Building Your Foundation before starting Real Estate Investing

Before You Start…

  While holding monthly meetings and giving presentations to the attending audience, one of the more common questions we receive is: “How do I start?”

That is a great question!

When we started, we jumped right in. We purchased 15 distressed condominiums, each 2 bedroom/1 bath, in Miami, Florida. The units were controlled by a private investor who held the note on the individual units. Every unit stopped paying their mortgage and was living rent free. The existing owner was burned out and wanted to quit being a landlord. He asked for $30K for the note. We bought the note at a substantial discount and closed the deal.

That was the easy part!

Talk about being over our heads. We had no idea how to proceed. Suddenly, we had to learn the following:

Landlording	Real Estate Financing
Rehabbing	Foreclosure Law
Evictions	Termites
Liens and Violations	Water Liens
Sales and Marketing	On and On and On…

We had nothing in place to proceed. We had to learn the hard way. It took time and time is the enemy to investors. The longer it takes the more money you are losing in the real estate investment business.

So before you get your feet wet with your first deal, make sure you have the following items setup and running.

Starting Your Investment Strategy

• Before you Start Looking for Deals:
  • Make sure EVERYTHING IS IN WRITING. Need I say more? This is the beginning of your business plan that can be show to investors, bankers, partners, private money lenders, etc.
  • Go to a Real Estate Investor Associations, REIA meetings to Network:
    • Our REIA Club: Miami Real Estate Investor Association MREIA
    • Additional Florida Clubs - Don’t just to one meeting a month. Go three times a week to different clubs and venues. Tonight we are going to a Google Developer’s meeting.
      • http://www.creonline.com/fl.html - This is a link that lists all the real estate investment clubs in the United States.
  • Open a Florida Corporation
    • For Florida go to http://www.sunbiz.org to open your own corporation.
    • Create Articles of Incorporation:
      • Identify corporate Officers: President, Treasurer, Secretary, etc.
      • Need to declare number of outstanding shares and price per share.
  • Buy/Sell Agreement or Share Ownership Agreement.
    • Want the ability to move shares when boards of directors change.
    • Make sure you have a Shotgun Clause or clause in agreement.
      • Dictates that if you are in a partnership and the partners want to get rid of you, you have to be bought out.
  • Company Seal – This is old school but some attorneys still use them.
  • Meeting Book – Corporate meeting notebook.
  • TAX ID # or EIN # - Uncle Sam wants their share.
  • Print up Your Business Cards – Got to let everyone know what you are all about.
  • Get creative – Don’t make your business card boring. Make people remember you through your card.
  • Business Bank Account
    • Documents Needed to Open an Account
      • Drivers License with Photo
      • Articles of Incorporation
      • Certificate of Status
      • EIN #
      • Signatures of Corporate Officers
      • Order Checks
      • Order Credit and Debit Cards
    • Make sure all the documents you order have the proper information. No delays due to typing mistakes.
    • Bank Stamp for Deposits - Cashing one of our $40K checks was delayed due to an improper bank stamp. We didn’t have one!
  • Build Your Team
    • Real Estate Accountant – Someone who understands real estate investing.
    • Real Estate Attorney
      • Paul B. Woods – Florida Land Trusts
      • Bruce Jacobs - Attorney at Law
    • Business Plan – You wouldn’t go into the woods without a map or a GPS. Your business plan is your map or GPS.
      • Eduardo Paz – Straglobus, Inc.
  • Attend Conventions – Network big time and get ideas.
  • Develop A System – Streamline your processes, save time, make money.
    • Outsource your weaknesses and work on your strengths.
      • I hate paper work and accounting. I get someone else to do these processes for me.

Like building a house or anything else you must lay the proper foundation to support what you are trying to build. We give a copy of this outline to all of our mentoring students who are just starting real estate investing.

Next Step - Finding the Deal

Related Links, Blog Postings, Presentations or Articles:

• MREIA's Mentor Program
• Florida's Public Housing Authorities PHA
• Section 8 Miami Blog

Written by +Bob Burns.

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Building Our Foundation. +Real Estate Investor about.me/RobertKBurns Telephone #: 305-586-5280 email: sec8@planocho.com

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Section 8 Waiting List Openings in other Regions. Uh?

Should we cover Section 8 waiting list openings Nationwide?

We have been wrestling with this question for a while now! REIC is pretty connected to Section 8 Wait List openings in the Southeastern region, since a majority of our clients / readers are from South Florida. Should we care about other regions of the US concerning Section 8 Wait List Openings? YES! We should cover the whole US, Section 8 office by Section 8 office.

Here is our Justification!

Why is this important to our investors, blog readers and tenants? Miami Florida is the gateway to Latin America and the Caribbean. As a result, we have every nationality from these regions calling Miami, Florida their home. This does not mean they don't have relatives living in other parts of the United States.

Look at my background! I was born in Germantown, Philadelphia, Pennsylvania but I am calling Miami, Florida my current home. The rest of my family lives in New Jersey, Pennsylvania, Rhode Island, California, etc.

A Section 8 or Plan 8 Wait List opening in New Jersey may not be important to the folks living in Miami but maybe their relatives in New Jersey could act on this information. Word of Mouth, Baby!

Here are several other reasons we feel we should cover all the Section 8 or Plan 8 Wait list Openings:

• Section 8 Vouchers are Portable.
  • See our posting about Section 8 Portability.
• People don't like South Florida and want to move to another state or region.
• Family Issues like death, health, divorce, empty nest, etc.
• Better Jobs and Salaries.
• Economic Hardship.
• The Weather in South Florida! Hurricanes, Heat, Humidity…
• Competition for the available Section 8 Vouchers and Wait List Openings.

We are sure you can add several other reasons why you want to move away or to South Florida.

So in the future we will be announcing Section 8 Waiting List Openings throughout the United States.

If you hear about any Section 8 Waiting List Openings please contact us at our email address below. We could use your help!

Oh by the way, below is a Section 8 Wait list Opening:

• Arizona
  • Section 8 Wait List of Cochise County, Arizona is currently Open

So starting today, we will TRY to cover all the Section 8 Wait List openings Nationwide.

Related Links, Blog Postings, Presentations or Articles:

• Check out our new blog:
  • Section 8 Miami: http://www.section8mia.com
• Section 8 Power Point Slide Show on Slideshare.net
• A REIC blog posting with a Section 8 Podcast

Written by +Bob Burns.

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Going Nationwide Baby! Real Estate Investor about.me/RobertKBurns Telephone #: 305-586-5280 email: sec8@planocho.com

Our Internet Footprint:

Florida's Hurricane Season and FEMA's Hurricane Preparedness Widget

Florida's Hurricane Season

One of the biggest pains being a real estate investor in Florida is getting prepared for Hurricane Season. Due to the amount of work, we wait to the last minute before placing the hurricane shutters onto our rental property's windows.

As a result of waiting, problems are going to arise like:

 

• Going to Home Depot.
• Gathering Supplies, if available like:
  • Make sure you buy gloves PLEASE. I can't count the times we have been hurt just because we don't have gloves on.
  • Sun Block, Hats, Sunglasses, etc. Florida SUN is brutal. I find that the weather is beautiful just before the storm arrives. Sort of like "The calm before the storm."
  • Buy Wasp spray! As you are installing shutters on the second floor of your investment property you will find out why you need the spray! The EASY way or the HARD way.
  • A SPEED tool that allows you to secure the screws or wing nuts onto the shutter. You will thank me later!
  • Ladders of various sizes. Buy at least one that adjusts to 40 feet made out of fiberglass, NOT ALUMINUM. Why? Hint: High tension electrical cables.
  • Chain Saw and gas for cutting tree branches away from the property and for use after the storm.
• Waiting in long checkout lines.
• Loading tools and supplies onto your vehicle. Like getting your ladders onto the truck.
• Driving to the property! OK for local properties but what if the asset is in another county? At one point I had several properties in Sarasota, Broward, Miami Beach and Miami-Dade.
• Traffic – People getting out of the storm's path.
• Finding HELP! Try installing these shutters alone! Now try it on 15 other properties. See what I mean.

You are going to work harder than you ever did before. You' ll be so tired that you want the storm to blow away your portfolio of rental properties so you won't have to ever do this again.

At last the second, the storm veer's and never arrives.

You see how crazy it can get?

Oh, by the way, if for some reason you didn't get the shutters up on time and there is damage as a result of the storm, the insurance company will not pay. Just thought I would mention that!

FEMA Hurricane Preparedness Widget

One of the reason I was inspired to write this post, I found a little widget from FEMA that provides you information about getting prepared for the hurricane season or any other disaster. I have installed this widget on all my sites to help my readers make informed decisions. See the widget sample below.

Related Links, Blog Postings, Presentations or Articles:

• See our new Section 8 or Plan 8 Miami Florida Blog. A Section 8 or Plan 8 blog for real estate investors and tenants in Miami Florida. This blog is designed to provide content for real estate investors, landlords and potential tenants who wish to participate in the HUD program.

Written by +Bob Burns.

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Post Up! Real Estate Investor about.me/RobertKBurns Telephone #: 305-586-5280 email: sec8@planocho.com

Our Internet Footprint:

Miami Dade Housing Choice Voucher Program Building

HUD's fourth largest Section Eight or Plan Ocho program in the nation is managed by Miami-Dade Public Housing Agency MDPHA. It is a management nightmare! I remember the old Coral Way offices and waiting hours to see a Landlord case worker. The county decided to outsource the management of Miami-Dade Public Housing Agency MDPHA's Housing Choice Voucher Program. Miami-Dade awarded a multi-year contract to Quadel Consulting. They are responsible for:

• Section 8 Voucher Program
• Section 8 Home Ownership Program
• MDPHA Family Self Sufficiency (FSS) Program

This allows the MDPHA to save money and increase processing efficiencies.

Landlords, this is a great program to use for renting your investment properties. When a unit becomes empty, the clock starts ticking. You are losing MONEY! You need to lease this unit as soon as possible! Adding Section 8 or Plan 8 to your marketing funnel, increases the probability of finding a qualified tenant.

I put to together a simple video below that shows you the outside of the Miami Dade Housing Choice Voucher Program Building. Go down there NOW and set up an appointment to discuss the Landlord Program. Address is: 7400 NW 19th Street, Bay H, Miami, Florida 33126. Don't expect an appointment right away. They will schedule you via a 3-4 week window. Sorry, it is what it is!

Related Links, Maps, Blog Postings, Presentations or Articles:

• Miami Dade Housing Choice Voucher Program Building Map.
• Quadel Consulting Web Site.

Written by +Bob Burns.
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	Change! Nothing Stays the Same. MREIA's President about.me/RobertKBurns Telephone #: 305-586-5280 email: rkburns@investmentpropertiesmiamiflorida.com MREIA's Web Page: www.miamireia.com

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Why aren't Your Real Estate Taxes reduced when Property Values are Down? Time for Tax Appeal!

It is that time of year again! Every year counties within the United States issue their real estate tax bill to commercial and residential property owners. These funds are used for various line items of the county's budget. Your tax bill is based on the assessed value of the asset according to the tax assessor's evaluation of the properties contained within in the county (Using Arial Photos). It is also based on the last purchase price that you paid for the property.

In case you didn't notice but A LOT of people purchased properties at the height of the market. Did the counties care if you did that? Noooooo....the more you pay for the asset, the more taxes they collect. But what investors didn't count on was the market tanked and property values dropped like a rock in some parts of the country. Unfortunately that included Florida, mainly Broward and Dade counties.

So here you are, holding onto a property and paying taxes (pre-bubble burst) on a property that lost at least half of its value or more! Does the county government care about this? Nooooooo....If they did, there would be less revenue for the county coffers. So what can we do as property owners?

No Taxation without Representation!

Luckily for us our founding forefathers saw this happening too! This great country of ours was founded on tax revolt. They made sure our representatives are held accountable for their actions. So, most counties have made provisions in the municipal code to allow tax payers to appeal their accessed property values. There is a small window, yes I mean SMALL, during the calendar year where you can file the proper documents with the county to ask for a reduction. Now don't get me wrong, the county is not going to give up. They will fight you. You better be able to prove that you are being over taxed!

As a real estate investor, I don't relish the thought of doing this every year for the rest of my life for various reasons:

1. Time consuming.
2. Need proper documentation.
3. Dealing with government employees.
4. Traffic.
5. Parking Fees.
6. And on and on...

I leave that up to EXPERIENCED professionals. Let them hassle with this process. The advantages are:

1. They know the proper filing dates.
2. They are experienced.
3. They know the proper documents to file.
4. Familiar with the tax appeal system.
5. They only get paid if you win the appeal.
6. The asset looks attractive to other investors.
7. Nice profit windfall for investors. Found Money...Yeah Baby!

Now is the time to start considering how you can increase your cash flows on your real estate investment portfolio. Remember, the window for filing your real estate tax appeal is small so start considering your options NOW!

Do you have any experience with the tax appeal process that you would like to share with us?

Related Links, Blog Postings, Presentations or Articles:

• Update #1: After I wrote this posting, I started looking for a Real Estate Tax Reduction Specialist because current properties are severely over assessed. Here is a company that has been successfully appealing commercial property taxes for 21 years:
  Real Estate Associates - www.realestateassoc.net

• Update #2: RETA does residential and commercial. However many Homes are protected by the Save Our Homes Amendment and Homestead exemptions. Therefore the Taxable value maybe lower than the Market or Assessed value. Please send us your properties Folio Number and we will let you know if a reduction is possible.

Written by Bob Burns.
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	"God Bless!" MREIA's President about.me/RobertKBurns Telephone #: 305-300-6242 email: rkburns@investmentpropertiesmiamiflorida.com MREIA's Web Page: www.miamireia.com

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Miami Florida's Section 8 & Housing Authority Office Locations and Contact Information

You don't know how many phone calls we receive asking about Section 8 or Plan Ocho program managed by the Miami Dade Housing Authority MDHA in Miami, Florida. The callers have many questions concerning HUD's subsidized rental program.

The most common question is "Where are Miami-Dade's Section Eight offices and how can I contact them?" We decided to put together a list of Section 8 or Plan Ocho offices that provide help for families in distress for Miami-Dade County, Florida. There are also several satellite offices for different cities in the county.

See Below:

Section 8 Plan Ocho Office Locations & Contact Data
Florida's Section 8 Public Housing Agencies PHA Offices.
HHA - Hialeah Housing Authority
Homestead Housing Authority
Miami-Dade Housing Agency MDHA
Miami-Beach Housing Authority
Section Eight or Plan 8 Property Web Sites
Access Section 8 Property Web Sites  Go Section 8, Social Serve, Florida Housing Search
Written by +Bob Burns.
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"Give Back to Your Community" MREIA's President about.me/RobertKBurns Telephone #: 305-300-6242 email: rkburns@investmentpropertiesmiamiflorida.com MREIA's Web Page: www.miamireia.com

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