positive cash flow.
Just because it is called passive income, doesn't mean you have to be passive about it. Actively working on your portfolio each month does not mean having to actively work "in" your portfolio each month. If you want to keep your monthly cash flow high and your stress low, then doing a small list of minimum tasks will go a long way.