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When You Ask Top Dollar For a Property – Do It Right – Give Some Value…!

They Paid $139,000 – Now Asking $299,000.

I want to start off by saying that I believe in the “capitalist” system.   All of us have the right to ask any price we want if we decide to sell something and I think we’d all agree on that.

adding value

However after many years in the business I’m still amazed at some investors who think they can get absolute “top dollar” for a Duplex without doing much to really improve it.

The property I’m talking about is located at 1814 Cirby Way, Rosevile, Ca 95661.     I remembered this property because I did a video of it, when it was a “bank owned” Duplex in 2011.

After almost 3 years of ownership they’ve really not added any extra value.  “Curb Appeal” looked like the last thing they thought of.   Maybe they are still working on it.

The Buyer  now has been trying to sell this one since November of 2013.  They started out at the list price of $329,900.

While this Duplex is in a decent enough neighborhood, it’s also on a fairly busy street.   To overcome that major objection and get a decent tenant in a property like this, you have to have some nice curb appeal don’t you think…?

I have two videos below.   The 1st one is the property before the current owner purchased it and includes both sides.   The 2nd video is the “left side” only.

I think this owner really missed an opportunity and took far to many short cuts.  They ignored the principle of “adding value”.  As a result,  his rents are lower than other “like properties” near by, while at the same time he’s asking top dollar with no real return for the prospective Buyer he’s trying to sell to.

This is my opinion, but if you have followed this blog, you can see why I was disappointed.

Take a peek at these and let me know what you think

VIDEO ONE

VIDEO TWO

 

 

In the Mean Time…?

Make it a Great Day…!

Ed Favinger, Broker CRS, GRI, SFR, CDPE     916-203-1260      favinger@rwnetwork.com

 

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Do You Allow Tenants to Park Their Vehicles on The Front Yard Landscaping…?

I Get That Icky Fingernails on a Blackboard  Feeling Whenever I See This…!

You know when I’m out and about and I spot this, it irritates me to no end.   It’s amazing to me that any Owner/Investor would put up with this.

Number one, I think it shows how disrespectful of the Owner this act is when a tenant does it.    Number two, ask yourself the question.  If you have a rental close by or god forbid, it’s right next to a property like this, would you think  “prospective” tenants would find this appealing and then decide they’d want to live next to that…?   I wouldn’t and I think the vast majority of folks agree with me.

It certainly promotes a devaluation of the neighborhood… don’t you think..?

One of the things we do as Property Managers for our clients is to drive by their properties on a fairly regular basis.   The reason you would hire a Property Manager would be to stop just this kind of thing if you don’t have the time or inclination to confront a tenant doing this.

Take a peek at the duplex here on Montrose in Folsom that I drove by last Friday.   Along with a pick up truck parked smack dab in the front yard, we’ve got trash cans sitting out in front when they should be behind the fence or in the garage until trash day.  It doesn’t help that the owner has a poorly maintained landscaped area.

I did some research on this property and the current owner bought this from the bank as an REO.   I think the owner is making a big mistake not taking more care of this property.   “Pride of Ownership” principles apply for rental properties too.   Not only is he hurting himself, by not maintaining and in fact “improving” his curb appeal, he’s keeping the potential rents and income to him down for his property.   As I pointed out earlier, it  also denigrates the neighborhood and lowers the “tenant profile”.

Here’s a picture of a property at 2728 El Parque, Rancho Cordova that represents the kind of pride of ownership from an owner that “gets it”.

2728 El Parque, Rancho Cordova

What do you think…?   Am I wrong…?  Drop me a note or post a comment here.

In the Mean Time…?

Make it a Great Day…!

Ed Favinger, Broker, CRS, GRI, SFR, CDPE     916-203-1260    favinger@rwnetwork.com

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Don’t Overpay for a Folsom Duplex Without Checking Out Recent Sales…!

Why Would a Duplex almost identical to one we closed last year be worth $80,000 more…?

I ask the question because the property listing does show the owner did pay to install a Roof recently.   The Seller also made updates to the heating and air systems in one of the units and a recent exterior paint job for the building along with some recent water heater replacements.

The Seller is also offering a credit to the Buyer for new flooring in one of the units if you pay his price of $375,000.  However, the most recent comparable sale just around the corner closed escrow at $295,000.

By the way, the Fargo property started out even higher…

Both of these properties were built approximately the same time within 2 years of each other and both have 2 bedroom 1 bath units with single car garages.

The rents reported on the Fargo duplex are at $1,500 more annually then the one we closed escrow on at 46 Dean.   

The square footage of the units are about the same as well.    While the Seller of the Fargo duplex has recently reduced his price, don’t you think it’s still a little high..?

If you are a Seller you should look at recent sales and price them accordingly because the longer it sits on the market and gets stale, the tougher it will be to get sold.   Even if you did get an offer, if conventional financing is involved, it will be hard for the property to appraise anywhere near the current asking price.

In addition, I was disappointed at the “curb appeal” of the Fargo property because it wouldn’t have taken much to get the landscaping a little nicer.

What is my opinion of where the Fargo Duplex should sell for..?   I think somewhere in the $300,000 – $315,000 range and that would be “top dollar”.

Let me know what you think.

 

In the Mean Time…?

Make it a Great Day..!

Ed Favinger, Broker, CRS, GRI, SFR, CDPE   916-203-1260   favinger@rwnetwork.com

 

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Cameron Park Investment Property Coming Back on the Market…?

Two Single Family Detached Homes on One Lot..

tamis cambridge

 

We have a buyer that is having difficulty qualifying for a loan and we’ve placed this one back up on the “Active Release” status.

Once we get another offer acceptable to the Seller, the current Buyer will have 24 hours to withdraw from the contract.

The best part about this deal is that the tenants are already in place and want to stay.

This property is in a great location and unique in that it is surrounded by Single Family Homes.   While it’s located near parks, schools and shopping, it’s also a short distance to the Highway 50 onramp to the El Dorado Hills, Folsom and Rancho Cordova work centers.

Take a peek here at the Cash Flow Figures and click here for more pictures.   If you know of anyone looking for an investment like this, please send them the link to this blog post.

In the mean time…?

Make it a Great Day…!

Ed Favinger, Broker, CRS, GRI, SFR, CDPE    916-203-1260     favinger@rwnetwork.com

 

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Gaslight Apartments – 15 Units – Folsom, California – Back on the Market…!

All The Inspections Are In….

 

If you have been looking for an small apartment complex in Folsom, then today’s your lucky day.    When we first put this property on the Dean side of Gaslightmarket we did not have any inspections so the buyer who wound up with the deal completed them all and then decided he didn’t want to move forward.

So… today so we are putting this back up on the market looking for a new buyer.

If you Click Here, you’ll get all the information including a short exterior video of the property.  If you would like copies of the inspections, please call me and I would be happy to email them to you.

 

In the mean time…?

Make it a great day…!

Ed Favinger, Broker, CRS, GRI, SFR, CDPE      916-203-1260     favinger@rwnetwork.com

 

 

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Rent Control – Back On The Radar Screen… Watch Out…!

I’m Just Passing this On….

If you don’t live in California and are reading this from out of state this is a hot button issue in areas like the San Francisco Bay Area and in some parts of Southern California.3d House (XXL)

If you want to see a list of those cities in this state that have rent control laws CLICK HERE.

Now if you are an Investor or even a current Home Owner thinking of renting your place out,  this issue should be a concern because it will affect you.

We just completed a “walk through” inspection of the Gaslight Apartments yesterday. Can you guess what the Bay Area investor asked me…?  “Are there rent control laws here in Folsom”.

He was relieved when I said no.   It was then he commented on how horrible it is in San Francisco and San Jose.

Take a look at this article written by Dan Walters of the Sacramento Bee in today’s paper and get ready to watch some shenanigans on this issue.

Dan Walters: Rent control returns to Capitol as burning issue

Let me know what you think and in the mean time…?
Make it a Great Day…!
Ed Favinger, Broker CRS, GRI, SFR, CDPE     916-203-1260   favinger@rwnetwork.com
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Looking for a Nice Four-Plex in a Good Area…?

It’s Too Bad This One is So “Overpriced”…!

As someone who specializes in the sales and management of residential “investment” real estate I make it a point to go out regularly and preview a lot of property to keep up with the market.

A Four-Plex at 3632 Hallelujah Court, Carmichael came back up on the market just a few days ago for a whopping asking price of $688,000.   That price is lower than the original list price of $725,000.   The scheduled gross annual income they are showing is $51,384 which gives this property a GRM (Gross Rate Multiplyer) of 13.38.  With a GRM that high it’s not going to be possible to get a cash flow without a monster downpayment if you need some financing to complete this deal.

Why they are listing this property for so much is beyond me especially when there’s an exact copy of this unit at 5720 Engle Road that closed escrow last October for $495,000.

Click Here For More Information, incuding a “pro-forma” cash flow analysis on the Engle Four-Plex

The Seller of 3632 Hallelujah Court owns the property “free and clear” by the way.  They didn’t raise the price just to cover an existing mortgage.

If you want to compare them, below is a video of the exterior of the property and the one at Engle.   What do you think…? is the Hallelujah property worth almost $200,000 more…?

My conclusion…? Based upon their “scheduled” income and the GRM established by the sale of the Engle Four-Plex, I think the best the Hallelujah owners can expect as a reasonable offer would be nothing higher than $550,000.

 

Make a comment here and let me know what you think.

 

In the Mean Time…?

Make it a Great Day…!

Ed Favinger, Broker CRS, GRI, SFR, CDPE      916-203-1260     favinger@rwnetwork.com

 

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A Sacramento Duplex Flip… Making a Profit With Minimal Work…!!

A Quick Turnaround  & They Really Didn’t Do Much…!

The Duplex at 9234-9236  Corinthian Cir, Sacramento was listed in March of last year as a Short Sale that was finally approved and closed escrow just a couple of weeks ago on the 8th.

During that long period, the property temporarily came back on the market last November and I was able to get in and look at one side but not the other because it was occupied by an “uncooperative” tenant.    When it came back on the market it was “Subject to a Release of Contract” from the current Buyer which is usually a formality but must be obtained before they can really accept another deal.

I guess the original buyer was able to hang in there by resolving what ever issue caused the property to come back on the market.  After about 9 months of  a long short sale process, they finally close the deal at $190,000.   A Buyer I represented made an offer I think for about  $220,000 when it popped back up temporarily.

If you are a flipper you have probably heard something like this before, but for you folks just starting out…?   “You Make The Money On The Buy, Not The Sell”.

In other words you have to “buy it right”.

Today that Corinthian Duplex is a “Pending Sale” effective  January 23rd after just 9 days on the market.

Folks, all they did to this property was clean out what ever trash was left over from the previous tenant.   I don’t believe they did anything more than that.

The 1st video below is from last November when I previewed it and sent this to an out of the area Buyer.   The 2nd video was done about a week ago of the other side that I was not able to get into last year because of the tenant.

LAST NOVEMBER

 

JUST A FEW DAYS AGO

 

Let me know what you think…  If it was group I was involved with, we would have fixed this up and help elevate the neighborhood values more.    I will keep you posted as to how much they got for it when it is reported as a Closed Escrow and I’ll follow up to see what the eventual buyer of this Duplex does with it.

In the mean time…

Make It a Great Day….!

Ed Favinger, Broker, CRS, GRI, SFR, CDPE       favinger@rwnetwork.com    916-203-1260

 

 

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The Gaslight Apartments, Folsom, Ca 15 Unit Complex For Sale…!

Posted on the Market on January 15th….

So Far…?  6 Offers…!!

For those of you that don’t know me, I work primarily with Residential Investment Property and Investors.   We were fortunate to get the opportunity to do the Property Management  for the Gaslight Apartments in the summer of 2012.   The Apartments consist of,  (9) 2 bedroom 1 bath and (6) 1 bedroom 1 bath units.

The property is well located in Folsom, near City Hall, the new Library, City Park and Zoo.   It’s a corner lot location with a single family home on one side and Theodore Judah Elementary on the other.

Since the time we took over, we’ve increased the owner’s Monthly income  over $1,000 by very modest increases in the rents of these long time tenants, some of whom had not seen a rent increase in 18 years.

While Gaslight doesn’t have all the latest amenities, it does have Covered Parking and a Community Pool.

The Owner’s have decided to move on after owning this for approximately 20 years or so.

There’s a lot of “upside” on this one for the right owner…!

Click Here for a Proforma Cash flow analysis based upon Current Rents

Click Here for a Proforma Cash flow analysis based upon another modest increase in Rents

Click Here for a Rent Roll that shows the current rent, laundry income & potential rent.

As of January 23, 2013 this property is still available, so if you are interested let me know.

 

In The Mean Time…?

Make it a Great Day..!

Ed Favinger, Broker, CRS, GRI, SFR, CDPE    favinger@rwnetwork.com     916-203-1260

 

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Thinking of Selling in the Next Two or Three Years…?

Then Check This Out… You Might Want to Think First Before doing any Major Improvements….

 

5Projectstoavoid

 

In the Mean Time…?

Make it a Great Day…!

Ed Favinger, Broker, CRS, GRI, SFR, CDPE     916-203-1260    favinger@rwnetwork.com