I remember thinking this when we were first starting out. Back then, there was only one Realtor in Edmonton that really catered to investors in single family real estate. We met him a few times but really, we were way too under-confident to approach him to do business with him. For one, we thought he was so established with the big players that we’d get left by the way side, and for two, we didn’t want to waste his time and then have him not want to deal with us again. So instead, we struggled our way through trying to teach our Realtors….I wonder how much time and energy we could have saved by just going forward and letting him guide us through?
We hear this a lot, people are afraid that there are only so many ‘deals’ to go around….let me tell you right now, this is a complete misconception. The market isn’t what it was in 2009 when sellers were begging anyone to buy their place, but it certainly has lots of options. Every investor is different. It never ceases to amaze me that no matter what kind of pre analyzed property we send out, whether it be new, old, ugly, beautiful, big, little, dirty, clean, lots of cash-flow, no cash-flow, NE, SW or out of town…there are always reasons why some investors love them, and other investors hate them. No two investors are alike in what they want in a property. There are plenty of properties to go around for everyone.
When you use our team, there are 3 full time agents that are dedicated to helping you. If you are in a position to go ahead with a purchase, there is no reasonable and educated request that can’t be fulfilled. We’ll even hand them to you all pre analyzed, pre viewed, market rents pre determined and often, pre rented. There are no big fish or small fish, we’re all swimming in the same pond, yes, but we’re all needing different things. Rest assured, we’ll help you find what works for you and brings you closer to your personal goals.
By and far, the most successful investors in Edmonton, are the ones that don’t live here. Let me tell you why; investing is supposed to be unemotional, right? Tell me, which way would it be easiest to be unemotional about a property, when we’ve seen it or not seen it? Or about a neighbourhood, when we’ve grown up in it in or barely heard of it? Or when we’re given a spreadsheet with a few pictures, or walk around in it with all our senses going full throttle. The point is probably made. It is much easier to buy as an investor when you are forced to be unemotional and being far away, you have no choice but to made decisions based on numbers and facts. Hands down this forces you to make better decisions.
One thing that has seemed to plague Edmonton over the years is good Property Managers. So this question is one that we have heard many many times. The problem is, there is no straight answer. The answer depends on A LOT of factors, a couple of which are:
– Here the property is located is key. We’ve found and recommend some great managers here in Edmonton but what we’ve noticed is that the bigger they get, the less they manage well. Not that they don’t care, or that they are trying to not follow through, they just aren’t able to with the influx of Investors all wanting Edmonton and area. We have found that our clients have great success when we hand pick the manager, for the property. We will never tell you the name of a manager to use before you have the property. A proper decision can only be made with that information. Depending on where the properties are, the managers offices are, the number of people they have helping them , the tenant demographic of that area and how that fits with different management companies….that all factors into who we recommend.
– There are also some managers that won’t accept properties in certain highly troublesome areas, and I don’t blame them one bit. I won’t let my clients buy in those areas either. If you have the opportunity to buy a property for an almost too-good-to-be-true price, maybe take a second glance…what’s the vacancy rate? The tenant demographic? The neighbourhood amenities? And most importantly, can you find anyone legitimate to manage it for you? No matter how good the price is, if you can’t rent it, it’s not a good deal.
– Other factors include whether you are in town, out of town, want to do some self-management, want to be completely hands off etc etc. There are some companies that do an excellent job and you pay them peice-work, instead of by percentage…this can be an excellent alternative for those that want to do some things themselves, but not all things. But they can really eat up cash-flow if they are doing everything for you. On the other hand, if the property is extremely low maintenance (we know how to find those as they are our personal favourites), this can be an excellent, non-expensive way to go.
As you can see, there are lots of factors, so once a property is chosen, we can then direct you to your best option.
We are experienced and have sold many properties. The fact that we have a lot of buyers (not to mention a lot of buyers who like to buy in bulk) can be very advantageous in selling your property with us. We may have someone waiting for exactly what you want to sell. We could have it sold before the sign goes up!
Good question, glad you asked.
At RMLO (Ritchie Mill Law Office), here’s what we do to protect you on every transaction. For a ‘normal/BASIC’ purchase transaction, our ‘No Surprise legal fees’ cover standard purchases which fall in our BASIC/ ‘normal’ timelines where we:
- Receive and review your purchase contract
- Search and review title and taxes
- Contact you
- Examine and review registrations against title
- Review and prepare mortgage documents, if any
- Meet with you to review and sign documents
- Prepare and forward documents to the Land Titles Office for registration
- Review and check registration
- Receive, hold and forward funds, organize key release, and
- Report to you, banks, municipalities and others.
These are the basics; all included in your BASIC legal account.
For 2012-2013 our BASIC legal account for properties under $400,000 is $1295 + GST
All InvestorOnFire clients) enjoy a $50 discount.
So for a BASIC, ‘No Surprises’ transaction here’s your budget number
$1245 + GST
Barry C. McGuire
Suite 101, 10301-109 ST NW
Edmonton, AB T5J 1N4
All purchases have a BASIC legal account component.
At RMLO (Ritchie Mill Law Office), BASIC is a fixed-price quotation and covers 85% of all transactions. EXTRAS are based on two things, lawyer time expended solving extra issues and the RUSH part of your transaction (if any). Transactions where EXTRAS show up make up the remaining 15% of all transactions. All right, let’s get into some details.
Let’s talk timing first. Your new purchase transaction will either be ‘normal ‘or ‘rush ‘. You definitely want it to be ‘normal ‘and most transactions are. What’s ‘normal’? A normal deal is classified as one where your closing date (date you take possession and get keys) is about 30 days after you remove your last condition (35 days for out of province buyers and up to 60 days for out of country).
Why 30 days? To get started working on your new purchase paperwork, two things have to happen. Number one, we need what are called ‘realtors instructions ‘. This is a full copy of the contract, schedules, addenda, condition removal forms and information about the seller’s lawyer, all of which come from the seller’s realtor’s office. NOTE: It’s the seller’s realtor, not your realtor who sends this out these realtor instructions. Number two, we need to have what are called ‘lender instructions’. This is official paperwork from your new lender telling us how to prepare your new mortgage.
It often takes 7-10 days AFTER you go unconditional for these two sets of documents to arrive in our office. Now your time to close has been cut to 20-23 days. But, at least we can get started.
Next, we do some preliminary diligence such as title and tax searches and review both the realtor instructions and the lender instructions. If any issues show up or if the mortgage instructions are incorrect we speak to you, the seller’s lawyer and/or the mortgage company. Problems or incorrect mortgage instructions often take a tremendous amount of time to correct. But, with 20-23 days until closing that is usually sufficient time and we keep your transaction in the ‘normal’ category.
Anything less than 30 days may generate various categories of ‘rush transaction’. If we get those two sets of instructions 2 weeks before the closing date, then, your legal account could increase by up to 50%. Instructions one week before the closing date bump your account up further. Lastly, if your paperwork shows up only a couple of days before closing where lawyers and staff must work nights or over the weekend or we have to stop what we are working on to get a ‘rush’ deal done, you are in a ‘super-rush’, which might result in a doubling of our normal legal account.
Now, we don’t just charge rush fees blindly. We do factor in how busy it is at the Land Titles office, our office and the market generally. If everything is quiet, we can handle more rushes at lower cost. Each purchase is different and these can only be general comments on our philosophy and procedure. BIG NOTE: We totally understand no one likes a RUSH deal or RUSH fees. Therefore, we absolutely don’t charge rush fees unless a rush really exists!!
Completion on time means your stress is reduced; all parties including you, your lender and realtor have certainty. Very importantly, nasty consequences of late completion are eliminated. Extra legal fees and late completion interest are eliminated or substantially reduced, if we close on time.
We completely understand that you and your realtor might try and be unsuccessful in getting 30 days to close after you go unconditional. Sometimes you just can’t get 30 days. Perhaps it’s a hot seller’s market or there is pressure from the seller who just wants to close sooner. Perhaps it’s a negotiating tool on your end. You can get a great deal, $ 20,000 below market if you close in 7 days. When it’s pressure from the seller you may not be able to do anything. When a RUSH close gets you a big economic benefit, a little bit extra in legal fees is well worth it.
It is important for you to understand these timelines. You may hear from others involved in the transaction that they think it can be done more quickly, or it only takes a week or two. Of course it can if your new mortgage is the only one your lender is working on and if instructions arrive instantly and if there are never any problems. Is that realistic? No. We believe that the above time lines are realistic for normal transactions. Please call us with any timing concerns. For instance, are you away on holiday or business?
Please review our information letter that comes to you as soon as we know about your transaction. In that information letter we discuss in more detail legal accounts, how we calculate the same and much more valuable information. Don’t be shy, e-mail or call and ask us questions.
Barry C. McGuire
Suite 101, 10301-109 ST NW
Edmonton, AB T5J 1N4
We understand that your first investment property and your 100th is a very big deal. We are glad to be that advocate in your court….doing all WE can to make the transaction successful.
You have spoken with a member of our team and are ready to make your next move but you feel that our attention is not as focused on your transaction as you would like. Please be assured that every single client is important to us, no matter how many or how few properties they plan to purchase. Know that over the last 14 years, we really do know what moves ourselves and our clients forward. If you are finding that you are not getting the attention you need, perhaps you are not following the system as its laid out. Can we help you with this?
Because our mandate is to make investors successful for the long run, not just have them buy properties, we are pretty strict on the process. We need you to trust that we have guided hundreds of investors to success BUT it is those that listen to us and follow our system that wind up successful. Those that try to mold us into their way of doing things either don’t’ end up buying or buy the wrong property (on their own) and come back to us wanting help sorting it out later. Let us save you the headaches we had. If we have guided you and positioned you and have told you that you are ready to buy, sometimes the only thing to do, is buy.
No amount of time or waiting or learning or searching will give you more success than just doing it. Because of this, patience is key. Sometimes the right property does not come along right away. It takes a lot of time for us to search, work the numbers and build relationships with the right contacts to get you that golden deal.
Everyone on our team also handles a very high volume of calls, emails and texts on a daily basis but we do our best to return all messages within 24 hours or sooner if it is an urgent matter.
If you still feel you have taken all the right steps, done the things we have suggested but still feel unable to move forward, let us know! We take note and always strive to improve our systems and try to work with you one on one to get you past whatever hurdle is holding you back. Many times, its ourselves, though we may not realize it.
You have been following our system and have been presented with multiple properties but you just can’t seem to take the next step. Something is holding you back.
Most times, its our own self sabbatoging, for whatever reason. We have seen this happen to a lot of clients and it can be due to many things such as insecure financing or a hesitant spouse. Let us know and we will help you work through it so you can take the next step. In some cases the answer might be to take a break and revisit the drawing board. We are here to help you with your road blocks so let us know!
Some property managers will have you do things that will make their job easier but won’t affect the amount of rent you get, nor how soon you get it rented. Blinds is one of those things. We recommend just put up nice curtain rods and then your tenants can bring their own curtains or drapes for the property. This gets rid of the major cost of installing them, the issues when they break, and allows tenants to choose their style of curtains…making it more homey for them.
There is no need to go through the time and expense of having blinds installed in your rental unit.
Not only can you purchase property with us through a builder, we recommend it! We work hard to build good relationships not only with our clients, but with our industry contacts as well. A builder specializes in building a house – we specialize on investing in Real Estate. They may know the best contractors to build your house, but we know the best house for an investor. Not to mention, Investor On Fire clients often receive exclusive pricing that would not be available if you went directly to the builder.
Buyer Brokerage Agreements
According to CREA:
There are very few real estate industry members – if any – who would consider listing a seller’s property without having a written seller brokerage agreement. Working with buyers should be no different.
Written service agreements with buyers serve three primary purposes. First, the role and responsibilities of the industry member are clearly articulated, clearly understood and agreed to in writing. Second, the service(s) to be provided are clearly understood and agreed to in writing. And third, the responsibilities of the buyer are clearly understood and agreed to in writing. Written buyer service agreements provide the best protection for buyers and their representative(s) in the event a dispute arises regarding their respective roles or the service being provided.
Yes. That is one of the main purposes of this agreement. To take any possible “bias” away from showing you properties based on commissions paid. Of course, if you tell us that you are NOT interested in looking at properties where you have to pay out commissions, then we won’t show them to you, however, what is preferred, is for us to show you everything available. Ultimately, you are agreeing to hire us to find you a property that fits your criteria, so we will then be able to show you EVERYTHING that fits that criteria, without worrying about the brokerages commissions.
Yes, for sure, we will let you know if it is a FSBO or a discount brokerage offering below our listed commissions up front. That way, you see every property and can make an informed decision as to whether it interests you or not.
Yes, in most cases it does. And in the rare case, if the seller wasn’t willing to pay or no commissions were offered, I will let you know that up front. You can then choose to proceed or not.
Yes, it is now part of Real Estate law.
According to CREA:
Alberta consumers are always free to decide what type of service(s) they wish to contract for from an Alberta industry member. Buyer brokerage agreements are not intended as a tool to force a consumer’s hand; rather, the opposite is true. Buyer brokerage agreements provide clarity. The consumer knows exactly what to expect from their industry member representative and because of that, there is an enhanced level of trust and confidence that the industry member will promote and protect the buyer’s interests. In the absence of a written service agreement, there is a degree of risk in that required disclosures may not be made, and the role of the industry member and the service(s) being provided may not be clear in the buyer’s mind.
If we have done something to your dissatisfaction, please let us know right away. We will do our best to correct the problem. We think we are very reasonable and if we can’t come to an agreement we will break the contract so that your obligations to our brokerage end.