For those of us in the fixer upper and rental house business Fixer Jay is the old pro.
This book has the strong qualities of Jay’s first book (“Investing in Fixer Uppers”)–written in a easy-going, lay-back style that makes it enjoyable to read, and it presents an eminently useful model that really works.
Jay likes to avoid slick and flashy techniques because “slick is another word for slippery.” He points out the gurus who formerly expounded on a wide assortment of get-rich techniques are “either bankrupt or working in gas stations.” Jay advises to stick with run-down, fixer-upper types of properties. Buy low, and improve their value, and rent them out. It’s a winning formula that I, and many others, have used to make money in real estate.
I particularly liked Jay’s technique of taking a low key negotiation approach, like the former TV-detective Columbo when he interrogated suspects. Instead of putting the seller on the defensive, don’t directly tell them what’s wrong with their house, no one wants a complete stranger to come up and criticize their house. Instead, always show respect to the seller, and have the seller tell you what’s wrong with the house by asking him a series of polite questions. Just when Columbo was going out the door and you thought he was leaving, he would always turn around and say, “oh by the way, just one more question for you.” He asked it in the most polite way, and often the answer to that question was the one that cracked the case open.
Listen carefully to what the seller has to say. You can learn a lot by listening. Don’t be critical, never talk down to anyone. Even sellers who must sell, won’t sell to you if you try to intimidate them. Jay points out that you still must diligently verify any information you get from the seller. One way to do that is to ask for their “Schedule E” tax form.
Another key to Jay’s formula is turning motivated sellers into bankers. This is something that a lot of us, myself included, need to work on. If we follow Jay’s advice and get the seller to finance at least part of the loan, the purchase process suddenly becomes much easier.
I also liked Jay’s memo system of dealing with renter problems. In using this system, I find it simplifies my dealings with renters. If you call and tell them to do something, they forget. If they see it in writing, in an official-looking memo, they will usually, but not always, do what you ask them to do. It reduces direct contact with them and it gives you written documentation in case you later need it later to remove them from the house. I like Jay’s comment “tenants don’t intimidate me because they are simply no match for my landlording skills.” A bold statement that we should all strive for.
Overall, there is a lot to like about this book. If offers sound advice for the new, and the seasoned, investor. The Columbo negotiating technique alone was worth reading.
Share this: del.icio.us | Digg | Ma.gnolia | Reddit | Stumble Upon | Technorati