Max Cash Flow Now

Max Cash Flow Now: Rental Property Profits Maximized by Avoiding Mistakes

How many times have most of us taken on a project only to have it turn out to be a total learning experience?  Going in, we may have thought we talked to the right people, asked many of the right questions, researched enough but in the end still were hit with surprises and costly mistakes.  No one has the time or money to spend on a hit and miss investments strategy.

We were talking with a small group of people at our Local REIA (Real Estate Investment Association) meeting who were interested in using their rental properties to make $1000 net profit every month through our system of transitional housing.  One member joined our small discussion group and said he had tried transitional housing with the specific tenant population we work with, with a program he put together himself.  He was disgruntled and said it was not working for him.  His biggest problem was vacancy rates. We suggested meeting with him later to find out what he was doing and offered him a free consultation.

He was the first of two transitional house landlords we met recently who were having difficulty with their properties.  Neither of them were our students and both were doing poorly because of avoidable pitfalls.  During our meeting, we discovered if he wanted to turn things around it was necessary for him to approach areas of his property and tenant management differently, along with how he marketed.

Transitional housing may appear simple to figure out, and it is not rocket science, but there are caveats to every unique business venture.  Don’t confuse learning something new with unusual time commitments or more work, but with simply knowing how to use tried and true choices. Why re-create the wheel?  Get the job done efficiently the first time around instead of on a live and learn basis.

How can you know what you don’t know?   To learn more download our FREE Ebook, “Max Cash Flow Now,” from the right side bar.

Max Cash Flow Now: Take Yourself on Vacation with Increased Rental Property Profit

Take yourself on vacation using your increased rental property income.  I was driving home in 11-degree temperatures from a meeting with one of our rental property owner/students.  He was telling me about his upcoming vacation to warm and sunny Mexico.  While some of you reading this are in warmer climes, most of us have been hit by an unusually cold winter and our minds go on vacation more often than our bodies!  We all could use a vacation to break up the winter months.

Our student mentioned that he skimmed a little off his rental income every month to add to his vacation fund.  Not a bad idea I thought as I watched the snow blowing along the side of the road.  In most rental situations, the property owner does not have anything at the end of the month to skim. What I heard our student/rental property owner say was “Before I worked with your program my gross rents were barely getting the expenses paid; now it does that twice over and leaves me a little play money.”  Oh, the joys of having a little play money – practically unheard of in this economy.

Not everyone would take this approach with the additional income they generate from their rental properties.  I understand.  Some would even think it bad business not to put the entire added profits back into their investment, but then again . . . live once and enjoy it!

There is so much room in the deal after transforming your rental property with our unique approach that considering taking a little every month and padding your vacation fund may not be such an imprudent idea.  How many rentals do you have right now that would help pay your way to Mexico or Hawaii this winter?

To learn more about our method download the FREE Ebook from the right side bar.

Max Cash Flow Now: Income property can have very stable, respectful and reliable tenants.

Yes, that’s correct!  It all depends on product, location and first rate tenant screening.  If you don’t have all three, your vacancy rate will be elevated.  Let’s talk about product first.  We recommend to our students that they furnish their properties with clean serviceable items, new linens and art work on the walls.  What you are creating is an environment that is very agreeable to the tenant, one that not only the tenant will look forward to coming home to, but also one, through pictures on flyers, web sites and word of mouth, will draw new inquires.  We are all for building and keeping a pipeline.

Many furnished rooms for rent are not clean and be full of old, thread bear chairs, sofas, and soiled mattresses.  Would you want to stay any longer than you had to in a place that does not support a good sense of self-esteem?  Nicely furnished rooms generate good paying tenants, who stay for long periods.

Our preferred tenant populations  normally do not have their own transportation so proximity to public transportation is necessity.

Key to this equation within our system is good tenant screening, which strangely enough does not include credit or traditional background checks.  Our tenants are referred to us, so we gain knowledge about them and their history though direct questioning of people who are familiar with each possible tenant individually.  We discover personal background information and work experience.  This type of screening done methodically will produce good paying renters who stay for long periods creating a stable house.

To discover more about setting up transitional housing, please download our free Ebook from the right side bar.

Max Cash Flow Now: Rental Property Cash Flow Wizards meetup.

A group of alternative housing landlords got together recently at a local neighborhood bar to discuss a range of common concerns.  They were anxious to re-confirm a collaborative coalition rather than a competitive one.  There is such a need for this type of work and everyone brought important questions and answers to the get together.  The group was made up of of experienced property owners and others that were just opening up.

It was a great sharing of ideas, solutions, and experience.  Things discussed were; the state’s early release program, vouchers to property owners that pay for up to two months rent, newly discovered tenant referral sources, a free bicycle program, and a group marketing initiative.

Everyone is doing so well.  One property owner commented that even with 2 out of 7 beds opened for a while, she was still making great cash flow on her property.  Presently with a little attention given to her referral sources, she has filled the 2 beds and has 2 guys waiting in the “pipeline.”  The experienced landlords all agreed that it doesn’t take much once a house is established to keep it full and they were all loving the income their properties generated every month.

If you’re a first time reader of this blog post, it’s important to appreciate that these property owners are renting individual furnished rooms to a definite tenant population thus creating great rental property income – on the average of $1000 a month NET.

Learn more about transitional housing by downloading our FREE Ebook by inserting your email address on the right side bar.  And feel free to contact us anytime with questions.

Pic’s of Transtional Housing

Max Cash Flow Now: Build ROI with investment property through transitional housing.

We write a lot about increasing rental income 3 to 4 times by renting out individual furnished rooms.  But, what does a furnished transitional home look like?  Here are some interior pictures of some of our student’s homes.

Commen Area

Private Room

Dining Area

Kitchen

Private Rm

Semi-Private

Each home has been furnished with reconditioned, used or gifted furniture, fixtures and appliances at very reasonable costs, normally in the range of a one time cost of $400 to $600 per bed.  A schedule to repay yourself for this investment in furnishings either can be very short, or over an extended period of time depending on the advice of your accountant.

Our philosophy is to provide a warm, clean, comfortable environment that fosters a growing sense of self-esteem, which is so important for individuals seeking employment or struggling with getting their life back on track.

Be the difference in someone else’s life and at the same time prosper financially.  Read our free Ebook, which can be downloaded on the side bar to the right of this post.

Max Cash Flow Now: Rental property cash flow can be thought of in different ways.  It’s that time if year when most of us are thinking of what we can give, what we can bring, what we can share.  Our daily blog however is mostly centered around receiving.  Receiving is, without question a good thing, but it is at the Holidays that so much of our focus shifts to giving.

Business shouldn’t be only about what we can get out of it – ideally there must be a mutual exchange of goods or services in which all parties experience value for a healthy balance to exist.  Many of our students take up our program for the sole purpose of what is it they can receive. No problem, after all business is based on smart decisions regarding how to make the most of a good investment – so naturally we applaud their thinking.

However, our program innately carries a business balance where everyone involved receives and gives within a healthy mutual respect.  In tough times or good times, offering someone a clean, affordable place to call home is foundational to the spirit of giving.  At the same time, receiving a maximum return on an investment is ultimately the purpose of good business.

Times are changing more rapidly than we would have ever conceived possible just a few short years ago – business is not “as usual”.  In this hard economic period, doesn’t it make sense to enter a business arrangement knowing that it not only benefits you, but countless others?  Think outside the box.  Remember receiving has the additional bonus of feeling even better when you are giving back in return.

Learn about our method of giving and receiving by downloading the FREE eBook on the sidebar on the right.  Happy Holidays!

Max Cash Flow Now: Protect your rental property income and investment with landlord insurance.  We found this concise article by Hugh McInnes, an Australian Insurance Broker. Check with your own insurance professional to make sure you are adequately  covered.  If your using our method of multiplying rental income, we would also suggest a very inexpensive medical insurance rider to cover up to $5,000 each occurrence, to help your tenants cover the costs of medical treatments for minor injuries.  It would be rare for our recommended tenant population to be in possession of health insurance.  To learn more about our system to increase cash flow, download our FREE eBook by entering in your email address in the box on the right.

Have a Rental Property? Make Sure You Invest in Landlord Insurance by Hugh McInnes

If you are considering renting a property to turn a profit, it is wise to look into landlord insurance to protect your investment.

Landlord insurance provides similar protection to homeowner’s insurance but includes special protections to insure your needs as a landlord are met in the event you cannot rent your property for profit.

There are several major items that landlord insurance covers:

Building Damage
This is the most similar aspect to homeowner’s insurance. Landlord insurance covers your property in the event of most types of damage. For example, if your property is damaged or destroyed in a fire, the insurance will cover the cost of rebuilding the property. Remember to insure for the proper amount or you will be stuck covering the difference. Also, read your policy carefully as there are certain types of damage that are usually not covered, such as flooding and other “acts of god”.

Loss of Rental Income
This is where landlord insurance goes above and beyond typical homeowner’s insurance. Not only does it help you pay for damage to your property, a good policy will also reimburse you for lost income in the event that your property is uninhabitable by your tenants due to damages. If you rely on these properties for your income, this is a life saver.

Legal Fees and Liability Coverage
As a landlord, you take on addition risk since you have other people living in your property. For example, if your tenant is injured on the premises, you could be held liable for damages. Most landlord insurance covers your legal fees in the event that your tenant sues you for damages. In addition, if the tenant wins the lawsuit, a good policy will cover the judgment against you so your personal property and assets are untouched. Some policies even cover medical expenses that your tenant might incur if injured in your property.

If you are a landlord and you chose not to purchase this insurance, your homeowner’s insurance will not protect you in any of these events. It’s like any other insurance. If your building is never damaged, your tenant is never injured and you never lose any property, you’ll never need the insurance. However, life isn’t predictable and if any of these events ever happen you will have nothing to worry about. Sometimes it’s worth paying a little extra for the piece of mind that a good insurance policy offers.

Max Cash Flow Now: Finding an agent’s “pocket deals” for your investment portfolio will increase rental property income.  A pocket deal is slang for real estate a Realtor may know is about to be listed or a present listings price is about to change.

It was a year ago a Realtor called to say she had a listing that a bank had foreclosed upon, but was having difficulty getting any offers and was lowing the price $20,000, (about 20%) and that it would take effect the following day.  We made arrangements to see the property and put in an offer that same day.  As no other buyers were able to submit an offer within the 24 hour deadline of our offer, ours was accepted.  We got a great deal.

Once you have found your great deal, what are you going to do with it?  Rehab and flip, or rehab and hold?  If you’re considering holding and building a real estate portfolio of rental properties don’t settle for a small monthly income while you are waiting for real estate prices to rebound.  Instead, why not go for $1,000 month in net rental income per property?

We learned of our REO agent because we called on another listing which had the term REO in it’s listing remarks.  REO stands for real estate owned, and is the nomenclature for a listing that was probably foreclosed upon by a mortgage lender.  We went on to clear a monthly rental profit of $1,300 on the above mentioned property and then turn-keyed it to another like-minded investor four months later for a $35,000 return.  The new investor kept our program in place and now he is clearing the $1,300 monthly.

You may already know and maybe not but some real estate brokerages cultivate relationships with a bank’s asset manager, who will list many of the properties that it has in it’s inventory.  Therefore, it’s important to build a relationship with these specialized brokers.  We recommend that you avoid signing an exclusive representation agreement with any particular agent, as you’ll build relationships with many of them.

Learn how we make our monthly profits on rentals and how we have helped others do the same by downloading our free eBook, see sidebar.

Max Cash Flow Now:  Had a Denver investor ask us to tour his property so he could discover if he could increase his rental property income.  We arrive there last Tuesday and found a two story single family home, which was built in 1910.  We love going through those older homes.  So many quirky little things about them; odd hallways, stairs in weird locations and several exterior doors where you wouldn’t expect them to be.  This home has seven bedrooms and five large full bathrooms, three of the bedrooms had their own private full bath. Amazing!

This home, if rented normally, would only be attractive to a very large family and would probably rent for $1600 a month in the quiet, urban working class neighborhood where it is located. Certainly no more than that.  The investor wanted to see if it would be suitable for our program.  We measured all the bedrooms, counted amenities, proximity to conveniences, ran a few numbers and decided it would work perfectly and his gross monthly rent would amount to $4,500.

His PITI on the property using private money, currently is $3,500, so he’ll net about $700, after paying a portion of the utilities.  Once a title-seasoning period has passed, he’ll refinance the property to lower his payments, thus, increasing his net well beyond the $700 to around $2,300 per month.

Learn about our system by downloading our free eBook, see side bar.

Max Cash Flow Now: Rental property income comes in two forms, active and passive.  We’re all aware of the passive kind.  Purchase a SFR or multi-family, rehab to rental level and rent out to a family at market rates or to a section 8 renter.  But is it so passive after all?  Every rental property requires property management, either done by the property owner themselves or by a property management company.  In either case it’s an expense of either time or money that cuts into your net cash flow.

If you’re the type that does your own property management, our system should be of interest to you.  It’s a system that does require more of a commitment of time up front, and by that I mean the first two or three months, while you implement the program.  Then after that, your time involved is whatever you want.  We like to keep a pipeline of potential tenants and that takes a few random minutes every month.  Then when you are getting a renter in and one is leaving, your time is required.  Is it overall more time than a typical rental?  A little.  Is the extra time worth it?  Not even close!  Three to four times the net monthly income you were making on your property previously.  That’s right! All because you changed the tenant population, and put into practice a program that would consistently earn you an average $1000 per rental unit “net” or more.

To learn about our system, download our free eBook, see sidebar.