Monday, March 30, 2015

Homelessness - A Roanoke City Low Income Landlords Perspective

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I wrote another commentary for the Roanoke Times. It is listed below. This article regards what I see to be one of the primary reasons for homelessness in the city. A lack of affordable housing. We are currently in the submission process for the article and it hasn’t been published yet. So far, everything I have sent them they have included in the paper so I expect it will be granted for submission.

That was a fantastic article written by Kevin Kittredge, Mark Powell and Amy Morgan along with the participation input from Duane Howard, John McDonagal and Mark Petersen, regarding Southeast Roanoke being beyond it’s saturation point with homeless services.

I’ve never met a person that has said that the Mission doesn't do good work. However there is NO REASON that the Mission can't spread out it's services and offer them in other places of need. Or change their model to something that works towards getting every single person who walks through their doors into permanent housing. Especially with the massive amount of money, donations and volunteer labor that they get.

The mass shelter based housing model the Rescue Mission uses has been characterized across the country as only "managing the problem" rather than ending it like the modern methods do. I lived within a couple blocks of the Mission for several years and know for a fact that many of the same homeless people have been there at the mission for 25 plus years.

Methods such as homelessness prevention, rapid rehousing and availability of affordable housing are key to ending homelessness.

I am a low income landlord and have several properties in the city and around the Rescue Mission. I have a unique understanding of what causes homelessness as a result of the line of work I’m involved with. I would like to discuss my perspective of a contributing factor towards the reasons for homelessness that hasn’t been covered at length regarding this issue.

Multifamily housing is essential for low income people but is still too expensive for our lowest income population. For our lowest income population, all it takes is a situation like their car breaking down and the next thing they know they can’t pay rent and are in need of shelter.

As a landlord, I see their total monthly income when qualifying them for a rental. The average disability recipient gets a total of $700 per month to live on from their SSI check. NO ONE can survive on that income unless they have the ability to split up their rent with several other people. Keep in mind that a typical small multifamily apartment in a low income area runs in the $500 range to rent. They then have to eat, have gas for their car, pay their utilities amongst many other expenses.

That’s why rooming houses are essential to providing our lowest income population with an affordable place to live where they don’t have utility bills eating up the remaining amount of their income.

Back in 2006 the city decided to rezone all of the housing dramatically decreasing the number of affordable multifamily housing units. They also cracked down on rooming houses making it so landlords could not afford to operate one and pay the utility bills along with taxes, mortgages, maintenance, insurance, etc with the 4 unrelated adults limit they imposed. This drove up the room prices out of the range of our lowest income population.

The 2006 crack down created very small economically segregated pockets within the city where this affordable housing can exist. This in turn created a supply and demand issue which contributed to higher rents.

The next steps the city took after making this change was to partner with a few select landlords that call themselves “social entrepreneurs”,  They sold them buildings for $10 dollars that you and I as tax payers paid millions for. They then allowed them to turn these buildings into Luxury Apartments further exacerbating the problem. We are now left with very few affordable housing options for the homeless and an overwhelming supply of housing for moderate to high income people.

Roanoke City has been importing homeless from all over the state of Virginia and surrounding states. We are either going to need to stop the importation of homeless or create avenues that will end homelessness rather than simply managing the problem.

A modification of the cities existing rooming house policy would be one quick partial solution. This would result in a substantial Rescue Mission population decrease which would allow for them to focus on the worst problems by helping those who have mental conditions, drug addictions, or providing training for people to get jobs, etc.

Solving the homeless issue in the city will require a multifaceted approach. And all parties will need to work together including the city government, homeless services and landlords. This problem won’t resolve itself on it’s own.

REI of Virginia Business Trip To Indianapolis Indiana

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May 28th, 29th and 30th 2015 will be the 14th Annual National MrLandlord.com convention which will take place in Indianapolis Indiana.

Several REI of Virginia members plan on attending so we are sending you this email for a great educational tax write-off / vacation.

CLICK HERE for a list of the instructors. We have had both Jeffery Taylor and Jim Ingersoll at our REI meetings. Jeffery has a great lineup of people scheduled as speakers with a wide variety of experience.

I just got off the phone with Jeffery and bought tickets for me and Spanky. A few tips…  I signed up for his newsletter (only one person is entitled to that and some other bonus at the convention). That deducted $100 from our tickets and the cost of the newsletter is $100 so it is a wash. He then told me that he would let us bring another 2 people for no additional cost. So essentially 4 people get to go for the regular 1 person price of $299 if we get our tickets now. That brings it down to only $75 per person.

We will also be saving some money by renting a car and driving there. We plan to rent a big SUV and need 2 more people to ride with us so we can all split up the costs and make it cheap. Maybe we will rent a van if there are enough people and we will all go together. Or if there are more than 2 that want to drive with us I can help organize car pool groups that can ride together. I will also help organize people who want to go if you don’t already have partners you plan on going with so you can save some money on the convention fees as well.

Please let me know if you are interested in taking this tax deductible business trip and I will help get you partner REI members. Lots of fantastic info at this conference. Take a break from work and go with us. Reply to this email to let me know if you want to go!

CLICK HERE for details on the convention.

FYI, Jeffery Taylor will be speaking at the Charlottesville REI meeting on April 9th at 5:30pm. If you would like to contact the Charlottesville REI the contact person is Beth and number is 434-882-4664

Using Privatized Banking To Leverage HUGE ROI, Safe Reserves and Maximize Positive Cash Flow

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This week our guest speaker flew in from California to see us. His name is Kraig Strom CFP® ChFC™ and works with Team Financial Partners. Kraig has some interesting concepts to talk with us about that pertain to using equity in your properties to build wealth.

The Rich Have Used Family Banks To Build Wealth and Freedom For Generations.  Discover powerful cash management strategies through the creative use of properly structured High Cash Value Life Insurance contracts!

Most people think of life insurance as a death benefit but large banks, corporations and wealthy individuals know that it’s a powerful cash management tool that SUPERCHARGES any investment, especially Real Estate!

Case Studies:
      ·       6 Month Flip – 36% Increase in ROR
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Bank of America & Wells Fargo have 39 BILLION dollars inside this type of life insurance?  Come and find out why!

Monday, March 23, 2015

Look Like A Meth Lab To You Or The Signs Of A Filthy Lazy Tenant?

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This week we will have special guest speaker Agent Crowder who will be with us to teach the group what we need to do when discovering drugs in a tenant’s house.

I guess the first thing that would be needed is how to identify the drugs. I’m sure most people could identify a marijuana plant like I found below by the back porch of one of my apartment buildings last year.

But I can admit that the meth lab picture at the top looks to me like tenants that like to urinate in jars because they are too lazy to walk to the bathroom. The only thing I initially see that would tip me off would be the scale. However, there are some various common chemicals mixed in to the garbage.

Drugs in your property, example being the meth lab, could lead to some very serious problems for you. It is incredibly expensive to do a proper cleaning of a meth lab to ensure that future residents won’t be harmed by the chemical residue that the manufacture of it leaves. And as I recall the states now no longer fund the cleanup. I believe that the funding for this was going to be the responsibility of the federal government. But it didn’t get transferred to them right away. So it may be your responsibility. We will find out that and many more important things to know in the meeting.

What do you do when you find drugs in your rental unit?
What do you do if you suspect a meth lab in your rental?
What do you do if you are unsure but have been told by neighbors that your tenants are dealing drugs?
What do you do if your tenants are telling you that there is a drug house across the street?

Find out all of this and much more at our upcoming meeting. Education is the key to your success.


Thursday, March 19, 2015

It's OK on City Property But Not Yours!

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This photo was taken Thursday at 7pm, March 19th 2015. It's a photo of 1709 Salem Ave in Hurt Park. The property utilizes the Low Income Housing Tax Credit Federal housing program. The property received a tax credit allocation in 2009 for $636,674 with a 10 year value of $6,366,740.

Roanoke City government tore down the apartments that were there and rebuilt new apartments in the name of Hurt Park Limited Partnership.Hurt Park Limited Partnership has a principal owner address listed at the Roanoke Redevelopment and Housing Authority. Of which all Authorities are quasi private businesses that have been granted governmental powers.

Monday, March 16, 2015

Have You Signed Up For The REI Discount Program?

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Save Money on Materials for Your Properties

Real Estate Investors of Virginia is excited to announce a new partnership to help you save money on materials and services for your properties. Start saving today by signing up for your free Community Buying Group membership. As part of our partnership, Real Estate Investors of Virginia members enjoy access to the CBG benefits program at no cost to you.

CBG helps you do business better through savings at Lowe’s, Sherwin Williams, Sunbelt Rentals, Sears Commercial and more than 20 other CBG Preferred Partners.

Click the link below to sign up now. A Community Buying Group representative will follow up to make sure you are set up to take advantage of the programs you want to use.

https://www.communitybuyinggroup.com/group-signup/9b643d3e006b14beba251b0e95011121

This is one more way Real Estate Investors of Virginia is working to help you be more successful!
 

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