This may not be a popular post, but think about what it says. Those of you who are waiting wistfully for Michigan to return to the glory days of "The Big 3" better not be holding your breath. The glory days of "American" auto companies dominating the auto buying market in the United States is clearly over. Don't get mad, it's a fact.
The auto industry is a global thing now with many competitors bringing their products to our doors here in our country. If you doubt the global reach of the auto industry, do a little research on where GM and Ford are investing their money. You don't have to look very hard to figure out that they're investing in a lot of places other than the United States - and well they should be. There isn't much news about any of the "American" companies building new plants in the U.S. - that's because they aren't.
So, the auto industry is writing a new chapter in its history and that means that Michigan and Detroit - the Motor City - are out of luck and used up, right? If you think so, you're just as wrong as the people waiting for the auto industry to swoop in and save Michigan. Sorry.
Is this all bad news? Of course not, unless you listen to the news and read the statistics without thinking. Michigan is poised to become a leader in alternative energy creation and the manufacturing of plants and related components. The corridor between Ann Arbor and Detroit has become a hotbed of technology developing firms. Whether you like casinos or not, it's hard to argue that they are driving Michigan ahead into a "Services" based economy from a Manufacturing based economy. The health care industry is growing as fast as anything in recent memory and with The Detroit Medical Center, the William Beaumont facilities, Henry Ford Medical System, St. John Health System, U of M Hospital and the Kresge Eye Institute, Karmanos Cancer Center and many more like Stryker Corp., you have to believe that Michigan is as well suited to capitalize on this boom as any state.
So, is the glass half full? Or is it half empty like everyone thinks who believes that Michigan is down for the count. I think it's half full and so should you.
Until next time.
Friday, May 2, 2008
Saturday, April 5, 2008
Some of my Friends are Making It Happen - Part 1
Hello again! And again it's been a while since I posted. I really have to get better about that just in case someone is actually reading this.
Today I want to talk about one of my associates from the REIA of Macomb (REIA stands for Real Estate Investors Association an dyou can visit their site here http://www.reiaofmacomb.com/). I won't talk about them by name, but if they see this, they'll know who they are.
The person and project I want to tell you about today are really incredible. You might know her from a post a while back entitled "The Power of Teamwork". Her name is Tina. Tina just finished a big rehab project. No, not what you are thinking - Britney Spears is a different kind of big rehab project. For those of you not familiar with the term "rehab" as used in real estate, it means buying a house that needs a lot of work, fixing it up and selling it to someone else. The goal, of course is to make money, but also to improve a neighborhood and provide a good house for someone.
For a lot of real estate investors a "big" rehab is fresh paint, new carpet and refinishing some hardwood floors, maybe glass block windows. Compared to that, what Tina did is a rehab on steroids. What she did really wasn't a rehab, but a rebuild. She did some amount of work on every inch of the house she bought.
She put new support structure in the basement, replaced the furnace and the plumbing, installed new windows, put in a new kitchen floor and new carpet, tore down a useless wall, gutted a bathroom, moved the electrical box and the laundry hookups and poured a new driveway. I'm tired just thinking about it. I need a break.
O.K., on top of all that - literally, on top of all that - she designed and had built the upstairs in the house. The structure was there, but there were no walls, just framing. She designed the layout herself and had her contractor build 3 new bedrooms and a new bathroom based on her design. Then she painted the house herself and found a buyer.
When all was said and done she had spent approximately 4 months and tens of thousands of dollars. She sold the house and made a nice profit. I don't know how much money she made, but I know she's a lot richer from the experience she gained. Most investors lose money on their first rehab project, Some lose their shirt and even more lose the desire to ever do another rehab project. It is rare, indeed, for an investor to turn a profit on their first rehab, especially one that big.
Congratulations, Tina.
Until next time - Make It Happen! Whatever "It" is in your life.
Bernie
Today I want to talk about one of my associates from the REIA of Macomb (REIA stands for Real Estate Investors Association an dyou can visit their site here http://www.reiaofmacomb.com/). I won't talk about them by name, but if they see this, they'll know who they are.
The person and project I want to tell you about today are really incredible. You might know her from a post a while back entitled "The Power of Teamwork". Her name is Tina. Tina just finished a big rehab project. No, not what you are thinking - Britney Spears is a different kind of big rehab project. For those of you not familiar with the term "rehab" as used in real estate, it means buying a house that needs a lot of work, fixing it up and selling it to someone else. The goal, of course is to make money, but also to improve a neighborhood and provide a good house for someone.
For a lot of real estate investors a "big" rehab is fresh paint, new carpet and refinishing some hardwood floors, maybe glass block windows. Compared to that, what Tina did is a rehab on steroids. What she did really wasn't a rehab, but a rebuild. She did some amount of work on every inch of the house she bought.
She put new support structure in the basement, replaced the furnace and the plumbing, installed new windows, put in a new kitchen floor and new carpet, tore down a useless wall, gutted a bathroom, moved the electrical box and the laundry hookups and poured a new driveway. I'm tired just thinking about it. I need a break.
O.K., on top of all that - literally, on top of all that - she designed and had built the upstairs in the house. The structure was there, but there were no walls, just framing. She designed the layout herself and had her contractor build 3 new bedrooms and a new bathroom based on her design. Then she painted the house herself and found a buyer.
When all was said and done she had spent approximately 4 months and tens of thousands of dollars. She sold the house and made a nice profit. I don't know how much money she made, but I know she's a lot richer from the experience she gained. Most investors lose money on their first rehab project, Some lose their shirt and even more lose the desire to ever do another rehab project. It is rare, indeed, for an investor to turn a profit on their first rehab, especially one that big.
Congratulations, Tina.
Until next time - Make It Happen! Whatever "It" is in your life.
Bernie
Tuesday, February 26, 2008
We Are Not Alone!
Hello! It's been a while, not that any of you missed me - I know better than that.
The title of my post does not indicate that beings from another planet have arrived in Detroit. On the other hand, it doesn't mean they haven't arrived, either! I suppose if they want to buy a house bring 'em on! Lots of 'em.
What I do mean is that we aren't alone in our housing slump. We aren't alone in our pain - at least on the housing front. In terms of overall economic decline, not many will argue that Michigan is suffering more than most - if not all - other states. Between the limping auto industry, the loss of other manufacturing jobs, declining housing values, an exodus of college gradutes to other states, Michigan has it pretty bad to be sure. Unscrupulous mortgage lenders and record foreclosures just seems to be piling on at this point.
There is good news and there is bad news with regard to real estate, though. First, the good news - we are not alone! Now for the bad news - we are not alone!
Let's talk about the good news first. I read an article today about the housing "crisis" and the top foreclosure markets in the country on a popular Internet site and guess what? Detroit wasn't mentioned once. Not once. Hooray! Michigan was only mentioned in passing, too, and referred to as "rounding out the top ten". This is good news on a couple of fronts. First, we aren't at the top of the list (Michigan still tops the unemployment list, however). In fact, we are barely in the top ten.
Second, there are a lot of other markets ahead of Michigan on the list - venerable, bullet-proof markets. Markets that everyone thought were untouchable juggernauts (I love that word) of appreciation. Markets everyone thought would be perpetually propped up by sunshine, an aging and mobile population and real estate investors. Markets like Florida (particularly highbrow Cape Coral & Fort Myers), Arizona (especially venerable Phoenix), Nevada (specifically Las Vegas, one of the fastest growing cities in the country for a long time), Georgia (did anyone ever think Atlanta would fall apart?), and California (exclusive Riverside / San Bernardino are in a shambles). These markets are now reeling from foreclosures as speculators (some of whom call themselves investors) walk away from condos purchased on the assumption that property values "can't go down", and owners that can't give their places away.
Don't misunderstand, I am not taking pleasure in the pain and suffering of other states. I'm not that cruel. At the same time, it is important for us to understand that Michigan is not alone. We see and hear so much negative news about the dire straits in Michigan that it's easy to think we are all alone in our misery. In some ways, it's almost easier to think we're alone - it makes us special in some sick way. We're different. Nobody understands what we're going through. We aren't alone, though, and we need to realize that the problems we have here are not unique. The causes may be different, but the results are the same.
We don't really need to talk about the bad news, do we?
Until next time - Make IT Happen (whatever IT is in your life)
Bernie
The title of my post does not indicate that beings from another planet have arrived in Detroit. On the other hand, it doesn't mean they haven't arrived, either! I suppose if they want to buy a house bring 'em on! Lots of 'em.
What I do mean is that we aren't alone in our housing slump. We aren't alone in our pain - at least on the housing front. In terms of overall economic decline, not many will argue that Michigan is suffering more than most - if not all - other states. Between the limping auto industry, the loss of other manufacturing jobs, declining housing values, an exodus of college gradutes to other states, Michigan has it pretty bad to be sure. Unscrupulous mortgage lenders and record foreclosures just seems to be piling on at this point.
There is good news and there is bad news with regard to real estate, though. First, the good news - we are not alone! Now for the bad news - we are not alone!
Let's talk about the good news first. I read an article today about the housing "crisis" and the top foreclosure markets in the country on a popular Internet site and guess what? Detroit wasn't mentioned once. Not once. Hooray! Michigan was only mentioned in passing, too, and referred to as "rounding out the top ten". This is good news on a couple of fronts. First, we aren't at the top of the list (Michigan still tops the unemployment list, however). In fact, we are barely in the top ten.
Second, there are a lot of other markets ahead of Michigan on the list - venerable, bullet-proof markets. Markets that everyone thought were untouchable juggernauts (I love that word) of appreciation. Markets everyone thought would be perpetually propped up by sunshine, an aging and mobile population and real estate investors. Markets like Florida (particularly highbrow Cape Coral & Fort Myers), Arizona (especially venerable Phoenix), Nevada (specifically Las Vegas, one of the fastest growing cities in the country for a long time), Georgia (did anyone ever think Atlanta would fall apart?), and California (exclusive Riverside / San Bernardino are in a shambles). These markets are now reeling from foreclosures as speculators (some of whom call themselves investors) walk away from condos purchased on the assumption that property values "can't go down", and owners that can't give their places away.
Don't misunderstand, I am not taking pleasure in the pain and suffering of other states. I'm not that cruel. At the same time, it is important for us to understand that Michigan is not alone. We see and hear so much negative news about the dire straits in Michigan that it's easy to think we are all alone in our misery. In some ways, it's almost easier to think we're alone - it makes us special in some sick way. We're different. Nobody understands what we're going through. We aren't alone, though, and we need to realize that the problems we have here are not unique. The causes may be different, but the results are the same.
We don't really need to talk about the bad news, do we?
Until next time - Make IT Happen (whatever IT is in your life)
Bernie
Tuesday, January 1, 2008
The Power of Teamwork
Happy New Year!!
I'm going to post today about a success story. It's a story about teamwork. About the power of teamwork. About a common goal. A vision. A story about partners vs. competitors. A story about changing lives. About doing good. About helping people. A story that's a good way to start a new year. At the end of my last post I talked about making a difference in the hypothetical. Today I'm going to talk about making a difference in the actual.
A few weeks ago a fellow member of the REIA of Macomb (REIA stands for Real Estate Investors Association - Click here to check out the REIA of Macomb site) posted a message on the group's Forum. She knew of a couple that were looking for a place to live. They're young, she said, and don't have a lot of money. They're good people, she said, and they need a break. Could anyone help them find a place, she asked, and, by the way, they need to move in around the first of the year.
I was taken at first by Tina's post because it fit exactly the strategy of BPS Property Solutions - find people that need a place and help them find it. Rent it, lease option it, whatever. As I thought more about the post, though, I was taken by Tina's desire - drive really - to help this couple.
It turns out the girl (who shall remain nameless) is the daughter of one of Tina's close friends. They were being forced out of their current place and needed a new place as soon as possible. Being young, they don't have a well established credit profile. They don't have a big down payment. They do have the desire to own their own home. This is the perfect scenario for a lease option. I was in. I contacted Tina as fast as I could and told her I would try to help find a place for her friend's daughter. I knew it would be a challenge - find a place, get it under contract, get it closed, do repairs and get them moved in, all inside of a month or so and for less than $650 a month during the holidays. But I was taken by Tina's drive and I was in (refer to my prior post titled What Are You WIlling To Do?).
As Tina and I met with them and looked at a couple of houses, we learned that they had looked at a house in a local community and tried to buy it outright on their own. They were unable to get the financing secured because of their short - and sketchy - credit profile and undocumentable income from tips and seasonal work. We continued to look for houses that met their criteria - thankfully they were realistic about their expectations and what they would get for the payment they can afford.
The house they tried to buy stuck in my brain. I found what I thought was the same house still listed and made an offer in the price range that would get them the payment they were looking for. I really didn't know that it was the right house, but it looked decent and fit their criteria so I was hopeful. Tina and I kept finding listings and looking at houses. Let me tell you that $25,000 won't get you many houses in move in condition - at least not in areas where a young couple would feel safe - and we needed a house in move in condition because of the short time frame. For $25 grand you can get a lot of "project" houses, you can get every kind of mold imagineable, you can get some pretty funky stuff.
I kept thinking about the house and believing that it would happen. As the days went by, though, I started to think that my offer was not just rejected, but ignored. We were closing in on Christmas without a sign of a house for them. I know there's a 'Twas The Night Before Christmas parody in there somewhere.
On December 26th, I got a call from my realtor saying that the bank had countered my offer and that she had accepted their counter on my behalf. I gulped, took a deep breath and asked what their counter was (I wanted the house, but it had to be at the right price in order for them to be able to make the payments). The house was listed at $39,900. My offer was $25,000 and the bank's counter was $26,000!! Or, wait, did she say $36,000? I asked her to repeat what she just said - I thought she meant $36,000 and I was ready to fire her! No, I heard correctly, $26,000. I called Tina and told her the good news.
There was this nagging thought in the back of my head - what if this wasn't the house? It was still a good house, but what if it wasn't the house they really wanted? I started feeling less happy and more worried - I had got this house without me or them ever seeing it. What if they didn't like it? What if? What if? What if? I knew the house was in great shape because Tina had looked at it while I was out of town. I knew it was a good deal. But, what if?
Well, we had the inspection on New Year's Eve and, guess what? It is the right house. It is in great shape. It is just what they wanted. A couple of finishing touches and a minor furnace repair are all that's needed. We are scheduled to close in mid January. By the way, they were trying to buy this house for more than the listing price!
I know there's a lot of painful little details in my recounting. I know it sounds like I'm boasting or bragging or looking for glory. My intention is not to sound boastful. Actually, that's exactly my intention. Not me boasting about me, but about what you can do when you put your mind to it. About what you can do when you have a great team. About what you can do with a common purpose and a vision. What you can do when your goal is to help people. What you can do when you put your ego behind you and your heart in front of you. Yes, I am boasting about what Tina and I accomplished. Not for my ego and not for Tina's. Not for glory. Not to be heroes. To show you that real people have the power to make a difference.
Tina and I are teammates in this deal. In another deal, or another house, we might be competing for ourselves, but in this deal we are teammates. In another deal, or another house, there will be an understanding that we do business the same way. The only way. With the same purpose and vision. And competitors or not, we'll each be just as happy to see the other "win". We will always know that what we did together changed 4 lives over this holiday season - hers, mine and two young people starting out the new year fresh. I think a quote from Tina's friend's daughter says it all, "From the moment we looked in windows of this house we knew this was the house we wanted". And now, they have it. Thanks to the power of teamwork. And thanks to Tina having the drive to make it happen and help people.
Until next time. Make It Happen - whatever IT is in your life.
I'm going to post today about a success story. It's a story about teamwork. About the power of teamwork. About a common goal. A vision. A story about partners vs. competitors. A story about changing lives. About doing good. About helping people. A story that's a good way to start a new year. At the end of my last post I talked about making a difference in the hypothetical. Today I'm going to talk about making a difference in the actual.
A few weeks ago a fellow member of the REIA of Macomb (REIA stands for Real Estate Investors Association - Click here to check out the REIA of Macomb site) posted a message on the group's Forum. She knew of a couple that were looking for a place to live. They're young, she said, and don't have a lot of money. They're good people, she said, and they need a break. Could anyone help them find a place, she asked, and, by the way, they need to move in around the first of the year.
I was taken at first by Tina's post because it fit exactly the strategy of BPS Property Solutions - find people that need a place and help them find it. Rent it, lease option it, whatever. As I thought more about the post, though, I was taken by Tina's desire - drive really - to help this couple.
It turns out the girl (who shall remain nameless) is the daughter of one of Tina's close friends. They were being forced out of their current place and needed a new place as soon as possible. Being young, they don't have a well established credit profile. They don't have a big down payment. They do have the desire to own their own home. This is the perfect scenario for a lease option. I was in. I contacted Tina as fast as I could and told her I would try to help find a place for her friend's daughter. I knew it would be a challenge - find a place, get it under contract, get it closed, do repairs and get them moved in, all inside of a month or so and for less than $650 a month during the holidays. But I was taken by Tina's drive and I was in (refer to my prior post titled What Are You WIlling To Do?).
As Tina and I met with them and looked at a couple of houses, we learned that they had looked at a house in a local community and tried to buy it outright on their own. They were unable to get the financing secured because of their short - and sketchy - credit profile and undocumentable income from tips and seasonal work. We continued to look for houses that met their criteria - thankfully they were realistic about their expectations and what they would get for the payment they can afford.
The house they tried to buy stuck in my brain. I found what I thought was the same house still listed and made an offer in the price range that would get them the payment they were looking for. I really didn't know that it was the right house, but it looked decent and fit their criteria so I was hopeful. Tina and I kept finding listings and looking at houses. Let me tell you that $25,000 won't get you many houses in move in condition - at least not in areas where a young couple would feel safe - and we needed a house in move in condition because of the short time frame. For $25 grand you can get a lot of "project" houses, you can get every kind of mold imagineable, you can get some pretty funky stuff.
I kept thinking about the house and believing that it would happen. As the days went by, though, I started to think that my offer was not just rejected, but ignored. We were closing in on Christmas without a sign of a house for them. I know there's a 'Twas The Night Before Christmas parody in there somewhere.
On December 26th, I got a call from my realtor saying that the bank had countered my offer and that she had accepted their counter on my behalf. I gulped, took a deep breath and asked what their counter was (I wanted the house, but it had to be at the right price in order for them to be able to make the payments). The house was listed at $39,900. My offer was $25,000 and the bank's counter was $26,000!! Or, wait, did she say $36,000? I asked her to repeat what she just said - I thought she meant $36,000 and I was ready to fire her! No, I heard correctly, $26,000. I called Tina and told her the good news.
There was this nagging thought in the back of my head - what if this wasn't the house? It was still a good house, but what if it wasn't the house they really wanted? I started feeling less happy and more worried - I had got this house without me or them ever seeing it. What if they didn't like it? What if? What if? What if? I knew the house was in great shape because Tina had looked at it while I was out of town. I knew it was a good deal. But, what if?
Well, we had the inspection on New Year's Eve and, guess what? It is the right house. It is in great shape. It is just what they wanted. A couple of finishing touches and a minor furnace repair are all that's needed. We are scheduled to close in mid January. By the way, they were trying to buy this house for more than the listing price!
I know there's a lot of painful little details in my recounting. I know it sounds like I'm boasting or bragging or looking for glory. My intention is not to sound boastful. Actually, that's exactly my intention. Not me boasting about me, but about what you can do when you put your mind to it. About what you can do when you have a great team. About what you can do with a common purpose and a vision. What you can do when your goal is to help people. What you can do when you put your ego behind you and your heart in front of you. Yes, I am boasting about what Tina and I accomplished. Not for my ego and not for Tina's. Not for glory. Not to be heroes. To show you that real people have the power to make a difference.
Tina and I are teammates in this deal. In another deal, or another house, we might be competing for ourselves, but in this deal we are teammates. In another deal, or another house, there will be an understanding that we do business the same way. The only way. With the same purpose and vision. And competitors or not, we'll each be just as happy to see the other "win". We will always know that what we did together changed 4 lives over this holiday season - hers, mine and two young people starting out the new year fresh. I think a quote from Tina's friend's daughter says it all, "From the moment we looked in windows of this house we knew this was the house we wanted". And now, they have it. Thanks to the power of teamwork. And thanks to Tina having the drive to make it happen and help people.
Until next time. Make It Happen - whatever IT is in your life.
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