Manny Khoshbin > Quotes

“Auctions are also to be avoided, both because you will be competing against a larger number of potential buyers and because you will be making decisions in an accelerated time frame, which makes it difficult to do your due diligence. When it’s a good time to buy there will be an abundance of discounted properties to be found, so you won’t need to rely on auctions.”
― Manny Khoshbin, Manny Khoshbin's Contrarian PlayBook

“The third way you can incentivize the seller to accept your initial offer is by offering a sizable nonrefundable deposit. You can offer this after your short due diligence expires, or after you are certain your loan will be approved. Again, this indicates that you are serious about the property and that you fully intend to make the deal happen. A nonrefundable deposit is a layer of protection for the seller, and the fact that you are offering it up front demonstrates good faith on your part. This makes you a very attractive buyer.”
― Manny Khoshbin, Manny Khoshbin's Contrarian PlayBook

“if it’s a bad time to buy in one place, it could be a great time to buy somewhere else. This is true when comparing states, cities, or even neighborhoods!”
― Manny Khoshbin, Manny Khoshbin's Contrarian PlayBook

“If you are ready to go with a lender-approved loan application for the property, you will still have the ability to offer the seller a shortened escrow and due diligence period, which is often the greatest incentive of all.”
― Manny Khoshbin, Manny Khoshbin's Contrarian PlayBook

“The inspector will examine the property for code violations, such as ADA, fire and safety. This will potentially include code issues that were previously grandfathered in but will need to be fixed moving forward. The inspector should be able to tell you the number of years remaining on the roof and give you a status report on the heating and cooling systems, as well as the condition of the plumbing, electrical wiring, foundation, and other key structural elements. In addition, make sure your inspector looks for asbestos and mold, which are both considered health hazards and can be expensive to address. If your inspector recommends a specialist to deal with the asbestos or mold, make sure to follow through on the recommendation.”
― Manny Khoshbin, Manny Khoshbin's Contrarian PlayBook

“You want to find agents who are genuinely interested in helping you with your goals, both short and long-term, rather than those that are just looking for their next commission. Look at the experience of the agent as well–it takes time for an agent to really get to know their market.”
― Manny Khoshbin, Manny Khoshbin's Contrarian PlayBook

“but no matter what, don’t sell off property at a loss.”
― Manny Khoshbin, Manny Khoshbin's Contrarian PlayBook

“Overall, I only recommend investing in a condominium if it is the only type of residential property you can realistically obtain financing for.”
― Manny Khoshbin, Manny Khoshbin's Contrarian PlayBook

“In drafting your revised offer, you must remember to be reasonable with the seller.  Keep in mind that you both have the same objective, which is to close the deal and close it quickly.”
― Manny Khoshbin, Manny Khoshbin's Contrarian PlayBook

“If the neighborhood is too noisy, future buyers won’t even want to come in the front door to look at it”
― Manny Khoshbin, Manny Khoshbin's Contrarian PlayBook

“Keep in mind that you will always have other costs that are not considered part of your operating expenses, such as leasing commissions, tenant improvements, and capital improvements, which are all usually amortized over a period of years but directly affect your cash flow. You should consult your tax advisor on these expenses.”
― Manny Khoshbin, Manny Khoshbin's Contrarian PlayBook

“In the process of picking a winner, remember that the right property probably won’t look like much of a winner at all. Look for the asset that comes at the right price, and comes with plenty of built-in room for improvement”
― Manny Khoshbin, Manny Khoshbin's Contrarian PlayBook

“purchased my first home in 1997, using FHA financing with 3 percent down. It was a six-bedroom, bank-owned (REO) home that had previously sold for $200,000. I bought it for $142,000 and sold it a year later for $220,000, realizing a gain of almost  $80,000! Given my financial situation at the time, I could not have done this without FHA financing.”
― Manny Khoshbin, Manny Khoshbin's Contrarian PlayBook

“how much you would be making if the building were 100 percent occupied. Then, knock 10 percent off this figure in order to arrive at the gross revenue based on a 90 percent occupancy rate, which is a more realistic number to project. Adjust the rent per foot to market rate, if the current rate is below market.”
― Manny Khoshbin, Manny Khoshbin's Contrarian PlayBook

“by maintaining a consistent onsite presence. “Give to Get” with your tenants, and treat them like your partners–because that’s what they are!”
― Manny Khoshbin, Manny Khoshbin's Contrarian PlayBook

“Unemployment The economic health of major local industries Quality of life issues for the community Including community development and services Local residential and commercial development”
― Manny Khoshbin, Manny Khoshbin's Contrarian PlayBook

“as tenant leases will typically cost you to renew, especially in a tenants’ market. Typically, lease renewals on office buildings will cost you 3 percent commission for the entire term of the lease (as opposed to residential lease renewals, which normally cost nothing).”
― Manny Khoshbin, Manny Khoshbin's Contrarian PlayBook

“The potential downsides of assuming an existing loan would be if it has a higher interest rate, if it has a hefty prepay penalty, or if the loan matures in less than three years.”
― Manny Khoshbin, Manny Khoshbin's Contrarian PlayBook

“Next, I ask the agent to confirm the current occupancy rate. I also ask if any of the tenants have recently vacated, and if there are any tenants in default of their lease agreement. For obvious reasons, you must assume that tenants defaulting on their lease agreements will negatively impact the property’s financial projections moving forward”
― Manny Khoshbin, Manny Khoshbin's Contrarian PlayBook

“When it comes to establishing your credibility, the more information you can provide upfront about your real estate experience the better. It will make you look steady and stable–in other words, someone they will be able to close escrow with. When you present yourself to the seller in this way, you are
making it clear that this is not your first rodeo, and that you mean business. As a result, the seller (and the seller’s agent) will see you as someone to be taken seriously”
― Manny Khoshbin, Manny Khoshbin's Contrarian PlayBook

“Provide documents that show your investment experience and your financial readiness. When I submit my letter of intent (LOI) with my initial offer on a property, I also send a pre-approval letter from my lender, a brief bio, a schedule of my real estate holdings (Buyer’s Resume), references from brokers I have closed deals with, a current savings account statement and the first two pages of my most recent tax returns (with all confidential information blacked out, of course). If you are not in a position to submit all of this information, just provide what you can. The idea is to speak to your strengths as a buyer. Try to at least submit a pre-approval letter from your lender, as this will go a long way towards setting yourself apart from the average buyer.”
― Manny Khoshbin, Manny Khoshbin's Contrarian PlayBook

“I advised a friend to buy a condominium for $65,000.  She qualified for an FHA loan and only put $1,200 down. A year later, she sold it for $105,000 and bought a 4-plex apartment building. She then transitioned into a 6-unit apartment building, and finally into a 12-unit complex. By 2005, she had made $770,000 on her initial investment.”
― Manny Khoshbin, Manny Khoshbin's Contrarian PlayBook

“The cap rate indicates what your rate of return would be on this property, given the practical/market expenses and assuming you paid all cash.”
― Manny Khoshbin, Manny Khoshbin's Contrarian PlayBook

“If you do decide that a condo would be your best option as a first buy, you should request basic financial information from the complex’s HOA, including their current year budget, how much they have in the way of reserves, and the cost of any major upcoming repairs.”
― Manny Khoshbin, Manny Khoshbin's Contrarian PlayBook

“Finding the right property–one that will make you money on the buy–is a dynamic process with several distinct steps. First, you will define your market: The general geographical area in which you will be looking. Next, you will define your submarket, the neighborhood that holds the best investment opportunities. Finally, you will use your resources to pick a winning property in your submarket, according to the Contrarian PlayBook’s criteria. All of this will put you on the path to your $100 million real estate portfolio!”
― Manny Khoshbin, Manny Khoshbin's Contrarian PlayBook

“As you learned in Play #7, you will then divide the NOI by the sales price in order to arrive at an actual cap rate.”
― Manny Khoshbin, Manny Khoshbin's Contrarian PlayBook

“The three key components of due diligence are property inspections (including ALTA surveys and other reports), tenant interviews, and the collection and analysis of the seller’s current financials.”
― Manny Khoshbin, Manny Khoshbin's Contrarian PlayBook

“By subtracting your practical operating expenses from the gross revenue at 90 percent occupancy and market rate, you arrive at the potential NOI, also referred to as pro forma numbers. The potential NOI projects the increase in revenues that you can reasonably expect in the future.”
― Manny Khoshbin, Manny Khoshbin's Contrarian PlayBook

“Too close to a freeway isn’t good for residential property either, because of the noise factor. If you make the mistake of buying too close to a freeway, it will be much harder to sell in the future.”
― Manny Khoshbin, Manny Khoshbin's Contrarian PlayBook

“the purpose of a good short-term goal is to translate inspiration into action!”
― Manny Khoshbin, Manny Khoshbin's Contrarian PlayBook