This will be a thread answering the questions I receive.

If anyone wants a question about Real Estate answered just @ me or comment on my threads.

I hope you enjoy!

@twtJSanghvi Asks

"What could be a shortest and suggested roadmap for a non-RE newbie, in his mid 30s, to break in big boys club"

The big boys all have large portfolios. (Usually coupled with Insurance and PE but thats another topic)

What you need to do is build your portfolio

Continued:

Building your portfolio is about not taking money out of your buildings and using leverage

Basic formula: Buy building at 60 to 70% LTV. 5 years later refinance, Buy new building. Rinse repeat

This will go up exponentially. But the more you take out the slower it is

@retardjuice Asks

"Do you utilize credit lines? And if through a business, is there any way to dodge the personal guarantees"

I try to keep my portfolio at around 50% leveraged. I have quite a few business cards. In my early stages, my investor gave me a credit line

Continued:

When starting out it is hard to get away from personal guarantees. It's usually just the cost of doing business.

It depends on the risk of your buildings. Almost every loan will have a bad boy carveout.

I still personal guaranty my high-risk buildings.

@martinezwow Asks

"How to analyze ROI"

On all my buildings I model cash flows for 10 to 20 years.

I use Argus can be done in Excel just a little tougher.

Always use IRR as a rate of return measure as it takes into account reinvestment and Time Value of Money.

@adrian1arevalo Asks

"When viewing a property, what are the first things you inspect? Roof? Location? Or is it dependent on the type of building?"

Pretty much all of that.

Older buildings I look a lot into physical aspects. Roof, environmental, basements, etc...

Continued:

A newer building I am less concerned and don't look into physical aspects as much.

(With experience you will be able to know the extent of physical damages. If newbie bring a GV with you)

Location is very important. But that is investor specific.

@YodeLeaheyWho Asks

"Ever buy distressed notes or liens?"

No, I do not. I actually don't really know anyone else who does either.

Personally, I wonder how the market is for that seeing how well Real Estate is doing right now.

@oruchegoodluck Asks

"What would be your advice to a novice Realtor?"

(If you are a commercial broker)

Focus on relationships not sales. Provide value to your client, be honest, be on top of shit.

Focus on creating relationships with clients and sales will follow

@PhilosophyNotes Asks

"Legal aspect of property management. Fair housing act, etc. how not to get sued as a landlord"

I don't touch residential so I can't help there.

For my CRE buildings:
Deice sidewalk
Fix sidewalk cracks
Get video cameras
Do things by the books

@justintran5262 Asks

"How to negotiate or the step by step process of how a deal actually gets inked. Eg title, escrow, etc etc"

I will make a thread on how to negotiate.

In terms of the transaction side peep a thread I made. https://twitter.com/EstateRanger/status/1181199607256276992?s=20

@KatoaLand Asks:

"Best types of re for cash flow and longevity.. also how does the debt work with like the down payment and stuff.. one last thing where did you go to learn about it"

I only invest in CRE.

There is no best type of RE. It is whatever works for you.

Continued:

For debt on CRE read this https://www.investopedia.com/articles/personal-finance/100314/commercial-real-estate-loans.asp

From @Investopedia

I learned about through experience working at a firm as well as reading on @Investopedia everything I didn't understand.

@IamLeoTheSailor Asks:

"Ideal balance between paid price and investment needed in order to get the property to max potential. 1. buy low and increase refourbishement cost or 2. better buy at higher price and reduce time/investment needed after purchase."

Continued:

This is deal-specific. I own some buildings that I didn't do anything to and my return is pretty low.

I have also bought buildings where my value add was high and my return was as well

Its all about what you are trying to do with your portfolio. Investor specific

@danieljpc_ Asks

"Starting in RE with little to no money, basically how to get your foot through the door"

A college degree really helps for the analyst side. Look for small companies that manage their portfolio.

Without a degree you will have trouble with a big firm

Continued:

If no degree and can't find a job with a smaller firm then look to CRE broker.

Take your state exam and apply to everywhere.

Make $. Use that to buy Real Estate down the road.

Lastly just know your shit and learn everything about RE.

@RecruitZero Asks

"Buying property with good credit but no cash (if its possible and/or advisable), and getting into wholesaling as a novice"

Don't know anything about wholesaling and never done it. I believe @willnyguifarro1 is the Twitter guy for it.

Continued:

You need cash for RE. Start saving.

You can set up investor deals and take money from other people. expect to raise 40% of the purchase price.

But honestly just start banking money.

@sanabruh_06 Asks

"What type of investment properties should beginners look to get into? (Sorry if you went over this already)"

Stay away from casinos, hotels etc...

I would say the easiest would be a small residential house or condo.

My first deal was a CRE retail strip.

@Stargazer01995 Asks

"Is it possible to get a RE job without a degree but working on building experience by working on your business (wholesaling/working with friends that are doing RE, and general RE information)?"

At a large firm probably not possible.

Continued:

Look for family firms. Small with assets under 300M.

You are on the right track. Your goal is to be a master at all things Real Estate and that your lack of a degree doesn't matter.

So keep studying and continue to be involved in the industry and you will get there

@obtaincapital Asks

"Enjoy the threads with specific details. Lot of insight when you share your rundown of property evaluations."

Thanks for the encouraging words I will try to do more of those.

@timohsy Asks

"Any interest in coming up with a thread discussing quick back of the envelope calcs may do before diving deeper on a property?"

Here are my Fav:
DSCR
Price per Sq Ft
Cap Rate
Avg. PSF for tenants pay

@dread_game Asks

"Good areas in Texas for Multi-family properties"

Not from Texas nor have I ever been to Texas. I also primarily do commercial Real Estate.

Sorry, I can't be much help with this one.

@mikeinyvr Asks

"If a landlord is feeling particularly generous and is constantly overlooking late fees, best course of action is to collect late fees throughout the year and give it back at Christmas by way of a gift or gift card? How many landlords do you think will do that?"

I am in commercial real estate and no one really does this

But I have heard of this being done in residential

I would say don't bother. Most people don't actually appreciate the gesture. Also when you give them it back it incentives them that they will get their late fees back

@LiveLoveTrade Asks

"Is real estate a full time job or can it be a side hassle? I’m a salaried employee and I want to invest in multi family on the side, wonderingabout the time it takes to manage it all, ty"

I am in commercial real estate. It is important to realize that commercial real estate takes far less time to manage than residential.

In your case, it depends on how many units. 4-10 probably not terribly difficult but you will need to spend some time on it.

@romy_gill Asks

"Considering you are experienced investor, I wanted to pick your brain over the commercial investment grade property. What creative ways you can find to put lessor down payment. Possibly 5% on a 3.4-4 million project?"

The only way to put that minimal of an amount into a deal is to first raise private capital and then take out a loan.

You are looking for 35% of the price in private money

For 5% on your end you will need to have trust and personal relationship with your investor

@Armanner_ Asks

"Mid 20's, best way to get into real estate in southern US? And necessary starting finances?"

Dont need to start in finance. Broker route is a non college option.

If you want to buy either start looking to save your $ or raise outside $

@Dr_Equity Ask

"Your biggest mistake in commercial real estate? What was it and how do others avoid it?"

Focusing too much on making my buildings look "Pretty"

constantly painting doing upkeep. I learned most of the time these improvements did not pay off in lower-income areas

@spencerrwise Asks

"What are your thoughts on how this forced shift to work from home will affect office going forward?"

I don't think it will have the impact people think it will. The fact is employees are unproductive at home, unsupervisable and most like the office.

@danefossee Asks

"What assets do you focus on? How do you structure your deals?"

I focus on retail and mixed retail office. I stay away from large office.

I structure my deals very differently from most. I will make a thread on this in the future.

@obtaincapital Asks

"Biggest mechanical item that causes the most headaches? And for emergency situations (leaking pipe, electrical out etc), do you have a direction for tenants to call specific contractor, or all requests go through you?"

It would be our HVAC systems. Tenants constantly losing remotes and most are at the end of their lifespans. 5k+ for a new one.

All work orders go through whoever is on call.

We are CRE, therefore, we are not on call 24 hours like residential.

@MenofSteelddd Asks

"Coming out of this quarantine, would it be best to go all in on investment or be smart about it? Different niches or similar and big things ones?"

I always think it is best to diversify your capital exposure. I would not put 100% of capital into one deal

@mylongletter Asks

"Where should you look to find templates for value add deals you can adapt for your own market?"

In real estate templates do not exist. Every single deal will be completely different from the last

You must find what you are good at and tweak it for each deal

@spencerrwise Asks

"How do you think about balancing diversification (geographic or type of RE) with focusing on a niche where you have depth of knowledge?"

Because I self manage all of my properties are within the same location. They are all outside a major....

New England city. Therefore I am not worried about geographic diversification as the city will not go anywhere.

If you are in a more rural area I would agree with you geographic diversification would be very important. (You don't want to own a whole town.

In regards to your niche comment that is the way, you are successful in real estate.

You always need to find what you are good at and utilize that to your best ability.

You have to figure out what you are best at and then use that as others will not be able to do what you do

@jkostecki_rei Asks

"Do you think the large multi-family space will change irrevocably and if so how as the result of this recession?

Or will things go back to normal in a couple of years?

(different design elements, leases structured differently, new ways of financing, etc.)"

I am not multifamily so I have very limited knowledge of the industry.

I would say though that leases will most likely change but with little avail. It does not matter what the lease says if the government does not allow you to evict tenants.

@sowhatnow101 Asks

"Where is best to start with 40k?"

It depends on what you are interested in. If you are interested in CRE you will not be able to invest with that.

If you are interested in small multifamily you could do that dependent where you are in the country.

If I were you I would focus on banking more though as 40k is not a lot in the Real Estate world.

With lawyer fees, accounting, and much more.

@Fares_Saadi1 Asks

"Thoughts on using auctions for first-time acquisition? Many thanks."

I would not advise. I have never bought anything at auction before in the CRE space.

I think you will have a tough time evaluating the deals without being able to go in the property.

@mtnofmusings Asks

"If you were just getting started in RE investing, what would you focus on, knowing what you know now?"

I would focus on my connections above all else. What takes the longest time in Real Estate is building a local network. Focus on that and you will be set.

@moneyandtacos Asks

"How applicable is real estate transactional knowledge to other infrastructure sectors (like solar)?"

I am not sure I have never participated in the solar industry before.

@dyer440 Asks

"When I look around locally there are all sorts of rental opportunities offering 10-20% cap rates.. is it just a small market (so inherently more risky), or am I missing something?"

I would say it is most likely correct that it is small markets.

It also depends on what you are looking at. CRE, single-family houses etc...

The smaller it is typically the riskier it is. Higher the cap means higher risk.

But it really depends on where the location is.

@CodyYounger Asks

"Your thoughts about lender relationships when investing. Is it important to focus on rapport with smaller local lenders, or are we just focused on who’s offering the best rates/terms at any given time?"

I only use small local lenders. I think the service they provide is invaluable.

You do not get the same level of service with large institutional banks.

I highly recommended using local banks and not jumping to the best rates.

I made a thread on this.

@obtaincapital Asks:

"In light of everything going on with riots/looting, any specific clauses/exclusions you look out for when getting property coverage?"

Honestly, when getting property and rent insurance I was never a huge stickler for it.

On my next deal or policy renewal on my list of things to do is a deep dive into policy coverage outlining what I am covered for and what I am not.

From there I will negotiate.

I will update this question with a thread most when I do this.

@mattbakerclc Asks:

"What is your strategy for minimizing insurance cost? Do you do cash value or replacement cost? Do you go through a broker?"

I have an insurance agent I deal directly with she gives me pretty good rates so I have always used her.

In the coming months, I will be re-evaluating all my policies and coverage.

Prior to this, I was never too concerned as I keep a larger than most war chest for all my properties.

I will update this question with a thread when I decide to go through it

@mattbakerclc Asks:

"How can I find investors? I was in a partnership where I was the operator and my partner found the capital. We recently stopped working together so I have to take on those responsibilities."

If you still have his old documents etc... you can use those to do some digging on how he did it.

The first thing would be to gather all of your prior deal experience (Track Record) and get it formatted well.

From there start a network, real estate events, friends, and family

Friends of your family and friends.

It is hard to give exact knowledge as the market is different everywhere but there are people out there.

It just takes a clear presentation and finding the people.

Make sure your pitch is stellar.

@damanf99 Asks and @itstdye Wonders

"1) Income around 100k. No other assets. Would you recommend getting started in CRE first?
2) Common pitfalls/mistakes of new investors?"

1.) It depends on where you are located. If New England or coast I would recommend saving more money.

100k although it may seem like a lot is not a ton for Real Estate.

Depending on your income it may be best to look to increase that

Lastly can look into single-family houses

Not my favorite asset class but it can be a great way to start up.

2.) I will make a thread on this soon

@FincBH Asks

"What's your take on the utility of a real estate license in building a network for eventual investment?"

I think its a good idea. The best way to build connections is to be involved in the industry you are looking at

Hard to build RE network when you work in tech

@mzhao8 Asks:

"How do you approach prop insurance? Do you insure each prop individually or do you structure as an umbrella? Feels like there's an oligopoly of insurers forming in the space, which is driving up non-controllable costs"

As of right now, all properties are insured individually.

I will be re-evaluating soon and will let you know what happens.

@Stargazer01995 Asks:

"Do you cold call for finding deals like in my field wholesale RE? Reason I ask I work 9-5 to fund my business but have a hard time finding time to call was thinking about hiring VA’s and or call after hours, thanks bro"

No reason to cold call you can check out my thread on how to find deals.

I only cold call properties that I want and will overpay for. Even then one of my brokers will typically do it for me. https://twitter.com/EstateRanger/status/1179388483900715009?s=20

@omidali503 Asks

"If you thought the US was headed toward a long term deflationary period, how would you position existing RE portfolio and new acquisitions moving forward?"

I would act as normal. But I am in a unique position. I hold all properties until I die for the most part.

As of now I pretty much buy with just location and cash flow in mind.

This would be a better question for someone in the corporate side of CRE

@VladStrelsov Asks

"When evaluating viable multifamilies to reposition, I get majorly hung up on renovation costs - how can I work with a GC in a way to avoid them taking me for a ride (and in a way I can ultimately replicate/partner)"

I can't answer the question how you would like because me or my partner manage most of our construction projects.

Unless it is a big project.

Best thing to do is to get many quotes on everything. Details are key, materials used etc...

Also become an expert in the project

@Fares_Saadi1 Asks

"Friend and I both working in MF REPE (an./ass. level), both went to top 3 Ivy but from modest backgrounds so can't leverage family/friends for capital. When would be best time to leave to start own fund (wait til senior to leverage work connections) /...

how would you go about it?"

Take the next year or two stack your cash stop spending.

You work at a MF REPE firm so start building a network of people you could potentially tap.

I came from a modest background as well but have a lot of wealthy friends.

In essence focus on stacking cash and building connections