Tag Archives: real estate

A Birthday Flight

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I take a 90-year-old woman, her 88-year-old brother, and her son on a helicopter tour.

I’ve been getting a lot of calls lately from people in Scottsdale, interested in helicopter tours. There’s a charter company down there named Westcor Aviation (associated with the Westcor malls and other real estate ventures) and my very first flight instructor, Paul, works for them as a pilot. They occasionally get calls from people who want to charter a helicopter and get “sticker shock” when they hear the rate: $1,500 per hour. So when asked to recommend other operators in the area, Westcor has begun recommending me, along with the others.

Doing flights out of Scottsdale isn’t exactly good for me. I ask $495 per hour for flights originating in the valley, with a one-hour minimum. But I don’t charge people for the amount of time it takes me to get from Wickenburg to the valley and back again. So I don’t really make much money on these flights. But they’re good experience and they do help pay for the helicopter. And they give me an excuse to fly.

I did one of these flights on Sunday. I’d gotten a call during the week and made arrangements with someone named Brad to fly his grandmother on a tour of the area for her 90th birthday. He’d fill the other two seats, too, and he’d make sure the total weight was below 650 for the three passengers. I just had to meet him at Scottsdale Airport at 10:00 AM.

This worked out well for Mike and I. Mike had gotten Greyhawk Members Club tickets to see the FBR US Open in Scottsdale, which wasn’t far from the airport. The tickets got us entrance to the event as well as entrance to hospitality tents scattered around the course. We could eat and watch the golfing from comfortable, shaded seats — all for free. We figured we’d head over to the course when my flight was finished.

We arrived at Scottsdale Airport about 40 minutes early and got a great parking spot right out in front of the terminal. We went into the restaurant for some weak coffee and a bite to eat and I spent some time reviewing the Phoenix Terminal Area Chart to see where I could take them. At 9:50, I headed out to the lobby to wait for my passengers. There were three young people there and one of them approached me. It was Brad.

I looked at him and his two companions. “I thought you said it was for your grandmother.”

“She’s on her way,” he said.

I tried to review the route I’d planned with him, hoping it would meet his approval. He didn’t seem to care. “She wants to see the Superstition Mountains,” he said.

I wanted to take her up the Salt River, which would take us near the Superstitions but not over them. I didn’t want to fly over or around the Superstitions. It’s rocky, dangerous terrain and I didn’t think it would make for an interesting or comfortable one-hour flight, given the wind conditions and the descending clouds out that way.

“She doesn’t know she’s doing this,” he added.

A while later, his grandmother arrived. With about twenty other people. She was a petite 90-year-old woman. They escorted her up to the window where she could see Zero-Mike-Lima parked on the ramp. “That’s your birthday present,” someone told her.

She was thrilled. They quickly sorted out who would be flying with her: her brother, who I can accurately describe as a little old man, and her son, who was considerably larger. I don’t think their total weight even reached 500 pounds. I escorted them outside to the security door and told them that only one person could accompany us through the gate to take photos. Out at the helicopter, I gave them the safety briefing. I put the birthday girl in the front, her brother behind her, and her son behind me. As I warmed up Zero-Mike-Lima, my passenger’s entourage watched from behind the glass partition.

We departed to the southwest to remain west of Runway 21. Although the controller told me he’d call my turn to the east, he was so busy with other traffic that I was clear of his airspace before he had a chance to. I passed north of Camelback, then headed east toward the Salt River. I skirted the north edge of Falcon Field’s airspace, then continued up the Salt River Canyon.

The desert was absolutely beautiful. I’d never seen it so green. And all the lakes we flew over — Saguaro, Canyon, Apache — were completely filled with water. The sunlight through the low clouds made a patchwork of shade over the entire scene, illuminating some hillsides and rock formations and shadowing others. The Superstitions were clearly visible, just below the clouds, to the south of us, so my passengers got to see what they wanted to, and so much more.

About 0.6 hours out, I made the turn to come back, using my GPS to give me a more direct route. The goal was to make the flight exactly 1.0 hours. Soon we were heading toward Fountain Hills. I looked at the clock on my instrument panel. It was nearly 11 AM. Is it possible that I’d overfly Fountain Hills just as they turned on the fountain? It was. We were still about three miles out when the water started to rise. It was an added bonus for my passengers to see it from the air.

We approached Scottsdale Airport from the west. Fortunately, the controller wasn’t nearly as busy as he’d been when we left and we had no trouble approaching the airport, crossing the runway, and landing right where we’d begun.

My passengers were very pleased with the flight. I was too.

And when the woman’s daughter handed me a check, a little voice in the back of my head reminded me, “And they pay you to do great stuff like this, too.”

Landlord Stories, Part II

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An update on my landlord situation.

We finished work on the rental house that my tenant had trashed.

The painting was done last week. The carpet was replaced on Friday.

Mike, John, Lorna, and I spent Saturday cleaning the vertical blinds — which had probably never been cleaned before — and fixing the broken things throughout: kitchen sink faucet, garbage disposal, exhaust fans, etc. We also cleaned out the storage closets under the carport. The tenant from hell had just stuffed both closets with things she no longer cared about — toys, games, photographs, clothes, trophies — you name it. The highlights: a 8×10 photograph of her mother (recently deceased) and someone’s service medal. Anything that looked as if it had value went to the local thrift shop. Everything else went into the trash. We filled the curbside trash bin for the fifth time that day.

The house looks absolutely great now. I’ve already gotten some calls from prospective tenants, but so far every single one of them has a dog. No pets. No exceptions. I’m not going through this again.

I also started the wheels turning on refinancing the place. My goal is to get a separate mortgage for the apartment building and the house. Right now, they’re on the same mortgage. Once they’re separated, I can sell each one individually. I’d like to sell the house and keep the apartment building. I’m pretty sure I want to put my office in Unit #4, which is upstairs and has nice views. But I got a call from someone who’s interested in renting it for three months and if she does take it, I’ll put off my office move until she’s gone.

Of course, since the whole property — house and apartments — are currently listed for sale, I might just sell everything off and be done with it. I just hope that if they do all sell together, it happens soon, before I pay over $4K in bank closing costs for the new mortgages.

Real Estate Wheelings and Dealings

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I listen to an offer from a real estate investor and learn a lot about buying and selling real estate.

Back when I first started making real money as a writer, I invested in real estate. The first year, I bought a two bedroom condo in town as a rental. The second year, I bought a property that included a 2 bedroom/2 bath house and a small apartment building with four furnished studio apartment units. The third year, I realized that there was far more fun things to do with my money so I bought a helicopter.

I still own all that real estate, although I don’t really want to. I hate being a landlord. I hate dealing with tenants and cleaning up after them. I hate showing the apartments. I hate evicting tenants who can’t seem to pay on time. I just hate the whole thing.

I moved my office into the condo about three years ago. It’s more space than I need, but at least I don’t have to deal with tenants there anymore.

A few years ago, I half-heartedly put the five-plex on the market. I gave the Realtor I listed with strict instructions: only show the place to qualified buyers. Give the tenants at least 24 hours notice and get their permission before showing their units. Unfortunately, a local Realtor who was too lazy to show the property properly gave the address to a potential buyer. The buyer didn’t do just a drive by. He drove in. And he started knocking on doors. When one of my tenants told me about this, I wigged out and took the property off the market.

This year, I needed to upgrade my helicopter from a 2-place Robinson R22 to a 4-place Robinson R44. To do this, I needed to either take out a huge aircraft loan or pull equity out of some real estate. So I put the five-plex back on the market.

It’s been shown a few times and I’ve gotten some low offers. One of the potential buyers was extremely obnoxious about it. He didn’t want the house. He just wanted the four-plex. So he offered an insultingly low amount. I didn’t even bother to counter.

I arranged helicopter financing another way, so I’m not desperate to make the sale. But I do want to sell. And I’d like to sell sometime before next summer.

The other day, my Realtor (a different one from last time) called to ask if I’d be interested in carrying 20% on the property. I thought about it a while and said yes. And yesterday, I met with someone who made me an official offer, one that shows exactly how much wheeling and dealing someone can do in the world of real estate.

This buyer wanted me to finance the 25% the lender would normally require him to come up with as a down payment. He wanted to pay me only 5% on the amount I’d carry (when his lender was getting 6.5%) and amortize that over 30 years, with a balloon payment in 3 years. He wanted me to pay all closing costs. He was, in essence, trying to buy a property listed for $324,000 for only $290,000 without any out-of-pocket costs. I’d basically be financing part of his investment, with a high-risk loan that had little collateral.

The deal got weirder as the meeting progressed. He said he worked very closely with his lender and appraiser and could get the property appraised for just about anything he needed it to. So to make the numbers work, he could pay up to $350,000 for the property. I’d still have to carry 25% — which was now over $80,000 — and I’d also have to give him a “seller rebate” of $20,000 so he could make some improvements on the property. So not only am I financing the investment for him, but I’m making the improvements, too. And hanging a lot of money out there for possible loss.

I came to the meeting prepared with a spreadsheet. I punched the numbers in and saw that it was possible for it to work. On paper (or pixels). But was I willing to risk $80,000+ on someone who wasn’t willing to put up any of his own money? No way!

This morning, I came up with a counteroffer that I know he’ll turn down. I e-mailed it to my Realtor. Hopefully, this buyer will just go away. My head is still spinning from his scheme.

But I did learn one thing: I can separate the two properties and refinance them with two loans. I can pull my equity out and be in a good position to sell either property on its own. That’s something I hadn’t thought about going into this and it’s a damn good idea.