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Torcana Investment Blog

How are investors sourcing great USA rental property in 2016?

Posted by Colin Murphy on Jul 29, 2016 12:57:29 PM


I´d like to write about something a little different than the norm in today´s blog. As many of our readers will be aware, most major markets across the USA are in full recovery mode and waves of cheap money are chasing a shrinking number of opportunities. As a direct consequence, many investors are struggling to add to (or even start) a portfolio of rental properties that generates solid cash flow.

Therefore, I thought it would be interesting to write a short summary of the methods successful investors use to source great value rental properties REPEATEDLY no matter how competitive or distressed their local market is. I realise there are large funds out there who buy hundreds (and sometimes thousands) or properties every year, but I´m focusing on the tools investors who are interested in purchasing 1-10 units can use.

As you will see, there is nothing complicated about what these people do, although discipline, focus and a strong work ethic are certainly common factors. I´ll start with the most obvious & simple ways and will finish with the more sophisticated ones.  

Public Listings (MLS/Zillow/Trulia/RedFin)
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These are the properties that are listed for sale on the open market. The majority are in decent condition and are being sold by licensed realtors. The multiple listings system (MLS) is what realtors, brokers, property managers and other professionals use to buy and sell properties. Within Torcana, we use the MLS quite a lot for research purposes (and sometimes for resales) but we don´t use it much to buy properties any more.

The reason is very simple - there is too much competition. Properties listed on the MLS (which are then widely distributed on open websites like Zillow & Trulia) are the most difficult way of securing a home at a great price. I still place bids on MLS properties regularly, but they would be short sales, bank sales (REOs) and another "distressed" homes. Anybody placing low ball offers on homes that are in good condition is going to end up wasting a lot of time.  

Wholesalers 
Wholesalers are specialists who secure properties and then sell them "as is" for a modest mark up. For example, they might put a property under contract for $50,000 and then assign it to somebody else for $55,000. You will find wholesalers on Zillow and Craigslist, they send a lot of direct mail and you´ll see their "we buy houses for cash" signposts everywhere. They will also be at local REIA and other networking events. I am on the mailing lists of 40-50 local wholesalers and every now and again we will buy a property from them. This is a very typical way for people who want to be full time investors to get started, as you don´t need much money to begin with (although it certainly requires a lot of effort).

Yellow letters / Direct marketing
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Nowadays, anybody can access very sophisticated databases of potential private sellers using free public records and specialist websites like listsource.com. Aside from being able to target specific neighborhoods and property types, you can also carefully select your criteria to target both financially distressed sellers (pre-foreclosure, tax liens, code violations) and sellers motivated to sell for non-financial reasons (recent inheritance, recent divorce, recent eviction issues, winding down for retirement). 

Torcana sends direct marketing campaigns regularly to specific zipcodes in Tampa Florida. There is a decent amount of trial and error involved and you need to be prepared to stick at it over many months. A lot of people give up too early with direct marketing and/or persist with poorly designed mailing lists. 

Coincidentally, we put a property under contract earlier this week (26 July 16) from a direct marketing campaign. It is a 3 bed 2 bath in an area of New Port Richey we know very well. It is owned by two sisters who have been going through a lot of personal family issues and on top of that had major problems with tenants. The property has been vacant for six months and there are significant unpaid tax and utility bills. For the sellers, this property has been nothing but trouble and a source of significant stress. We were able to negotiate a cash "as is" offer for the property and I am getting it professionally inspected today. If we proceed to purchase, we will probably spend $30,000 - $35,000 on renovations and transform it from one of the worst homes on the street to one of the best homes on the street. 

Private auctions
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There are many private auction platforms available : Hubzu.com, Auction.com, Hudhomestore.com, Hudsonandmarshall.com, Homepath.com and Homesearch.com are just a few of the ones we have used to successfully purchase Florida properties in the past year. They are all very different to each other. Each one has different terms, conditions, fees and contract submission platforms. For example, Hubzu charges 4.5% of the purchase price plus a $299 technology fee.

More importantly, some will provide inspection periods while others deduct immediate and non refundable deposits. We have successfully navigated these waters for several years and have converted a lot of neglected properties into beautiful turnkey gems.

Public Auctions
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Many people hear about the great bargains available in the online USA foreclosure auctions. There is some truth to that, although there is certainly nothing easy about securing them. Unlike private auctions, there is no title insurance given against any tax or lien defects in public auctions, so you are taking on a lot of additional risk by bidding on them. 

That includes anything from a second mortgage, to tax liens, utility liens, code violations and even alimony liens. For example, we might find a lien for $10,000 attached to the property and so we would adjust our bid price by $10,000 as this would have to be settled before I could take clean ownership. You can mitigate this by carefully researching public records for evidence of liens, second mortgages, complex ownership structures, unpaid HOA and utility bills and other complications.

You need to brace yourself for a lot of frustration with public auctions are well - at least 60% of the properties tend to get cancelled or repurchased by the banks as opposed to sold to 3rd parties. In other words, this is for people with a lot of time on their hands and a healthy appetite for risk. We bid on public auctions regularly, but it is really time consuming. Click here for a longer blog I wrote on public auctions back in April 2015. 

Where should you get started?
Getting started depends on what way you want to buy property and how much time you have on your hands. Most people never get started - they just spend loads of time thinking and reading about it.  

I´m lucky in that I can afford to spend 60 hours a week doing this full time and work closely with a big team of partners and colleagues on the ground. That means we can pursue all the above sourcing avenues simultaneously and deal with the purchase, renovation and resale tasks for a constantly changing stream of properties. 

If you are investing in real estate part time you should probably take it a little slower than I do. In other words, master private auctions before moving onto public auctions and get your wholesaler list up and running before you start working on direct mail campaigns.  

What people do you need in place to build a rental portfolio?
Nobody has been successful in real estate by working on their own. That´s a fact. There are severalessential people any professional investor will need which include:

- Property Manager (finding, processing and managing tenants)
- Contractor (overseeing necessary renovations and all the headaches that come with it)
- Handyman (to fix the multitude of ad hoc issues)
- Property Inspector (to ensure roof, HVAC, plumbing, electrics and structure are sound)
- Administrator (to process all the paperwork involved)
- Title Agent (to perform lien & permit searches and deliver clean title)
- A good CPA and lawyer to make sure you aren´t breaking any rules or paying unnecessary taxes

What about purchasing turnkey instead?
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If you don´t have the time to build a team that sources, renovates and manages properties but still want to put your hard earned money to work for you, then there is an obvious alternative which most of our clients already use. It is simply to deal with a turnkey operator like Torcana.

Unlike the vast majority of realtors who sell direct to home owners, Torcana have always specialised in delivering turnkey rental homes to out-of-state and overseas investors. That is our business niche and not very many people are doing it.

We already have a great team of people in place who have worked full time in this business for many years and we take all the risks involved in buying properties using the methods above so you don´t have to. 

We run a tight ship that enables us to deliver rent ready properties at competitive prices and strong cashflow returns in the 8-9% net range. Most of our properties are 3 bed 2 bath single family homes with a garden and attached garage priced in the $90,000 - $100,000 range.

If you are interested in learning more, then please reply to this email and let´s schedule a time to discuss further. It is always the people that make an effort to speak with us and stay in touch afterwards who receive priority access to our best opportunities.

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Topics: USA Property, tampa property investment, rental property, pasco

New law passed which will change the Florida condo market dramatically

Posted by Colin Murphy on Jul 22, 2016 10:50:59 AM

There was some great news for condo owners announced last week when the US Senate passed the "Housing Opportunity Through Modernization Act," by unanimous consent. 

I´m guessing very few people are going to read the small print, but it´s actually a pretty big deal as it eliminates many of the barriers to affordable mortgages for condo owners.

This bill will considerably loosen the existing restrictions on condominium financing. As well as making the FHA's recertification process substantially less burdensome, it also lowers the FHA's current owner-occupancy requirement from 50 percent to 35 percent. 



In other words, if you had a condo community with 100 units and only 35 of them were owner occupied, then you couldn´t get finance as an owner. In the near future, you can. In addition to first-time buyers, the bill will help current condo owners who hope to move up to single-family housing by making their current condominium much easier to sell (and therefore more valuable).

More importantly for Torcana clients, these changes will also make it easier for landlords of condos to sell them on the open market to owner occupiers. 

Tom Salomone, president of the National Association of Realtors said that "Condominiums often represent an affordable option that's just right for first-time and low-to-moderate income homebuyers. Unfortunately, overly burdensome restrictions on condo financing have for too long put that option out of reach for many creditworthy borrowers. This legislation meets those restrictions head on, putting the dream of homeownership back in reach for more Americans."

The bill has passed the House & Senate and is now on the Presidents desk. Once signed, it becomes law, so stay tuned.

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The Florida real estate market continues to go from strength to strength. If you had told me in 2010 that average house prices in Florida would rise continually for the next 4.5 years, I´d have said you were being ludicrously optimistic. With median salesprices for single families, condos and townhomes all increasing for 54 months in a row, that is exactly what has happened.

If you want the latest figures: the
Florida Realtors Association recently reported higher median prices (up 10.5%), more sales (up 4.5%) and dramatically fewer pre-foreclosure sales (down 37%) compared to this time last year. 

This really is a great market, and the turnkey rental homes we are selling to investors with price ranges of $90,000 - $120,000 and estimated NET rental returns of 8-9% are TERRIFIC value. 

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Topics: florida real estate, tampa rental property, florida condos

We look at what Brexit means for the US & Florida property markets

Posted by Colin Murphy on Jul 6, 2016 4:23:01 PM


It has been almost two weeks since Britain voted to leave the European Union and the economic and political shockwaves are still reverberating strongly around the world. I must admit I was very surprised by the result.

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With all of the British political parties in turmoil, a dramatically weaker currency, tens of billions wiped off the UK stock market and multi-nationals canceling or downsizing investment programs, the Leave campaign slogan of "Let´s take back control" looks grimly ironic. 

As reams of articles are being published daily on this huge event, I´m going to restrict myself to commenting on how Brexit might affect the Florida and the wider US market. While they might seem far removed from the Brexit referendum, there is no doubt that it is going to have an impact. In my view, it will mostly be a positive impact, for several reasons.

1. Lower Mortgage Rates
The most obvious boost is that US mortgage rates have fallen to a three year low because the Federal Reserve will drag its feed on rate increases when there is so much uncertainty in the global markets. Lower mortgage rates increases peoples buying power, increases demand for homes and gives a boost to average house prices. 

2. US real estate looks even more stable and attractive now 
Uncertainty in Europe will increase demand in safe havens like the US, pushing prices higher. With a strong dollar and government bond yields close to zero (and negative in some places) investors will also naturally increase their exposure to US real estate as it can offer higher returns and much lower volatility than the stock market. US REITs (Real Estate Investment Trusts) are already seeing an immediate increase in interest from institutional buyers. To put it simply, nervous investors have always turned to real estate during times of volatility. 

3. London´s loss will be America´s gain
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There is no question that Brexit is going to be bad for the London real estate market, especially the upper end. As banks and other multinationals downsize operations, local demand will suffer and the overseas buyers who have been investing huge sums of money in prime London real estate will startmoving cash to alternative property markets like New York and Miami. This was happening already, but Brexit will accelerate the pace. The share prices of major UK REITs & UK house builders have fallen by 20-30% in the past two weeks and nobody is predicting that they will recover to pre Brexit levels. 

4. Florida is stronger than ever house-for-sale.png
The Florida Realtors Association reported higher median prices (up 10.5%), more sales (up 4.5%) and dramatically fewer pre-foreclosure sales (down 37%) compared to this time last year.

Median sales prices for single families, condos and townhomes have all increased for 54 months in a row. If that isn´t a stable market, I don´t know what is! 

 

Nova Scotia Drive: Back on the market! 

When we advertised this beautiful home last week it was immediately reserved by one of our regular buyers. Unfortunately he has just canceled for personal reasons and so it is available to reserve today. Below you´ll find the full details...

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Nova Scotia Drive is a three bed two bath property that has just been transformed by a renovation budget that exceeded $30,000. With a new roof, paint, air con, kitchen, floors and bathrooms; this is essentially a brand new home and it will make a superb rental property. 
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Jasmine Estates is one of our favorite neighborhoods in Tampa and we have bought at least 8 properties in the immediate area this year (see map opposite). They have always rented quickly.

In addition to three bedrooms and two bathrooms, this home also has an attached one car garage and a newly fenced backyard. The purchase price is $105,900 and estimated net rental returns are 8.4%.

You´ll find plenty more details below including property description, video, photo gallery, map links, financial breakdown and renovation details. I would recommend that you REPLY QUICKLY if you are interested in securing.

About the Property

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As you can see from the “before & after” photos below, this home is in superb rental condition. We have put together an 80 second video slideshow which is worth reviewing.

The home itself is a 3 bed 2 bath built in 1980 with over 1,890 sq ft (1,310 of which is heated) with a one car garage and fenced backyard. These are the properties every Realtor wants to get their hands on as they are easy to sell and easy to rent. This is a completely off market property that is exclusive to Torcana clients.

Nova Scotia Renovations (more than $30,000 worth)

Major items
- New a/c unit
- New roof
- New flooring (vinyl planks throughout and new carpets in bedrooms)
- Newly painted both inside and outside

Kitchen
- New cabinets, sink and faucets
- New granite countertops and tile backsplash
- New light fixtures and crown molding

Bathrooms
- New granite counter and cabinet in main bathroom
- New vanity and back splash in second bathroom

Other
- New smoke alarms, blinds, fans and interior doors
- Landscaping and new fence in back yard


Financial Projections
 
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Important Links

1. Video SlideshowClick here
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2. Photo Gallery

BEFORE Renovation

AFTER Renovation

3. Market Analysis
A quick analysis of the current properties listed for sale within 0.25 miles of this location shows only one house under $100,000. With a high quality renovation and estimated 8.4% net return, our house is excellent value at $105,900.

A quick analysis of resent sales of renovated homes in the area also shows several in the $80-83 per sq ft range, which is what this home is priced at. 

4. Google Map Link
https://goo.gl/maps/3d12CRuKJ5H2 

5. Reservation Process
We are seeking cash buyers for this property (you can always refinance afterwards) with a 20-30 day closing. Initial deposit is $5,000 (payable to local title company) and we are happy to provide a 7 day inspection period, which can be extended for a buyer who wishes to visit personally. Happy to discuss the process further if you´d like to call us on 727 302 1422. 

 

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Topics: USA Property, tampa rental property, brexit

If you are waiting for the US housing market to slow down, you will probably be disappointed

Posted by Colin Murphy on Jun 16, 2016 2:37:30 PM

In today´s blog post..

- Feedback from a fascinating conference I attended in Miami recently
- How the economy and foundations of the current real estate market are different to 2006
- PLUS: Details of the new Torcana.com website

Will there be another housing correction in the US? 
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I was in Miami a couple of weeks ago (16-18 May 2016) at a large B2B conference. It was a terrific networking event full of real estate investors (large & small), lenders, insurance firms, renovation companies, specialist technology platforms and much more besides. The entire event was geared towards people who work in the business of single family home rentals. 

Aside from having 20-30 face to face meetings during an intense three day period, I also attended a dozen or so seminars with titles such as

"The Single Family Home Market in 2016 and Beyond"
"Buying in bulk vs buying individually"
"Major markets for foreclosures and property rehabbers"
"Exit strategies for small investors"

One of the major lessons I took away with me was that those who are sitting on the sidelines until the next correction in the US housing market comes along are going to be waiting a long time. There are several reasons for this, which I´ll try to explain briefly.

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In the last 7 years we have seen a HUGE transfer of ownership from unqualified owners getting "no doc" loans to highly qualified owners passing stringent tests. The people who have been purchasing US property since 2009 are probably the most qualified in the last 50-60 years. Indeed, the default rates of the "post crash" borrowers is just 0.5%, which is half the long term average of 1%.

These buyers have high FICO scores, solid incomes and many have secured ultra fixed interest rates over 25-30 years. There is no way they are going to be forced to sell at fire sale prices the way the previous generation was.

Investors who are currently building rental portfolios are also in an extremely strong position. Rental demand from millennials, retirees and regular people with solid incomes is higher than it has ever been. Average values of the rental homes they´ve purchased have increased for 50+ months in a row and rental rates are on a steady upward curve. 

Torcana is on the coalface of the single family home market in Tampa, and I can tell you that inventory is extremely scarce. It is a constant battle to secure great value rental properties and competition is fierce. A typical three bed, two bath single family home with a fenced yard and 2 car garage is incredibly difficult to purchase as everybody wants to buy them.

I am under no illusions that buying rental properties is going to get easier in the near future. It will get more difficult and I´ll have to work harder and get more creative to find them. The Torcana team are well aware that this is a dynamic market with lots of buyers.

As for builders? They aren´t building anywhere NEAR enough to cope with natural demand and they show no signs of doing so. One of the facts I picked up during the Miami seminar was that there were 5 million existing homes sold and less than 500,000 new homes sold last year. In other words, there are 10 times more second hand properties being sold than new properties.  

Tampa is the real deal
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Affordable real world markets like Tampa are not going to drop any time soon. In terms of prices and rental income, this is the most stable market I´ve seen in my 15 year career. The trend of high demand and limited supply is absolutely set to continue.  

The last two homes we advertised in our newsletters both sold within 1-2 days. We have several more really great houses in the pipeline and we´re confident they will sell equally quickly.

If you´d like to schedule a call to discuss what we have coming up, please let me know and I´ll be happy to fill you in. 

Finally, a quick word on our new website..
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The Torcana website was redesigned recently, and I thought you might appreciate a quick preview! We have been working hard behind the scenes to provide a great source of information for anybody interested in learning more about buying turnkey rental properties in the USA, particularly Florida.

Here is a quick summary of what is available and any feedback would be very welcome indeed. 

1. A wide range of free to download market reports including:
- Buyers guide to Tampa Florida
- Comprehensive 77 page track record with before & after pictures
- 20 Things to know when investing in the real estate market
- The five biggest real estate mistakes to avoid
- General guide to investing in the US rental market

2. Access to our Podcast Archive (I´ll be recording another one later this week)

3. Hundreds of articles on the Torcana Blog

4. A new look property listings section with interactive maps, photo slides and videos
(full details of new homes will be added very soon)

5. Detailed articles on each of the investment property types we target (public & private auctions, bank owned foreclosures, distressed sellers etc.) will be published in the near future. 

That´s it from me today!  

Kind Regards,

Colin Murphy

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Topics: florida real estate, real estate, tampa property investment, tampa rental property

Thinking of buying real estate from out of state or overseas? We explain what you will need..

Posted by Colin Murphy on Apr 17, 2016 1:00:51 PM

At Torcana our specialty has always been catering to the requirements of out-of-state and overseas buyers keen to purchase turnkey rental properties. Surprising at it may seem, most locally based sellers are simply not tuned into the specific needs of potential buyers located thousands of miles away. They find it difficult to educate them on the market or inform them of what they need to be aware of as a non US resident. They find it difficult to cultivate business relationships with people they rarely (and sometimes never) get to meet in person.  

While most sellers would not be happy with the idea of answering continuous questions and building relationships with potential buyers who may take months (and often years) to take the plunge and invest in a property, it is actually what we thrive on. 

We have always gone out of our way to offer a high quality of customer service which includes:

- A regular supply of blogs, ebooks and podcasts to teach you about our real estate markets
- Providing turnkey rental properties with high renovation standards and competitive pricing
- Optional introductions to vetted property managers, insurance brokers & accountants
- Spending quality time with people that wish to visit the areas we operate in
- Being genuinely available to answer questions before, during and after your purchases 

Our Track Record
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Back in January you may remember that we promoted a 30 page PDF that contained detailed information on 14 single family homes we had recently purchased, renovated and resold in the Tampa Florida area. They ranged in price from $70,000 - $100,000 with estimated net rental returns of 8-9% after all fixed and variable overheads.

We have been updating our records and next week (w/c 18 April)  I´ll be presenting a 75 page "Torcana Track Record" information pack which will contain details on no less than 36 properties worth $4.5 million that we recently transformed into beautiful turnkey homes.

The information pack will include a property description, financial breakdown and before & after photos of each home that was purchased, renovated and resold. They range from small 2 bed 1.5 bath properties in the Tampa suburbs worth $70,000 to two storey pool homes in affluent St. Petersburg neighborhoods worth $400,000. 

To give you a quick preview, here are details of three properties completed in the last couple of weeks ...

1. Valley Court, New Port Richey (Tampa FL). Status: Sold 
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This home probably had the best curb appeal of the 30+ properties we have purchased in this part of Tampa. With great neighbors and bordering the Magnolia Valley Golf Club, his three bed two bath single family with a 2 car garage and large garden has excellent capital appreciation potential.

VIEW TWO PAGE BROCHURE (financials, description, before & after images) 

2. El Camino Paloma Ave, Port Richey (Tampa FL). Status: SOLD
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A beautiful 3 bed 2 bath home in Port Richey which features fresh paint, new flooring, new third bedroom, bathrooms with new granite counters, an open plan living/dining combo and family room. There is an entertainment deck off the family room and the backyard is privacy fenced with a storage shed. Conveniently located near the bus line, shopping and restaurants.

VIEW TWO PAGE BROCHURE (financials, description, before & after images) 

3. Lakewood Drive, Hudson (Tampa FL). Status: Under Contract
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Lakewood is a 3 bed 2 bathroom single family home with a huge garden in a quiet peaceful neighborhood. This lot size is three times bigger than the average property we purchase! The home features a brand new kitchen with granite counters, new air conditioning unit, new floors throughout, a screened front porch, attic and oversized garage.

VIEW TWO PAGE BROCHURE (financials, description, before & after images) 

.......................................

As you can hopefully tell from the photos and financial breakdowns above, these are high quality renovations in genuinely nice neighborhoods. More importantly, all three of these properties sold for less than $100,000 and they all have high estimated net rental returns in the 8-9% range.  

Finally, here is a similar property that is available to purchase TODAY

Castanea Drive, Port Richey (Tampa FL): Available for $83,900 with est. 9% net returns

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Castanea Drive is an immaculate home in the sought after Regency Park neighborhood in West Tampa (New Port Richey neighborhood). It two bedrooms, two bathrooms and a bonus room that could be used as a home office or playroom. This is completely rent ready with gorgeous flooring, new bathrooms, newly painted rooms and a huge fenced in backyard. 

The local property manager we work closely with on all our homes in this region paid a visit to the house a short time ago. We spoke on the phone and he said "it was probably the tidiest and most rent friendly home we´ve sent him to yet".

When we told him we were also going to add a dishwasher, some granite counters, new vanities and other miscellaneous items, he just shook his head and said it would be a pleasure to find tenants for it.  

This really is one of the cleanest properties we have secured for quite a while and would make a perfect rental home. With Tampa getting more competitive than ever, this is a rare opportunity to secure a quality, high yielding rental for just $83,900. 

To put this price in perspective - it equates to $48 per square foot! You couldn´t build a house for anything NEAR this price. Big national homebuilders with significant economies of scale could not deliver homes to clients at these prices either. 

Castanea Images: Click here to view full gallery of images 
Note: These images DON´T include the additional renovations we will completing before resale! 
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Financial Breakdown (estimate only)
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Four Point Inspection
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(Click here for full image gallery)

This house is very sound with all major items in solid working order with many years of useful life remaining. Here is a brief summary of our professional inspection:

- Structure: Reinforced masonry
- Foundation: Slab
- Water heater: 8 years old 
- Roof: 9 years hold
- Air conditioning unit: 12 years old (est. life is 20 years)

Each star in the map below represents a home we have purchased and renovated in the past few months. While we also purchase in other parts of West Tampa & St. Petersburg, we know this area extremely well and the properties we have renovated here have always been rented quickly and efficiently. In short, it is one of our favorite neighborhoods for safe and profitable rental properties.   

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Next Steps

If you are interested in reserving the above home (or a similar one), please try get in touch with me by telephone or email as soon as possible to discuss the next steps. 

Finally, please feel free to call me anytime for a general chat. If you are interested in learning more, but aren´t sure when or how you will be in a position to invest, it will still be our pleasure to make ourselves available to offer any guidance we can. 

Colin Murphy
Torcana.com
727 302 1422

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Topics: Buying Real Estate, tampa rental property, investing from overseas

Our top 10 real estate stories from the last 10 years

Posted by Colin Murphy on Apr 1, 2016 6:16:36 PM

Every now and again I write a newsletter that takes a step back from the hectic day to day schedule of sourcing, renovating, promoting and selling turnkey rental properties in the Tampa Bay area. 

It is hard to find the time, but I enjoy the process of searching for a theme that has an interesting real estate angle that might offer our patient readers some respite from the constant barrage of promotional emails. 

Inspired by a Zillow article I read a few months back, this week I´ve decided to write about the "Top 10 Real Estate Stories of the Past 10 Years". Whether the last ten years have been good or bad to you financially, there can be little doubt that the period from 2006-2016 was one of the most disruptive in living memory.

Please read on if you´d like to take a short trip down (recent) memory lane to relive the changes caused by the market crash, the Fannie & Freddie bailouts, the record low interest rates and the rise of the internet as the dominant source of new sales and rental listings.

Each one of the ten stories below is more than interesting enough to merit its own newsletter, but I´m going to go through them extremely briefly in this email. However, I did record an indepth 20 minute podcast talking about each one in detail earlier this morning that I hope you can find time to listen to it. 

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1. The real estate market collapsed
A huge 10-12 year housing bubble fueled by sub prime mortgages, reckless Wall Street traders, low interest rates and a range of misguided government policies finally burst with a huge BANG in early 2008. Washington Mutual was one of the first dominoes to fall, but things really took a dive after Bear Stearns was sold for peanuts to JP Morgan and Lehman Brothers was allowed to fail. 

2. Fannie & Freddie received a massive bailout
During the chaotic fallout from the Lehmans Brothers crash, the stock price plunges of both Fannie Mae & Freddie Mac brought both semi government entities to near collapse. As they guaranteed such a huge portion of mortgages at the time, they were deemed too big to fail and ultimately received a $187 billion bailout (which has since been repaid). They continue to guarantee more than 50% of all new US mortgages and are the main reason why so many investors and home owners have been enjoying 30 year fixed mortgages. 

3. Government policy forces mortgage rates to historic lows
I think late 2012 was the record for mortgage lows when 30 year fixed rates were as low as 3.3%. That is a ridiculously low rate and a direct result of federal policies to stimulate the housing market. Smart investors, particularly higher net worth ones, were also able to access very low mortgage interest rates to expand their portfolios. 

4. Detroit declares bankruptcy 
During the summer of 2013 and after some very nasty and protracted arguments with creditors, Detroit filed the largest municipal bankruptcy (by far!) in US history. It exited a year or so later, but a city with a shrinking population of 700,000 still has more than 100,000 vacant properties and a long list of pending foreclosures. While local real estate experts can and do make lots of money, it is not an ideal "turnkey" market for out of state or overseas investors, despite what the glossy emails and brochures might promise.   

5. The Internet turns property search and lead generation upside down
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Stating that the internet is the most important tool for people searching for a new house seems like the most obvious thing in the world now. However, back in the early 2000s many people still relied on newspapers and property magazines as their main source of information. Detailed real estate information (e.g. sales prices of similar houses, days on market, property taxes) used to be available to professional insiders, and even what they had was nothing compared to what is available to everybody online now. Buying, selling and renting a property is far more transparent now thanks to the internet (although it contains a lot of inaccurate real estate info too!). 

6. Rebuilding in the aftermath of Hurricane Katrina
Back in 2004, Katrina was first and foremost a human tragedy with more than 1800 people losing their lives. However, it is also a huge real estate story as over a million homes were destroyed. The federal, local and private initiatives to rebuild this area have already started to pay dividends, but it will take a lifetime to replace all those properties. 

7. People stopped getting so obsessed with "bigger is better"
One of the positive side affects of the real estate crash was that people realized they didn´t always need to buy huge properties. In Florida especially, there was an alarming trend towards 4, 5 and 6 bed single family homes. I live in quite a modest sized house and can´t understand friends who buy these huge properties that cost a fortune to purchase, maintain and pay taxes on. People seem to be changing now though, and the same holds true for renters. If you have a well renovated property in a nice area, people will be more than happy with 1000-1300 sq ft in the areas we operate in. 

8. Real estate TV shows start to flourish 
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I have always found it very amusing that real estate shows only really started to flourish during the biggest real estate crisis in living memory. For the last 5 years, HGTV and other channels have been showing dozens of popular programs showing (good looking) people finding that diamond in the rough and transforming it into a beautiful home. They are good fun and I tune into them every now and again, but they are completely divorced from reality. 

9. Millennials and Baby Boomers drive migration back to urban areas
As discussed in a Torcana blog a few months ago, Millenials (lucky people born after 1980) show a distinct preference for urban accommodation close to transport links, amenities, universities, bars, shops etc. Many of them rent and like to keep flexible for job relocation and other lifestyle reasons. Conversely, many retiring baby boomer generations are moving back to the cities they left 40 years ago when they bought a big house in the suburbs to raise a family. 

These are just two of many different trends, and while some builders are capitalizing on them very well, the fundamental truths don´t change. In other words, when people want to settle down and have families, the default choice for most is still to buy (or rent) a more spacious house in the suburbs with a nice garden. That is the market Torcana is involved in. 

10. Return of cash buyers and massive portfolio builders
If you rewind the clock back to 2002-2007, practically nobody was buying properties with cash. To do so would have seemed completely insane at the time as prices were rising so fast and finance was so easy to come by. Fast forward to 2012-2016 though and in places like Florida you´re still seeing fully 40% of all real estate transactions being funded by non conventional means. Also, companies like Blackstone, Carlyle Group and KKR all have property portfolios worth many tens of billions of dollars. They barely existed as residential landlords ten years ago. 

Don´t let other peoples fears infect your drive to succeed as an investor
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Before I let you go to enjoy your weekend I wanted to touch briefly on something important. Earlier this week I had a conversation with a client that seems to repeat itself once every couple of months. An investor who has been reallyenthusiastic about starting their journey as a property landlord had their confidence dented by the opinion of a third party close to them.

Just like everybody else who wants to start a new business or do something different from the crowd, property investors have to combat their fair share of naysayers as they begin their real estate journeys. Keeping other peoples fears from infecting your drive to invest can be a challenge, particularly when they come from close friends and family members who have our best interests at heart.

I finished a very well known book recently called "The Millionaire Real Estate Investor" which has a large section at the back with mini biographies of successful people. One of the chapters that stuck with me was the story of a young woman called Renata Circeo. Just after graduating college, Renata was told by her father that "she was too young" when she approached him for a loan for a down payment on her first rental property.

Faced with that kind of feedback from such a trusted authority figure, most people would have postponed their real estate dreams then and there. But to her credit, this young lady took it on the chin and simply said "I know Dad, I just wanted to give you first refusal" before going ahead and finding the funds elsewhere. Fast forward 10 years from that conversation and she had a diverse portfolio comprised of 5 single family homes, two duplexes, six condos and an 18 unit apartment building.
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Clearly Renata had an uncommon drive, but I just wanted to illustrate that while there are many kinds of bumps on the road to building a real estate portfolio, it is absolutely worth it if you are willing to put in the time and research to make it happen. Torcana can help provide you with the right tools and options and we are  always available to talk to people who are interested in this business. 

I´ll leave it at that for today, but thanks for reading this far, and don´t forget to tune into our latest podcast

Kind Regards,

Colin Murphy
Torcana.com

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Topics: real estate, tampa rental property, tampa homeownership trends

The 13 things you should know before investing in real estate

Posted by Colin Murphy on Mar 7, 2016 1:10:17 PM

Last week was another hectic one for the Torcana team with two new properties purchased and renovations on several more underway. 

We will be releasing a detailed summary in the next day or two, so if you have been thinking about building up or starting a rental portfolio - please keep a close eye on this blog (or just call us). 

In the meantime, I have finished recording the sixth Torcana podcast and it is now available on all our platforms. As a lot of our readers are thinking about taking the plunge for the first time in the Florida market, I decided to compile a list of 13 actionable tips that are important to consider when buying rental properties. I talk about what you need to get in order before looking at properties, what you need to do before buying them and what you should be keeping an eye on afterwards. Enjoy!

New Podcast: The 13 things you need to know before investing in real estate

Please click here or on the image below if you´d like to listen now (also available on iTunes & Android). As always, feedback would be very welcome! 

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That´s it from me today.. and as mentioned above, keep an eye out for a new blog post containing the juicy details on the great rental properties we are currently working on.

Regards,
Colin Murphy

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Topics: podcast, real estate investment, rental property,

Would you like a home like this? Summary of our last six renovation projects.

Posted by Colin Murphy on Feb 24, 2016 11:00:00 AM

It has been an exceptionally busy six weeks for the Torcana team and we have recently completed renovations and resales for a wide variety of properties in the Tampa Bay area. 

Below you´ll find brief descriptions, including some great images, on the homes we have been working on over the past few weeks. Each of these four homes is priced between $89,000 - $115,000 with estimated net rental returns of 8.7% - 9%. 

(PS: I did find time to record a short podcast earlier today, so please click here if you´d like to listen to it now). 

7964 Putnam Circle, Port Richey, FL 34652 (Under Contact)
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A very spacious 3 bed 2 bath property measuring 1478 sq ft. Renovations included a new roof, a brand new kitchen (cabinets, countertops, appliances), upgraded bathrooms and new flooring throughout. It is currently listed for rent for $1,250 per month and we expect tenants to be in place shortly.

Expected net rental return: 8.9%.  
Photo Gallery: Click here 

7207 Fairfax Drive, Port Richey, FL 34668 (Under Contract)
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Another great 3 bed 2 bath single family home measuring 1326 sq ft. Renovations included a new roof, new floors, painting throughout, new granite countertops  and other cosmetic updates. Our local property manager is in the final stages of screening new tenants who have already signed an application and agreed to pay $1,075 per month.  

Expected net rental return: 8.7%.  
Photo Gallery: Click here 

7020 Ingleside Drive, Port Richey, FL 34668 (Under Contract)
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A 3 bed 2 bath property located just two blocks from the busy Embassy Blvd and very close to the huge Gulf View Square Mall. Renovations included a completely new kitchen with granite counters, upgraded bathrooms and significant landscaping. It will shortly be listed for rent for $975 per month and demand is expected to be very high. 

Expected net rental return: 8.7%.  
Photo Gallery: Click here 

5004 Sherwood Drive, Port Richey, FL 34652 (Under Contract)
A large 3 bed 2 bath measuring 1524 sq ft in a great location just off Cecelia Dr with easy access to Downtown Tampa, Clearwater and St. Petersburg. The renovations are well underway and include new granite kitchen countertops, paint throughout, upgraded master bathroom, significant plumbing and electric work and a new garage door with motor. 

Expected net rental return: 8.7%.  
Photo Gallery: None available as it´s still under renovation

Next Steps
If you would like to reserve properties similar to the four homes described above, all you need to do is schedule a call to discuss your individual preferences, budget, timings and general objectives. 

OTHER PROPERTIES
Sometimes we will purchase and renovate homes that are more suitable for resale to the local "owner occupier" market, so we don´t usually include them in our newsletters. These properties can take longer to sell and the rental returns will be modest, but the scope for capital growth is often higher.

Below you´ll see two great examples, but don´t compare them to the properties above as these are worth over $400,000 each!

235 Snell Isle Blvd NE, St Petersburg FL33701 (Sold)
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This is a very special home that we have owned for several years and just sold earlier today. It is a beautiful 3 bed 2 bath single home with a large garden and swimming pool located in one of the most desirable and historic neighborhoods of St Petersburg. We added a new bathroom in the master bedroom, a new kitchen with granite countertops, new light fixtures, baseboards, doors, and a new 4 ton air conditioner with new duct work.

There is a lounge area and a main salon which boasts a gorgeous reception and formal dining area. The three large bedrooms are all doubles with one located downstairs and two upstairs. It has been newly painted throughout and has stunning finished hardwood floors, newer windows and lots of natural light. Finally, the yard is beautifully landscaped with lush plants, palm trees and a swimming pool and deck area. 

Photo Gallery: Click here (make sure you look at these, it´s a stunning home).

3210 Gulf Blvd #304, Belleair Beach FL33786 (For Sale)
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This is a beach front condo with incredible direct views of the Gulf that we purchased about 18 months ago and just listed for sale two days ago. We have been inundated with calls from realtors ever since.

It is a beautifully staged and freshly painted home in immaculate condition. It features ceiling fans in every room with newer wiring, HVAC, light fixtures, crown molding, appliances, California style closets, Soltillo tile, granite & Corlan countertops and custom maple kitchen cabinets.

The community itself is extremely well run with significant exterior renovations completed in 2009. There is a large community pool, assigned parking (room for 2 cars) and direct beach access. Overall, this is a fabulous location in one of the most sought after low rise condo communities on the Gulf Coast. Watch the sunset every day from your private balcony overlooking Belleair Beach!

Photo Gallery: Click here (check out the views!)

Next Steps
Please don´t hesitate to pick up the phone and speak to us if you´d like to learn more about this business and more about building your own property portfolio. 

Free 14 page guide to the Tampa Florida real estate market

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Topics: florida real estate, rental property, tampa

Three ways you can build a great passive income stream

Posted by Colin Murphy on Feb 22, 2016 8:08:38 AM


I recently read an article that described the three main ways to earn passive income. For a lot of people (myself included), the holy grail of a career is figuring out how to build up a large passive income stream.

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Want to listen to the podcast version instead?

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I love the idea of working hard and building up sufficient assets so that my family will receive a regular income stream no matter what happens to me. Striving to achieve that goal is a great source of daily motivation. 

So, what are the three ways to build a passive income?
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The
first of the three ways is to start or invest directly in a business and bring it to a point where others can run it for you. I have HUGE admiration for people that are able to do this. 

The second way is to buy stocks and bonds that pay regular dividends and (hopefully) increase in value over time. Some people (Warren Buffett for example) are naturally brilliant investors that know how to make double digit returns year after year no matter what the market throws at them. However, most have no control over what happens to the funds they have tied up in the stock markets and just keep their fingers crossed that they can exit on a high tide.   

No prizes for guessing that real estate is the third way, and in my opinion, it is by far the most straight forward and controllable of the three main methods to make a passive income.  

One of the best things about real estate is that it is a concept most people can easily understand. You buy a property, get it fixed up and you rent it out. You set aside some money for repairs, be respectful of your tenants and then sit back while the rental checks arrive every month. With a bit of luck and a lot of patience, the value of your rental homes will increase nicely over time.

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While real estate may be an easy concept to grasp, that doesn´t mean sourcing, buying and preparing the right kinds of homes is easy. As I mentioned last week, it requires a lot of discipline and attention to detail.  

Fortunately, I happen to work in a business that helps busy people build strong rental portfolios. The better we get at helping people build these passive income streams, the easier it is for us to build our own.
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Topics: real estate, rental property, passive income,, tampa

Our 7 step process to buying an amazing Florida rental property

Posted by Colin Murphy on Feb 9, 2016 2:49:23 PM

In todays blog, I will outlining the seven steps we take every week to source, analyze, purchase and renovate homes throughout the Tampa Bay area in Florida. Last week alone, I analyzed 50 different homes, 19 of which were personally visited by my colleagues. We followed up those visits with nine cash offers and had two of them accepted.

The aim of this article is to really drill down into the nuts and bolts of buying and owning real estate. While the day to day reality is far less glamorous than the depictions of the popular tv shows, purchasing your own rental properties has the potential to transform your life in more ways than any other investment I know of. 

I have tried to write a valuable step-by-step guide for anybody interested in learning more about the real estate business. It hopefully gives some useful insights into what the Torcana team actually does every day, including all the number crunching, the hundreds of miles we clock up every week and the financial risks we take in the weeks and months before we present a turnkey property to you. 
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Remember: You can now subscribe to our weekly AUDIO & VIDEO podcasts
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Step 1: Finding and analyzing potential houses
Florida-MLS

When you first start looking at properties for sale, it is very easy to get overwhelmed by the sheer volume of options out there (see local map above listing homes currently available in our target areas). That´s why it´s important to focus on very specific property types, price ranges and locations.

Last week (1-5 February) I carefully studied 50 potential single family homes listed for sale in the Tampa Bay area. That included the MLS (official website used by real estate agents), Zillow, Craigslist and several online auction sites such as hubzu.com and auction.com. We also get calls every week from local property owners who receive letters from us asking them to call if they are interested in selling their property for cash.

By “carefully studying” I don´t mean reading the listing information and looking at the photos a couple of times. In the Torcana office it means inputting details into an in-house designed spreadsheet, which contains more than 70 rows of data on each property. As you´d expect, this includes the basics such as beds, baths, sq ft, year built, asking price and market rent. It also includes fields for outstanding permits, liens, rehab estimates, holding costs, tax records, closing costs, running costs, map links and much else besides.

Step 2: Visiting the properties 
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After the initial numbers were crunched, the initial list of 50 properties was whittled down to a shortlist of 19 that were to be personally inspected. After visiting hundreds of them you get pretty efficient at this and we can usually get in and out in less than 45 minutes per property. We use Google maps to plan our trips as efficiently as possible. It is also helpful to see where prospective properties are located in relation to others we have already purchased.

Draft renovation budgets are quickly calculated during these initial inspections, which usually includes a new kitchen, floors, roof, paint and bathroom vanities. Feedback is provided to me using a note sharing app which also includes observations on the local area. These observations can either be positive (neighbors with nice gardens and clean cars) or negative (neighbors with pit bull terriers and gardens full of junk). My spreadsheets are updated accordingly and 9 of the 19 properties inspected last week were given green lights to make offers.

Step 3: Making an offer 
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I am not a big fan of verbal offers – I prefer to send a signed document with a proof of funds to the seller or their representative. It shows that we are serious and ready to move quickly. We don´t wait around to make offers either – I will usually send a contract to the seller the same day we visit the properties. The best opportunities are rarely available for more than a couple of days.


Many of the sellers we deal with are banks, which have their own online systems for submitting offers. As you´d expect from a bank, most are pointlessly inefficient and almost seem to be designed to discourage people from making offers in the first place.

Step 4: Offers accepted 
Getting an offer accepted
Of the 9 offers made last week, 2 of them were accepted, which is actually higher than average (about 1 in 10 would be the norm). Once the sellers returned the signed purchase agreements, I immediately ordered property inspections from a licensed professional. We have been working with the same property inspector for a couple of years and he knows we need them quickly. If I order one on a Monday morning, he usually visits the property that same afternoon and emails me the official report the following morning. 

These reports (which cost $90 each) contain the following information:

- Dwelling (observations, comments and concerns on the exterior structure)
- HVAC (heating, ventilation and air conditioning details)
- Plumbing system (age of pipes, water heater, valves and condition of appliances)
- Electrical (condition of electrical panels, types of wiring present)
- Roof (type – shingle, tile etc, roof age, estimated remaining life, signs of damage)inspection.jpg

The important thing to note about property inspections is that they focus on the non-cosmetic stuff that can actually cost you a lot of money. Anybody can see that a kitchen needs upgraded and you will know the cost in advance. On the other hand, a roof, water heater or air conditioning unit on their last legs could cost you many thousands of dollars. Serious issues with the structure, the foundations or a buried septic tank could cost you tens of thousands to repair.

Of the two inspection reports ordered last week, one of them came back with a clean bill of health. The report on the second property (see image opposite) mentioned that there was aluminium wiring in the house, which could mean spending an extra $1,500 on special alumi conn fuses to bring them up to code (we learned that the hard way on a previous house). There were also some damaged water valves spotted.

A layman (even one who buys properties for a living) would probably not have noticed either of these items. As you can appreciate, these are issues that need to be identified quickly – ideally before your purchase deposit becomes non-refundable!

Today we will have to get a professional estimate to address the aluminium wiring and the damaged valves. If the seller is unwilling to renegotiate the price accordingly, we will cancel our contract, request a refund of our deposit and move on. 

Will will visit the inspected houses again early this week with a general contractor and will spend about an hour with them in each home designing a detailed renovation scope of works, which is inputted online in real time. Again, I will adjust our calculations accordingly.

Step 5: Purchasing the house
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Now that our due diligence on the house has been completed and we have a detailed renovation scope of works, it is up to our title company to make sure that clean title is transferred on the day of closing.

If any unpaid utility bills or taxes are found during their searches, they will have to be paid by the seller before the closing date. This sometimes causes needless delays – a property I was supposed to buy on 18th January is closing today (8th February) because of an unpaid $150 water bill. As usual, the owner (a bank) and the utility company did their level best to make this as complicated as possible. In the end we just lost patience and visited the water company ourselves, wrote them a check, got a receipt, sent it to the seller and told them to get on with it.
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Sometimes liens are placed on the property – which is more serious. I recently had a purchase delayed by 6 weeks because the seller had an unpaid $1,800 credit card bill. Mastercard were able to hold up the sale until it was satisfied. You´ll also see liens placed by local tax authorities, local municipal authorities, home ownership associations, mortgage companies and even child support authorities. 

As you can probably guess, this is an important part of theprocess and not the time to take your eye off the ball. The most dangerous way to purchase a property is at a public auction as you will not have any time for any formal title checks or title insurance. You might think you got a bargain for $60,000 only to find that you are on the hook for a $70,000 second mortgage that came with the property. It happens every week. Professionals can spot the second mortgage in the public records before they bid. Newbies often don´t know where to look. 

Starting your property investment career by purchasing at a public auction is a little bit like heading straight for the advanced black rated slopes on your first day skiing - probably not a good idea. You´d be better off starting with the REO auctions that come with the liens already cleared.

Step 6: Getting the property rent ready and tenanted
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Before I go any further, thanks for reading this far! I´m not going to go into much detail about getting a property rent ready as I have discussed renovations in other blogs (and will do so again in the future).


I will simply summarize by saying that we do whatever is necessary to present the property to our buyers and their future tenants to a higher than average standard. When we list our properties for rent, the quality of the kitchens (usually with new cabinets and granite counter tops), bathrooms, flooring, paint and landscaping are all higher than average for the local area.

To be clear, that doesn´t mean they are nicer than your $400,000 house, just better than the other $90,000 properties in this particular area. Over renovating can be a very easy way to lose money. 

The upshot of our renovation policy is that we get lots of inquiries and the properties are quickly rented. I remember we finished two big renovations in late December and our property manager was able to place tenants in both homes by the 7th of January. Pretty quick right? Demand in these areas is naturally high and when we advertise a renovated home with great photos you´ll always generate a lot of interest.

Step 7: Selling turnkey to our clients
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The whole point of this entire process (the sourcing, the number crunching, the property visits, the negotiations with sellers, spending money on houses in disrepair, dealing with contractors and title agents) is to enable us to provide great turnkey rental homes to our clients.


All of our offers and renovation budgets are calculated with the end goal in mind – presenting a rent ready property at a fair price that will generate an estimated 8-9% in net cash flow per year.

In other words, if you buy a property from us for $100,000, we want you to receive $8,000 - $9,000 net every year. That is net of your expected property management, property tax and home insurance costs. It also includes setting aside another 10% for vacancy and maintenance reserves. The properties you see advertised with 15% returns usually forget to include this stuff (and will probably need a new roof within 2 years).

We don´t just sell and then leave you alone either. We make sure you have a great property manager (who uses software that lets you login and view status of your income & expenses 24/7) an insurance carrier who understands what coverage landlords need, and we are always available to answer your questions before, during and after the purchase. 

Conclusion
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We do all the work (and believe me, doing this properly requires a lot of work) so you don´t have to. It is difficult to source, renovate and purchase rental properties as a hobby or part time. Most people don´t have 60 hours a week like I do to stare at spreadsheets and make offers all day long.

The vast majority of our clients have full time jobs doing something completely different to real estate investing. What they have in common is that they recognize the importance of putting some of their hard earned cash to work for them. After all, having a passive income stream is crucial to anybody who wants financial freedom and it requires long term planning.


Buying rental properties is the best way I know to protect and grow your wealth without subjecting yourself to the volatility of the stock markets and the unacceptably low returns from bank deposits and government bonds. 

Right now, we have four properties under renovation and another three under contract. The properties being renovated will be reserved in the coming days and the others within a few weeks. If you are interested, please don´t sit back and wait for the information to come to you, as most are sold to people who reach out to us in advance.

I´d love to hear from you today! 

Click here to schedule a call

Colin Murphy
Torcana Ltd


PS: You can now subscribe to our weekly AUDIO & VIDEO podcasts


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Topics: Real Estate Investing, Research Guidelines, Property in Florida, tampa rental property

Five crucial tips most realtors and property sellers do not like talking about

Posted by Colin Murphy on Feb 5, 2016 11:44:41 AM

As mentioned at the beginning of our special video podcast last week, we have decided to work harder at helping people access to great real estate information while on the move. 

Earlier this week I recorded a second podcast, one that discusses five important issues that most realtors and sellers will avoid talking about.

1. What is the actual step by step process for buying a home after you´ve agreed a price?

2. How do title companies protect your funds and ensure you don´t get a shock after you´ve taken ownership?

3. How are closing costs broken down and what do you need to look out for?

4. What are the three most important things you need to do after closing on a property (hint: insurance and property management are two of them)

5. What are your tax obligations as a landlord, explained in plain laymans English?

Whether you are just starting out on the property ladder or have a few rental homes under your belt, this recording could save you thousands of dollars and help you get to the next level.

There are four ways you can access this information right now. Here you go!

1. Subscribe to our podcasts on iTunes or Playstore! Torcana on iTunes

As of this week, you can now access the Torcana podcasts directly from your Apple or Android smartphone. That means new episodes will automatically appear as soon as I record them.

If you already listen to podcasts, all you need to do is search for Torcana. If you are new to this, download a podcast app first (Podcast for iTunes or Podcast Addict for Android) . Feel free to call me if you´d like a quick tutorial on getting started! 

I love listening to podcasts. I always subscribe to 8-9 different shows. Unsurprisingly, real estate and investment podcasts are my favorites, followed by current affairs. 

Direct link to iTunes: Click here


2. Watch the Video Version

If you have the time, the video versions are the best way to enjoy these. I try to insert as many helpful images, graphs and titles as I can.

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Please click here if the link above does not work for you.

3. Listen to the Audio Version

Audio is the easiest way to enjoy these podcasts. Listen to them in your car, on the train, in the gym etc. If you want access all the time, it´s best to subscribe directly from your smartphone (see instructions above), but you´ll always find the latest versions on soundcloud.com as well. 

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Please click here if the link above does not work for you. 

4. Download a PDF version

To me this is the least useful of the four, but if you want a very quick summary of a 15-25 minute podcast, then you might like to view and read this PDF. (Immediate access, no forms).
 

QUICK UPDATE ON OUR CURRENT PROPERTIES 
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As of today, we have three properties under renovation and another three under contract. Two of those have already been reserved and it´s likely another two will be in the next few days.

It would be fair to say that a majority of the turnkey rental properties we sold last year were allocated to buyers before we even advertised them for sale. The people who had made the effort to speak with or visit us, who did their research and clearly outlined their budgets and goals, were our most active buyers and they secured terrific properties. 
 

Click here to schedule a call

If you would like to be on this "pre-sale" list, all you have to do is make an effort to speak with us and ask a few questions. We´d love to hear from you! 

Hope you enjoy the podcast above - your feedback is very welcome. 

Colin Murphy

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Topics: Real Estate Investing, tampa rental property, podcast

Special video podcast on building a Florida real estate portfolio

Posted by Colin Murphy on Jan 29, 2016 5:36:26 PM


man-running-earphones.jpgOne of the biggest changes I have noticed in the last 10 years are the tremendous opportunities people have to entertain and educate themselves while on the move. Everywhere around the world, you will see people in cars, gyms, parks, train stations and airports watching or listening to a bewildering array of programs on a portable device. I personally spend a lot of time listening to real estate & business podcasts (email me if you´d like to know what they are) and I figured that it was high time we started delivering information to our clients in video & audio formats in addition to our emails, blogs and smartphone app platforms. 

Earlier this week, I recorded a 25 minute podcast which may be of interest to anyone who: 

- Wants to put their put their savings to productive use
- Is interested in building a cash flow positive rental portfolio
- Would like to learn about the tremendous opportunities available in Tampa Florida

Torcana´s Video Podcast (audio only also available)
With the aid of graphs, bullet points and images, this podcast clearly outlines:

- Exactly why we are investing our own funds in Tampa Florida
- Our property sourcing methods 
- Why economic, cultural and demographic conditions for landlords have never been better
- Full details of three recent turnkey properties
- Frequently Asked Questions
 

Please click here or on the image below to view our video presentation. 

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Audio Only VersionPodcast_logo.png
If you´d like to listen to an audio version of the podcast while on the move, please click on the link below. It should play directly on your iPhone & Android device. 

https://soundcloud.com/colingmurphy/investing-in-the-tampa-florida-rental-market 

LET US KNOW IF YOU ARE INTERESTED! 

It would be fair to say that a majority of the turnkey rental properties we sold last year were allocated to buyers before we even advertised them for sale. The people who had made the effort to speak with or visit us, who did their research and clearly outlined their budgets and goals, were our most active buyers and they secured terrific properties

Click here to schedule a call

If you would like to be on this "pre-sale" list, all you have to do is make an effort to speak with us and ask a few questions. We´d love to hear from you! 

Hope you enjoy the podcast above - all feedback very welcome. 
 

Colin Murphy
Torcana Ltd

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Topics: florida real estate, tampa property investment, tampa rental property, podcast

Stunning Tampa FL rental home with 9% returns. Look at these photos!

Posted by Colin Murphy on Jan 25, 2016 5:22:05 PM

Over the next couple of months, I will be sending shorter, more frequent blogs compared to the longer "newsletter" type ones sent recently

The aim of these posts is to give our readers an insight into the day-to-day business of buying, renovating and selling properties in the Tampa Florida area, plus more images and details of the individual homes as they become available. Here is a prime example of the turnkey homes with high rental returns that we offer to investors:

Avery Rd, New Port Richey (Tampa Florida)
Avery-Rd.png

A recent property we completed in late December was also one of the complicated renovations we have undertaken in Tampa. 

Avery Rd is located in a quiet neighborhood just off the major route 19 and is full of well kept lawns and owner occupiers who take pride in their homes. This is a huge 4 bed 2 bath property measuring over 2,000 sq ft. A very nice mix of retirees and young families live in this middle class suburb which is within commuting distance to downtown Tampa, Clearwater, Palm Harbor and St. Petersburg.

Within 35 days of purchasing this home, we had completely transformed it with a $37,000 renovation which included a new roof, new painting throughout, brand new kitchen, new flooring, new wall lights and ceiling fans, creation of new master bedroom and extensive landscaping.

Before & After Photos
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More "Before" Photos
More "After" Photos

Rent and Financials
This property was listed for rent on 29th December and a qualified tenant was secured at the full asking price ($1250 per month) by January 7th. The new owner can reasonably expect to earn a 9.1% return on their money, after fixed and variable overheads. 

Avery-Financials.png 

DO WE HAVE MORE PROPERTIES LIKE AVERY RD?
The property above was sold to a Torcana client in late December. They had been in regular contact with us throughout the year, had done their research, and were prepared to move quickly once an opportunity landed on their desk. 

The good news is that we are working on more properties that are just as profitable (and a little cheaper) than Avery Rd. In fact, we are in the process of purchasing & renovating five 3 bed properties right now, all of which should be rent ready within 4 weeks. 

We strongly encourage anybody interested in this concept and these types of high yielding single family homes to call us in advance. Many of our turnkey homes are sold in this manner before being officially listed for sale. We are also happy to meet you and show you around the area if you´d like to fly down.

In our experience, the people who are most comfortable and successful in building rental portfolios are those who take their research seriously, who engage with us regularly and who build relationships on the ground.

Want to read more about homes like Avery Rd?
Over the past few weeks, our marketing team has been busy putting together a 30 page brochure with very detailed information on 14 properties like Avery Rd. Aside from detailed financials, we have also included property descriptions and terrific "before and after" renovation photographs. 

Tampa Florida rental properties: Free 30 page brochure
Note: Free 14 page report on Tampa Florida included with above brochure!


NEXT STEPS

If you are interested in having a conversation regarding the five homes we are currently preparing for resale, my advice is to download the 30 page brochure above and then schedule a call with me directly. 

Click here to schedule a call now

Colin Murphy

 

 

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Topics: florida real estate, tampa property investment, tampa rental property

2016 Dilemma: Stable rental income vs treacherous stock market?

Posted by Colin Murphy on Jan 20, 2016 3:59:30 PM

I recently returned from another visit to booming Tampa Florida and as you´d expect, I spent a lot of time examining properties and meeting various real estate colleagues. Nothing unusual there. 

More unusual were the networking conversations I had with wealthy professionals who work outside the property industry, who previously had little interest in real estate investing or in rental properties. Last week I spent several hours with people who had been investing for retirement over the past 10-20 years. Many had substantial sums invested in equities and bonds. They are knowledgeable people whose opinions I respected.
China-stockmarket.png
All were worried about what 2016 had in store and were nervous about the global stock markets and commodities. Perhaps you have had similar discussions with your friends about how to protect your portfolio?

It is official that stock markets have had their worst start since 2008, and both investors and savers are rightly getting nervous about what might happen to the value of their portfolios. They have enjoyed nice dividends and rising shares for five years but 2015 was a bad year, and the outlook for 2016 is very uncertain.

In contrast to the equity boom of the last five years, large numbers of people are now viewing the income and capital growth from rental properties as far safer and more profitable than the falling dividends and share prices in the stock markets. 

Now more than ever may be the time to serious consider rental properties
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It is worth remembering that the stock market is not the economy and the economy is not the stock market. As stock markets have fallen or stalled over past 12 months we have simultaneously witnessed strong job growth, strong population growth and the strongest rental demand in our lifetimes.

Some markets have been heavily inflated with cheap debt - think prime locations in New York, London or LA. We don´t think they are good value. The opportunities are in regular neighborhoods that elitist speculators stay away from. In other words, the places where you and your parents grew up. 

We buy and renovate concrete build, single family homes in middle class areas where regular young familes can afford to rent. They are close to good schools, shops and transportation. They have newer roofs, kitchens and fenced in backyards.

If you know where to look, there are ample opportunities to protect and grow your wealth through real estate. The easiest way to illustrate is to show you a summary of the properties we have recently purchased, renovated and sold turnkey to investors. These single family homes are all rented and the 8-10% rental returns are based on the actual net income after overheads. 

Torcana-Renovations.png 

Want to read more about the homes above? 

Over the past few weeks, our marketing team has been busy putting together a 30 page brochure with very detailed information these 14 properties. Aside from detailed financials to show you that the returns really are this good, we have also included property descriptions and terrific "before and after" renovation photographs.

If you read this brochure and decide that you´d like to buy one or more similar rental properties, all you have to do is schedule a call with me. We have just started renovations on five more properties exactly like the ones above. 

Tampa Florida rental properties: Free 30 page brochure

NEXT STEPS
We strongly encourage anybody interested in this concept and these types of high yielding single family homes to call us in advance. In our experience, the people who are most comfortable and successful in building rental portfolios are those who take their research seriously, who engage with us regularly and who build relationships on the ground.

A typical three bed single family home after renovations
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Our full time job is purchasing and renovating single-family homes in Tampa Florida to a higher quality than other local landlords. As you can imagine, buying right and renovating right is very time consuming and we go the extra mile to provide items like fenced back yards, new roofs, modern kitchens and modern bathrooms. Demand for these types of properties is extremely high and they are easily rented. For example, we finished renovations on our last two properties after Christmas and they were rented by January 8th. 

If you are interested in having a conversation regarding the five homes we are currently preparing for resale, my advice is to download the 30 page brochure above and then schedule a call with me directly. Hope to hear from you soon and thanks again for reading! 

Colin Murphy


Click here to schedule a call

Kind Regards,

Colin Murphy

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Topics: tampa rental property, stock market, stable rental income

Tampa Florida Property Investors: Check out these major local trends

Posted by Colin Murphy on Dec 4, 2015 1:18:12 PM

We speak with local Tampa real estate investors all the time in our business. One issue which we hear again and again in networking events is that it is increasingly difficult to find good quality homes to purchase at the right price. 

Conversely, if you did a straw poll of tenants looking for good quality rental property in Tampa at a reasonable price, they would tell you the exact same thing. It is getting more and more difficult for regular people to find a nice home to rent. This is the niche we are working hard to exploit. 

Our full time job is purchasing and renovating single family homes in Tampa Florida to a higher quality than other local landlords. We go the extra mile to provide items like fenced back yards, new roofs, modern kitchens and modern bathrooms. Demand for these types of properties is extremely high and they are easily rented.    

Bimini-Banner.png

Our opportunity lies in the fact that homeownership rates are at their lowest levels for a generation and rental occupancy rates have never been so high. There are many reasons why these conditions currently exist in Tampa Florida and many other parts of the USA. Here are a few of them:

- College debt burdens
- Higher utility costs
- Stagnant wages
- Desire to be more mobile in case of job relocation
- General lack of trust in banks & home ownership after previous downturn

The older generations also are surprisingly reporting many of the same sentiments. The desire of many to downsize after the downturn and budget for higher healthcare costs is converting huge number of over 55s into renters.

Twain-Exterior-Banner.png

While these trends are undoubtedly unfortunate for many of those trapped in them, real estate investors are well placed to meet the demand being created for rental properties in what remains a very strong housing market. O
ur niche caters precisely to this space and anybody who takes the time to study and invest in the concept can achieve terrific long term capital growth and cashflow.   

Real estate may be local, but the big macro trends are what really matters in the long term. Today I´m going to discuss two of them in particular.

1. Home Ownership Trends
Consider the following: Firstly, home ownership is at its lowest rate in more than a generation and is widely expected to fall further. Secondly, population growth (both in Tampa Florida and the wider USA) is at an all time high. Thirdly, new construction is still a small fraction of what it was ten years ago. What does that combination tell you? It tells me that there are a lot of people looking to rent a shrinking supply of homes!

Just look how home ownership rates have been falling. When you combine this with a rising population and low levels of new construction, you are left with very fertile ground for landlords. 

us-homeownership.png

These low home ownership rates are not just the result of younger Americans struggling to save for a down payment on a home. It is increasingly the result of middle-aged, higher income Americans choosing to rent. According to a recent Harvard study, families or married couples aged 45–64 accounted for twice the share of renter growth as people under the age of 35.

2. Millenials
If you go to any conference full of real estate professionals in America today, chances are that you will hear a lot of builders, realtors and city planners talking about "millenials".

What are they? In a nutshell, millenials are young people under the age of 35 who tend to be well educated and technologically savvy. According to the US Census, there are 80 million of them. 80 million!! Like every other generation before them (GI Generation, Baby Boomers, Generation X) they display distinctive economic, political and social traits which have profound impacts on the economy.  

To illustrate how important millenials are becoming, look no further than the graph below. 

millenials-graph.png

Millenials attitude to real estate
At the moment Millenials love renting modern apartments in city centers near bars, restaurants, parks and fitness centers. They are the main reason so many of them are being built in Tampa and other major metropolitan areas right now.

However, despite the obvious demand, I´m not particularly keen on purchasing expensive downtown apartments in Tampa Florida with low rental returns. I am much more interested in what Millenials will be doing when they hit their late thirties and early forties.

While every generation thinks they are unique, some things are universal. As Millenials get married and start families, many of them will aspire to the exact same thing as their parents did: houses with gardens in the suburbs. The key difference is that this demographic tends to rent rather than buy, so the spike in city center apartment rentals they are provoking now is going to move onto the suburbs.

millenials2.png

In conclusion, rental demand is already very high for the single family homes we are purchasing in the middle class suburbs of Tampa Florida. If recent home ownership stats and demographic trends are anything to go by, this trend is set to continue long term. In other words, this is a great time to build a rental portfolio and Torcana are perfectly placed to help. 

Next Steps
Over the next few weeks, I wil be publishing full details of the properties we are currently renovating in Tampa Florida. However I can confirm that the sales prices of these rent ready homes will range from $87,000 - $105,000 with estimated net rental returns of approx 9%.

We strongly encourage anybody interested in this concept and these types of properties to call us in advance. In our experience, the people who are most comfortable and successful in building rental portfolios are those who take their research seriously, who engage with us regularly and who build relationships on the ground. 

I´d like to invite all of our readers keen to speak to us about our forthcoming rent ready homes to click on the link below and schedule a call with us. It is a very simple piece of software that allows you to select a suitable time that is available on my calendar. (If it doesn´t work for you, just send an email to investments@torcana.com). 

Schedule a call with Colin Murphy

Finally, if you haven´t had a chance yet, please feel free to download our 14 page guide to buying in Tampa Florida. 

Click here for full information pack
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Topics: tampa property investment, tampa real estate investment, tampa rental property, tampa homeownership trends, tampa millenials

You could lose your home if property taxes are not paid. Follow these simple steps to avoid it.

Posted by Colin Murphy on Oct 5, 2015 6:08:40 PM

In the past couple of weeks, two clients of ours have had serious problems due to a failure to pay their property taxes on time. One of them lost a property at a foreclosure auction and the other came very close do doing so. In both cases, the amounts owed for quite minor (less than $10,000) and both owners would have had no problems paying them if they realized how serious the issue was. For that reason, I thought it would be useful to write a short blog on the importance of keeping on top of your US property tax obligations. 

Many of you will have accountants or property managers who pay these taxes and other fees on your behalf every year. However, you should always carefully read any letters received regarding your properties. Also, please don´t assume that everything will always go smoothly - even something minor like a change of address or personnel can result in several warnings passing unnoticed. 

What are property taxes?

As you may be aware, every type of building in the USA is subject to property taxes. They are usually payable annually in one instalment during the first quarter of each year. These local taxes are calculated by the County Tax Appraiser and are based on local services, amenities and average property values within the vicinity. In October each year an estimate of the current years’ property taxes is published on the County Tax Appraisers website. They must be paid by the following March and discounts are often offered for prompt payment.

Note: Please bear in mind that property tax is completely different to income tax (which is based in income earned rather than the value of the building). 

Is it easy to check what property taxes are owed?
Yes, it is very easy! All you need to do is find the website for your local tax appraiser. For example, owners in South Carolina could Google "York County Tax Appraiser" and owners in St. Petersburg (FL) could google "Pinellas County Tax Appraiser". 

If you are not sure which county your property is located in, then this website containing a full list of US Counties by State will help. Each tax appraisers website is slightly different, but it is generally quite easy to search by owner name, street name or Tax ID number. Most offer easy options to pay by credit card or Paypal. 

How can I refresh my memory on the important issues an investor needs to keep on top of?
We published a short 10 page guide a couple of years ago highlighting the most important steps in the purchase process, the running costs and your annual filing obligations. Whether you own just one property or a large portfolio, there should be some useful informaton in here for you.

guide to complex real estate

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FAQ for investing in Tampa Florida: Most popular questions answered

Posted by Colin Murphy on Sep 4, 2015 1:47:09 PM

Throughout 2015, we have received a huge range of questions from people interested in purchasing our turnkey investment homes in Tampa Florida. We thought it would be useful to compile some of the most common ones and publish them in blog format. If you have a question that hasn´t been addressed here, please insert it in the comments section below and we will be happy to answer it for you.  

What exactly does Torcana do?
- We purchase single family homes in safe, middle class locations from distressed sellers and property auctions
- We renovate them to a high standard and bring them up to code
- A carefully vetted local property manager is appointed (buyers always have option to choose their own property manager)
- Properties are advertised, tenants are carefully screened by the property manager and placed on one year leases
- We sell the turnkey property to investors at very competitive prices ($80-$100k) with estimated 8-10% net rental returns

Aren ́t hurricanes and floods big problems in Florida?
As a low-lying state bordering the Gulf of Mexico, Florida gets its fair share of extreme weather. However, the properties we purchase are concrete block, are not located in high risk flood areas and are fully insured. The majority are also located a couple of miles from the coast. 

Wouldn ́t it be better to invest closer to downtown Tampa?
As you would expect, property prices in Tampa are much higher than in the suburbs. If you wanted to achieve net rental returns of more than 7%, you would most likely be purchasing in a lower income, inner city neighborhoods. Additionally, the families and retiree renters we target in the $900-$1,100 per month range want the extra space, safety and peace and quiet offered in the northern suburbs. Why pay $1000 per month for a 2 bed condo in Tampa when you can have a 3 bed single family home with a garden for the same price? Recent infrastructure improvements have also lowered commute times to Tampa. 

Who is responsible for renovating the properties?
Torcana has more than 5 years of experience buying and renovating properties in the Tampa Bay area. Our general contractors (who we have long established relationships with) only begin once very detailed costings and deadlines have been agreed. Progress is carefully monitored and we personally visit all properties under renovation several times per week. Bear in mind that we only sell properties to buyers AFTER they have been fully renovated. 

How do you calculate the monthly rental income?
Our property managers visit all of our properties once we are under contract. We request feedback from them on the types of renovations tenants appreciate and we base our rental numbers on their experience renting similar properties in the area. We have an excellent track record of achieving (and sometimes exceeding) our rental estimates. 

What insurance is in place?
Fire, theft and hurricane damage insurance equal to the purchase price of the property and liability insurance of up to $100,000 would be the typical policy recommended. Annual costs would be $1,000 and these would always be included in our cashflow calculations. These are estimates only based on our own rental properties - please consult suitable professionals regarding insurance.

What are the typical running costs for a single family home?
Your fixed running costs would include property taxes, insurance (see above) and property management. It is also recommended that you make at least a 5% annual allowance for vacancies and maintenance items that may arise. Here is a typical example of a property we recently sold to an investor (all figures are estimates).




Is financing available for these properties?
The majority of our buyers purchase with cash although some have secured finance through their own established credit lines. We are also happy to put you in contact with local Tampa mortgage brokers (for 1-2 properties) or specialist portfolio lenders (if you are considering multiple purchases).

I have heard that sinkholes are an issue in Pasco County. How would this affect the investment?
Pasco County had 249 reported sinkholes between 1969 – 2006, so not very many considering the size of the area and the 47 year period. However, the area generated headlines in the early 2000s due to a large number of insurance claims abuses (i.e. claiming "sinkhole" compensation for a crack in the driveway). These insurance payouts caused premiums to increase in certain areas, but things have calmed down since. We have access to detailed subsidence reports and check the local area sinkhole history before acquiring any properties.

Does Pasco County have a high crime rate?
The short answer is no. Pasco County (Population 250,000+) has lower crime rates than both the Florida and the US averages. Consider the following statistics from 2013: 

Pasco County: 262 violent crimes per 100,000 people
Florida: 476 violent crimes per 100,000 people
USA: 368 violent crimes per 100,000 people

Pasco County: 2,343 non violent crimes per 100,000 people
Florida: 3,151 non violent crimes per 100,000 people
USA: 2,731 non violent crimes per 100,000 people

Over the last few months, my local currency has fallen in value against the US dollar. Should I wait until it recovers?
We have done business from clients in more than 30 countries around the world and we are well aware of how currency calculations can play havoc on peoples investment plans. The truth is that nobody (including the heads of the major Central Banks!) knows how your currency is going to trade against the dollar in one week, one month or one year from now. All we can say is that it looks like the American housing market will continue to be strong in the coming years and owners should enjoy a solid US dollar income stream for the duration of their ownership and capital growth on exit. The truth is that waiting for a currency rate to change is pure speculation. Our advice would be to invest when a suitable property becomes available and you have the funds to purchase it. 

What is the purchase process?
1. Have a detailed conversation with our sales consultants and review our comprehensive marketing materials 
2. Once you have selected an available property, we will draw up a purchase agreement and email it to you
3. You can sign and return it digitally and wire a deposit to a licensed title company
4. You have a 7 day rescission period to perform additional research and arrange inspections
5. You pay the balance of the purchase price to the title company within 3 weeks and return some additional closing documents
6. We can help put you in contract with an insurance broker to put suitable coverage in place at closing
7. Your selected property manager will send you a separate agreement to sign and ensure you are ready to receive rental income

Is it possible to visit the properties being purchased?
Absolutely! We are happy to facilitate client visits to Tampa. Please try to provide us with at least 7 days notice.


DOWNLOAD A FREE GUIDE TO TAMPA FLORIDA

This free 14 page guide was created to provide valuable insights for those keen to learn more about investing in one of Florida´s hottest and most rewarding rental markets. If you want to know how to source solid middle class properties from $70,000 - $100,000 that deliver estimated 8-10% net rental returns, then you need to download this report. 

- Learn how we source properties in very competitive locations

- Read about the key factors driving the single family rental market

- Browse through local area descriptions of our key target neighborhoods

- See how we avoid expensive mistakes with our due diligence checklists

- Crunch the numbers on some turnkey properties we recently sold to investors

- Answers to the frequently asked questions posed by our savviest buyers


Free 14 page guide to the Tampa Florida real estate market

 

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This is what a perfect turnkey rental home in Florida looks like

Posted by Colin Murphy on Aug 26, 2015 12:20:00 PM

In this special blog we are providing full details on Bimini Drive, a solid, concrete block 1,515 sq foot single family home in Tampa Florida that was built in 1980. It has been totally rehabbed with modern fixtures and finishes (and a little bit of flair) to match the rental demand from 21st century tenants.  

It has large front and back gardens, garage, a spacious kitchen, a living room and a separate dining room adjacent to the kitchen. We have converted a bonus room into a third bedroom which increases both the value of the property and the rental income it generates. 

Bimini

This home is located in the heart of the single family home communities of West Tampa that are highly desirable to local owner occupiers and renters alike. They fit exactly into what the average young American family needs, desires and can afford. 

In short, this is one of the best homes we have purchased in the last two years and it is a perfect turnkey rental property with strong capital growth potential. Please see below for further details and images. 

Renovations Completed 
- Landscaping front and back gardens 
- New granite countertops and tile backsplash in kitchen 
- New kitchen cabinets, oven hood and electrical outlets 
- Extensive repairs to the roof 
- Brand new a/c system (worth more than $3,500) 
- Addition of third bedroom 
- New garage door and garage motor 
- New tile flooring

Screen_Shot_2015-08-25_at_16.55.58

Bimini

Financial Breakdown: Year 1 (all figures are estimates)

Price $102,500
Gross Rent $13,200 ($1,100 per month)
   
Property Tax $1,000
Insurance* $1,000
Property Management $1,003
Vacancy Reserve $660
Maintenance Reserve   $627
   
Net Annual Income $8,910 ($743 per month)
Net Rental Return 8.7% (estimated)

* Unlike many companies, we include comprehensive insurance quotes in all our calculations. These typically include cover for fire, theft, damage, hurricanes and liability up to $300,000. 

Bimini Drive: The Bigger Picture
Average incomes in this immediate area are over $33,000 per year. Additionally, average sales prices are $98,858 and unemployment is just 4.8%, well below the USA and Florida averages. 

Two major Elementary Schools (Calusa & Marchman Technical) are less than a mile from this property. These schools average less than 10 pupils per teacher and are highly desirable. That is a big deal for young families looking to rent here and young families looking to buy. Marchman Technical also has a High School within walking distance of Bimini Drive. 

Unlike most properties in Pasco County, this property is within a very short walk to a whole range of supermarkets, banks, restaurants, health clubs and a variety of retail outllets. The Gulf View Square Mall, with more than 100 retail outlets and a range of bars and restuarants is also less than a 5 minute drive away.

In Florida it often seems that you need your car to get anything done, so it is very refreshing to have so many amenities on your doorstep. Our property is marked by the gold star in the top right corner of this map. 

Bimini Map

Think about a property from a renters perspective
The information described above is extremely important to us when seeking long term investments. It is not rocket science as most people can figure out what renters and owner occupiers want to be close to. We are fussy about what we choose, which is why we don´t secure a high volume of these types of properties. They tend to get snapped up quickly. 

Despite the fact that our main goal is to deliver high income streams to our clients, we actually spend more time identifying the factors that will lead to capital growth (solid construction, carefully considered renovations, rising population, good schools, income growth and proximity to major employment centers). 

Or to put it another way, once you take care of the big picture, a professional property manager will have no trouble maintaining a high income stream for you. 


Here are some more photos to view:

Bimini

Bimini

Bimini

Bimini

Bimini

If you are looking for an opportunity to put your money to work in a safe area that generates a high income and capital growth, then this property is for you.

On the otherhand, if you want an example of a high risk investment, you just need to browse through the Auction, MLS and Zillow listings which are full of unrenovated, dated and badly built properties in poor locations that only local experts can navigate. 

We have invested heavily in Pasco County with our own funds because we have the time, resources and manpower to take advantage of the great opportunities here. This area is now one of the top 40 fastest growing counties in the USA and its population is forecast to grow by 20% in the next ten years. We can very confidently state that this property will enable you to grow your capital and earn a steady income stream.

Financial Breakdown: Year 1 (all figures are estimates)

Price $102,500
Gross Rent $13,200 ($1,100 per month)       
   
Property Tax $1,000
Insurance* $1,000
Property Management $1,003
Vacancy Reserve $660
Maintenance Reserve   $627
   
Net Annual Income $8,910 ($743 per month)
Net Rental Return 8.7% (estimated)

Next Steps

If you are interested in reserving this property, please call me directly on 321 806 1195 and I´ll be happy to answer any additional questions you may have and talk you through the reservation process. 

This will be sold on a first come first served basis with a $5,000 deposit, a 7 day due diligence period and a 3 week closing period.  


Kind Regards,

Colin Murphy
Director
Torcana Ltd

USA: +1 321 806 1195
Ireland: +353 1 4434 466
UK: +44 207 193 4024
Skype: torcana-colin

investments@torcana.com
www.torcana.com

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Free real estate guide to investing in Tampa Florida

Posted by Colin Murphy on Jul 17, 2015 12:21:10 PM

We are very proud to launch a professionally designed 14 page report on investing in rental properties. While much of the content is specific to Tampa Florida, this guide should be useful to anybody who wishes to learn more about starting or expanding a real estate portfolio. 

gen-usa-banner

We have learnt a lot from our mistakes and successes over the years. This experience enabled us to create a range of systems for sourcing, negotiating, purchasing, renovating and marketing a wide range of properties.

In this guide (available to download now), we pull back the curtain on our operations so that our readers can: 

- Learn how we source properties in very competitive locations
- Read about the key factors driving the single family rental market
- Browse through local area descriptions of our key target neighborhoods
- See how we avoid expensive mistakes with our due diligence checklists
- Crunch the numbers on some turnkey properties we recently sold to investors
- Get answers to the frequently asked questions posed by our savviest buyers 

Free 14 page guide to the Tampa Florida real estate market

 

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The secret to real estate success (in a crisis or in a recovery)

Posted by Colin Murphy on Jun 25, 2015 11:21:00 AM

I recently discovered a blog post that I originally posted in October 2009. The title of the article was "How to profit from other people´s irrationality" and at the time, there was certainly plenty of irrational behaviour to observe.
economist-crisis
That article was very much written in the eye of the storm. The fallout from Lehman Brothers was still fresh in peoples minds, unemployment was increasing dramatically and the sovereign debt crisis was starting to rear its ugly head in Europe. In late 2009, real estate prices, particularly in hotspots like Florida, were falling off a cliff (they eventually stabilised in late 2010). 

The people who used cash savings to purchase the USA rental properties were definitely moving against the herd. Afterall, the only reason USA real estate prices were so cheap was because so many individuals, companies and banks wanted to sell. Not everybody needed to sell, but there was enough panic in the air that they did so anyway, even if it meant swallowing a huge loss. 

Conversely, the buyers who were savvy enough to realise that many of these Florida properties were fundamentally sound and irrationally priced would have been handsomely rewarded. 

Nowadays, the real estate investment landscape in the US couldn´t be more different. Average prices have risen in all 20 metro areas for almost 4 years in a row, unemployment is just 5.6% and property sales volumes are in rude health and showing no signs of slowing down.  

With such a dramatic change, should investors be adopting completely different strategies to those who were buying in 2009?

Putting your money to work
Before I answer, consider the following quote from the blog referenced above that I published nearly six years ago. It is just as true today as it was then:

“Life is full of uncertainties. Future investment earnings and interest and inflation rates are not known to anybody. However, I can guarantee you one thing.. those who put an investment program in place will have a lot more money when they come to retire than those who never get around to it”

In other words, whether asset values are falling, stabilising or rising, if you don´t save some money and then put it to work, you´ll be a lot poorer for it in the long term. 

I´m sure some of our readers have owned properties for 20+ years. Have you ever stopped to think about how much rental income and capital growth has accrued in those assets while you were busy working 9-5? 

For our younger readers, can you imagine how different your financial situation would be in 20 years if you put together a plan and took action to purchase 1, 5 or 10 rental properties and took good care of them?   

Our next opportunities..porpoise
As many of you are aware, we have been very busy sourcing great value single family homes in the northern suburbs of Tampa Florida (with a focus on Pasco County).

It is an incredibly labor intensive business as only a small percentage of potential properties are worth making an offer on and we have to make at least 15-20 offers to get one accepted. 

As you would expect, we personally visit all short listed homes before calculating our preliminary renovation budget and best offer price. 

Once we buy a property, we renovate it and offer it to our clients on a silver platter. Typically, the sales prices will be between $70,000 - $100,000 with estimated net rental returns of 8-10%.

Tampa Update 25 JuneWe purchased one property last week at an auction, we are closing on another one this week and we expect to put two more under contract before the end of next week. 

As demand for these turnkey homes is much higher than our limited supply of them, it will be the people who take the time to schedule a call with us who will get first preference. If you would like to be on this list, please take a moment to send an email to investments@torcana.com and let us know when you would like to speak with us.

In conclusion, if you can ignore the urge to follow the irrational behaviour of the herd and concentrate on planning, taking action on and sticking to your own financial goals, then you can be successful no matter what part of the economic cycle we are in. 

 
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