Monday, September 15, 2014

This Week Syndicated Radio Talk Show Host Of The Program Financial Safari

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This week our special guest speaker will be Monti Smith, a talk show host for the nationally syndicated program, Financial Safari.

One of the most important things you can do is to set your assets up so your loved ones will get what you pass along to them without the government and lawyers stripping away your wealth in probate.

Monti has focused her financial planning practice on income planning, asset preservation and legacy planning for pre and post retirees.

Come on out and hear what Monti has to say about the right way to protect your money and belongings for future generations.

Monday, September 8, 2014

Something A Little Different That We Haven’t Seen Yet…

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Hi Everyone,

This week we are going to have guest speaker Jeremy Vogan from Countryside Service Company, LC. He will be talking about something a little different from which we typically see.

Jeremy called me about a month or so ago wanting to present a real estate related business opportunity to our group. From what I understand, this company is a large builder who had spec homes for sale and got caught holding too many when the bottom dropped out.

Essentially what they are doing is unloading all of their property in a creative and unconventional way. The sales price of these properties is set at full market value. What they are offering is the ability to owner finance them with only 10% down.

They then act as the property manager and continue to work with the tenants in the currently leased house so it’s a hands off investment for you.

REI is not endorsing these people. We are simply letting them come and offer their product and services. You have to do your own due diligence and determine if it is a good investment for you or not.

Things to consider would be:

Will the property cash flow? If not what would you have to chip in to cover the mortgage to them with only 10% down.

Are you rolling the dice on appreciation only or will this be a solid investment that you will profit from?

What kind of contractual agreements can be thrown in to sweeten the deal to make these properties at least break even so they can be paid off over the years by the tenants. Possible suggestions would be no cost property management, no cost maintenance, etc.

Come on out this Tuesday. This should be an interesting meeting.

Monday, August 25, 2014

This Week At REI We Will Have An Open Forum

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This week at REI of Va we will be having an open discussion. These meetings are often full of great information. This is a time where questions and comments can be made about any aspect of Real Estate Investing. All topics of discussion are welcome. Beginner to advanced.

The topics of discussion will pertain to subjects such as Rehabbing, Landlording, Property Management, Wholesaling, Obtaining Financing, Crowdfunding Real Estate, Terms on Creative Investing, Asset Protection, Marketing, Tax Issues, Property Insurance, Investing in Real Estate Outside the US, etc.

There is a whole world of real estate investing to be explored that our group hasn’t even touched on. Come on out and bring your questions and knowledge to share.

Tuesday, August 12, 2014

Home Depot Wants REI’s Business

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In common conversation I have learned that the vast majority of our membership goes to Lowes for their building materials. Home Depot has been pulling some of us away due to their offering of 20% off on paint for our membership.

Lowes in turn offered to match the 20% discount on paint to REI members.

Now Home Depot is coming to our meeting this Tuesday to step it up another notch and let us know what else they can offer our membership since we like discounts. 

Come on out to the meeting this week and learn what needs to be done to get your discounts at Home Depot. Every dollar you save is a dollar earned. REI feels it is important to use the buying power of our 550 members to get the products we need at the best price.

If you are not already signed up for the many other companies that we get discounts through go here. We already paid for your membership. If you subscribe to this email you are eligible to get your discounts.

Click Here: Community Buying Group

Monday, August 4, 2014

How To Collect Money Owed To You Through Garnishments

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This week our guest speaker will be Attorney Darren Delefield. Darren will be at the meeting to talk about the various types of garnishments that a landlord can do to collect bad debt. We’ll cover wage garnishments, bank account garnishments and personal property garnishments.

Come and learn the most important bits of information that you need to obtain on your rental applications so you have all of the information needed in order to get paid in collections. Then learn what you can garnish and how to file a garnishment to get your money.

Go ahead and cancel any plans you have as this is a meeting that will make you money. Hopefully we have the big room, if not you better be there early to get a seat. I see many have to leave on nights that I expect a big meeting and we get stuck with the little room. The meeting starts at 6:30 sharp.

See you there!

Monday, July 28, 2014

Stone Veneer For Your Rehabs

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This week at REI of Virginia we’re going to learn about using stone veneer in your rehabs. A company named M-Rock Stone Manufacturing out of West Virginia will be coming down to talk to us about their varied stone veneer systems that are super easy to install. NO MASON NEEDED. If you can use a screw gun you can install it.

These stone veneer systems can be used for both exterior and interior applications such as fireplaces, backslashes, bars, columns and other accent pieces for your home or flip. This is that extra touch you need to knock that flip out of the park.

I’m already thinking about an ugly fireplace I need to hide in my rehab in Glenvar.

Come on out Tuesday night and spend some enlightening educational time with good like minded people.

We’ll see you there!

Wednesday, July 16, 2014

Hometown Flooring, Beware

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 (Commentary)

Warning to all REI Members. Be careful of doing any business with the guy Chris from Hometown Flooring that came to our group.

I suspected there were issues with this guy when he came to the meeting and had a hard time answering very simple questions pertaining to flooring installation. Then later after the meeting I was asked by a few of our members who invited him to speak. I asked why and was given detailed explanations of how this guy got one over on them over and botched flooring jobs so bad that the entire floor had to be ripped up and redone. That was after he blamed it on the structure of the house.

Let me tell you, I installed flooring for years and I can tell you that the structure of the house has nothing to do with it. If there are imperfections in the floor they are fixed before the new floor is put down.

I didn't bother saying anything about this guy to the group because someone obviously got some good work done by him since they recommended him. And people can make mistakes from time to time. But now I am hearing the exact same thing again. This is the second person in the past month that has told me that he has unresolved issues with their floor. This last report pertained to a tile job that had gone bad and the Chris guy claims it's due to something wrong under the tile that he didn't fix before laying it.

Below is a response from Chris that he gave to our member about her friend that also has unresolved issues. For no apparent reason this guy is saying the REI group is full of slumlords. 550 slumlords? Really?

"In regards to (Name Removed) I tried to go the extra mile and did not charge her for many things that needed to be fixed during her kitchen remodel. Im not going to beat a dead horse but there were MANY changes made during this process. I could list a page of things wrong with her electrical, and whoever built her house. There are two sides to every story. I try to make sure that every customer is happy and I have realized over the years that you cant satisfy everyone. (He is right about that but the number of complaints that I have received about this guy shows he very well could be the problem)
As long as I know I did my best, thats all I can do.
In refference to the REI Group, I spent a day measuring 6 houses for someone, gave them estimates the next day on every house, then they tell me Home Depot will install a whole house for $49. I consider this a slap in the face when someone tries to use a shaddy sales pitch from another company in hopes to beat down my prices. I refuse to do work for slum lords and I feel there are many in the REI Group." Wow, what nerve this guy has! As if he knows any of us other than who he did estimates for.

Monday, July 14, 2014

Is Your House Losing Energy And Money?

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This week at REI of Virginia it’s all about consumption of energy. As you know money saved is money earned. It all comes down to what it will cost you to make your house more efficient. And what the ROI of the products required will cost you to save X number of dollars. Basically how many years it will take to recoup your investment. From that point on it’s all gravy.

Our guest speaker will be friend and REI member Jerry Eastridge. Jerry does energy audits as one of his many talents. And he is an expert in the field.

I’ve been really interested in this topic over the past few years. I’ve been working on getting my new house I’m rehabbing in Salem highly energy efficient. And I’m most of the way there. I’ve got open cell foam sprayed throughout. Basement, attic roof and all exterior walls are sprayed. 

Along with that we’ve caulked the crack everywhere between the floor and the wall and spray foam and caulk around every window and door. I didn’t seal around the electrical outlets because I’ve been told I don’t need to because of the foam.

I’ve added a device connected to my breaker box that smooths out the electrical waves traveling through wires which reduces heat in wires and motors of appliances. Heat is lost energy. A guy who came to our group a while back was selling his for about $1,200. He proved it worked. On average it saves 10% on your power bill. He decided to give me a deal at $1,200. When we were talking he put an X on the $2,500 and wrote $1,200. LOL. I had to turn him down because I found the exact same thing here for much less.

http://www.ebay.com/itm/Electric-Saver-Power-Factor-Save-Electricity-KVAR-1200-/390144826453?pt=LH_DefaultDomain_0&hash=item5ad6719c55

He also was selling a laundry product that you don’t have to use detergent due to ozone being mixed with water which produces hydrogen peroxide. Remember his stack of towels that were washed with detergent and his other stack washed with the ozone product hooked up?  I found that product for much less than the $2.5K he wanted for his here. I ended up having to let him know that I found it cheaper and he matched the price saying at least that will pay gas money for coming out here. LOL.

http://www.ebay.com/itm/DEMO-HIGH-Water-Flow-O3-Pure-Eco-Laundry-Clothes-Washing-System-Ozone-Generator-/131236749451?pt=LH_DefaultDomain_0&hash=item1e8e51e08b

I couldn’t find an equal product that killed all bacteria in ductwork. His produced plasma as well as UV light. I bought his product but here are some that are similar minus the plasma.

http://www.ebay.com/itm/Air-Purifier-whole-house-UV-Light-in-duct-for-HVAC-AC-Duct-Germicidal-Filter-/281385325599?pt=LH_DefaultDomain_0&hash=item4183df541f

My next steps are to get my friend Jerry out to my house for another energy audit to make sure that I buttoned everything up. Then I will move on to some more fun stuff like a solar hot water heater, solar thermal collectors which are very cool, a micro hydro system in my creek to produce 24hr power, a hydraulic ram pump like the one CB Knox brought to our meeting to get powerless water up to my chicken shack.

One day I’ll be off the grid completely. I’m going green guys. And having fun with it!

It’s all about you this Tuesday. Come on out to the meeting as we’ll be talking about ways to keep money in your pocket. 

See you there!

Monday, July 7, 2014

How To Fill Out A Summons For Unlawful Detainer

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I have been asked a number of times from novice landlords how to evict a tenant who is not paying their rent. 

First you give them what is called a 5 Day Pay Or Quit Notice. The Roanoke City courthouse says that notice is sufficient if it states something to the effect: Date, Name of Tenant and that they are behind in their rent by whatever amount and you are giving them a 5 days notice to pay that amount or you will terminate the rental agreement and seek to have them evicted. You also need to sign the pay or quit notice.

You can either post that notice on the door of the unit or you can mail it to the tenant. Standard first class mail is acceptable.

Send me an email and I can give you a copy of my 5 Day Pay Or Quit notice if you want something specific. If you don't have my email address you will need to sign up to be on our mailing list in the top right of this website. I don't post my email address on this website because that leads to spam bots picking it up.

Click on the images below. I am attaching a copy of a filled out unlawful detainer. It includes the wording from our attorney Ross Hart who suggested a great way to ensure that you can get a judgement for any amount that is due no matter when the final court date is. If you are a novice landlord you probably don't understand why this is required under the automatic assumption that you naturally would get everything you are owed however this is not always true.

Other things you may not understand:
* 6% DOJ means you are asking for 6% interest from the Date Of Judgement
* As of today, July 2014, your court costs will be $48 for the unlawful detainer. Then another $12 dollars for each and every person you evict that pays the sheriff to serve the papers. That adds up. If you use a process server such as Paul Yengst, he charges as of today $10 total no matter how many people you are serving. That's why I have $58 listed in the line before costs. If you are using a process server you have to write their name on the Unlawful Detainer so they know to give it to them and not charge you the sheriff fees.
* I always write Reasonable in the attorney fees area. If the tenant contests what they owe you and you have an LLC you will need an attorney to come back with you for the contested date unless you are there just as a witness. Reasonable allows the judge to award your attorney what they see as fair.
* Notice that I wrote any and all other occupants next to the persons name I am evicting. This is important. If the tenants moved in some other people that you don't know about or don't know their name you have to use this statement. Otherwise if they do not leave after you got judgement, the sheriff will come to the house and ONLY kick out the person you evicted. You will likely have to go back to court again to kick out the remaining people as the police often aren't concerned by people trespassing in your house if they were invited there by the former tenant. Sometimes they pick and choose which laws to enforce and when it comes to the supposed Rich Landlord laws often fall to the side.





































This Week We Will Be Diving Into The Unknown!!!

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Ladies and gentlemen… This week, at REI of Virginia, we will be diving into the UNKNOWN!!! Literally. I have no idea what we will be talking about. It is unknown. Probably won’t be known until it is actually happening.

But it will be fun. We always have a good time and end up having a highly diverse conversation when we hold a group forum.

We’ll see you there!

Monday, June 30, 2014

There’s Money In Commercial Real Estate

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For so long we’ve focused primarily on residential real estate investing. This week we’re going to start digging into the possibilities of investing in commercial real estate. There are so many different types of commercial investments and each has it’s own particular skill set to own and operate in a profitable manor.

Commercial real estate typically includes things such as large multifamily, office, industrial, warehouse, retail, etc. Each of which has it’s own special ground rules to be a successful investor.

Our member and good friend, Frank Martin, will be leading a discussion on commercial investing and he promised to bring some numbers to the table including things such as what you would expect to pay for various types of commercial property and what rents you would expect to get on these properties.

We all know it takes allot longer typically to rent a commercial property but these commercial tenants most often stay much longer. You also don’t have the headaches of tenants calling and complaining about this or that being broken as commercial leases typically require the tenant to fix all maintenance issues with exception maybe of the exterior walls and or roof.

There are some downfalls to commercial landlording, however, there are many benefits that make up for it. The path that I have seen many successful investors take is they get started in residential investing and at some point in time or another they end up switching over to commercial investing due to it being much easier to manage. Then somewhere further down the road their pockets are fat and they own an empire.

That’s where I’m going. My wallet is already full…  Now I need a clear and concise, risk free roadmap from point A where I’m standing directly to point B.

Come on out to the meeting this week to get your toes wet in commercial investing. Over the next year we are going to continue to dig deeper in these areas of investing. REI of Virginia plans on giving you the expertise so if a commercial investing opportunity presents itself in the future you will be armed with education to make a wise financial decision.

See you there!!!

Monday, June 23, 2014

Becoming Your Own Banker At REI This Tuesday!

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There are many benefits of using a bank to finance deals that will in turn over years make you very wealthy. Believe it or not, the less money you have in a deal, the higher your ROI or cash on cash return will be. Sounds strange but it’s true and I can prove it.

However no one with a minimum of two brain cells to rub together would over leverage themselves as that is always a house of cards that will in time fall. I’ve seen it happen many times.

In the process of making yourself wealthy via the bank loans you are also making the bank very wealthy as “compounded” interest averages to be quite a bit higher than it initially sounds.

Our CEO, Dan Cullather and I have been talking about a book he has been reading regarding being your own banker. He introduced some very interesting concepts to me that he will be sharing with the group.

Cancel your plans if you have any because you don’t want to miss this meeting. Hopefully it will be in the big room so people aren’t turned away from a lack of adequate seating like last week.

Be there or be square…

Thursday, June 19, 2014

Chronic Complainers - An Adequate Representation Of The Neighborhood?

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Every neighborhood has one. A chronic complainer.

It can be very tempting to ignore a complainer as they eventually become irritating and it's human nature at that point to withdraw from an irritant.  But believe me, you ignore complainers at your own peril. That's because complainers really are suffering. They're not suffering from the superficial stuff about which they're whining. They're deeply deeply wretched human beings who, when ignored, will feel driven to clamor even more for attention, because they're feeling misunderstood.

People who complain a lot generally are not the kind of self-starting, take-care-of-business, solve-the-problem-pronto people with whom we want to work. Expecting them to be that would be an exercise in futility. It's best to appreciate them for what they do well, and know that they won't ever be a truly supportive team player.

Unfortunately I am incapable of doing so. When I get nasty abusive voicemails on my phone about my tenants or properties, I most often block the caller from contacting me. Next time they call they hear the "do, dooo, dooo, this number you have called is not in service" message from Google Voice.
 
I prefer to talk to people in an educated positive manor as that is what motivates me to work together for a good solution.

Know also that chronic complainers can bring down the atmosphere in an entire neighborhood. The negative atmosphere leads to blight as it leads to people keeping their property at a substandard level and not caring about what happens in the surrounding area. It's very important for neighborhoods to understand that this type of negative behavior creates an undesirable outcome and neighborhoods should consider stifling the complainers who are speaking on behalf of their organization and replacing them with positive proactive speakers who understand how to move a neighborhood forward.

A quick background on myself. I served a 3 year term on Roanoke Neighborhood Advocates because I do have a passion for owning properties in up and coming neighborhoods as that leads to high sales prices in the end game. I buy in neighborhoods that have made that first turn that I can see positive progress in the future.

I specialize in boarded up houses. I like to make the most radical difference to a neighborhood that I can bringing a F grade property up to a B. I don't take a property to an A flip grade. That's not my forte and there is no economic advantage of doing so until the neighborhood has taken a full swing which takes years. At that point it makes since to fix a property up to flip quality to sell it and buy 4 more in the next up and coming neighborhood.

My B quality property is far and above most owner occupied property in the neighborhoods that I buy in until the point where they have finished the final turn into a grade A neighborhood. The Mountain View Neighborhood is still a ways off from being a B grade neighborhood.

All of my properties have a valid rental exemption certificate as they are kept in good working order. They also pass Section 8 inspections and insurance inspections. All properties are "fully in compliance" with the law. Landlords have very rigid requirements in Virginia that owner occupied property is not subject to. All of my properties are well "above minimum standards."

I'm posting a voicemail that I received from one of these fringe complainers that got blocked from calling my phone due to an inability to speak to me in a professional manor.

A few points to make:

1. A boyfriend, not husband, of a tenant of mine that was drinking and hit his girlfriend. He is not on my lease and the female tenant let him come over. After he hit his girlfriend which was in front of another one of my tenants, he refused to let either of them leave the house because he didn't want them to call the cops on him. Yes, stupid guy. His charges were abduct by force / intimidation. The complainer has all of the details wrong saying the "White" girl was locked in a closet. What's up with the "White" thing anyway, is he racist? What does the color matter for? Is there a reason for that bit of information? The "white" girl was drinking with both of them as they are friends.

2. The female tenant on the lease had a background check from us, as all tenants do. And she is fine. I have not "chosen" to make the neighborhood suffer as the caller says.

3. Those tenants are not new to the neighborhood, they have been living in another house over there for years.

4. I support all neighborhoods and never "try" in any way to harm them by moving in people I don't completely think are good for the neighborhood.

5. Does this ******* think I live in South Roanoke or something? I also live in a bad neighborhood. As a matter of fact mine is much worse. I live behind the rescue mission. The caller states that I would never allow this to happen in my neighborhood. As a matter of fact, the house right next door to me just got shut down as it was found to be a crystal meth lab and the police were at it every day for months. The landlord that owns it is one of our members. No way would I think that he was TRYING to ruin my neighborhood. It's not easy to get these losers out once you have found that they turned a new page to crime.

6. I WILL NOT be evicting the female tenant from the house. She was the victim of a crime. She WILL NOT be going anywhere. Complainer is trying to get me to break the law. Maybe he will read up a little regarding the rights of a victim in a domestic violence situation and what a landlord can and can't do. Corbin, I'm calling you out right now. I WILL NOT break the law for you. She is a victim not a criminal.  I DEMAND that you go back in your hole...

7. Listen to his tone and choice of words. It starts out good and gets really nasty as it goes on. I'll bet he didn't know that my voicemails are public information. The house in the picture is my supposed substandard housing that he can't get rented. Don't bother anymore man. I've been told that you are known for stealing deposit money anyway.

Corbin Prydwen - VP representative of the Mountain View Neighborhood Association: Let me make myself clear. I do not think the rest of this neighborhood association (Other than the Jim guy who works at Lowes) backs Corbin in his unprofessional attitude. I know many of them and they are good people. Corbin just became the VP and is now drunk with power. Guess what buddy? I could care less what you are!



Monday, June 16, 2014

Landlord Tenant Expert Attorney Ross Hart On New Legislation You Need To Be Aware Of

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This week at REI we have one of our favorite entertaining speakers, Ross Hart. Ross is an expert at landlord tenant issues and he will be talking about new legislation that will be coming around the corner this July.

There are some changes that have been made to the landlord tenant act that you need to be aware of. Ross will cover these topics so you understand what is required and keep yourself out of hot water.

Below are some of the topics of discussion:

1. If you have 3 or more properties our politicians have decided unanimously that you are now subject to the landlord tenant act.

2. You now can get a fine if the tenant pays off a judgement and you don’t notify the court.

3. New boarding house laws that could allow you to rent a single family house of up to 8 people under certain conditions. Currently the city says no more than 4 unrelated adults or a family plus 2 unrelated adults.

4. You can now amend your unlawful detainer if the tenant doesn’t show up to court to add more damages, more rent, etc.

5. You can now bill a tenant for local government fees if you have it in your lease. So when the government sends you the rain tax you can have that tax added to their rent. Or when they send you a bill for the tenants trash etc, it gets billed as rent. We really need to talk to Ross about this one. Lots of possibilities here.

6. Now, if you didn’t take the tenant to court, and they still owe you money, it is now legally owed to you without the judge saying so. So it is now OK for a collection agency to go after them without a judgement from the way I read that bill.

7. Now the estate of a dead tenant owes any damages to the unit or back rent, etc. 

Good stuff people!!! I’ll see you there…

Monday, June 9, 2014

Learn All About Prepaid Legal Services From Legal Shield This Week At REI

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This Week our special guest speaker will be member and friend, Eliane Niemann. Elaine works with Legal Shield which is a prepaid legal service.

They have small business services which include:
* Legal Consultation on unlimited matters
* Business law expertise
* Contract and document review
* Debt collection assistance
* Legal correspondence &
* Trial defense services

I am interested to see what limitations there are with the service. Especially in our industry considering the fact that we use legal services frequently.

Come on out to our weekly meeting and spend some time with good like minded people.

See you there!

Monday, June 2, 2014

Roanoke City Treasurer Evelyn Powers At REI of Virginia This Week

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This week our guest speaker will be the Roanoke City Treasurer, Evelyn Powers. Evelyn is concerned with some of the things that have been going on in the city and offered to come and speak with our group.

Her job as treasurer is to maintain the highest accountability of local and state revenue collections. Unfortunately their have been a number of shady things that the city has been doing lately with the management of their finances.

It is commonplace these days for the city to hide the fact that a property is destroyed or has to be converted to a single family house and novice investors unknowingly fall into their trap. Or to sell million dollar tax payer owned buildings and land to friends for $10 bucks. Corruption has reached a shocking level within Roanoke City government.

They have developed a hostile environment that attacks small business and drives them out of the city to invest in the surrounding areas which lowers property values due to a lack of supply of people wanting to invest their money in the city’s blighted areas. All citizens in Roanoke City suffer as a result of the policies of the city leaders.

Evelyn will be attending our meeting to give us her ear and work together with us to hopefully resolve some of these issues. 

She is there on our side. Not against.

Come on down, it will be a fun meeting!

Monday, May 26, 2014

Self Directed IRA’s This Week At REI

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Our educational entertainment this week will be all about Self Directed IRA’s. And our guest speaker will be Kevin Miele. If done correctly, there are ways to take your self directed IRA and purchase investment real estate with it with a company that you control.

Come on out this week and get the details on what you can do with a Self Directed IRA!

REI Member John King Tackles A Massive Project

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Developer / REI of Virginia member John King has big plans for Cliff View, a parcel of land over by Lewis Gale Hospital. Good stuff John!!!

video platformvideo managementvideo solutionsvideo player


Monday, May 19, 2014

This Week It’s All About Renters Insurance

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This week we will have guest speaker Betsy Thomas with State Farm Insurance. Betsy will be with us to give us the details on Renters Insurance. It’s funny how I talk with landlords online in some towns where all of the landlords require renters insurance and others like Roanoke where it seems that very few landlords require it.

I guess we just haven’t been sold on the benefits of requiring it. In my lease it requires that all tenants get renters insurance but I haven’t taken any steps to ensure that they have.

I had a tenant one time that set one of my houses on fire. They denied starting the fire and said someone ran up to the house outside and started it. The fire started in the exterior wall and I suspect a boyfriend of the tenant started the fire who works as a volunteer fireman for the Hardy Fire Department. He was the one warming his hands on the fire when my upstairs tenants came down and saw it.

The tenant girl living in the house had the nerve to demand that I have all of her furniture professionally cleaned. I asked her where her renters insurance is since it is required in the lease. She freaked out and said that it wasn’t required in the lease and I told her to go read it. So that was the end of that discussion. Who knows if she sued me what would have happened.

I have also heard stories like this one from our members. There was a small leak in a member landlords plumbing. It was leaking into the basement. There was a very small puddle on the concrete floor. The tenant was subletting the house for storage by allowing a friend to store her furniture in the basement where the leak was. No water dripped on the furniture.

The tenant called a mold specialist in Roanoke and that mold specialist said that there is mold all over in the basement air and her furniture due to that little leak. The landlord had the leak fixed within a few days of being notified. The tenant sued the landlord and believe it or not, ended up winning based on that mold specialists scare tactics that were used to get a few thousand dollar mold remediation job done on the basement.

So, if the tenant had renters insurance, would the landlord still end up liable? I don’t know but what I do know is we should be able to get answers to questions such as this from Betsy at this weeks meeting.

So come on out and have some fun with like minded people in an educational environment.

See you there…

Monday, May 12, 2014

The Dirty And Potentially Illegal Tricks Roanoke City Government Plays On Unsuspecting People At Tax Sales

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Dirty Tricks People Play For The All Mighty Dollar

Roanoke City has a tax sale of real estate every 8 months to a year. I’ve attended every single one for the past 10 years or so and have purchased a few properties from these sales. I’ve learned allot of lessons over the years and the city has taught me that they can not be trusted and are willing to stoop to low levels that are shocking and most likely illegal.

It is important to expose this corruption within so those who are leading this city have an opportunity to resolve the issues and terminate the city employees who are taking part in this.

Below are a few issues that I have personally witnessed or have been a part of. I’m sure there are many more.

Sales Advertised With Guaranteed Clean Titles Are Not Guaranteed Clean:
Roanoke City advertises in their tax sales that they are giving you a property that has a clean title and is free of all claims. I purchased a property back in 2007 that had a serious title problem. Years before the property was sold with the wrong lot information, it was mixed up with the lot next door. Which means the person next door actually is the owner of the property. No title company would insure it therefore no bank loan could be obtained as a result of the title problem and ability for the next door owner to lay claim to the property. I contacted the attorney working for the city at that time and he told me that’s your problem and sent me packing after paying 35K for the property. So lots of money and work for my attorney and we were fortunately able to get a clean title.

Property In SE Roanoke Torn Down Just A Couple Days Before The Sale And City Attorney Contemplated Not Telling Buyers:
Roughly 5 to 7 years ago I was driving around last minute, a couple days before the sale, and saw one of the houses that was advertised for sale being demolished. When I got to the sale there was a photo of the house not demolished. I overheard the same attorney as before with my title problem talking to the guy in front of me. He was telling him that it was demolished but they seriously considered not telling the buyers as they don’t legally have to do so. I was shocked. It’s Unbelievable that anyone would even think about doing that. I’m sure that most people already did their research by driving around and viewing the properties long before I did and when they were looking at it it was there.

City Rezones Property And Hides That The New Owner Will Have To Convert It To Another Use:
Every once and a while the city rezones properties across the city. I think the last time they did it was in 2006. The law is that if a residential property is vacant for at least 2 years than it loses it’s CO and has to revert to a single family house. Almost every house at every tax sale has been sitting vacant for at least 2 years. It takes 2 years of non payment of taxes in order to be able to sell the property to get their tax money.

When a multifamily house is sold at these tax sales and you look online on their GIS you will see that they will leave the property listed as a multifamily even if they are going to force the property to be reverted to a single family due to sitting vacant for too long. Most people do not know these laws. Fortunately I have been doing this stuff for long enough to know what the city will pull on people as they have attempted to do the same thing to me or fellow investors I know.

If the property was rezoned as single family and sat there for 2 years the city will not let you keep it a single family. They will force you to get a permit and revert it to a single family house which could bankrupt someone who was not expecting those additional costs and just getting started out in investing. I have seen it time and time again.

There are MANY examples of the city hiding this information at the sale. As a matter of fact, Not a single time have I ever heard the city disclosing this information. Unsuspecting buyers pay big bucks for these properties thinking that they are able to continue operating it as a quad or triplex or duplex and then later find out that they have to dump many more piles of cash into it to bring it to the cities new requirements. Often they don’t have the money to do so and the deceptive practices that the city takes part in end up ruining the rest of their life due to that bad investment.

Take the property at 608 8th St SE that was sold at a tax sale many years ago. And the house is still sitting just as it was. The only difference is now the neighborhood gets to continue to look at that eyesore because the government hoodwinked the buyer who significantly overpaid for the house because he thought he was buying a Quadraplex. I bid on that house but couldn’t justify more than 5K due to the knowledge of the games that the city plays with peoples lives. This poor guy got in a bidding war with other novice investors and ended up sinking 20K into the property before any work was done.

Or look at the last tax sale and the property at 1509 Chapman Avenue. Which appears to be a duplex to the novice however it was rezoned a single family house and will be required to be converted by the novice investor. Wow, wait until they find that out.

I’m willing to bet that I would hear some city employees defending their non disclosure of this information while stating that they legally don’t have to. I would find it hard to believe that they legally would not be required to disclose something of such significance. However if they aren’t required to do so they still have moral and ethical behavior that we should be able to count on.

If you are reading this and you agree with what they are doing and are saying in your mind that an inexperienced investor should not be warned about this as they should have done their due diligence, than you have something very seriously wrong with you. Yes, I am calling you out specifically. You need to get help. You are an evil heartless person and need to go back in your hole. That’s right… I said it!!! The world would be better without people like you.

Now don’t get the impression that there was some big slip-up and the city “forgot” to tell the auctioneer. This happens at EVERY tax sale. And at EVERY tax sale the city pays it’s code enforcement department to be at the sale over in the corner taking notes on who the next owner will be as their attack will follow the new unsuspecting owners purchase. 

City Has Detailed Knowledge Of Serious Problems With A Property And Hide This Knowledge From Buyers:
Another property went up for sale at the past tax sale that had a huge fire in it a few years back. The city condemned the property after the fire and boarded it up. This property was 819 Campbell. The only reason I know that it burned is I own a property behind it. You can’t easily tell from the outside that this property was destroyed.

I bid on this property because I specialize in extensive rehabs. However I was only willing to bid at most $3,000 as it would take a substantial amount of money to rehabilitate it. Most people couldn’t do it.

Even though there were a number of the code enforcement staff and management in the building, they all decided to deceptively hide the fact that they condemned this building due to a bad electrical fire in the basement. I have been told by an unnamed city employee that they have, in their possession, a file on this property that includes all of the pictures of the damage etc but were unwilling to disclose it. It’s the law that things like this are disclosed by Realtors and knowledge of something like this and not disclosing it is FRAUD.

I have been told through the grapevine that in most cases they will not allow someone to back out of money owed to the treasury department but will make exceptions when friends of the city are involved. In this case the unsuspecting bidder of this property backed out which leaves the city offering the property to the backup bidder which was me.

So I contacted the auctioneer to purchase the property. But in doing so found that the new attorney outsourced by the city who is responsible for the tax sales has a “friend" that he is trying to give the property to and they are not interested anymore in selling it to the backup bidder which is standard procedure. NICE, again this kind of corruption these days should be expected from our local government. There was a day and time where you could count on and trust in what government does but I’m very sorry to say that that is a time that has come and gone…

You may be saying… Dallas, if you have the knowledge of this, why don’t you stand up at the tax sale and warn people. Well, my answer is that I did. Both me and Dan tried to tell the auctioneer, city employees and other buyers at the sale that the city was advertising an incorrect higher Tax Assessed value of every property but we were quickly shut down as the auctioneer referenced his communication with the city attorney regarding people speaking up at the sale. He then restated that they are correct tax assessed values. The reality is that they were last years higher tax assessed values and no representation of todays assessed value.

So what do we do about it? Actually I don’t know the answer to that. That’s why I’m writing about it. It can serve as education to novice and moderate investors. I will be sending it to the management of the city as well but they have shown me in the past that they are unconcerned about important matters such as this.

You Have To Have Thick Skin And Be Prepared For Traps To Work With Roanoke City

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See the letter below sent to me. It’s an example of what I continually hear from real estate investors in Roanoke City. Rather than helping guide the guy through the state process of rehabilitating a building they use the Virginia Statewide Uniform Building Code against him to make him feel helpless. It also appears that they are misinforming him of his rights.

This is the way Roanoke City currently operates and those who are in power should immediately put an end to it. People should not be treated in this manor. The city should roll the red carpet out for investment money and make the process easy to deal with. And inspectors should be required to take customer service education classes that teach them how to treat people with respect to make it a positive experience when working with the city rather than a nightmare.

This gentleman DOES NOT need an architectural engineer as they suggested to rehab the building himself. He is not making any major structural changes that would require that. He has NOT moved around any walls or done any major structural work other than ADDING one little wall. He is also NOT required to be held to 2014 code but rather the code of the date it was originally built.

Verification of that here:
http://www.reiofvirginia.com/2014/03/guide-to-virginia-maintenance-code-is.html

I have read the Virginia Uniform Statewide Building Code and it’s references to a Certificate of Occupancy. And It appears that you do not need a new CO if the property is being used for the same purpose as it always has been. If the prior CO has been revoked than they shall issue you another CO once the property has been brought back to code of the date it was originally built. This unnecessary harassment should stop. Driving investors out of the city to invest in the surrounding areas is not advisable and does nothing more than hurt and further depress our blighted neighborhoods. 

Roanoke Cities new policy should read, “If You Have A Hammer And Are Swinging It We’ll Do Everything We Can To Help You.”

Hi Mr. Powell,

My name is NAME REMOVED;  I recently found REI of VA online, which is where I found your e-mail address.  I hope my writing you isn't too inappropriate or bothersome. I need help, perhaps an attorney with an understanding of building codes as they apply to me, and I am hoping you can point me in the right direction.  I purchased my first would be income property 5 years ago in Roanoke City and have been renovating it in hopes of renting four apartments and two retail spaces in the building.  I am admittedly a complete novice at all of this, but I was trying to take a building that was empty, and an eyesore, and make it a decent, functional, and more appealing addition to it's surroundings.  It is a slow process for me because I am just an average individual, funding it out of my pocket a little at a time. The apartments and retail spaces had been rented in the past, before I came along, and the building was built in 1935.  I truly thought that "the powers that be" in the city would be happy with my efforts.  I have had a bit of an awakening since then.  I am having a problem getting a C.O., which they tell me I need, and they are telling me that they will not even talk to me about signing off on electrical work that I have had done, or anything else until I hire an architectural engineer to go top to bottom - front to back and give them among other things fire ratings for every floor, ceiling, wall, and stair.  Even if I can scrape together the funds to hire the engineer,  I am extremely concerned that they are holding this building to 2014 new construction codes.  I of course want it to be safe, but with things like the difference in thickness of drywall boards thru the years, I feel like I will be chasing my tail into bankruptcy. I have read several things on REI that seem to suggest I'm not alone in this. I really didn't think the City would be out to get me but that sure is the way it feels at the moment. Perhaps I can make it to Shaker's at some point, the group of people sounds amazing.

Thank you,
NAME REMOVED
PHONE NUMBER REMOVED

Monday, May 5, 2014

Estate Planning & Real Estate Exit Strategies This Week At REI!!!

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We have a very interesting meeting lined up for this week at REI of Virginia. The guest speaker will be attorney Joel Miller. He is a specialist in IRS Tax Matters and Estate Planning.

It seems that every single attorney I talk to has a different answer on what to do regarding estate planning. We now have an attorney with the right specialties to make a qualified decision. It’s very important for an attorney to not only have the knowledge of what can be done regarding Estate Planning but what the Tax Ramifications are as a result of doing so.

And in all good Estate Planning you should consider a good exit strategy. What do you do when it’s time to cash out? What’s the best way to pass property over to your children? What’s the best way to convert property to use to cover the expenses of potential care you need in the future? Is it wise to “spend down” all of your money so you are eligible for government care? What do you do if you own a few million dollars of property? There are many questions to ask and Joel will be there to cover the bases.

So come on down to the REI of Virginia meeting this week and spend some educational time with some good, like minded people.

See you there!

Friday, May 2, 2014

2014 Virginia Passed Laws That Affect Landlords.

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I did many hours of research to see what passed this year that people aren’t talking about in our industry. So, since no one seems to be watching, I’ll do it.

A: Small landlords now with 3 to 10 properties are subject to the Landlord Tenant Act look up HB 273  http://leg1.state.va.us/cgi-bin/legp504.exe?141+sum+HB273  Click on the Governors Acts of Assembly Chapter Text for the FINAL bill on all of these.

B: If a tenant pays a judgement that you have against them, you have 90 days to notify the court so it can be entered on the judgement docket. If you don’t you are liable for a fine of $100 as well as the cost of releasing the judgement. HB 393 http://leg1.state.va.us/cgi-bin/legp504.exe?141+sum+HB393

C: If a city councilman or other part time officer agent or employee of a city misuses public assets in the amount over $1,000 in a year period they will be slapped on the hand with a Class 1 misdemeanor which would be equivalent to a minor traffic ticket. That is IF the police department wants to charge them. HB 420 http://leg1.state.va.us/cgi-bin/legp504.exe?141+sum+HB420

D: Cities, counties and towns now have to give you the last 2 years of appraised values. They used to only have to give the last year. HB 525 http://leg1.state.va.us/cgi-bin/legp504.exe?141+sum+HB525

E: Group homes / boarding houses: Roanoke city currently says you can have no more than 4 unrelated adults OR a family and 2 unrelated adults in a house to be considered a single family house. This bill says that if you are renting to no more than 8 people with mental illnesses, intellectual disabilities or developmental disabilities and you have one resident or NON resident staff person which could be you, the house shall be considered residential occupancy by a SINGLE family. HB 527 Group Homes and Zoning http://leg1.state.va.us/cgi-bin/legp504.exe?141+sum+HB527

F: This one is great! If a tenant doesn’t show up to court, and you demonstrate to the judge that they owe more money, the court now is required to allow an amendment of the amount you are requesting on the unlawful detainer and enter a judgement for the new amount. HB 596 http://leg1.state.va.us/cgi-bin/legp504.exe?141+sum+HB596

G: Looks like now if you have it in your lease, you can bill a tenant for any local government fees that you get which include things such as storm water (rain tax), recycling, trash collection, rental inspection programs, power, etc. If landlords jump on board with this one the city will have repercussions when they go after the landlord. The fees that you charge them will be legally deemed to be rent. We will need to talk about this one in more detail. Maybe Ross will come in and talk about it. HB 614  http://leg1.state.va.us/cgi-bin/legp504.exe?141+sum+HB614

H: Adding an alternate name: Virginia Residential Landlord Tenant Act to The Virginia Rental Housing Act. Also now if you have terminated the rental agreement, and didn’t take the tenant to court, you are still legally owed unpaid rent, late fees, damages, etc. You no longer need a judgement for the money to be owed. Which would lead me to believe that you can now send a collection agency after them without a judgement.

Also in this bill if a tenant dies the rental agreement is immediately terminated on the date of the death and the estate of the person who died is liable for actual damages to the property. This bill is HB 638 http://leg1.state.va.us/cgi-bin/legp504.exe?141+sum+HB638

Monday, April 21, 2014

Colors, Colors, Colors This Week At REI

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Ok, I’m back now after about a month and a half of vacationing. Back out of retirement. Was fun but I get too board begin retired. Andy lined up a great meeting this week!

When you’re flipping a property interior decorating is extremely important. It can mean shaving off months of time in the sale of your property which allows you to get your money back out quickly and move on to the next. This week at REI were going to learn all about colors in your flips. Our special guest speaker will be Teresa Dorlini of Circle Design Studio.

Have a look at their website here. http://www.circledesignstudio.com/

I must say that their work is very impressive. So come on out and hear from an expert in the field.

See you there!

Monday, April 14, 2014

Roanoke County GIS At REI This Week

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Ladies and Gentlemen, I am pleased to announce that we will have David Wray with the Roanoke County Government at REI this Tuesday to talk about a new GIS system that they have that is supposed to rival the City GIS.

I sure hope they do. All I know is that I was on there yesterday trying to look up a house and found that I still couldn’t on a Mac. I have never been to a website in history that would not work with a Mac so I really don’t understand this. I just looked into it a little more and found one that works. It’s has no where near the capabilities of the City GIS but at least I can see some data. I really don’t understand why the County wouldn’t have one equally as nice as the City considering the City told us that it only cost about $5,000 to implement not counting their own man-hours of inputting data and taking pictures.

The 2 websites I found are the Counties WebPro Real Estate Data:
http://www.roanokecountyva.gov/index.aspx?NID=86

And County Maps:
http://roanokecountyva.gov/index.aspx?nid=76

Hopefully there is another one I’m not seeing. If they need the number and contact information for the site that Roanoke City put up, I’m sure they will give it to me. I really would like to start investing more of my money in the County where they like investors. However it’s imperative that they have a good GIS system that I can do my research on.

Monday, April 7, 2014

Landscaping and Curb Appeal This Week At REI

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We have our member and friend, Jeane Dixon at the upcoming meeting to talk about landscaping and curb appeal. Creating an attractive yard is something that is suited well for taking advantage of while you have a rental. 10 or 15 years down the road you may be ready to sell. At that point the trees planted will be large and well established creating the intended environment which will add quite a bit to the value of your property if done correctly.

Good curb appeal not only helps your house increase in value but it also is one of the few things you can do that pays for itself as a fresh coat of paint does. While waiting for it to establish your attractive yard will make your property rent for more to cover your costs of getting it in order. An extra $25 dollars a month translates to $300 per year in additional rent. But that’s only if you jack the rent by $25. I see so many landlords do upgrades to their property and not get it back in rent. Crazy! Do the right upgrades and you can get it every time. Do the wrong ones and they will never pay back.

I won’t be able to make it to this meeting unfortunately as I’m going fishing for a week with Roger and Dan at Dan’s place in Nags Head NC. Sharks and Sting Rays are on my menu. I wish I could because Jeane has some great ideas and really knows her stuff. I have also been told that she has very fair pricing for her services as well. When I get back I’m going to ask her if she could brainstorm for me and develop a plan that I can hire her for to landscape my new house out in Salem. All with beneficial plants such as fruit and nut trees, and herbs.

No, not the Wacky Tabacky kind of herb…

Come on down to the weekly Shindig. Will be fun as usual and it’s always good to spend a little time every week with good like minded people that are driven towards success. It keeps your head in the game and your eye on the prize.

Monday, March 31, 2014

This Week Another Stab at 1031 Exchanges

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1031 Exchanges will be the topic of discussion this week at Real Estate Investors of Virginia. We will have guest speaker and financial advisor, Jerry McMillian to cover the topic. We talked about 1031 Exchanges with our member Robert Young about a year ago and it’s about time we dive back into them.

1031 Exchanges are a way to get around paying capital gains on a property that you sell as long as you reinvest all of the proceeds in a new property. You are essentially deferring this tax for later recognition. One who takes advantage of sophisticated loopholes such as this understands the time value of money. The ability to make more money with that dollar in your pocket today. However there is a cost of doing 1031 Exchanges that must be considered. It’s a no brainer for expensive property but questionably beneficial on low dollar volume exchanges.

Come on out and lets get back into the details of the 1031 Exchange and spend a little time with good, like minded people.

PS. I’m back from Tampa. Spanky and I went down there on one of those cheap Allegiant flights. We were there to talk to REO Realtors and get a feel for the market and specifically where we should invest. I learned allot. It was a highly productive trip.

We rented a speedboat for one day to ride around and see where it would be good to buy a house on the water as well. That thing was fast! I found that all of the boat rental places wanted people to have lots of experience with boats after getting turned down a few times. So I quickly realized that I had to lie to get a boat. Man did we have fun… There was a tornado watch and the water was really choppy. Only beached the boat once!

We’re glad to be back alive. The flight back was contracted out to Miami Air. There was a very inexperienced pilot of this massive plane. We were coming down into Roanoke and he almost crashed it. People were thrown all over the place smacking their heads on the walls of the plane. The plane dropped several times so fast that there was weightlessness. Then several G’s that made your stomach turn upside down. Not mine but many people in the plane were puking. It was gross.

I was scared for real. It takes quite a bit to scare me. I was clutching onto the seat in front of me for my life. Thoughts going through my head that I don’t have my company set up in a trust yet with beneficiaries that can have it once I die without having to deal with our lovely government. Looking out the right window there was Smith Mountain Lake. Then there was Tinker Mountain. VERY CLOSE to the plane. We were right next to it. It was a little higher than we were.

Once the pilot realized he was going to crash the plane he pulled up hard and we were headed straight up still getting thrown all over the place. There was some wind but I think it was more pilot or plane error. About 15 minutes of pure terror. No Joke! Once we got above the clouds it settled out and he landed it in Greensboro where he abandoned us after the airlines held us hostage on the plane for 2 hours straight while they were figuring out what to do. Me and Spank hired a Cabby to go back to the shop and get a van for 8 of us to bring us back to Roanoke. Whew, glad that part was over.

Monday, March 24, 2014

Open Letter From Yours Truly To The Entire City Council, Mayor, City Manager, City Planning and Code Enforcement Staff Of Supervisors. One Responded Due To Election.

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Picture by roanokefreepress.com
Hi,

Please see the attached link to the Real Estate Investors of Virginia website. Something that you may be concerned with, or maybe not. I honestly don’t know as our group has had poor results over the past 3 years we have tried to work together with the city as partners.

http://www.reiofvirginia.com/2014/03/proof-roanoke-city-government-hates.html

BTW, at the last city tax sale there was a number of questionably illegal, certainly immoral and unethical activities that took place that I’ll be writing about next week. Just checking with you all to see if these regular issues we are seeing happening are the new norm. I’m sure you must not be aware of this stuff because I can’t see any reasonable person allowing it to continue.


Best regards,


Dallas
_______________________________________________________________________

FROM DAVE TRINKLE:
thanks for sending- I will investigate but we are generally extremely well recvd by businesses and I would not think it is anything in the norm or expectable range and may be a matter of interpretation.
thanks again
davee
_______________________________________________________________________

Hi Dave,

Thanks for your response. I think you are a little out of touch with investors in the city. I can assure you that the city is not well received by the majority of property investors. I am an officer for Real Estate Investors of Virginia and of our membership of 550 investors in the city, not one of them has ever told me that they are happy doing business with the city. However I get lots of positive feedback about every town surrounding it.

Best regards,


Dallas
_______________________________________________________________________

NOTE:
I WILL BE WRITING ABOUT SOME POTENTIALLY ILLEGAL ACTIVITIES THAT WERE DONE BY THE CITY AT THE TAX SALE. WHEN I DO, I WILL EMAIL YOU AND YOU CAN JUDGE YOURSELF IF THEY WERE “IN THE NORM” OR WITHIN AN “ACCEPTABLE RANGE” OF LEGALITY.

EVERY REALTOR AND BROKER I HAVE TALKED TO SAID THEY ARE WELL OUTSIDE THE “ ACCEPTABLE RANGE” OF LEGALITY AND FAR FROM THE “NORM".

Lets just all play by the rules. Honesty and morality should not be a thing of the past. I do not find it acceptable for our local government to follow in the footsteps of corruption that our national government deems acceptable.

Section 8 Coming To REI of Virginia This Week

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Tuesday evening at REI of Virginia we have Helen Shampine and David Bustamante coming to speak with us. They are in charge of the Section 8 program in this area. The Section 8 program used to consist of both the Housing Authority and TAP but it has all been turned over to the Authority now.

The purpose will be to talk about the Section 8 program to the members of our group that don’t know about it and to answer any questions or suggestions that we may have.

Over the years I have been real happy with the Section 8 program. Can’t beat that guaranteed rent. And the residents are under your thumb to a certain degree because if they are in violation of the lease they can lose their Section 8.

However there have been some problems lately. For example, now it takes much longer to get a new Section 8 tenant into a unit than it used to. You can wait for a month or more for everything to be approved. With that considered and the option to rent the property to someone else not on the program who qualifies and has rent in hand, it makes it hard to willingly lose a month or more of rent in order to rent to the Section 8 tenant. At that point the benefits get outweighed to a degree.

They have also been having some problems with inspectors that are way over the top nit picking every little thing. I’ve had small scrapes on a deck from the tenant dragging furniture across it that I had to have repainted because the inspector thought it fell into the chipped flaking paint category. And she just checked the property 2 weeks earlier with the last section 8 tenant. I’ve had an inspector on a re-inspection tell me that I had to cut out all of the caulking around the bathtub and replace it because the TENANT was a filthy pig and didn’t use Tilex to get rid of the mold that gets on all grout or caulk if it is never cleaned. I see that as a tenant issue, not a landlord issue.

So come on out to the meeting with your suggestions in hand. For those of you who aren’t familiar with the program I would still suggest it even though I have had problems. The main reason I would is that I haven’t given up faith in the people who run this program as they have always been concerned with my issues and I feel like they are trying to work to always keep it a top notch program in our city. I can understand that they will have some bumps along the way and have confidence that they will fix them.

See you at the meeting!

Tuesday, March 18, 2014

Proof Roanoke City Government Hates Business

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I’ve got bad news for you people. It’s a verification of what we all already knew.

Roanoke City Government has told their code enforcement department to single out landlords to take to court rather than enforcing the state code equally amongst all property owners.  I don’t think our politicians who wrote these maintenance codes or the judges that enforce them would be happy to hear this.

I was at a South East Action Forum meeting in February and they were reading their meeting minutes from their January 2nd 2014 meeting at Jackson Park Library. Below is a quote from their meeting minutes which I was able to obtain.

Code Enforcement Officer’s Report:

Code Enforcement Officer, Victor Villasenor, reported that work on the 13th Street roundabouts is progressing and that there will be properties on the Code Enforcement court docket for January 16th. He added that during this time of year, the focus on code violations will be on rental properties. Members were encouraged to show their support for these efforts at the court date.

This is bad and clearly demonstrates that the local government is in a full scale attack against small business owners across the city. What do you think about the “corporate culture” that our mayor, city council and city manager have implemented within the city departments that they are over?

Monday, March 17, 2014

Fantastic Meeting Lined Up That You Don’t Want To Miss!

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I am pleased to announce that REI of Virginia is having one of our favorite speakers at our meeting this Tuesday. Our member and good friend, Ray Alcorn will be giving his 2014 forecast for the real estate industry.

If you don’t know Ray he is what I call a real estate guru even though he doesn’t consider himself to be. I guess because the guru’s have a bad name due to a few scammers. Ray is the real deal.

Ray has been involved in Commercial Real Estate for over 30 years. It’s in his blood as his father was involved with commercial real estate as well.  He’s done everything from trailer parks to high end commercial property, etc. And has been very successful at doing so.

Every year Ray puts together a projection so fellow investors can determine what to do with their money in the upcoming years. I’ve never met a person that scours over every statistic out there to the degree that Ray does in the development of his outlook.

Going to be an outstanding meeting.

We’ll see you there!

Monday, March 10, 2014

Guide To Virginia Maintenance Code. Is Virginia Code Retroactive?

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Commentary:

The simple answer is that in most cases, Virginia Building Code is not retroactive. ONLY in the case of an imminent hazard can the government force you to bring a property up to currant code. Our politicians have been good to us by allowing these protections from rogue enforcement that would happen as a result of language that could have been made discretionary. Fortunately it wasn't.

And an imminent hazard would be defined as something that will certainly cause serious injury to an individual if it is not repaired, replaced, or whatever. I don't know a single property owner that would willingly and knowingly allow any imminent hazard to exist in or on any of their properties.

So what we've come down to is if there is anything that a Code Official is requiring you to do, ask yourself if it is an imminent hazard. If it is fix it immediately. Items such as adding a ground fault circuit interrupter (GFCI) outlet near water (bathroom or kitchen) would qualify as an imminent hazard due to the fact that if the item they have plugged in goes bad, the lack of a ground in old wiring will cause the person to get shocked by what they have plugged in. Another example would be a wire that they see is frayed and lost it's protective coating. A person could get electrocuted by something like that so clearly that would be an imminent hazard.

Also, If what was originally built is not in working order you will have to fix it. Everything must be maintained in good condition and in working order. If you decide to repair that broken item and the repair is "In Kind" meaning that you are using the exact same thing to replace what was damaged than you don't have to bring it up to today's code. However if you install something completely different, everything that you are working on will have to be brought up to today's code. There is value in keeping a house historically accurate.

If it is an issue where code is trying to make you add something to your property that doesn't qualify as an imminent hazard such as a bathroom vent or a window, or an anti hammer valve on old plumbing, etc,  you have the right to refuse to do so. Your property is essentially grandfathered in and if what is in question was built prior to code or was built to the code of the day than you have the choice to upgrade it or leave it as is.

Code enforcers like to quote Section 102.1 out of the Virginia Maintenance Code as an all inclusive statement that they can do whatever they want to you implying that the code has so much leeway that it is at their discretion no matter what it is. However that's not the case. Reading this "alone" would seem that way.

Section 102.1 states " . . . the purpose of this code is to protect the health, safety and welfare of
the residents
of the Commonwealth of Virginia, provided that buildings and
structures should be permitted to be maintained at the least possible cost
consistent with recognized standards of health, safety, energy
conservation, and water conservation, including provision necessary to
prevent overcrowding, rodent or insect infestation, and garbage
accumulation . . ."

The use of "health, safety and welfare of the residents” to encompass everything doesn't fly. The code is very clear that an imminent hazard must be found to make a property be brought up to a more recent code.  They can’t encompass anything they want as the law is very restrictive on what the purpose and scope of these inspections are. The statement above is from the code section “Purpose and Scope."

On the exact same page of the Purpose and Scope it dictates the Application of the Purpose and Scope. See page 5 of the Virginia Maintenance Code. http://www.dhcd.virginia.gov/StateBuildingCodesandRegulations/PDFs/Virginia_Maintenance_Code_USBC_Part_III.pdf

"Section 103 - Application of Code
103.1 General. This code prescribes regulations for the maintenance of all existing buildings and structures and associated equipment, including regulations for unsafe buildings and structures.

103.2 Maintenance requirements. Buildings and structures shall be maintained and kept in goof repair in accordance with the requirements of this code and when applicable in accordance with the USBC under which such building or structure was constructed. No provision of this code shall require alterations to be made to an existing building or structure or to equipment unless conditions are present which meet the definition of an unsafe structure or a structure unfit for human occupancy.
103.21 (where they say fire detectors are not required) Maintenance of non-required fire protection systems. Non-required fire protection systems shall be maintained to function as originally installed. If any such systems are to be reduced in function or discontinued, approval shall be obtained from the building official in accordance with Section 103.8.1 of the Virginia Construction Code.

103.3 Continued approval. Notwithstanding any provision of this code to the contrary, alterations shall not be required to be made to existing buildings or structures which are occupied in accordance with a certificate of occupancy issued under any edition of the USBC" (Virginia Uniform Statewide Building Code).

So as you see above. The laws are very clear and very restrictive regarding to what degree that code enforcement enforces Maintenance Code. Virginia Politicians were looking out for us when this code was drafted as they understood that there is potential for widespread abuse by lower levels of government.

May God Bless the USA!



How To Become A Millionaire Investing In Real Estate In Your Spare Time

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Photo By www.BiggerPockets.com - Great Educational Forums There!
This week we have a nice treat for you. Our President, Andy Stowasser, will be walking the group through a meeting called How To Become A  Millionaire Investing In Real Estate In Your Spare Time.

I can’t wait to hear it. I always like to hear our members speak who are people who have been there and done that. Andy is one of them for sure. I’m guessing he will be taking a buy and hold approach in this meeting.

Information such as this is extremely valuable. Secrets of the wealthy are disclosed. There is plenty of room for us all to fill our pockets. If you are not a premium member at this point hopefully you will consider signing up.

It’s going to be a packed meeting for sure. Make sure you get there early because if we get stuck in the small room and you are late you probably won’t get a seat. Over the years I can pretty much predict how many people will be at whatever meeting based on the topic. I guarantee it will be a packed house tomorrow.

These kinds of meetings benefit those on their way to millions as well as those who are already there. I most often pull out a few gems of information that help me step it up to the next level. Education within our industry is key to success.

So reschedule your plans if you already have them because we’re talking money and potential life changing events. Whatever else you are doing can wait.

We’ll see you there!!!

Monday, March 3, 2014

Lead Safe Roanoke Speaking At REI This Week

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This Tuesday we have a fantastic meeting lined up with Marla Robertson and Ann Weaver of Lead Safe Roanoke. Marla and Ann run a great program and they now are lined up with more funding.

Lead Safe Roanoke is a program that protects children by testing your property for lead and fixing the problem if it has it. I have used it a number of times in the past. Typically what I’ve seen is that they end up installing new windows, doors and paint if needed. And they often dig out the dirt around the house and replace it with mulch as that dirt often is contaminated by lead.

So what’s the catch? There isn’t one really… If your property qualifies by having low income children under the age of 5 or a pregnant mom you will get this work done for free. However you will be required to put the tenants up in a hotel for a few days while the work is being done. No big deal considering the value that you are getting as a result of the work done. 

You can also participate in this program on a property that you just purchased if you make a commitment to try to keep it rented to low income families with children that fit the criteria.

Come on out to our meeting. You don’t want to miss this!!!

Monday, February 24, 2014

Have Problems In Or Around One Of Your Rentals?

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If you are having problems around one of your rentals it can make it very hard to keep the house occupied with good tenants. I had a problem in the past where a house across the street was full of drug dealers and these guys would actually have the nerves to sit on my porch and not move out of the way for my tenants that were paying to live there. Even after I told them I don’t want to see them on the property again.

So that’s when I found out about the BAR program that allows you to have anyone other than the tenants on the property arrested for being there without having to attempt to contact you the landlord which legally was their restriction in the past. Once on the BAR program if they have ever been barred on that property and told not to trespass there all it takes is the police seeing them back on the property and they can be arrested immediately.

See below information on the officers that are now ahead of the BAR program AND any other neighborhood complaints. Keep their contact information in case you need them or go ahead and call them to get your properties listed on this program.

Good morning everyone..........

As part of the organizational enhancements made within the Roanoke Police Dept. effective January 7th, I wanted to make certain you had the contacts for your neighborhood's Police Dept. Community Response Team.

* Lt. Daniel Hartman (daniel.hartman@roanokeva.gov or 853-2671) is the Community Response Team Lieutenant for the eastern side of Roanoke, and
* Lt. Rick Morrison (rick.morrison@roanokeva.gov or 853-1634) is the Community Response Team Lieutenant for the western city of the city.  

In addition, the city continues to be mapped into four (4) Community Response Team zones with the following Community Resource Officers:
* Officer Kenny Johnson (kenneth.Johnson@roanokeva.gov) is the Community Resource Officer for NE,
* Officer Brian Tinsley (brian.tinsley@roanokeva.gov) is the Community Resource Officer for SE.
* Officer Derrick Spradlin (derrick.spradlin@roanokeva.gov) is the Community Resource Officer for NW
* Officer Ryan Brady (ryan.brady@roanokeva.gov0 is the Community Resource Officer for SW  

All are very excited about the transition and look forward to working in partnership with you to keep our neighborhoods safe and engaged.  .

Over the next few months, all of the Community Resource Teams will be working to get around to the different neighborhood meetings and introducing themselves but until that time, please feel free to contact them with any concerns you might have.     

Thanks!

Bob

Bob Clement, Neighborhood Services Coordinator
Office of Neighborhood Services
Noel C. Taylor Municipal Building
215 Church Ave SW, Room 312 North
Roanoke, VA  24011
P:  (540) 853-5210   F:  (540) 853-6597

REI of Virginia Members Having A Problem With Rental Inspections and C/O’s

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So there are two different things that the city wants landlords to have on each and every house. A valid rental certificate if the house is in a low income area which they have defined as a rental inspection district, and a certificate of occupancy (CO).

We all know what the rental certificate is however some aren’t familiar with the CO. A CO is essentially a stamp of approval that says specifically that a property is up to the code at the time it was built and it has been approved for a very specific use. For example it has been approved as a single family house or a triplex or an apartment building, or a very specific kind of business, etc.

The city decided that they wanted to push towards getting every property a valid CO so they put together a plan where they would allow a landlord to get a CO and their rental certificate at once and at no additional cost beyond the normal cost of a CO.

Just for a little review of history, Virginia Code states that every property from the time it is built has a CO. However there was a time that was pre building codes in Virginia. And houses that were before the building code existed are grandfathered in. Code states that if a house was built in a certain way that was acceptable at the time it was built, the city code enforcers and building inspectors can’t make you change it to bring it up to todays code. That is only if you are doing an “in kind" repair. If you are doing more than a simple repair than the work you do has to be of todays standards.

This was a little protection that our state level politicians had to put into law because they found that cities and towns across the state were taking advantage of the code and harming their citizens by ordering complete renovations of houses every time the code was updated. Give em an inch and they take a mile every time.

So to make it clear, you do not have to have a CO as long as the house was built pre building code which almost every house in the city was. AND as long as the use wasn’t changed from the use prior to the state accepting the building code. The burden of proof is on the city that the use has been changed since the implementation of the code.

The city has historically attempted to make people feel like they have to have a CO but this is not true. They have done such a good job at this that there have been a number of Legal Aid cases against landlords historically where Legal Aid was using a defense that the tenant should not have to pay any rent for the entire time they were there based on the house not having a CO. Legal aid in these cases was confusing this with a rental certificate which is a completely different thing. Unfortunately the landlords I talked to did not adequately represent themselves and they lost thousands of dollars due to their lack of knowledge of the law.

If you wish to confirm the laws on CO’s click the link below. It’s important for you to understand the law as you will be taken advantage of if you don’t.
https://leg1.state.va.us/cgi-bin/legp504.exe?000+reg+13VAC5-63-160

I continually get complaints from our members about this Rental Certificate / CO issue so I sent a message to Chris Chittum about the issue hoping he would resolve it and make everything easier on landlords if they want to keep pressing this CO issue. Below is my email to him and then his response. I told Chris I would send this to you so we are all up to speed on the issue.

Essentially his response is that there will continue to be multiple inspections by both code enforcers and building inspectors if you desire to get a CO and they will put a plan into action to make the process easier for you to understand.

Hi Chris,

Our members are having some issues regarding the communication between city departments that I was wondering if you could help with.

A number of times every month members are contacting me asking questions regarding certificate of occupancies and rental certificates. In the past it was Tom Carr’s position to not have a duplication of services as to avoid unnecessary costs to the taxpayer considering that building inspectors are as qualified if not more qualified to do a rental inspection. I talked to you about this issue as well and you agreed regarding the duplication of services.

It is possible that the code enforcers feel like the building inspectors are stepping on their toes if they do the rental inspection and maybe this is what is causing the problem. I’m not sure.

Over the years the city has had a desire to get all properties a CO so when you request a CO you also got a rental inspection at no additional cost. Currently our members are having issues thinking that they got their rental certificate when they got their CO or having code enforcers threaten them that they must get a rental certificate after getting the CO. This issue sets landlords up for a lawsuit from the tenants which is not desired.

If you could think of a good solution that’s also good for the taxpayers pocket it would be greatly appreciated.


Best regards,


Dallas Powell
Chairman
Real Estate Investors of Virginia
1417 Peters Creek Rd.
Roanoke, VA 24017

Cell: 540.293.2335
Dallasjr@PowMarCom.com


Dallas,

I talked with Neil Holland, Building Commissioner and Dan Webb, Codes Compliance Coordinator about the process for bundling a C.O. and a Rental Certificate.  I understand that we have been doing this experimentally for about a year or so. We now know that it can work, but have learned that we need better communication internally among ourselves and externally with customers.  The sequencing of the process is also important and is an area that we will work on.  I appreciate the feedback; bringing this issue to our attention will help us improve.

If there is construction on a rental unit that triggers the need for a
building permit, we encourage the owner to go ahead and get a C.O. at the same time (if there is no existing C.O.).  The C.O. validates the occupancy and that the units were legally established at some point.  This practice is mutually beneficial as it acts as a vested right to the property owner for a certain number of units.  It also prevents us from having to do a lot of pointless research in the future on whether the number of units were legally established or not.  For example, a 3-unit building in a single-family zone could have been established legally long ago under a different zoning.  That's fairly common.

The new practice is to include a four year Rental Certificate with the C.O.
An owner does not have to apply separately or pay a separate fee for it
when bundled with a C.O., but does need to be issued a written Rental
Certificate.  Apparently, we need to a better job of communicating this to
customers.

As things stand now, a single inspector cannot cover both construction and maintenance inspections because we are dealing with two separate codes: The Virginia Maintenance Code and the Virginia Construction code.   Tom Carr may have advocated such an arrangement before, but since we became accredited, each code requires different competencies and the inspectors must be certified in their respective disciplines.   We may at some point have inspectors cross-certified to do both, but right now we do not.  This means that it is absolutely necessary to have two different inspectors check the property, at least for the time being.

Another consideration is that the Virginia Construction Code requires that there be no violations of the Virginia Maintenance Code or Fire Code before a C.O. is issued.  So, what we try to do is coordinate those inspections to the extent possible.  When an inspection for the C.O. or permit is requested, the Combination Inspector should contact the Codes Compliance Inspector for that area and schedule a dual inspection.  What I — and I think some owners — are struggling with is the fact that, at final building inspection, a rental inspection may uncover a lot of things that need to be corrected, when the expectation was that both certificates would be issued at final.

Therefore, I think an initial rental inspection needs to be done earlier in
the game - before the final building inspection.  On final approach rather
than at touchdown, if you will.   That way, the owner has an opportunity to address rental inspection issues.  Then the dual inspection can be conducted at the end of the project and both Rental Certificate and C.O. can be issued at the same time.   Of course, all this varies depending on the amount of construction taking place, so each case is different.

What I plan to do in response is work with Neil and Dan to develop a
written internal policy as well as a customer guide for owners so everyone can be on the same page.  I hope that will make things run more smoothly for all involved.

Again, thank you for bring this issue to our attention.

Regards,
Chris

Chris Chittum, AICP          
Director of Planning, Building, and
Development
215 Church Avenue, SW Roanoke, VA 24011…
(540) 853-2356 (desk) (540) 815-0291 (cell)
 

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