Posts Tagged ‘Perpetual Income’

House Buying Negotiating Techniques “Suppose that … “ and “Just one more question …”

Friday, September 14th, 2007

Returning to the topic of negotiating to buy a house, I came across an insightful technique suggested by Bryan Wittenmyer in his book Perpetual Income. Instead of directly making an offer, frame the offer in the least offensive way by saying, “Frank, suppose I gave you $5,000 down for the property, is there any reason why you wouldn’t carry the mortgage?” Wittenmyer says that people are conditioned to say “no,” and with this technique, the answer you want is “no,” but “no” means “yes.” This is a very non-threatening way to present your offer because all you are doing is just proposing a possibility, not making an offer.

I don’t consider myself an expert in negotiating, like Donald Trump.


However, I do know that if you offend the seller in any way, he will not sell to you even if you make a good offer. If the seller’s pride is offended by an offhand comment like “this house is worn out and needs a lot of work,” you have just criticized a place he has lived in and maintained the best he could for the last 20 years. You can forget about buying that house.

I still remember a disparaging comment that someone make about a house that I was selling in 2002. I overheard a guy tell his wife “this one is a loser.” Steam came out my ears. Having spent the last 8 weeks fixing that house up, I thought it was in pretty good shape, so I took his comment personally. You don’t easily forget it when someone offends you (whether real or imagined).

The “suppose that” technique is a perfect fit with the Lt. Columbo, “and just one more question” technique that Fixer Jay DeCima described in an earlier post.

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Unclog a Shower Drain – another tip from Bryan Wittenmyer’s “Perpetual Income”

Tuesday, September 11th, 2007

Another excellent tip for us fixer upper rental house investors, from Bryan Wittenmyer in “Perpetual Income: How to Generate Cash Flow from Low-End House Investment,” is how to cheaply unclog a shower drain.

Wittenmyer suggests 1) pouring several quarts of boiling water down the drain to dissolve the old soap. Repeat this process after five minutes. Then, 2) following the hot water with a gallon of Clorox to dissolve the hair clogs. For the price of a $1-$2.00 bottle of Clorox, you have saved the cost of a plumber’s visit.

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Generate Cash Flow from Low-End Investments – Bryan Wittenmyer

Monday, September 10th, 2007

For those of us in the fixer upper rental house business I like to share interesting books that I happen to be reading.

I am presently reading Bryan Wittenmyer’s book Perpetual Income: How to Generate Cash Flow from Low-End House Investment. The author writes a book that truly gets down to the nuts of bolts of all aspects of finding, buying and renting low-income properties. A lot of real estate books are 90% fluff and 10% substance. This book is 100% substance.

The key, as Wittenmyer explains it, is to buy low-end (and not slum) housing because it is cheaper to buy, pays a pretty good monthly rent, and can be paid off quickly. This book has an enormous amount of really practical suggestions that apply to both low-end housing as well as middle-end properties.

I particularly enjoyed his section on what to repair, in recognition of the fact that the tenants will not take care of the property anyway. I like his practical advise on how to repair typical rental problems, but by spending the absolute least amount of money in the process. One suggestion was to mix leftover paints together in a five gallon paint bucket, and use the resulting grey paint to paint attics, or other areas where the color doesn’t matter. He also suggests not washing a wall before painting (unless heavy dirt exists) because paint can do a great job of covering the fingerprints and odors. Wittenmyer says, “why waste time cleaning when you can paint over it?”

I couldn’t agree more.

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