10 Cheap Home Value Boosters

With all the rehab I've done, I think I have a pretty good idea of what fixes you should make to a house to get it to sell quicker and for a higher price. However, just to show you can never know everything about a subject, an article on MSN taught me a few new tricks. Some things I didn't know:Tip #2: I normally replace the appliances in my houses, but if the existing ones are still in good shape except for cosmetics, I didn't know you could just...

Trading One Job For Another

I've been thinking about this for a while, but when I read the latest post on one of the real estate investing blogs I follow regularly, I had to write about this.I follow several blogs of people who got started in real estate investing. Over the past several months, three of them have decided to get their real estate license and become Realtors. It seems to me that this is just trading one job for another. I will admit there are some advantages...

2006 Financial Year In Review

The end of the year is fast approaching and it is looking like I'm going to be too busy for the remainder of the month to get much going in terms real estate deals, so I thought I'd look at how I did in 2006.Real Estate:I rehabbed only one house this year. My goal was to do at least two, so I fell short there. In my defense though, I was asked by my investors to stop for a while until I could conference with them. That took me out of the market for...

Home Sales Up, Prices Down

Back in September, I wrote about a news story that said home prices had declined for the first time in 11 years. Today, there is another story out: Home sales are up, but prices are down.The National Association of Realtors has announced that sales are up one half of one percent - the first rise in eight months. However, the median price of a home has dropped 3.5% from last year, a record decline. They also state there is still seven months worth...

Whitney Houston Faces Foreclosure

From CNN: Whitney Houston's New Jersey mansion is set to be sold at a sheriff's sale on January 4th because she is more than $1 million behind on the mortgage and still owes this year's property taxes.Now that's an auction I'd like to be ...

DLCV Reverse Split Just Days Away

This press release from Dolce Ventures indicates their 304.44 for 1 reverse split should be completed on or about November 16. This is the arbitrage play I wrote about earlier. If you are making this play, I would start checking your brokerage account daily. Based on my experiences with Schwab, once the split happens, you'll probably see their ticker symbol, DLCV, in your account replaced by a number. About a week or so later, depending on your brokerage,...

Credit Report Corrections

A couple of months ago, I requested our annual free copy of my wife's credit report from Equifax. There was nothing seriously wrong with it, but there were several old accounts that I wanted removed. I filled out the correction forms and sent them back. By law, Equifax has to respond within 30 days. A couple weeks after I sent in the corrections, I got a letter back from Equifax saying the three accounts they listed were verified to be correct and...

Thoughts On HomeVestors

Sorry no posts for so long. Life has been pretty busy lately. We went to California Thursday and spent Friday at Disneyland. It was the first visit for my almost 3 year old daughter and she really enjoyed it. Got back into town on Saturday and spent most of Sunday in the hospital emergency room because my wife's back locked up and she can barely move. She's been home in bed all week and I've been taking care of her and my daughter. Needless to say,...

Shaun's Real Estate Adventures Honored

I am pleased to report that this blog was selected as one of The Top 35 Real Estate Blogs by BiggerPockets.com, a special interest media and publishing company focused on real estate investing. The list was posted at the end of August, so this might be old news to some, but I just found out about it :-) Thanks to BiggerPockets for the honor! Their site has a blog plus lots of other good stuff and I recommend taking the time to see what they've got...

Hitting Home

As I was driving home yesterday, I was listening to the Randi Rhodes Show on Air America and she was talking about the economy and interest rates and how many people are starting to have difficulty meeting their adjustable rate mortgage payments as interest rates rise. Now intellectually, I've known this was happening for some time, but hearing the people that were calling in to her show really made it much more concrete for me. People were calling...

Sick Days

I've been sick the last couple of days with a bad cough that has prevented me from sleeping for the last two nights. Needless to say, I'm in no shape to do any sort of real estate deals right now. I was able to see a doctor yesterday and got some medicine, so I should be on the road to recovery. Of course, the prescription cough medicine has codeine so that knocks me out a bit too.I saw on the news today that new home sales are up for the second...

Phoenix Area Radio REI Show

Gregg Reichman of Active Finance Group will be on KFNX 1100 AM today and every Wednesday for the next 3 months from 2 PM to 3 PM. He will be discussing current real estate market conditions, wholesale real estate, foreclosures, and hard money financing. If you want to call in and talk to him, the number is 602-277-KFNX (5369). Active Finance Group is closely affiliated with BuyAZForeclosures.com. Both companies specialize in foreclosures and wholesale...

Possible Reverse Split Arbitrage Play

I was searching the SEC filings database and came across this possible reverse split arbitrage play: Dolce Ventures, Inc. This stock trades on the "pink sheets" under the symbol DLCV.The company will be undergoing a 304.44 for 1 reverse split with shareholders owning less than 15,222 shares being unaffected by split. For more details, read the company's SEC filing. Pertinent details are in the section titled "The Reverse Split" (surprisingly enough)....

Another Reverse Arbitrage Deal Completed

A while back, I completed a stock deal that gave me a 2,567% ROI in 212 days. This was accomplished through the magic of reverse merger arbitrage - a play where you buy a few shares of a stock that is going to undergo a reverse split with special handling for odd lot shareholders. See my previous post about this for more details.The deal I just completed was for far less in terms of dollars, but again provided an astounding ROI: 364% in 59 days,...

Back In Business!

I had a brief talk with my investors this weekend. That had previously asked that I hold off on purchasing any more properties until we could have a meeting. After all was said and done, they have decided not only to continue with the buy-fix-sell strategy I have been using, but to also add some more money to the game.As many of you know, I work on an all-cash basis. When I started out a couple years ago, prices were quite a bit lower than they are...

Home Prices Decline For First Time In 11 Years

I'm sure you've all read the articles that appeared on Monday that said, for the first time in 11 years, existing home prices fell. (If you didn't, you can read about it here and here.)What struck me about these articles is the different views the so-called "experts" have. In the first article, we have this:"This is the price correction we've been expecting," Lereah said. "With sales stabilizing, we should go back to positive price growth early next...

Market Flushes Out The Not-So-Serious

Yesterday afternoon, I had a guy over to give me an estimate on cleaning my carpets. He was the owner of the carpet cleaning company and we got to talking and it turns out he used to invest in real estate. When I told him I had sold my rental a while ago, he said "So you got out while you could, huh?", referring to the recent market slowdown. Well, no, I got out because it made sense to me at the time.He went on to tell me that he had 9 houses at...

A Little Of This, A Little Of That

Not too much has been going on with me and real estate lately. I've made the decision to invest some money in my own house - finally. We've been living there for three years now and still have temporary paper blinds on some windows! So we're in the process of getting in-ceiling speakers installed (the house is pre-wired for surround sound and the cables are sticking out of the ceiling on big nails), having an entertainment center built, and a new...

Builders Are Practically Giving Away Homes!

Well, not really, but I did see an amazing offer last weekend. I have some relatives who are looking to move to Arizona from California and they were out here last weekend to look at houses. They looked at some resales, but also looked at one new build development. The house they liked was the biggest in the development, about 2,300 square feet. It was priced at $395,000, but the builder was offering an $85,000 incentive. With that incentive, the...

AZ Republic Article On Teaching Sellers

Brian over at How To Invest In Real Estate posted a story from the Arizona Republic about how sellers are basically clueless about the current real estate slowdown and are still looking to sell their homes for the inflated prices of the last two years. Realtors are having to educate them on the current market dynamics and find ways to make them realize they may need to lower their price, not once, but several times.But one line in the article really...

Another Prosper.com Update

I've already mentioned I've grown disappointed with Prosper.com and will not be lending any more money through there. I've noticed now that they have added a new feature called "Community Payment" which I'm not sure I like. The concept is simple: if a member of a group is behind on payments, other group members can chip in and make a payment on the overdue loan. This helps keep the group's rating up by cutting down on the number of late loans the...

First Payment From Commercial Project Received

I received my first payment yesterday from the large commercial project in Louisiana I invested in recently. Also had an update on the progress from the property owners. They have hired a new property management company and that company is actually moving into the building, which is a plus. This company managed the building for over a decade before the previous owner took over and had the property at 80% occupancy. They are currently at 40%, but...

Bonus Cash!

I spent the weekend in Las Vegas, where I won about $500. Unfortunately, my wife lost the same amount, so it was a push overall. Still, it's good to come back from Vegas with the same amount of money as when I left!But the bonus cash I am talking about is not from Sin City. It's from Security Union Title Company. When I checked my mail when I got back into town, I had a refund check for $44 from this title company. The accompanying letter says the...

Reverse Merger Arbitrage Works!

Wow.. I just completed a deal that gave me a 2,567% ROI in 212 days. That's an annualized ROI of 4,419%!! And it's perfectly legal! Anyone can do it!I sound like a bad infomercial. I better explain.Thanks to Gualberto over at The Art Of Money blog, I learned about a stock investing technique called reverse merger arbitrage. He's explains the concept here. How it works is you buy shares in a shell company - a company that has no operations and is...

House 3: Lessons Learned

Each project gives you tons of opportunities to learn, so if you can't find at least some new things you've learned, you're doing something wrong. I certainly got lots of opportunities to learn on this project! My lessons:Location, location, location! Of course, this is the cardinal rule of real estate and I thought I knew it. In fact, I do know it. Where I was lacking was my ability to properly judge a neighborhood. I knew when I was investigating...

House 3: Final Results

Here are the final numbers on House 3:Purchase Amount-$138,280Fix Up Costs- $29,443Insurance- $303Utilities- $517 Costs Subtotal - $168,543 Selling Price$195,000 Selling Costs -$18,874 Property Taxes - $491 Income Subtotal $175,635 Misc. LLC Expenses - $400...

House 3: Done Deal!

I spoke with my escrow agent this morning and he confirmed the buyer's loan did fund on Friday and the docs got recorded, so it is now official - the property has sold! (He didn't get back to me on Friday because he had a family emergency and had to leave the office.) He said he was wiring the funds to my account this morning. In fact, I just checked and the funds have already hit my bank!Today, I called the power and gas companies and had them take...

House 3: Signing Complete!

When I showed up at the escrow office this morning, the buyer was still signing her documents. I took the opportunity to give her the keys to the property. Technically, I should wait until the loan has funded and the documents have been recorded, but I don't want to have to make another trip to the property or escrow office. I signed my paperwork and left. They are going to send the docs to the lender by courier in an attempt to get the loan funded...

House 3: Signing Tomorrow!!

Woo-hoo! The title company received the loan docs and we are scheduled to sign tomorrow morning! The buyer is signing at 8 AM and I am signing at 9 AM. The title company will courier the loan docs to the buyer's lender in hopes that they will fund the loan tomorrow afternoon. If not, it'll have to wait until Monday. (Damn - I didn't catch that the closing date was a Friday!) But all is good!As usual, I found one error on the preliminary HUD statement....

House 3: Two Days To Closing

I stopped by the property this morning and was pleased to see it was in the same state as I left it last week. I might get out of this thing without any more vandalism yet!Spoke with the escrow company. They are working on my file now. They do not have loan docs for the buyer, but they have been told they will arrive tomorrow. (Of course, we all know that doesn't mean it will happen.) I was supposed to get the preliminary HUD today to review, but...

House 3: Looking Good

I received another addendum today from the buyer that details the air conditioning info and purchase price increase I talked about earlier. The lender also wanted the contract to include instructions to the escrow company that the $2,500 be made payable only to an air conditioner licensed contractor. Apparently the lender doesn't want the borrower to get any cash back at closing. It doesn't matter to me one way or the other. I was also told that...

Giving Up On Prosper.com

I'm going to give up on Prosper.com. I think they have a good idea, but it doesn't really work for me. I have a couple problems with it:The 3 year loan period. I realize this is to help the borrowers to give them a lower payment, but right now, I prefer loans of 1 year or less.Small payments. I am unwilling to lend large amounts of money on unsecured loans to people. A small loan amount combined with the 3 year repayment period equates to tiny monthly...

House 3: Buyer's Inspection Report

They managed to beat the deadline. They had 10 days to inspect the property and get me a list of what they wanted fixed. At 9:30 PM on the tenth day, they faxed it. As usual, it was just a copy of the inspector's report with a note saying they wanted everything fixed. (Actually, there was one minor thing they didn't want fixed, but it was basically everything.) Anyway, we counter-offered back with crediting them $1,500 at closing for them to fix...

How Do They Stay In Business?

I am continually amazed by the fact that escrow companies are able to stay in business. They have about the worst performance record for any industry I have ever dealt with. (And this includes dishonest cabinet makers.) It is even more mind-boggling when you consider all their instructions, every single thing they have to do, is in writing! They cannot do anything based solely on a verbal order. How hard is it to follow written directions?As of...

House 3: Still In One Piece (Updated)

I stopped by the property this morning and it is still in good shape. I think two things are helping keep the vandals at bay: the padlocks I put on the back gate and all the construction going on in the neighborhood. The construction has caused some streets to be closed and I had to take a rather circuitous route to get to the property. I'm glad the house is under contract now. Viewings for buyers would probably be low due to the construction.I still...

The Next Venture Has Begun

As I alluded to earlier, I have started a new venture that is pretty exciting. Things have been finalized now and I am willing to discuss some details.Several months ago, I attended a get-together of several people from the richdad.com message boards. I came out of that meeting very fired up on apartment investing and got started on educating myself on that subject. I haven't gotten very far in that respect, but I have put another one of the important...

House 3: Another Update

I've received a copy of the inspection report summary. Nothing too out of the ordinary, considering the house is 50+ years old. Some things were found that the first inspection report found and some things were noted that weren't in the first report. I have yet to hear anything from the buyer regarding what, if anything, they want me to fix. I expect that will come Monday or Tuesday. I also received a copy of the earnest money deposit check.One nice...

House 3 Update And The Next Venture

Escrow has been opened on House 3 and the inspection is supposed to be happening today. I will be getting a fax of the signed contract and the earnest money receipt sometime today. I'm glad to see the inspection is happening just one day after escrow was opened. The buyer is not selling a house to buy this one, so perhaps she is hurrying to get into the place before the first of the month so she doesn't have to pay August rent. (Not to mention collecting...

House 3: Sold!

My counter-offer was accepted and the property is now in escrow aga...

House 3: Two Offers Received

While I was in Las Vegas last weekend, my Realtor got two offers for the property. One was for full price with a 3% seller contribution. The buyer pays for the home inspection and I am to pay for a home warranty at a cost not to exceed $350. The buyer put up $1,000 earnest money and is getting a 100% loan. The good news is, even though the contract says the buyer wants to close around mid-August, the agent said they would be willing to close sooner...

For The 30 And Under Crowd

I came across the Penny Foolish blog, written by Kira, a young recent college grad just starting out on her financial education. What caught my eye was the Festival of Under 30 Finances she is putting together. (More info here.) She is soliciting articles about financial issues relevant to people under 30 years old. I think this is a great idea and I hope it is a success! If you have something relevant to contribute, please submit it to h...

House 3: Security Update

I stopped by the property this morning on the way to work. We had a monsoon last night with not a lot of rain, but lots of wind, at least where I live, and wanted to make sure the property was ok. I also needed to make my weekly visit to check on it and make sure it hasn't been broken into again. The fact that I had a dream a couple nights ago that someone had broken in and graffiti-ed the inside also had me a bit nervous.I was pleased to see everything...

House 3: Squatters Begone!

I stopped by the house this morning and, as I was unlocking the front door, I noticed there were sheets hanging over a window to the right of the door. Hmmm.. I didn't put those there. I opened the door and saw several things:The window on the other side of the room to the backyard was open.There was a red car in the backyard.Through a doorway to the right, I could see a bicycle leaning against the wall and a bunch of clothes on the floor.I closed...

Prosper Loan Late

One of my four loans on Prosper is late on the payment. Right now, it's at a less than 15 days late status. Payment was due on the 16th. Interestingly, this was the loan where an early payment was made before the first month was even up, lending some credence to her claim that she intended to pay the loan off in 1 year instead of the normal 3. The borrower is rated HR, meaning High Risk and total loan amount was for $3,500 at 20.75%. My exposure...

House 3: Checkup

I stopped by the property yesterday morning just to check on it. Everything looked OK. There were no broken windows, the window AC unit was still there. The outside porch light was on, but I left it on, figuring it may be playing a role in keeping vandals at bay. My two desk lamps were still there and the timers they are connected to were still working and set to the right time. The laundry room door was unlocked, so some potential buyers must have...

House 3: Back On The Market

My agent heard from the buyer's mortgage broker today. Apparently, the reason for the delay in the loan docs was the buyer had a late payment on his credit report. He said it was the bank's fault and initially, the bank agreed. However, after further investigation, the bank changed its mind and decided it was the buyer's fault after all. That dropped his credit score and he no longer qualified for the loan. The mortgage broker says they can get it...

House 3: Escrow Update

We were supposed to close escrow today. Actually, the original close date was last Tuesday, but we extended it a week. My agent has called the buyer's agent and has not gotten a response. She also called the buyer's mortgage broker and asked what was going on. She got the usual mortgage broker answer - "Oh, there were some problems that weren't the buyer's fault but they are all cleared up now," etc., etc. My agent then asked if we were going to...

House 3: Still No Buyer's Docs

We're supposed to close escrow tomorrow. As of 1:45 PM today, the escrow agent still does not have docs from the buyer's lender and no one there is returning his phone calls. This does not make me happy. I asked my agent to contact the buyer's agent and have them start pestering their lender for loan docs as well.I did stop by the property this morning and it's still in good shape. The window AC unit has been installed. No more vandalism has been...

House 3: Sale Documents Signed

I went to the title company this afternoon to sign all the documents. There were several errors on the HUD - as expected. First, they had my agent's commission as 3% when it should be 1%. They also left out the $350 I am kicking back to the buyer for a stove to replace the one that was stolen. Then, they charged me $525 for a termite treatment. This was never mentioned to me and it is not in our contract. The escrow company charged me because...

House 3: Closing Delayed - But That's Good

When I spoke with my Realtor last night, I got some good news. The appraisal on the house came back at $195,000, not $193,000 as we were expecting. And the buyer's mortgage broker says the lender is okay with that, so I don't have to drop the price as much as I thought. My agent is getting the paperwork to me so I can sign off on the new sales price.The title company says buyer's loan docs are supposed to be in on Monday, but to be safe, we are pushing...

House 3: My Signing Scheduled

I hadn't heard back from the escrow company by mid-afternoon, so I decided to give them a call. Turns out, my escrow officer is out of the office the rest of the day because his grandfather's health is failing. His assistant has "put my file on top of his desk" and I've made an appointment to sign the papers at 11 AM tomorrow. We close on Monday, but I'll be out of town then and my Friday is rapidly filling up as well, so I'm running out of time...

House 3: Less Than 1 Week Left

I spoke with my escrow officer today to see if the closing, which is scheduled for Monday, is on track. Unfortunately, his response was a bit disappointing. He said the file was on his desk and he was planning on starting work on it in a day or two. This is what I hate about title companies. They've had this file for three weeks and they haven't done a thing with it yet. What will happen is they will suddenly need stuff done at the last minute and...

House 3: Increased Police Patrols

I called the police department today and spoke with an officer in the Community Response Office and told them what has been going on at my property. They filed a request for increased patrols in the area. This doesn't mean they will guarantee increased patrols, but it does mean that whenever the police have some extra time, they are supposed to spend it patrolling the neighborhood. Hopefully, that will help cut down on the cri...

House 3: Can't Get Rid Of It Fast Enough

My handyman called me Sunday afternoon. This was not a good sign, since he was finished repairing the window and back door on Friday. He was in the neighborhood and drove by the house just to check it out and he saw someone had pulled out the window air conditioner unit from the converted carport. He said it didn't look like they broke into the house, but just pulled it out from outside. He's stopping by today (Monday) to board up the hole and, the...

House 3: Burgled Again!

My agent called me yesterday with the results of the buyer's inspection. The buyer basically faxed over the inspector's report and wants everything fixed. That's not going to happen. But the scarier news was the inspector called and told us the house had been broken into. They only stole the new stove that I just put in - that's about all that is in the house anyway. That by itself isn't a big deal. What scared the crap out of me however, was what...

House 3: May Fall Through (Updated)

I just found out that the buyer's lender found out this property was a flip and they want an addendum to the contract. The addendum states that I will sell the house for whatever the appraisal comes back at (or $205,000, whichever is less) AND I will still contribute 3% of the price.There is no way any seller in their right mind would agree to this. Suppose the appraisal comes back at $175,000? I'm not going to agree to sell the property for an unknown...