On The Beach Education Corporation

I have been enjoying the unseasonably warm weather in Thunder Bay having already reached a high of 30C. It was high time to get the bicycles out of storage and put to use. Steve is a rambunctious fellow. He found the steepest hill to fall off on and separated his shoulder. Emergency did nothing for his injury and slinging it made it worse. This condition is known as hockey shoulder. Apparently a lot of hockey players have it. The bone sticks out of his shoulder and it looks really weird. I am grateful that Steve did not break his neck or worse. He is recovering well while I nurse him back to health while managing 243 units, temporarily taking over the maintenance duties and working on two acquisitions. Another day in the life…

CAUGHT RED-HANDED
We caught this guy trespassing on our property. He was shoveling a truck load of roofing shingles into our garbage shed late at night. Check your local by-laws because this infraction is a $5,000 penalty in Thunder Bay. Make signs and post it on your garbage sheds. I was really upset when I lost half the photos during the download process. Thank goodness for geeks. My Manager used a ShareWare program that retrieves deleted files. And voila! He got those photos back and I got the man and his license plate. Just Google “Recover Deleted Files” to find the program. And yes, he shoveled it all back into his truck and promised never to return.

CONSPIRACY OF THE RICH
In Robert Kiyosaki’s newest book, he writes that there is $38 Billion of mortgage re-sets due by January 2012. If you think it’s bad now, the worst is yet to come. For those of you with a hankering to buy real estate in the U.S., you can use the next year to study up on taxation and other due diligence items. When the time is ripe to buy, you will be in the best position to know when to buy, what to buy and for how much. I have been watching the price of apartments drop from $50,000 a door to between $12,000 to $20,000. You can even buy foreclosed apartments at $5,000 per unit. It’s going to get ridiculous over the next few months. Banks don’t have liquidity. Currency is being devalued every day. Your best investment is to get educated so you know what to do with your money on your terms. Start up a mastermind or book club and study the masters. Start your own conspiracy of the soon to be rich.

REAL ESTATE SEMINAR: JUNE 12-13
The real estate rules have changed. If you are curious to know how high mortgage interest rates will go or how to qualify for mortgages, one of Canada’s leading real estate experts is coming to Vancouver. That would be Don R. Campbell. We have known Don since 2003 although this picture was taken in 2005 at his QuickStart Program. Don is the guy you see on tv or quoted in the newspapers for his unbiased research. I am sending you an exclusive invitation to this event which is usually reserved only for members at a fabulous price including hundreds of dollars of bonuses. Find out how the changes taking place in the industry will affect you, your future and your bottom line. The ability to take advantage of opportunities equals Perspiration + Preparation. Click here to read all the details of this exclusive event.

WORLD’S SMALLEST POLITICAL QUIZ
Left, Center, Right, Republican, Democrat, Tory or Liberal. I’ve never put a label on my political views because I agree and disagree with all of them. So I refused to be labeled until this little quiz came my way, thanks to Jon Addiss. The Fraser Institute said it’s “a fast, fun, and accurate assessment of a person’s overall political views.”  Suite University said it is the “most concise and accurate political quiz out there.” Over 15 million people have taken the quiz. The quiz pegs me as a Libertarian, support maximum liberty in both personal and economic matters, tolerate diversity and support a free market.
http://www.theadvocates.org/quiz

PRO-ACTIVE PROPERTY MANAGEMENT – PART 7
Inventory control. You may be spending a lot of money buying supplies that you already have. Storing equipment and supplies in a haphazard way leads to inefficiency. Four of our largest buildings have 1, 2 or 3 storage rooms per floor. That’s a lot of stuff and money lying around, out of sight, out of mind. Invest a day or two to sort and organize these rooms. If you can save from buying $1,000 in equipment and supplies, that’s the equivalent of having to earn $10,000 in gross income to pay for those supplies. Remember the 10% rule that I have written previously about. For every $1000 of gross income that you earn less your overhead, the average business is lucky to earn a 10% net profit, or $100 of profit free and clear to spend or invest as you see fit. For every dollar that you spend, you need to earn ten times that amount to be able to afford it. Effective management is about keeping costs under control while increasing revenues.

Money is for making things happen. Richard Branson.

July Ono

Welcome to the year 2010. I have been discovering that life is not about my expectations. Life is about how I manage my expectations. The reason that I have been experiencing disappointment and frustration is because my map of the world isn’t the way I want it to be right now. And that’s okay. It’s coming. Tony Robbins has a great saying: frustration means you are on the verge of a breakthrough. Instead of anchoring a negative feeling around frustration, he recommends reframing it into a positive feeling that is empowering. I’ve been having a lot of practice at this lately and my reframe is to first be aware that I am being frustrated, then to verbally state out loud “I am on the verge of a breakthrough. This is fascinating.” It’s taken about 4 to 5 weeks for me to notice that my frustration level has decreased. When I look at what I have accomplished versus what I haven’t done, I am always amazed at the results. And remember to say “Thank you.”

HIRING A RESIDENT MANAGER
Now that our systems are almost completed, we are in hiring mode. There is a position for a Resident Property Manager who will oversee a 243 unit portfolio spread over 7 buildings. The technical aspects: excellent administrative and management skills, computer-literate, fluent use of English grammar in correspondence required. The psychological aspects: self-motivated team leader, resourceful, forward-thinking, looking to settle down for the long term. This is a great opportunity for a self-starter to manage a multi-million dollar portfolio. Tell me why you think you are the perfect fit? Resumes to info@lakeheadapartments.com

AND THAT’S A RRAP
In January 2009, I purchased a 28-unit apartment building with a single investor. This is a lower income building that requires managing up. It meets the requirements to qualify for the Canada Mortgage and Housing Corporation’s Residential Rehabilitation Assistant Program aka CMHC RRAP. We accepted an invitation for assistance from one of my former Real Estate Network Group members, Chris Veale. He was a tremendous help in breaking down the units so that contractors could easily identify what needed upgrading and provide complete bids. The application process started in February 2009 and we got approval to proceed with bids in October. We just finished the electrical safety inspection and fixed all the deficiencies. This is a federal grant program targeting older buildings with low income tenants. The government offers owners assistance with upgrading their buildings. It takes patience to fill out all the paperwork but it’s free money. Upgrading buildings to handicap access is also available.

WHEN CONDO CONVERSION MAKES SENSE
This is a buy and hold strategy for certain buildings. The mill rate for residential properties is lower in Ontario than it is for commercial properties. For example, the property taxes on a 48-unit multi-family apartment is $18,000 versus a 48-unit multi-family apartment that has been condo converted is $9,000, this is a $9,000 savings per year. It’s easy to figure out the break even point when you will recoup the cost of converting and if it fits in to your exit strategy. This is a value add for this building and increases the attractiveness to a potential future buyer.

INVESTOR SAVVY: CREATING VALUE
Have you taken the time to think about an investment from your Investor’s point of view? How would you rate your investment? How do you create a wow experience? If you want to attract investors, what would they want to hear? The bottom line is important and it’s how you achieve that bottom line. Investors want to hear that you are continually increasing the value and performance of their investment, whatever the economic climate. Every month, every year, the revenue in your portfolio should continue to increase even in a down market. It’s easy to make money in an up market. The aphorism goes, all ships rise with the tide. The people who make money during a down market are the savvy investors. It’s only when the tide goes out that you learn who’s been swimming naked as Warren Buffett says. This is your opportunity to provide intrinsic value on top of financial value.

SUCCESS BLUEPRINT WORKSHOP
My business coach Andrew Barber-Starkey with www.ProCoachSystem.com is putting on one of his exceptional workshops. There’s no obligation to buy anything except to enjoy the day and learn lots.
Jan 19 in Burnaby; Jan 25 Edmonton; Jan 26 Calgary
Click here to download the Annual Progress review, an exercise that we use in his coaching program, as a free gift from Andrew.

PRO-ACTIVE PROPERTY MANAGEMENT - PART 4
When managing multiple turn overs at month end, give tenants an incentive to move out early and to move in late by pro-rating their rent and bonusing it back to them. This way you can manage multiple turnovers and spread it out over a week or two instead of doing it all on the last day of the month. This tip is part of my “How can I create a fail-safe, fool-proof property management system that is easy to use?” system.

Never forget: the secret of creating riches for oneself is to create them for others. Sir John Templeton.

July Ono