Real Estate Investing: Some of the problems and losses I've faced in 5 years |
- Some of the problems and losses I've faced in 5 years
- What should I be asking?
- Pre Construction Condo Investment
- Multifamily commercial loan
- Where do you store your money while waiting to buy your next rental?
- Question about Lawn Care for 4plex
- Investing in LCOL Multifamily
- Positive Cash Flow w/ VA Loan?
- Help with Dad's Commercial Real Estate
- Almost discouraged myself on first investment
- First Time Getting Sued
- Modelling a simple RE investment
- FHA Loans, Underwriters, and Reserve Requirements Problems
- How to find out desirable a location is to rent?
- Remodeling Investment: laminate or tile?
- Struggling getting leases signed
- Canadian mentorship programs
- Does Purchasing with LLC Affect Personal FTH Loans?
- Pet risks?
- Need some ideas! How to get started?
- How many of you act as your own realtor when it comes to buying and selling property?
- Foreclosed property selling for more than the assessed value?
| Some of the problems and losses I've faced in 5 years Posted: 18 Jun 2020 06:14 AM PDT Just like to catalog some of the problems that come up and the cash required to mitigate ($60k). RE is still a good investment but it's vital to keep a healthy cash reserve:
So far no fires, no deaths, no bankruptcies. Edit: added post with the benefits over last 5 years. [link] [comments] |
| Posted: 18 Jun 2020 10:15 PM PDT Meeting with realtor to view a possible investment property (my first) Aside from the financial questions and talking numbers, what are the appropriate questions I should be asking the realtor when viewing a property to see if it would be a good investment? What would you ask? What do you look for when viewing a potential investment property that you might buy? [link] [comments] |
| Pre Construction Condo Investment Posted: 18 Jun 2020 07:39 PM PDT Hello All, I'm looking to purchase a pre construction condo as a temporary investment until I can profit/save up enough to purchase something larger. Anyone have any positive or negative experiences with this kind of investment? Any tips or advice are welcomed. Thanks! [link] [comments] |
| Posted: 18 Jun 2020 09:40 PM PDT So I'm looking into buying a 6 unit property and will need a commercial loan to finance it. My only debt is my primary residence which I'm about to move out, rent it, and occupy one of the 6 units. 3 of the units are already leased. I have pretty good income and cashflow, however my lender wants 20% down which I can afford. I will be pretty much cleaned out at that point but with my income and my 2 properties my positive cashflow will be around 5k per month. Will I be approved for the loan or is my capital on hand not enough? [link] [comments] |
| Where do you store your money while waiting to buy your next rental? Posted: 18 Jun 2020 11:31 PM PDT I will be buying my first rental property next year. I could gather the money in my capital one savings account giving me 1.15% apy or I could put it in the S&p 500 mutual fund which would get me on average 7% a year. Where are you guys stashing your money while waiting to buy a property? [link] [comments] |
| Question about Lawn Care for 4plex Posted: 18 Jun 2020 07:40 PM PDT Hello, Not a huge issue, but I'm an out of state landlord and my property management is charging me roughly $55 to mow the lawn on a 4plex I own about twice a month. I'm wondering if this sounds about right? The property isn't one of my better ones so I'm wondering if reducing the lawncare to once a month will make much of a difference or not. I live in a city so grass and etc.. isn't something I'm too knowledgeable about Thanks [link] [comments] |
| Posted: 18 Jun 2020 11:11 PM PDT New to RE investing but had always been interested. For those of you who invest in multifamily in LCOL areas, what have you experienced as pros and cons? Would you recommend it compared to MCOL to MHCOL areas? Here are some initial assumptions I have about LCOL areas but please add or correct any items based on your experiences: Pros: 1. ~$100-$120 per sq ft 2. Availability of relatively newer and well maintained homes for $200k-$400k 3. Very low property taxes possibly $1k-$3k per year 4. More favorable landlord right / regulation 5. Higher cap rates, possibly 7% up to even 12% 6. Cheaper to renovate a fixer upper with lower costs of labor Cons/Uncertainties 1. Lower quality tenants (reckless and take bad care of home, tenants with mediocre credit, people may have trouble paying rent on time etc...) 2. Safety of neighborhood is a concern 3. Bad schools 4. Lack of (good) jobs in the area / poor infrastructure [link] [comments] |
| Positive Cash Flow w/ VA Loan? Posted: 18 Jun 2020 01:57 PM PDT My wife and I are looking to use the VA loan to buy property at our next duty station. This will be our first time buying a house, and we plan to rent it when we move again. I've been reading books and doing research, and one of the recurring themes is that the property should be cash-flow positive from day 1. I'm doing the math, and I just don't see how, with a 0% down VA loan, this is possible. Our budget is between $200k-$250k. With 0% down, the average monthly payment is around $1200-$1500 (that includes the mortgage, property tax, home owners insurance, and HoA), and the average rent in the area we are moving is also between $1200-$1500. We could break even like that, but it doesn't account for property management and maintenance, which any at all would be negative cash flow. Am I missing something? Is the trick to find something cheaper that we may not love living in? Do the tax benefits balance things out? I just don't see how, within that budget, with 0% down, anything would be cash-flow positive. [link] [comments] |
| Help with Dad's Commercial Real Estate Posted: 18 Jun 2020 10:26 PM PDT Hi guys, I need some help/advice as to what to do with my father's affairs. My father's getting old, but won't retire. His work is in real-estate in NYC, but he's very private about it so we don't know too much. His taxes are all over the place (didn't file from 2009-2019, but has since caught up to 2017), and he's taken out a bunch of loans under his LLC to develop his real-estate. We know he's got 4-5 pieces of large commercial real-estate that are all (slowly) being developed over the next 5-10 years. My mother, siblings, and I are worried that if something were to happen to him, we don't know enough about his work/properties to figure out what to do. To solve this, we decided to take 2 weeks from this summer, where he will show us everything he owns, and walk us through the important documents/information. My idea is that we'll keep this information centralized in a Google Sheet, accessible by all my siblings, and every year, we go through it with my father, updating all the relevant info, so that if something were to happen, we'd know what to do. But I have absolutely no idea what information we should be asking him, what we should be writing down, what documents we need copies of, etc. Has anyone gone through something similar? Do you have any advice for systems to keep track of this info, or what the most important info is? [link] [comments] |
| Almost discouraged myself on first investment Posted: 18 Jun 2020 06:39 PM PDT So I have been looking at a property in Nashville TN for a while with the intent of turning it from an SFH to a Duplex. The listing states it's 3 beds and 1 bathroom. Usually that lets you know that it is as it states 3 bed and. 1 bath. Today after the inspection I found out it's 2 beds and third bedroom is really the basement. So I immediately was disappointed thinking it was 3 beds up top. Yes I know why would I get all the way to inspection without realizing it was just 2 beds up top. It's a noob mistake mixed with blindness. So now I realized I can rent up top for 1200$ a month which will pay for the mortgage payment. And renovate the basement/garage. Close the garage and divide into two bedrooms. The large closet will be turned into a full bathroom including shower. And the living room and kitchen are already set. I almost pulled out the deal but all in all there should be a cash flow of 300+ a month. Unless I want to rent the bottom portion of the home for 900-1000 and have 500+ cash flow but that's without me living there. I'm expecting the renovations on the bottom half will turn out to be between 15-18k. I went back to the neighborhood and asked the neighbors hey how much does this area rent for? They stated between 1200-1500. Something else that seems promising is right behind the backyard they are building more properties. Most likely tall and skinny homes. [link] [comments] |
| Posted: 18 Jun 2020 06:43 AM PDT I've had several properties for quite a few years, perhaps this happens to everyone at some point. It's a personal injury allegedly caused by faulty building construction/maintenance. It's a section 8 unit, fully managed, and the property management company is also named. I'm the sole owner of the LLC the building is under. I haven't reviewed my contract with the management company since I started using them, but I'll be looking at that and all correspondence near the date of the issue. The management company has been unresponsive on other (business) issues since the pandemic began, but they keep sending me the rent so I haven't complained. The incident in question was quite some time ago. My first instinct is to call the best lawyer in town and essentially hand it off to them. I'm apprehensive about contacting the management company, and I've never met the tenant. Needless to say I'm pretty nervous, any advice on what steps to take would be greatly appreciated. [link] [comments] |
| Modelling a simple RE investment Posted: 18 Jun 2020 08:17 PM PDT Hi guys, I just built my first RE model, mostly from intuition, but also with a little help from YT videos (specifically, I didn't know how to use PMT to calculate payments). I just wanted to check with others on whether this model looks correct? I know I shouldn't be using yearly payments, but that seems like a minor thing to tweak. I'm really just trying to learn the intuition of a real estate investment for now. Appreciate your thoughts. https://i.postimg.cc/qRYHcWfj/Screen-Shot-2020-06-19-at-1-07-20-pm.png edit: to clarify, this is a purely hypothetical exercise. [link] [comments] |
| FHA Loans, Underwriters, and Reserve Requirements Problems Posted: 18 Jun 2020 07:09 AM PDT I am currently house hacking a duplex and looking to get property #2. Running into a few problems that I haven't seen mentioned anywhere since I started my RE journey. Problem #1 Income: Now that I claim rental income I make too much to qualify for a low down payment conventional loan (Home possible). With home prices near me, I will need 40-50k for a 20% down payment plus closing costs, moving cost, etc. If I save 20k a year it will take me 3 years to save up, so that's out. Problem #2 FHA loan: My next option is a low down payment FHA loan. FHA guidelines require you to be at a 75% LTV before you can use your current rental income to qualify. Since I used a low down payment loan to get into my current residence I am nowhere near a 75 LTV. FHA loans also suck, they can't compete with conventional financing. Sellers hate them and the guidelines are so tight they won't work on a lot of properties. Problem #3 Underwriters: This is what I really don't get. How are people house hacking every single year and not having an underwriter rip you apart? I had to write an explanation letter about why I wanted to move so quickly. And while I think I could do it 1 or maybe 2 more times tops, I don't think an underwriter would buy it 3+ times. Problem #4 Reserves: I remember hearing "Real estate is like a snowball, once you get it rolling it becomes easier." Except every lender I've talked to, even portfolio lenders, want 6 months of reserves for each property. It's like trying to roll a snowball up a hill with its increasing weight fighting you. Even if a purchase a new property and manage to cash flow $200/door, the time it will take me to save up 6 months reserves and another 20% down payments will be long. On top of all this the market is extremely competitive and multifamily homes often get accepted offers in under 48hrs. Prices continue to rise and banks tighten guidelines due to COVID. How are people actually scaling up? I feel like I am missing something or the RE podcast hype sold me on a bunch of BS. [link] [comments] |
| How to find out desirable a location is to rent? Posted: 18 Jun 2020 06:05 PM PDT I'm brand new to real estate investing and I'm looking to buy a house that I can rent out. I'm wondering if there's an easy way or a website to use to find out how easy it would be to find tenants? For instance, a place downtown or near a college would be easy to rent, whereas, somewhere out of town or in the suburbs might be more difficult. How do you guys determine that? Walkability? Crime score? School score? I wish there was just a website I could type an address into and it could give me a score of how hot the rental market is. [link] [comments] |
| Remodeling Investment: laminate or tile? Posted: 18 Jun 2020 03:24 PM PDT Everyone loves the new gray, white decor tones. Trying to make some cheap upgrades to the property to increase resell value. Trying to decide if it's worth upgrading with nice tile or cheap laminate? Homebuyers don't seem to care much as long as the "look" is right....right? [link] [comments] |
| Struggling getting leases signed Posted: 18 Jun 2020 02:09 PM PDT Hey all, first off: Thank you all for your nuggets of wisdom you have bestowed onto me as I lurk this sub. I am transitioning from maintaining a 12 unit property to managing it, with an intent to purchase once I secure financing. I am, however, hitting a road block. I can not seem to get prospective tenants to commit to signing a lease. I have many leads and contacts throughout the week, but they immediately go cold. Once they express interest, I ask a few vetting questions to see if its worth the hassle, then send over an application for them to fill out along with asking them what date and time are best for them to view the unit. That is usually where they disappear and they very rarely complete an application. It seems like everyone expects to just walk inside a unit and look around without providing any personal information. Even on FB marketplace I can see that I am being left on read by pretty much everyone who says they are interested. I give them some time and then reengage, adding a sense of urgency that there are other people interested in the unit with a suggestion to act sooner rather than later, and again, no response. I know this process is pretty organic to each individual so I'm wondering if any of you can share your insights on exactly how you get those commitments from people to turn them into happy tenants. Thanks again for all your knowledge and help. [link] [comments] |
| Posted: 18 Jun 2020 01:41 PM PDT Hey, I'm looking to get a bit more serious about growing my real estate portfolio and becoming a more efficient investor by signing up for a mentorship. Any Canadians have a recommendation for a good program? I'm in B.C. if that makes a difference. [link] [comments] |
| Does Purchasing with LLC Affect Personal FTH Loans? Posted: 18 Jun 2020 08:59 AM PDT Hey guys, sorry if this is a stupid question but I could not find an answer to this through a preliminary Google search or on Bigger Pockets. If my partner and I form an LLC and pursue to purchase a property with it, will it affect our ability to be eligible for a first time home buyers loan later on down the road? Currently we are each individually renting but would like to keep this option available should either of us want to purchase a home in the future. I would assume no because the LLC is its own entity but just want to confirm. Thanks guys! [link] [comments] |
| Posted: 18 Jun 2020 12:42 PM PDT Hello, I own 2 single family residences and am beginning to get some applications for tenants with dogs. Are there any risks I'm not thinking of already? How much do you charge for a "pet fee"? [link] [comments] |
| Need some ideas! How to get started? Posted: 18 Jun 2020 12:03 PM PDT I'm sorry if this has been posted numerous times. My wife and I are looking to get into a house flipping and rental business. We both work corporate jobs, own our own home, but don't have a lot of start up capital and have a fair amount of personal debt. I've previously set up a LLC from a deal that fell through 15 years ago. So I have that but it's not being used at the moment. We also have close real estate friends. I'm fairly handy and my wife is eager to help. I'm also somewhat familiar with real estate, business and finance. My general thought would be, we'd buy a house to fix, while still working(maybe cut back a few hours) do it at our own pace, and resell for a profit and continue the cycle until we could replace out current income to become full time flippers/landlords. With not having start up money, what are some resources that can be utilized to get started? Government loans? Home loans? Small business loans? Investor loans? Is it even possible to get started without having a ton of your own cash to invest? Any input or ideas would be greatly appreciated! [link] [comments] |
| How many of you act as your own realtor when it comes to buying and selling property? Posted: 18 Jun 2020 11:14 AM PDT Trying to learn as much as I can before entering the RE investing market. What are some of the pros and cons of acting as your own realtor? I've heard getting a realtors license is fairly easy, but would y'all consider it worthwhile? Considering mostly mutli-family units, if that makes a difference at all. [link] [comments] |
| Foreclosed property selling for more than the assessed value? Posted: 18 Jun 2020 11:00 AM PDT I'm super new to all of this and was looking for some general guidance. My friend is looking to purchase a house that is listed at $240k. The house has been foreclosed on and is now owned by the bank. A quick lookup of the tax history shows that the assessed value is only $176k. The bank will not budge on their asking price at all. Is this normal? Could this just be a realtor smelling opportunity with a first time home buyer? It's definitely a good property, but I have noticed some drainage issues and a possible issue with the roof. Inspection is saturday, followed by an appraisal, so we'll know more then. [link] [comments] |
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