Anyone doing a real estate deal in LA quickly discovers that there is a ton of paperwork involved. Some other time I’ll do a detailed rant about all of the government forms involved. But, for now, it suffices to say that there are probably 100+ pages of forms that need to be reviewed and counter-signed … Continue reading “Trying out a transaction coordinator”
Category: Brokerage
Why you don’t close on Mondays
You never close real estate deals in California on Monday. Why? To close a deal, the escrow company generally needs to receive the funds from the buyer and the buyer’s bank the day before. Since you can’t wire money over the weekend, closing on a Monday would require that the buyer and the bank wire … Continue reading “Why you don’t close on Mondays”
Are apartments still worth buying?
This period of sustained, low interest rates is driving every sane person out of cash and into hard, income producing assets. Why? Because, after inflation, keeping your money in cash right now is basically like lighting 1-2% of it on fire each year. This has been true since 2009, but I think most people are … Continue reading “Are apartments still worth buying?”
I blew up yesterday
Yesterday wasn’t my best day as a broker. I got an email from a client letting me know that the loan broker I set her up with was not being responsive. Having gone through this once before with this loan broker and client, I saw red. Why did I see red? Many loan brokers pay … Continue reading “I blew up yesterday”
The Magic Number for FHA Loans
12. That’s the magic number for FHA loans on 2-4 uni apartment buildings. It stands for 12x the annual rents. Why is 12x grm the magic number for FHA loans? 12x a building’s total annual rent (including the fair market value rent of the unit you will occupy) is basically the maximum price you can … Continue reading “The Magic Number for FHA Loans”
Disclose, disclose, disclose
Am doing a bunch of deals right now and keep running into the same problem: Buyers Sellers being slow to disclose issues with their properties. Bluntly, this is stupid. I’m not a lawyer, but I can tell you with 100% certainty that, by not disclosing problems with your property during the sale process, you are exposing … Continue reading “Disclose, disclose, disclose”
More on the state of the apartment market
This is a verbatim quote from an email from an agent listing an apartment building in a nice part of the Valley: “Yes, it is available, but seller is now asking $50k over listing price. Need an offer all cash at listing price or above no contingencies. That is the only way.” I’m keeping the … Continue reading “More on the state of the apartment market”
How to be a bad broker (episode 387)
Am working with a client considering buying a duplex in LA. The listing broker has the building on the market at $500k. He has no idea what the rent is on the one occupied unit (in what is a rent control building). To illustrate how insane this situation is, let’s review the numbers: List price … Continue reading “How to be a bad broker (episode 387)”
How not to price your building
[Note: I wrote this piece a long time ago but couldn’t post it until now, because I didn’t want to screw up a potential deal in progress.] Am helping a couple who are looking to buy an apartment building for roughly $1MM, all cash. Surprisingly, there’s not a lot out there. I did manage to … Continue reading “How not to price your building”
Thanks for the amazing response
Wow – we got a lot of new visitors to the site yesterday. I’m very hopeful that some of them (you?) will stay on and join our conversation going forward. I’ve already set up meetings with several people who contacted me. If you’re sitting there reading this (incredibly boring!) blog and soaking up everything I’ve … Continue reading “Thanks for the amazing response”