I Own one and want two.....

Hello to all. This is my first post on biggerpockets and I am excited to get involved. Recently I purchased my first investment property. A Victorian styled home, wich is a commercially zoned duplex. The downstairs is an antique gift shop and I am updating and remodeling the upstairs into an apartment. I am 3/4 of the way done and I want another one. I have had my eyes on a few in my area. My question is How to go about it..... my credit is kind of shabby, should i draw up a nice business plan? should i hold out and let this build equity to use as collateral towards another property? I am open to any and all suggestions. Thanks.

Davion Malwah

Multi-family Investor · Los Angeles, California

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Jun 21 '11, 02:26 PM

Personally if it was my first property, I wouldnt rush into a second. Build some equity, get your feet went with landlording, than look to expand.

Aaron Mazzrillo

Wholesaler · Corona, California

330 posts
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Jun 21 '11, 02:30 PM

How did you get the first one?

I agree with Davion. You are not even done with your current project. If you are buying and selling consistently, sure, you should already be looking for your next acquisition to keep the funnel full. However, you said this is your first. Treat it like a pair of shoes; Try it on, test it out for a while, and if it makes you happy, go get another.

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James Vermillion

Rehabber · Lexington, Kentucky

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Jun 22 '11, 11:36 PM

You should be working on a business plan no matter what route you choose. If you plan on proceeding real estate investing, either now or in the future I would work on coming up with a game plan, education, and fixing the credit situation.

You should start right away with repairing your credit, as this will help you in your life whether or not you decide to pursue real estate. As you do so, you can build equity in your current property, finish the project, and start prepping for number two.

Once you have everything lined up, then you can move forward with confidence.

Jerry Ruday

Carpenter · New York

7 posts
51 influence

Jun 23 '11, 11:41 AM

I do plan on holding and renting this one out. I have been working diligently and am excited for the results, i am hoping this is a proper start and cant wait to move on. Thanks alot guys for the responds and they are very well taken.
James, it has been in my mind to get started on a business plan and i have actually been making small mental notes on what to include, you just reassured me that i need to get that done sooner than later, but my hesitation comes from not knowing exactly where to start, what to include or how to write a proper and professional business plan

James Vermillion

Rehabber · Lexington, Kentucky

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Jun 23 '11, 11:56 AM

Jerry,

Look around online and see what you can find, there are some templates that can help you get started. Also, there is an article/blog post somewhere on BP that had a list of things to include and think about when developing a business plan, I will try to track it down. Another source would be J Scotts website, he offers his business plans when you sign up for his email newsletter.

With those resources you should be able to start on your business plan which you can expand once your knowledge and education grows.

Conny Wolfram

Wholesaler · Santa Monica, California

60 posts
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Jun 30 '11, 12:01 AM

Originally posted by jerry ruday

....it has been in my mind to get started on a business plan and i have actually been making small mental notes on what to include, you just reassured me that i need to get that done sooner than later, but my hesitation comes from not knowing exactly where to start, what to include or how to write a proper and professional business plan

Jerry, look at your local library for this book: How to write a business plan (McKeever, Mike P.) - it comes with a CD, and has as far as I recall 5 pretty good sample business plans. Just chose one of them, and adjust the specifics to your situation/business.

Also, question: where in NY are you located? If you want to work on a 2nd property I would (like other BiPo members already suggested) wait until I'm done with the duplex. Because this first property goes a long way in proofing to a potential (private or hard money) lender that you know what you are doing. Or you could purchase a REO/wholesale property that comes already with owner financing built in - i.e. we sell these sometimes on 6 - 9 months financing... if you have questions let me know. Good luck!

Conny