Why Is Real Estate One Awesome

So four years ago I set out to fill a void for my city and people my age and start a career in Real Estate as the "Ypsi Real Estate Guy". When I started everyone thought I was crazy, as most all Realtors and Real Estate Agencies had long abandoned the area at the time of the downturn seeking safely in the Ann Arbor Market.

After I started to become more and more successful with the model of serving my community more and more brokers (other Real Estate Companies) took notice. Over the course of four years I have been contacted by every Real Estate Brokerage in Washtenaw County asking me if I would be interested in joining their company.

At the end of every conversation, I would thank them for their time and tell them how humbled I am that they would be interested in adding me to their team. Then I would tell them, as soon as you are ready to open an office in Ypsilanti please give me a call :D

At the beginning of 2014 Real Estate One contacted me and they said that they were planning on opening an office in Ypsilanti in the Township. This started a series of conversations with the Manager and the Company President Dan Elsea about Ypsilanti. I found out that they were excited about Ypsilanti and recognized the need for a great Real Estate Company and my fondness for them grew quickly.

It was hard to leave the company that I started my career with and had given me so much, but at the end of the day I had to put the interests of my family, my city and the people I serve above my loyalties to Howard Hanna.

But I feel great about my move to a company that loves and cherishes Ypsilanti as much as I do and is willing to put their money where their mouth is. In addition they contributed $50,000 last year to Special Olympics Michigan, and are sponsors for this years Ypsi Pride day :D

For more info on this Michigan born and bread company and all they do check out their website http://www.realestateone.com

Detroit - Soup

A couple of friends and I were interested in the concept of doing a "Ypsi Soup". Soup is an originated on the East Coast, and is a low barrier way to bring community together to fund projects. Someone either makes, or sponsors enough soup for a medium size group 30-50 people. Everyone that comes brings $5.00 for their dinner (soup of course) and community members that are in need of help bringing their ideas to fruition present to the group. 

After the presenters are done we each vote on who we feel is most worthy of the money in the pot (everyones $5.00) we all vote and put our submission in a box. At the end all votes are tallied and someone goes home with the sum to help bring their project to fruition!

This is great opportunity because it allows for anyone come to ask the group and it is awarded by the democratic process. The night we went a young teacher won the day that wanted to provide Christmas gift to disadvantaged students in her class. It was such a great opportunity for her to ask her community to help and she ended up getting $500.00!!!

We are looking forward to brining this to fruition in January so stay turned for more news! For more info on Detroit Soup check out their website http://detroitsoup.com

Holistic Flipping

I am writing new 2 year goals for myself in both my personal and business life. Trying to get a good comprehension on where I am at, the talents and assets I have, my personal passions and how to apply them over the next two years to good results in our community.

I have been thinking about starting a business flipping houses now for about 6 years and have helped many clients in their businesses doing flips and investments but have not entered the area as the actual "flipper" as it were quite yet.

The real reason I want to flip properties is because of the return it gives to my community. Flipping can make a home that was once an eye sore a source of pride. It can take a local person that might be looking for a job and put them to work. It can add one more amazing family to the fabric of my community. Additional to all of that I would like to add another couple of layers to further enhance the Holistic approach to flipping.

I want this home to have solar panels, I want raised beds in the backyard, I want to home to retain its historic qualities and products to be added to it from that time period. And I also want a part of the profit proceeds to go to a local non profit that will help for the advancement of our local youth.

I am in the process of structuring this business with hopes to start "Flip-Ypsi" next year. If you have any input on this process or would like to hear more of my ideas I would love to chat. I have carefully thought thru this process and know that it will be difficult to layer this type of deal but this is the type of dedication that our community needs and deserves.

Ypsilanti Is The Place To Invest

This morning I was trolling thru the Hudhomestore.com website and checking out properties in Detroit listed below $10,000. There were some really nice properties but I was not very familiar with the specific neighborhoods and what I knew about a lot of the locations was that there was a lot of crime and blight in those specific areas. As I scrolled thru the listings a home in Ypsilanti that I am familiar with popped up that was on the market for a little over $30,000. And I thought I should share some of my experiences representing investors in our city and how investing in Ypsilanti makes so much more sense for you and your money than investing in Detroit currently does.

To start I want to talk about the homes that I have already sold in the last two years in Ypsilanti that make particular financial sense to a smart Investor that is looking to purchase the home and rent it out anywhere from 2-5 and then list and sell the home. Here are the names of streets and a little info about five specific homes I want to talk about today

$25,000 four bedroom home rented at $1,000 per month needed a new kitchen and some carpet

$26,000 three bedroom home rented at $9000 per month no work needed besides paint

$21,000 three bedroom home rented at $850 per month new kitchen and new hot water heater installed

$30,000 three bedroom home rented at $900 per month no work needed

Now, lets say that you got a typical mortgage on one of these homes with 20% down in this case lets round that number up to include closing costs and go with $7,000 down. Also, lets say that you need to put $2,000 in to work on the home for improvements so up front you will be putting in $9,000 and mortgaging around $20,000. Lets include your monthly taxes (by the way the taxes in Ypsilanti Twp are around $1,000 per year at this range and the city would be at $2,000 so we will average the two), and your homeowners insurance into the mix just to make sure we are accounting for all costs:

$20,000 30 year mortgage at 4% $95.00 per month
$900 per year for homeowners insurance $75.00 per month
$1,500 per year for property taxes $125.00 per month

For a total of $295.00 per month

And lets be conservative and say that you rented the home out for $800 per month over the course of 5 years. We will also account for an extra $1,000 per year to account for any repairs on the home that might come up for a total of $5,000.

$800 X 60 = $48,000 - Total Mo Payments 17,700 - Repairs $5,000 = 25,300

So over the course of 5 years you will make roughly $25,300 in income when all accounted for just to review that is an extra $5,060 per year. At this point you could have contributed all of your earnings to your mortgage payments and paid off the mortgage on the home. If you have not done so you are still in a good position because this is where it gets interesting.

Lets assume conservatively that the house prices in your neighborhood rise just an average of 2% every year that you are in ownership of your investment. And lets say that you paid $25,000 for the house but got a deal and the house was assessed at a value of $30,000 when you bought it, and the home is now worth $35,000 (this is very conservative I would imagine that the gain would be closer to 25% in the next 5 years). At this point you list and sell the home there are some commissions involved and you end up selling it for $30,000. if you have already paid off the mortgage then you just made $30,000 congrats :D. If you have yet to pay off your mortgage you will do so and gain about $12,000 on top and add that to the $25,300 you gained over the last 5 years.

Lets go back to your initial investment of $9,000 and see where we ended up in terms of ROI. So, obviously this is a serious investment and takes time patience and often frustration so lets say that you spent 100 hours per year dealing with this home and since time is money lets quantify that at $20.00 per hour of time spent making this investment work. So, we are going to quantify that time spent as an additional $10,000 expenditure. So, to review we have invested a total of 46,700 into this home whew thats a lot of money. But lets look at what we gained as well $48,000 in revenue over the 5 years + the $35,000 we sold it for = $83,000 for a net of $36,300!!!!!! By the way that is a 400% return on your investment in 5 years

Lets look at another 5 year investment of $9,000 that will again that much.........oh what there isn't any oh yeah thats right I forgot. A CD would currently net you $9,000 investment about $500 over 5 years.....$500

Happy Day!!!!

Is it just me or do things just seem to be headed in the right direction for both Ypsi and Detroit. Maybe my news is always filtered to positive and uplifting news stories. Or, maybe just maybe we are heading towards good, sustainable, positive growth as a region and more importantly as a people. 

Everyday, I am hearing or experiencing another positive movement in the news that will help to bring better lives for our poor and under educated. More enriching lives for those of us that we would call "Middle Class" . And probably more money for those that have means and are ready to invest it in our recovering and reshaping region. 

To start I am so encouraged to hear all of the positive news on the transit plans. It sounds like as a region we might actually be able to come together to help solve this long term problem that has been plaguing us for an extremely long time. The fact is young smart engaged individuals don't want to have to drive everywhere, and they want public transit. This is just as true here as it is in any vibrant region in the United States, and Detroit is just the last to get on board. Here are a few articles that really gave me hope on this subject of late: http://goo.gl/1SfaJ, http://www.annarbor.com/news/public-iI don't know maybe its just me? Maybe nobody else has noticed all of the amazing an positive news in terms of growthnvited-to-give-input-at-ann-arbor-connector-drop-in-sessions-in-december/, http://www.annarbor.com/news/ann-arbor-to-detroit-commuter-rail-officials-hope-to-hear-next-week-whether-refurbished-rail-cars-pa/.

In addition to this amazing news there has also been so much positive news here in Ypsilanti in regards to how we are going to use our city and how our young people will be educated. For those of you that don't know the Willow Run and Ypsilanti School districts just were approved by a vote by the people for a merger, the first of its kind considering both of the school districts are failing and in major debt. 

I have had the honor to be placed in a group of 200 other Ypsi Schools shareholders to help these two new districts re-form into a school system that we all can be proud of as Ypsilanti residents. It looks like a great new start to the financial and organizational problems that have plagued our schools for over a decade. 

http://www.annarbor.com/news/ypsilanti/whats-next-ypsilanti-willow-run-merger-supporters-dive-head-first-into-uncharted-territory/  

All I can say is that if these types of things keep up, that it will be great news for all of us :D

Futuring Real Estate in Michigan

      Yesterday my new Real Estate Agency Howard Hanna invited the top Realtors from our company to the Toledo Museum of Art for an amazing lunch and an amazing tour of this amazing museum. After the lunch our company President Hody Hanna spoke about the future of real estate in Michigan.

     Howard Hanna recently bought the brokerage that I have been working for (Edward Surovell). And what Mr. Hanna started talking about was all the reasons they have decided to take an adventure into the Michigan Real Estate market, by purchasing our company. He started talking about the unemployment rate and he said that "over the last 18 months the unemployment rate in Michigan has dropped at a more aggressive rate than any other state in the country". This is obviously a good sign for real estate as the more people that are coming back to work the more can afford to purchase homes.

   He also talked about the fact that people usually start getting aggressive about buying a home when they really see the market going up (which makes sense), comparing it to stocks and when a stock starts to rise how many people all the sudden feel a need to get in before its too late. And he as well as I can see that the market is starting to rise here in Michigan and cant stay this low much longer.

     I can see Michigan's real estate recovery on the horizon in the news as well. This week Chrysler added 1,250 new jobs (not old jobs new jobs) http://www.foxnews.com/leisure/2012/11/15/ap-source-chrysler-to-add-1250-jobs-at-3-detroit-area-factories-in-near-future. And the government granted Detroit 6.5 million to remove one of Detroit's biggest eyesores http://www.foxnews.com/us/2012/11/15/vacant-housing-project-where-diana-ross-supremes-lived-before-motown-stardom. I know that this is just some good news among a sea of negative news out there in the world, but I guess its a choice on how you want to view the world.

    I am so excited to see what will happen next in our great state and am looking forward to doing my part in helping our cities shine.

The Ypsi Times: Renting Vs. Buying in Ypsi

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