Last weekend I had a chance to take part of the 9th real estate course that Peeter Pärtel organizes. The 10th, which will take place in autumn is almost sold out, if you happen to want to grab a ticket. It was a very intensive 2-day course that firstly gave me a lot of inspiration for blog posts and secondly it was a very high quality look into what is happening on the real estate market. This is why I wanted to give an overview of how the days went.
Presenting your projects
The second day started with people presenting their projects that they had picked out the previous day. It was interesting to see what people had come up with, since some were clearly very realistic and had done a lot of overnight work, while some were very optimistic both in terms of returns and investor interest towards the project.
The key idea behind this part is obviously the fact that to find deals it’s not just enough to look at the ads and surf mindlessly. You have to actually go through the numbers to figure out what works out, and if it doesn’t then you’ll have a chance to figure out which part of the project should be altered to make that project work. (And to realise that some projects won’t work whatever you try to do.)
Recovery of debt
Lately there has been a lot of media attention on various cases of tenants refusing to leave apartments and the hassle that this brings. The laws in Estonia are quite strongly in favour of the tenant, which means that as a property owner you’re pretty screwed if something happens to not work out, since getting the person evicted or even getting the debt they owe you recovered is barely possible.
This section introduced an actual case of attempting to get a debt recovered by going the whole way – to suing the tenant. While this topic was quite familiar to me because I’ve researched it because it’s relevant to social lending as well, then it was really an eye opener in terms of just how depressingly slow and incapable the legal system can be at times.
Since the room was clearly full of many experienced people to whom you could talk during breaks and whatnot, it was reasonable to give them some time to discuss their thoughts on stage as well.
They gathered up the most experienced investors with the biggest portfolios to share some thoughts about what has worked out well for them and what kind of advice they wish they would have had when they were starting.
The main learning point was that to grow that big, you have to be aggressive. To be aggressive in growth however you need extra financing from somewhere, it’s not easy to just start growing a portfolio and end up with 50 apartments.
The final, stress relieving, section of the day had a visitor who spoke about the two tiny apartments that got a lot of media attention a while ago. (The apartments are 5 & 6 square metres respectively.)
It offered a chance to think about just how static the Estonian market really is, and what a long way we have to go in terms of alternative housing methods. Plus, it was a quite funny retelling of the events that surrounded the media attention.
Summary of second day
Clearly everyone’s brains were quite overloaded with the information from day one, so the pace was a bit slower and the topics were a bit more lecture-like. This wasn’t necessarily a bad thing, since I don’t think people would’ve been clearheaded enough to listen to the taxes section on the second day.
Overall I’d say I was deeply impressed by the quality of the event and I can see why they have been organizing it for years already. I will probably not attend the next event, but I’m likely to attend one in the not so distant future if things go well with my plans of real estate investing.