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It's Hot around Park Ave Especially for Investment Property!

The temperatures may be falling but the real estate climate around Park Ave is super hot, especially for multi-family investment property.  In the past six weeks or more, I've heard from many investors and want-to-be investors and when we secure an appointment to view these properties, there are usually two or more other investors looking at the same time.

A little free advice here for new and want-to-be investors.  There are three primary ways to loose money on your investment.   

The first is financing.  I meet many investors that want to buy the property as a primary residence simply so they can put a minimum down and mortgage the property to the hilt.  With interest rates so low that is tempting to do but all interest is front loaded, and so this strategy will only work if the investor is committed to a long term investment. 

Next comes maintenance.  Even if you purchase a property in perfect condition, tenants cause wear and tear.  If you can't tell a hammer from a screw-driver and the thought of getting on a ladder breaks you out in a sweat, you will need to hire someone to take care of your property.  So that is profit out of your pocket and into someone else's.

The last biggie is managing your property.  You will only make money if you screen and select good tenants and then collect the rent.  Some investors hire that job out and as a result a good chunk of their income is given a way.

The bottom line, is that there is a lot more work to being an investor than depositing rent checks.  If you need to mortgage the property, hire a handy man plus a property manager, make pretty darn sure that the return on the investment is great enough to cover these expenses. 

Showing Stress

I work hard when I take a listing.  My days are filled with putting out signs, taking photos, verifying tax bills, writing ad copy, calling utility companies and much, much more.  But my job is much easier than most homeowners.

When a house is on the market, a home owner must clean the gutters, manicure the lawn, paint the front door, hind the trash cans and that's just with hopes to have enough curb appeal that we get an appointment request.  When the showing request comes in, that's when the real work begins.

Yesterday I had a showing request for a family's home that have two daughters, aged 1 and 3.   When I arrived, the house was spotless......floors mopped, counters clean, beds made, absolutely no clutter and all the lights were on.  My seller greeted me with a big smile and then I heard it!  Not one, but two crying babies!   This particular showing came right in the middle of nap time and so both girls were taken from their bed and put in car seats so they could vacate the property for the showing.

And fortunately, in this case, my seller's efforts paid off.  We receive and accepted an offer last night.  But this was the 14th showing request for this property.  In a couple of incidences, the appointments were canceled just before the showing time and in at least once case, the buyers never showed up.  In one case, the buyers couldn't afford the house but they were curious to see it anyway.  And in all the other cases, the house just wasn't right for them for one reason or another.  But for each and every showing request, this house was cleaned and staged to perfection.  And regardless of the stress this caused, they always greeted me with a smile.

I wish I always could have that much grace.

Sad Day in Honeoye Falls

General Motors announced that it is closing its Fuel Cell Facility in Honoeye Falls today. This will have a huge impact on this tiny village's economy. GM has offered jobs in Michigan to many of the workers but I'm betting there will soon be a flood of nice homes on the market in Honeoye Falls and Mendon.