**********consultation************ This is the story: For those who don't know, we work in Detroit, market...

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********** Consultation **********
This is the story:
Those who do not know we work in Detroit, a very difficult and complex market. But very much!
Still, we work well to run many deals at the same time.
We have learned a lot in the last 3 years what is and what is not, from what to be careful and what is necessary for success. And it works….
We focus on improvement deals, also houses, also buildings and new construction.
Work with local partners and also recruit from investors in Israel.
Months ago a nice girl from Tel Aviv approached me, came from the recommendation and would like to meet. She has over a million shekels to invest and someone told her I was the address.
I met her, a long meeting, we sat for almost 3 hours, I explained to her a lot, a lot.
What we do, what our results are, what to watch out for, how we are targeted, where to invest, what areas of Detroit to enter, where to run and where the money really is.

The important thing I explained to her was to be very careful of rental houses, especially in Detroit. The amount of horror stories are great.
Everything you probably know but a lot more.

We met again, again a long meeting, we built trust, she even said she wanted to raise more investors and I already found a improvement project for them.

Suddenly she disappeared ... and I let go.

The other day I get a call from her
Turns out she has a boyfriend who is active in Detroit (didn't mention him in the sessions).
It deals with high tech,
And along the way, he travels once every few months and buys friends for rent.
So she bought, how many? She bought 4 homes for rent!
The first thing she says to me: "How did you not listen to you? So far, I remember you telling me not to buy houses for rent.
Now I need you to save me. "
"What happened?"
Apparently she bought and renovated 4 houses.
One tenant does not pay.
The other has a serious problem in the sewer system and they can't handle it.
The third level of renovation is low and unable to rent.
And in one there is a tenant who pays.
In addition, it has invested above their market prices.
One bought and renovated his 70K worth of 55K
Another one at 65K worth 52K
So do the others.
Apparently, the friend who bought them for her is not such an expert in real estate and has no answer.
I asked her: "I told you it was worth the investment, get in the flip deal, and the second part of the building is already leased."

And I ask, what would you do in such a situation?
Helping, not helping?
Is there any way to help?
After all, she'll lose anyway, or she'll invest more in assets or she'll sell at a loss.

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Responses

  1. I join the good minds who responded in the post and said that first of all help. Why? Because before real estate, before money, before business we are human beings. And once help and second time help..If you have the right and knowledge to help - why not?

    Of course beyond that you will gain the trust of someone with the potential to invest with you (not with you… it is always with us. Not with us..samantica is important to me)
    In future projects, and maybe even bring more friends with her like her.

    Yoni Kessous said something very true to me; Creativity is the key. Each property and its potential.
    There is a tenant who does not pay - you will begin an eviction process with the sheriff. A property that has invested in it beyond its value? Try owner finanace or lease options from the selling side. You will set a higher price or higher interest in owner financing that will allow you to repay costs.
    Sewer problem - bring in an expert inspector and evaluate the value of the problem and what to do with it.
    There is a lot to do - get help from local professionals in the area who understand the type of assets and this area specifically and try to see what the approach is that can "heal" its portfolio.

    And regardless - help is a privilege. Really before you have to remember it ..

  2. Obviously help! After all, a fact that appealed to you (although it bothered her) but still…
    Know a really similar story that the help advice was decided and only good came out of it.

    Do not think there is room for ego, anger, disappointment Wat Eber… was what it was? She has already learned the lesson! And now is the time to roll up your sleeves.

    Help her, help her as much as you can and later you will get a return. It does not matter if you succeed in “saving” or minimizing its investments made…. The right thing to do!

    Good luck to that girl

  3. If you can help,
    Obviously ..
    Although she drew knowledge from you and went elsewhere.
    Experience: Send your friend across the water .. The world is round, even if she does not immediately enter into the deal - the amount of people she would like to tell them how to save her, this is the best marketing

  4. Yoav's excellent post, and with lots of insights.

    1. If there is money available it does not mean that you have to buy what is on offer. There are people who are tickled to spend the money and answer that the money will work.

    2. Friends is good, high-tech is even better - on the other hand in real estate investments, listen to those who have knowledge and preferably experience. What the friend offers or recommends means nothing, and you can do otherwise.

    3. Before spending money, check what you buy. Like checking a car before buying it is worth checking the house.

    4. Now what to do? I'm always but always in favor of helping, and doing it with all my heart. You can do it for free as long as it is reasonable and it does not cost us anything for help, or charge for our work and effort.

    5. I think it is better for an investor to wait for spring, to sell and overlap, and the next time she wants to invest she should talk to the person who does it. And if Detroit interests her, then talk to Nadav and Yoav - I recommend, and I know they know. How do I know? - Is it a secret?

    And friends, before finding money to think that

    CASH IS KING

    Successfully,
    And a smiling day all the way to the bank