New Investors: Ask Me Anything

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New Investors: Ask Me Anything

Jonathan GreeneBusiness Member
Real Estate Consultant · Madison, NJ · Member since 2016 · 6k+ posts · 7k+ votes

If you are just getting into real estate investing and have a question that you need an honest answer to, ask me anything here. But don't ask a question if you are hoping to get a certain answer, and don't ask a question that you can find an answer to in the forums 100 times because that won't help you.

My areas of expertise are off-market acquisition, flipping, short-term rentals, fix and live, landlording, on-market real estate and real estate teams, mindset, and how to build relationships in the business, among others. I was a guest on episode 584 of the BiggerPockets podcast so fire away.

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Chad McMahan
Residential Real Estate Broker · Sedona, AZ · Member since 2017 · 754 posts · 504 votes
4y
Quote from @Jonathan Greene:

If you are just getting into real estate investing and have a question that you need an honest answer to, ask me anything here. But don't ask a question if you are hoping to get a certain answer, and don't ask a question that you can find an answer to in the forums 100 times because that won't help you.

My areas of expertise are off-market acquisition, flipping, short-term rentals, fix and live, landlording, on-market real estate and real estate teams, mindset, and how to build relationships in the business, among others. I was a guest on episode 584 of the BiggerPockets podcast so fire away.


What is the airspeed of an unladen swallow?


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  • Mohammed Milord
    Member since 2022 · 36 posts · 7 votes
    4y
    Quote from @Jonathan Greene:
    Quote from @Mohammed Milord:

    Hi Jonathan, 

    My question is how can you refinance after purchasing and repairing an investment property if you have a high debt-to-income ratio?


    This can only be answered correctly by a lender if you are looking for anything traditional. If your DTI is high, you probably knew going in that you couldn't do an easy refi so what was the plan on the way in if you are trying to complete a BRRRR?

    Hi Jonathan,

     What if you used a hard money lender to first buy and repair the property?

    1Reply
  • Stephen Moss
    Member since 2017 · 8 posts · 4 votes
    4y

    Hi Jonathan

    I have no ties to a location, I can go to any state.   I am looking for good cashflow and have a 25% deposit upto £1m purchase 

    Hope this helps

    Steve 

    1Reply
  • Lynn Anthony
    Member since 2019 · 44 posts · 11 votes
    4y

    @Jonathan Greene Hi thanks for offering up your expertise and time! Do you have connections for off market acquisitions in Charlotte NC area for cash buyers?

    1Reply
  • Devan Henley
    New to Real Estate · MD · Member since 2019 · 2 posts · 2 votes
    4y
    Quote from @Jonathan Greene:
    Quote from @Devan Henley:

    Hello Jonathan,

    a few weeks away from closing and I reached out to an insurer to get homeowners insurance. They explained that since it will not be occupied immediately and since I was going to be doing renovations that the property wouldn't be able to get insurance. I can't close without the insurance so what should I look into?  


     That's not correct. You still need homeowner's insurance and you also need vacant property insurance. All of us have both on all of our flip projects. What kind of loan are you using? It sounds like a misunderstanding in there somewhere or else that insurance agent knows nothing.


    It's a second home loan. Using it while I renovate then will transfer it into an LLC along with a second property that will be purchased in a couple months. I will reach out to get homeowners and vacant property.

    thank you for the info

    1Reply
  • Cory Pruyn
    Member since 2020 · 10 posts · 1 vote
    4y

    Hi, Jonathan!

    How would you recommend finding a good deal on a flip property in a small city? Local agents haven't been much help and there isn't much of an investment community to access.

    Thanks,

    Cory

    0Reply
  • Zachery Hitchcox
    Rental Property Investor · Japan · Member since 2022 · 38 posts · 15 votes
    4y

    Hello Jonathan,

    Have 2 properties in Las Vegas and looking to expand out to the Florida market, particularly north of Orlando (as my research has led me). So far, the agents that have been responsive and their lenders have a little over 1 year of experience according to the NMLS lookups. Seems like this is something that is coming up quite a bit as I imagine a lot of people dove into real estate in the boom the last year or 2. Is this a big red flag to stay away from as their experience is based on an overinflated market, or did the huge workload over the last 2 years may actually give these relatively new agents some good skills? 

    1Reply
  • Tonderlera Ohaeri
    Tobyhanna, PA · Member since 2015 · 8 posts · 1 vote
    4y

    Hi Jonathan,

    Thanks for sharing your expertise and success.  I have a long-time acquaintance that's a developer in Monroe County  Pennsylvania.  I would like this person to be a silent partner to help me develop personal care homes for the elderly.   What do you think is a strategic way to structure a deal in an effort to get this person to partner with me so that it benefits both of us?  I thought of putting in sweat equity, hiring staff, managing, etc. and the developer would use their money.  Whatever cash flow is made with the business, we would split the profits.  I could also offer the developer more of a higher percentage of the profits.  Again, what are your thoughts?

    1Reply
  • Christopher Sparacino
    New to Real Estate · Sarasota, FL · Member since 2018 · 82 posts · 49 votes
    4y

    hey Jonathan, I have a question regarding buying an off market house-hack with an FHA loan. I live in Sarasota, FL so there is usually no desirable multi-family either here or up north in Bradenton (a similar county to Sarasota). So with that said I am wanting to source my own deal off market (i have experience with finding properties off market from wholesaling). With that also said, i know you can use the FHA loan to buy off market (im pretty sure), but would you have any advice for someone wanting to buy an off market house hack using an FHA loan?

    1Reply
  • Jonathan GreeneBusiness Member
    OP
    Real Estate Consultant · Madison, NJ · Member since 2016 · 6k+ posts · 7k+ votes
    4y
    Quote from @Mohammed Milord:
    Quote from @Jonathan Greene:
    Quote from @Mohammed Milord:

    Hi Jonathan, 

    My question is how can you refinance after purchasing and repairing an investment property if you have a high debt-to-income ratio?


    This can only be answered correctly by a lender if you are looking for anything traditional. If your DTI is high, you probably knew going in that you couldn't do an easy refi so what was the plan on the way in if you are trying to complete a BRRRR?

    Hi Jonathan,

     What if you used a hard money lender to first buy and repair the property?


    Sure, but why do that right now. Hard money is extremely expensive. You would be paying at least 13-15% now and 2 points if you have no history with them. Have you ever done a BRRRR or a flip? If you do a BRRRR with hard money right now and the market goes down, you may not be able to complete the refi as you said before. If you already have high DTI, adding hard money is just putting keg powder near a match. Fix your DTI before looking to invest more.

    [email protected]Podcast Guest on Show BiggerPockets Daily 667: 5 Amazing Benefits Multifamily Investments Offer (That Single Family Homes Don’t) by Gino Barbaro
    Zen and the Art of Real Estate Investing59 Reviews
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    1Reply
  • Jonathan GreeneBusiness Member
    OP
    Real Estate Consultant · Madison, NJ · Member since 2016 · 6k+ posts · 7k+ votes
    4y
    Quote from @Christopher Sparacino:

    hey Jonathan, I have a question regarding buying an off market house-hack with an FHA loan. I live in Sarasota, FL so there is usually no desirable multi-family either here or up north in Bradenton (a similar county to Sarasota). So with that said I am wanting to source my own deal off market (i have experience with finding properties off market from wholesaling). With that also said, i know you can use the FHA loan to buy off market (im pretty sure), but would you have any advice for someone wanting to buy an off market house hack using an FHA loan?


    No one is going to sell to you off-market with an FHA loan, please change your strategy. Most off-market deals are cash or at the very least limited inspection and/or as-is. You can not offer as-is because FHA has their own inspection requirements that you can't guarantee. It is not a strategy to look off-market on your own with an FHA loan, you will be doing that for years with no success. I lived in Sarasota for 7 years and a multi-family house hack in that area is not great. Sure, maybe Bradenton, but you are trying to put a square in a circle hole because there are not a lot of options for multi scale that I know of. If you are using an FHA loan to house hack, you want to find an investor-friendly agent and work on-market so you are protected both ways and have a chance.

    [email protected]Podcast Guest on Show BiggerPockets Daily 667: 5 Amazing Benefits Multifamily Investments Offer (That Single Family Homes Don’t) by Gino Barbaro
    Zen and the Art of Real Estate Investing59 Reviews
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    2Reply
  • Jonathan GreeneBusiness Member
    OP
    Real Estate Consultant · Madison, NJ · Member since 2016 · 6k+ posts · 7k+ votes
    4y
    Quote from @Tonderlera Ohaeri:

    Hi Jonathan,

    Thanks for sharing your expertise and success.  I have a long-time acquaintance that's a developer in Monroe County  Pennsylvania.  I would like this person to be a silent partner to help me develop personal care homes for the elderly.   What do you think is a strategic way to structure a deal in an effort to get this person to partner with me so that it benefits both of us?  I thought of putting in sweat equity, hiring staff, managing, etc. and the developer would use their money.  Whatever cash flow is made with the business, we would split the profits.  I could also offer the developer more of a higher percentage of the profits.  Again, what are your thoughts?


     Once I saw long-time acquaintance I was already a no. There is no such thing in investing as a silent partner. They are silent until you do something wrong or lose money. Your proposal is for them to be the money and you to do the work, but what background do you have in doing that. Elderly home care is very complicated so you would need projects already completed to even have a chance. And you should not take money to do something for the first time without a very long deck on how it will all work. This sounds like you wanting to do something, but not having the money, but that doesn't make it a good investment for the partner.

    [email protected]Podcast Guest on Show BiggerPockets Daily 667: 5 Amazing Benefits Multifamily Investments Offer (That Single Family Homes Don’t) by Gino Barbaro
    Zen and the Art of Real Estate Investing59 Reviews
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    1Reply
  • Jonathan GreeneBusiness Member
    OP
    Real Estate Consultant · Madison, NJ · Member since 2016 · 6k+ posts · 7k+ votes
    4y
    Quote from @Zachery Hitchcox:

    Hello Jonathan,

    Have 2 properties in Las Vegas and looking to expand out to the Florida market, particularly north of Orlando (as my research has led me). So far, the agents that have been responsive and their lenders have a little over 1 year of experience according to the NMLS lookups. Seems like this is something that is coming up quite a bit as I imagine a lot of people dove into real estate in the boom the last year or 2. Is this a big red flag to stay away from as their experience is based on an overinflated market, or did the huge workload over the last 2 years may actually give these relatively new agents some good skills? 


     Years in the business can be a misnomer because they could have ancillary experience. Some agents are just good, some lenders are just good. You should be only asking yourself if you trust them to help you accomplish their goals or not. If you do and they are doing work for you, don't worry about anything until you see a sign that they are not. I do have connects in the area in the investment-side for agents if you need one.

    [email protected]Podcast Guest on Show BiggerPockets Daily 667: 5 Amazing Benefits Multifamily Investments Offer (That Single Family Homes Don’t) by Gino Barbaro
    Zen and the Art of Real Estate Investing59 Reviews
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    0Reply
  • Jonathan GreeneBusiness Member
    OP
    Real Estate Consultant · Madison, NJ · Member since 2016 · 6k+ posts · 7k+ votes
    4y
    Quote from @Cory Pruyn:

    Hi, Jonathan!

    How would you recommend finding a good deal on a flip property in a small city? Local agents haven't been much help and there isn't much of an investment community to access.

    Thanks,

    Cory

    It depends how you are looking to pay for that deal. Cash, loan, etc. Your best bet is definitely direct to seller marketing after pulling lists of preforeclosures or probate in the area as they will be best for sales now for what you want to do. But it's not agents faults that there is no inventory. You may live in an area where the bad properties (the ones to flip) don't go on the market. You can't work with wholesalers unless you have cash really so for small city it's a lot of word of mouth and direct marketing.
    [email protected]Podcast Guest on Show BiggerPockets Daily 667: 5 Amazing Benefits Multifamily Investments Offer (That Single Family Homes Don’t) by Gino Barbaro
    Zen and the Art of Real Estate Investing59 Reviews
    WebsiteView Page
    1Reply
  • Jonathan GreeneBusiness Member
    OP
    Real Estate Consultant · Madison, NJ · Member since 2016 · 6k+ posts · 7k+ votes
    4y
    Quote from @Lynn Anthony:

    @Jonathan Greene Hi thanks for offering up your expertise and time! Do you have connections for off market acquisitions in Charlotte NC area for cash buyers?


     Yes, let me check my list for the best connect for you.

    [email protected]Podcast Guest on Show BiggerPockets Daily 667: 5 Amazing Benefits Multifamily Investments Offer (That Single Family Homes Don’t) by Gino Barbaro
    Zen and the Art of Real Estate Investing59 Reviews
    WebsiteView Page
    1Reply
  • Jonathan GreeneBusiness Member
    OP
    Real Estate Consultant · Madison, NJ · Member since 2016 · 6k+ posts · 7k+ votes
    4y
    Quote from @Stephen Moss:

    Hi Jonathan

    I have no ties to a location, I can go to any state.   I am looking for good cashflow and have a 25% deposit upto £1m purchase 

    Hope this helps

    Steve 


     Right, but what I am saying is you are setting yourself up for failure. If you say have $1m available and 25 pct down and will invest anywhere with x return, you are going to get sold a bunch of bad deals that look good without considering management and area dynamics. We only counsel investors who have narrowed their scope down to the 3 towns, not states, 3 towns at a time. The reason we do this is because if they can't narrow it down, they are going to waste a lot of our time and we can't be experts on the daily investment market in 20 towns or 7 counties and we want to make sure we are using our time, and theirs, wisely.

    [email protected]Podcast Guest on Show BiggerPockets Daily 667: 5 Amazing Benefits Multifamily Investments Offer (That Single Family Homes Don’t) by Gino Barbaro
    Zen and the Art of Real Estate Investing59 Reviews
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    1Reply
  • Tyler Shoaf
    Investor · IN KY, UT · Member since 2022 · 10 posts · 5 votes
    4y


    "What is the airspeed of an unladen swallow?"

    @Chad McMahan African or European?

    2Reply
  • Shawn McCormickPro Member
    Realtor · Central Florida-Orlando · Member since 2014 · 1k+ posts · 892 votes
    4y
    Quote from @Zachery Hitchcox:

    Hello Jonathan,

    Have 2 properties in Las Vegas and looking to expand out to the Florida market, particularly north of Orlando (as my research has led me). So far, the agents that have been responsive and their lenders have a little over 1 year of experience according to the NMLS lookups. Seems like this is something that is coming up quite a bit as I imagine a lot of people dove into real estate in the boom the last year or 2. Is this a big red flag to stay away from as their experience is based on an overinflated market, or did the huge workload over the last 2 years may actually give these relatively new agents some good skills? 

     Hi @Zachery Hitchcox Central Florida did see a huge increase in agents since the market starting going up. This has been steadily increasing and although I don't have a specific number, the last I heard we have around 26,000 agents just in Central Florida. It is no surprise that your are running into new(er) agents, but there are plenty of us experienced ones too. Every agent will market themselves as 'investor friendly', but so many don't really know what that means. They just sold a second home to an out of state buyer once and its easy to spin that into 'experience'. 

    Happy to have a conversation about the Orlando market with you if you need. Best of luck to you!

    2Reply
  • Kobe McDaniel
    Real Estate Agent · Snohomish, WA · Member since 2020 · 99 posts · 49 votes
    4y

    Hi @Jonathan Greene

    What are some questions I should be asking my builder? Essentially interviewing them, what should I found out in terms of costs, timelines, permits and such?

    Thanks

    0Reply
  • Tyler GibsonBusiness Member
    Real Estate Agent · Orlando, FL · Member since 2017 · 1k+ posts · 2k+ votes
    4y
    Quote from @Zachery Hitchcox:

    Hello Jonathan,

    Have 2 properties in Las Vegas and looking to expand out to the Florida market, particularly north of Orlando (as my research has led me). So far, the agents that have been responsive and their lenders have a little over 1 year of experience according to the NMLS lookups. Seems like this is something that is coming up quite a bit as I imagine a lot of people dove into real estate in the boom the last year or 2. Is this a big red flag to stay away from as their experience is based on an overinflated market, or did the huge workload over the last 2 years may actually give these relatively new agents some good skills? 


     If they were able to have success then it likely helped them develop some skills. The last 18 months have been interesting here in Central Florda. 

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  • Tonderlera Ohaeri
    Tobyhanna, PA · Member since 2015 · 8 posts · 1 vote
    4y

    I have a background in personal home care, and I also worked in other human services field.  I also have a Bachelors in Social Work and soon to pursue a Masters in Management and Leadership - Organizational Behavior.  I checked with the licensing agency for personal home care and I'm qualified to run one.  I also have other administrative and managerial experience.  So I'm not concerned with not having the experience. I'm just looking for creative ways to structure a deal.

    0Reply
  • Zachery Hitchcox
    Rental Property Investor · Japan · Member since 2022 · 38 posts · 15 votes
    4y
    Quote from @Tyler Gibson:
    Quote from @Zachery Hitchcox:

    Hello Jonathan,

    Have 2 properties in Las Vegas and looking to expand out to the Florida market, particularly north of Orlando (as my research has led me). So far, the agents that have been responsive and their lenders have a little over 1 year of experience according to the NMLS lookups. Seems like this is something that is coming up quite a bit as I imagine a lot of people dove into real estate in the boom the last year or 2. Is this a big red flag to stay away from as their experience is based on an overinflated market, or did the huge workload over the last 2 years may actually give these relatively new agents some good skills? 


     If they were able to have success then it likely helped them develop some skills. The last 18 months have been interesting here in Central Florda. 


     Those are my thoughts exactly here. I was assuming the crazy market has generated a lot of new agents and probably some skillful ones too. Just a little concerned that these agents haven't had to deal with negotiating prices and working in a bit of a slower market. Hard to judge that though. Thank you for your thoughts

    0Reply
  • Fiza Ah
    Investor · Member since 2020 · 80 posts · 71 votes
    4y

    How can you guesstimate appraisal values using online tools? Can you? Should I be reaching out to my realtor to ask where appraisals are landing because tools aren't built for the time we're living in?

    0Reply
  • Stephen Moss
    Member since 2017 · 8 posts · 4 votes
    4y

    Thanks for the swift response, on that basis what are your hot three towns you would recommend to start looking at?

    Thanks

    Steve

    0Reply
  • Khaled Morad
    Lender · Tampa, FL · Member since 2018 · 422 posts · 210 votes
    4y
    Quote from @Mohammed Milord:

    Hi Jonathan, 

    My question is how can you refinance after purchasing and repairing an investment property if you have a high debt-to-income ratio?


     I can answer that question for you :)

    0Reply
  • Jonathan GreeneBusiness Member
    OP
    Real Estate Consultant · Madison, NJ · Member since 2016 · 6k+ posts · 7k+ votes
    4y
    Quote from @Kobe McDaniel:

    Hi @Jonathan Greene

    What are some questions I should be asking my builder? Essentially interviewing them, what should I found out in terms of costs, timelines, permits and such?

    Thanks


     How many crews do you have? Will one crew be assigned to work this job every day, six days a week? Where do you get your subcontractors from and can I use my own subcontractors? Who pays for materials, appliances, etc? Do you handle all of the permitting? Will you give an itemized work document in advance, with pricing? How many draws would you like to get paid in?

    Hope that helps to get started.

    [email protected]Podcast Guest on Show BiggerPockets Daily 667: 5 Amazing Benefits Multifamily Investments Offer (That Single Family Homes Don’t) by Gino Barbaro
    Zen and the Art of Real Estate Investing59 Reviews
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