Comments for The Dominion Group http://www.thedominiongroup.com Building a Better Baltimore, One House At a Time. Sat, 11 Feb 2012 21:01:37 +0000 hourly 1 http://wordpress.org/?v=3.0.1 Comment on The Rentership Society by Gordon Stebbings http://www.thedominiongroup.com/?p=1777#comment-908 Gordon Stebbings Sat, 11 Feb 2012 21:01:37 +0000 http://www.thedominiongroup.com/?p=1777#comment-908 Good analysis. Not far-fetched either. And while I agree with the final conclusion, I still think the "lack of access to credit" argument is overblown. To compare renting to the purchase of a distressed property is not valid. The ability to mortgage homes in very poor condition is part of the reason we are in this mess to start with. We still have a strong pool of qualified buyers here in the Baltimore market prepared to pay first-time-homebuyer prices for non-distressed properties. Not to mention the increasing number of programs aimed at allowing buyers to purchase a home with no money down. I guess a larger question is who really loses in this scenario? It won't be the rehab-for-retail investor who sells nice homes. It won't be the landlord who pulls increasingly higher rents. It won't be the buyers and renters who are getting more for their money than ever before. I'm guessing it will be the homeowner who has maintained but not updated their property, but they can't sell because their only competition are very nice very affordable properties. Interesting times. -G- Good analysis. Not far-fetched either. And while I agree with the final conclusion, I still think the “lack of access to credit” argument is overblown. To compare renting to the purchase of a distressed property is not valid. The ability to mortgage homes in very poor condition is part of the reason we are in this mess to start with. We still have a strong pool of qualified buyers here in the Baltimore market prepared to pay first-time-homebuyer prices for non-distressed properties. Not to mention the increasing number of programs aimed at allowing buyers to purchase a home with no money down.

I guess a larger question is who really loses in this scenario? It won’t be the rehab-for-retail investor who sells nice homes. It won’t be the landlord who pulls increasingly higher rents. It won’t be the buyers and renters who are getting more for their money than ever before. I’m guessing it will be the homeowner who has maintained but not updated their property, but they can’t sell because their only competition are very nice very affordable properties.

Interesting times.

-G-

]]> Comment on Which Market to Choose? Zip Codes by the Numbers by Errol Brown http://www.thedominiongroup.com/?p=1676#comment-871 Errol Brown Mon, 30 Jan 2012 06:11:45 +0000 http://www.thedominiongroup.com/?p=1676#comment-871 I'm looking at investing in a couple of properties in Reservoir Hill near Madison Ave. There's lots of renovation in the area. The first property is a total rehab to renovate, 55k, and resell and a second property, 130k, to buy and hold that's liveable but needs modernization such as new kitchen, baths, HVAC, electrical and cosmetic touches. Both are large row homes with brick exterior. Is this a good area to invest? Any suggestions on purchase price and getting estimates? Any other information would be helpful. I’m looking at investing in a couple of properties in Reservoir Hill near Madison Ave. There’s lots of renovation in the area. The first property is a total rehab to renovate, 55k, and resell and a second property, 130k, to buy and hold that’s liveable but needs modernization such as new kitchen, baths, HVAC, electrical and cosmetic touches. Both are large row homes with brick exterior. Is this a good area to invest? Any suggestions on purchase price and getting estimates? Any other information would be helpful.

]]> Comment on Catching A Falling Knife – Tax Lien Investing by Horace Moning http://www.thedominiongroup.com/?p=1287#comment-754 Horace Moning Tue, 20 Dec 2011 19:06:54 +0000 http://www.thedominiongroup.com/?p=1287#comment-754 Hi could i please have some of your investment information please. Hi could i please have some of your investment information please.

]]> Comment on Is the Foreclosure Crisis over? Then where’s all the REO? by josh http://www.thedominiongroup.com/?p=1668#comment-697 josh Sat, 19 Nov 2011 16:29:32 +0000 http://www.thedominiongroup.com/?p=1668#comment-697 what you are alleging initially, that banks are holding all this inventory to hope prices jump or not take the loss, is ridiculous. The connection between tarp and REO that should not be drawn is not the "cause and effect" or "one benefiting another" connection, which of course is very real. It is that because of Tarp money, banks are holding properties connection. The fact that tarp potentially makes money would never cause banks to be OK with losing money elsewhere if losing could be prevented. True, banks may be afloat as a result of tarp with the REO, but the leap from that to banks are holding non performing inventory as a result of Tarp is a stretch. Add in holding costs, and there are no reasons for a money making institution to maintain it. The loss is already real whether they sell or not and banks know it. So where are the properties?? sitting on a bank balance sheet waiting to be liquidated as a bank A. loses 5 percent annually on a non-performing asset to carry it B. borrows at an additional 5 percent to cover its 5 percent loss on the previous??? (see many 10 percent 30 year fixeds these days?? to break even no less??).....and now banks are in the real estate speculation business while the REO houses they have continue to lose money for them, tarp or no tarp. what you are alleging initially, that banks are holding all this inventory to hope prices jump or not take the loss, is ridiculous. The connection between tarp and REO that should not be drawn is not the “cause and effect” or “one benefiting another” connection, which of course is very real. It is that because of Tarp money, banks are holding properties connection. The fact that tarp potentially makes money would never cause banks to be OK with losing money elsewhere if losing could be prevented. True, banks may be afloat as a result of tarp with the REO, but the leap from that to banks are holding non performing inventory as a result of Tarp is a stretch. Add in holding costs, and there are no reasons for a money making institution to maintain it. The loss is already real whether they sell or not and banks know it. So where are the properties?? sitting on a bank balance sheet waiting to be liquidated as a bank A. loses 5 percent annually on a non-performing asset to carry it B. borrows at an additional 5 percent to cover its 5 percent loss on the previous??? (see many 10 percent 30 year fixeds these days?? to break even no less??)…..and now banks are in the real estate speculation business while the REO houses they have continue to lose money for them, tarp or no tarp.

]]> Comment on Hood Rats 2011 by Dominion http://www.thedominiongroup.com/?p=1484#comment-673 Dominion Fri, 04 Nov 2011 00:52:45 +0000 http://www.thedominiongroup.com/?p=1484#comment-673 Mocking? No mocking, just documenting what we see in our travels through the inner city. We could pretend things don't exist, but denial never solved any problems. The truth, the whole truth and nothing but the truth - whether you like it or not. Mocking? No mocking, just documenting what we see in our travels through the inner city. We could pretend things don’t exist, but denial never solved any problems. The truth, the whole truth and nothing but the truth – whether you like it or not.

]]> Comment on Hood Rats 2011 by Bob Turner http://www.thedominiongroup.com/?p=1484#comment-672 Bob Turner Thu, 03 Nov 2011 22:22:39 +0000 http://www.thedominiongroup.com/?p=1484#comment-672 How is this helping you're marketing for dominion? Mocking Baltimore, aren't you all trying to promote the city and their rehabs. Doesn't make sense, wonder if the Mayor has seen these.... How is this helping you’re marketing for dominion? Mocking Baltimore, aren’t you all trying to promote the city and their rehabs. Doesn’t make sense, wonder if the Mayor has seen these….

]]> Comment on Mayors Conference at Dominion’s Rutland Project by Linda http://www.thedominiongroup.com/?p=1624#comment-666 Linda Thu, 27 Oct 2011 17:58:10 +0000 http://www.thedominiongroup.com/?p=1624#comment-666 When these homes are being demolished is there a re-claiming company coming out to pull any materials that other investors could use for their projects? When these homes are being demolished is there a re-claiming company coming out to pull any materials that other investors could use for their projects?

]]> Comment on Is the Foreclosure Crisis over? Then where’s all the REO? by Steve http://www.thedominiongroup.com/?p=1668#comment-644 Steve Thu, 13 Oct 2011 23:43:10 +0000 http://www.thedominiongroup.com/?p=1668#comment-644 No Way is the foreclosure and Bank REO's over with. Pending foreclosures are out there - many have not even been filed against the homeowners yet, or are in a revolving door of loan modification applications. Add in the short sales before or after a loan mod is denied. I personally know of 100's of houses that are literally waiting for the banks to ramp up the foreclosure process. I come across a bunch over the past 12+ months that are still sitting vacant or better yet, the homeowner gets to enjoy free living while the Government decides what to do with this Robo signature crisis. And to make this political, very few residential foreclosures have been scheduled in DC and most counties of Maryland. Look at legal ads in local papers - hardly nothing. Maybe just for properties that don't qualify for Foreclosure protection laws - already vacant, had case numbers (in MD, they need case numbers issed by the local county court, which are not issuing these except for a small number of cases) before Robo crisis started or are commercial/land properties. Even rental housing are getting a pass - don't want tenants out on the street. Before the Robo crisis, there were 20+ pages of legal ads in most bigger newspapers (each County/Balt City), but now you barely find 1-2 pages per newspaper. But Viginia is in full force and has been most of the time here - at least in year 2011. So there is a huge back-up of houses that will be trickling out soon. A semi controlled release to foreclosing attorneys and Bank REO agents. But it will happen soon, but when? I think the US Govt is still negotiating with the top 17 banks that have been doing the massive foreclosures and what steps they are going to take to save as many as possible from ever being foreclosed on. I know of a two day workshop in PG County to bring in these homeowners and work with them again on modifying their loan payments - this was also done last June, if you saw their ads in the Wash Post, etc. This time, they are reaching out to the homeowners via direct mail rather than hoping they read the paper or see ads on TV. My two cents and then some more cents No Way is the foreclosure and Bank REO’s over with. Pending foreclosures are out there – many have not even been filed against the homeowners yet, or are in a revolving door of loan modification applications. Add in the short sales before or after a loan mod is denied. I personally know of 100′s of houses that are literally waiting for the banks to ramp up the foreclosure process. I come across a bunch over the past 12+ months that are still sitting vacant or better yet, the homeowner gets to enjoy free living while the Government decides what to do with this Robo signature crisis.

And to make this political, very few residential foreclosures have been scheduled in DC and most counties of Maryland. Look at legal ads in local papers – hardly nothing. Maybe just for properties that don’t qualify for Foreclosure protection laws – already vacant, had case numbers (in MD, they need case numbers issed by the local county court, which are not issuing these except for a small number of cases) before Robo crisis started or are commercial/land properties. Even rental housing are getting a pass – don’t want tenants out on the street. Before the Robo crisis, there were 20+ pages of legal ads in most bigger newspapers (each County/Balt City), but now you barely find 1-2 pages per newspaper. But Viginia is in full force and has been most of the time here – at least in year 2011.

So there is a huge back-up of houses that will be trickling out soon. A semi controlled release to foreclosing attorneys and Bank REO agents. But it will happen soon, but when? I think the US Govt is still negotiating with the top 17 banks that have been doing the massive foreclosures and what steps they are going to take to save as many as possible from ever being foreclosed on. I know of a two day workshop in PG County to bring in these homeowners and work with them again on modifying their loan payments – this was also done last June, if you saw their ads in the Wash Post, etc. This time, they are reaching out to the homeowners via direct mail rather than hoping they read the paper or see ads on TV.

My two cents and then some more cents

]]> Comment on Which Market to Choose? Zip Codes by the Numbers by Dominion http://www.thedominiongroup.com/?p=1676#comment-602 Dominion Tue, 20 Sep 2011 16:50:43 +0000 http://www.thedominiongroup.com/?p=1676#comment-602 That's awesome. Congratulations. In a strong market like Fed Hill, being in for 50-75 times monthly rent is great. Your biggest threat is probably property taxes - make sure to appeal those down to your respective purchase prices. Being Fed Hill, your vacancy rate is going to be very low. My only other question is the level of renovation. Are the layouts modern and open? Or are they the original layouts? What I'm trying to get at is the potential for appreciation. Fed Hill is a stable neighborhood so they'll likely always be great rental properties, but if the properties require a gut renovation in order to make them modern and attractive to a homeowner, you've got two long-term rental plays and the cash flow has to be the driving reason for the investment. The property that you've got $115K into will certainly cash flow well at $1995. The other property at $150K will cover your debt service, but you're not going to be taking any vacations on the excess income. Either way, you're young and building assets - thats the time to get started. If you'd like to discuss further, hit me up at jack@thedominiongroup.com and lets grab lunch. Thanks. Really appreciate the comment. That’s awesome. Congratulations. In a strong market like Fed Hill, being in for 50-75 times monthly rent is great. Your biggest threat is probably property taxes – make sure to appeal those down to your respective purchase prices. Being Fed Hill, your vacancy rate is going to be very low. My only other question is the level of renovation. Are the layouts modern and open? Or are they the original layouts? What I’m trying to get at is the potential for appreciation. Fed Hill is a stable neighborhood so they’ll likely always be great rental properties, but if the properties require a gut renovation in order to make them modern and attractive to a homeowner, you’ve got two long-term rental plays and the cash flow has to be the driving reason for the investment. The property that you’ve got $115K into will certainly cash flow well at $1995. The other property at $150K will cover your debt service, but you’re not going to be taking any vacations on the excess income. Either way, you’re young and building assets – thats the time to get started. If you’d like to discuss further, hit me up at jack@thedominiongroup.com and lets grab lunch.

Thanks. Really appreciate the comment.

]]> Comment on 1515 Lemmon St – Rental Deal Breakdown by Dominion http://www.thedominiongroup.com/?p=689#comment-601 Dominion Tue, 20 Sep 2011 16:42:39 +0000 http://www.learnthepractice.com/Learn%20the%20Practice/wordpress/?p=689#comment-601 Shawn, we work with a number of subsidized rental programs, including Section 8, MBQ, HOPWA, BHS and Dayspring. We haven't gone into the assisted living business, though we know a number of folks here in Baltimore who are doing very well with it. Cap rate is net operating income divided by your cost basis. People play games with the net operating income calculation, but our calculations take into consideration all cash expenses, plus reserves for vacancy, turnover costs and capital expenditures. Our take is that appropriate scattered site residential real estate rental returns should be in the 9-12% range, depending on location. Shawn, we work with a number of subsidized rental programs, including Section 8, MBQ, HOPWA, BHS and Dayspring. We haven’t gone into the assisted living business, though we know a number of folks here in Baltimore who are doing very well with it. Cap rate is net operating income divided by your cost basis. People play games with the net operating income calculation, but our calculations take into consideration all cash expenses, plus reserves for vacancy, turnover costs and capital expenditures. Our take is that appropriate scattered site residential real estate rental returns should be in the 9-12% range, depending on location.

]]>