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.

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

    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?


    I would never guesstimate anything and you can't do it without MLS access. The only way to properly judge your potential ARV or appraisal value is using true comps off the MLS so yes, if you don't have a RE license, your realtor should be able to send you similar comps.

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

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

    Thanks

    Steve


     In what state?

    [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
    0Reply
  • Fiza Ah
    Investor · Member since 2020 · 80 posts · 71 votes
    4y
    Quote from @Jonathan Greene:
    Quote from @Fiza Ah:

    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?


    I would never guesstimate anything and you can't do it without MLS access. The only way to properly judge your potential ARV or appraisal value is using true comps off the MLS so yes, if you don't have a RE license, your realtor should be able to send you similar comps.


    I don't have MLS access, and need to guesstimate to see whether it makes sense to pull out the original investment or stay in it longer. Thank you very much!

    0Reply
  • Carlos Fernandez
    Member since 2020 · 7 posts · 5 votes
    4y
    Quote from @Jonathan Greene:
    Quote from @Carlos Fernandez:

    Why are you trying to work with wholesalers? Are you a cash buyer? If you, as an unknown investor, are seeing a wholesale deal it means it has gone through their VIP list, their preferred list, and now it's to you just because of what you said, the numbers are garbage. Most of us who have been in the game for a while have premier access and can get better prices based on our relationship. If you are not a cash buyer, you should not even be looking at wholesale deals. 90-95% of all wholesale deals have inflated ARVs and reduced repair costs, this is how bad wholesalers make money. I hope that helps.

    Thanks Jonathan. I am actually a potential cash buyer using a self directed IRA Account and a HELOC I have in case I need it. All I am looking now it to meet wholesale sellers in my area (South Florida/Florida). I know I must pound the pavement to find the quality wholesalers that will get me started. I just don't who what pavement to pound.


     South Florida is very sketchy for wholesalers. I lived in Ft. Lauderdale for 7 and Sarasota for 7. I do have a friend who runs off-market in the Tampa area if you are interested up there.


     Thanks Jonathan.  I sent you a note.  Thanks again.

    0Reply
  • Mohammed Milord
    Member since 2022 · 36 posts · 7 votes
    4y
    Quote fro:
    Quote from :

    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 :)

     @Khaled Morad Please tell me more!

    0Reply
  • Somer Wheat
    Member since 2022 · 10 posts · 3 votes
    4y

    @Jonathan Greene

    Hello, thank you so much for an opportunity to ask questions. I am just starting out and I am interested in birddogging for a few months and maybe eventually wholesaling before I actually buy my first rental property. My question is, where do I find established investors to bring deals to, and what is the best software, apps, to research deals and find comps on the area of a property? Thank you so much for your time

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

    @Jonathan Greene

    Hello, thank you so much for an opportunity to ask questions. I am just starting out and I am interested in birddogging for a few months and maybe eventually wholesaling before I actually buy my first rental property. My question is, where do I find established investors to bring deals to, and what is the best software, apps, to research deals and find comps on the area of a property? Thank you so much for your time


    Go to local REI meetups both in-person and online and start to see who is really doing the majority of wholesaling in your area. If they run it like a real business, there is a better chance of legitimacy and bird dog opportunities there. You want to network so you can make sure the experience you get with someone is worthwhile. Everything starts with building relationships. For comps, true comps, you need MLS access, nothing else will be accurate enough. It depends how you like to prospect. You can use DealMachine if you like driving for dollars or PropStream if you like list building or List Source for old school list building. Hope this helps.

    [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
    2Reply
  • Khaled Morad
    Lender · Tampa, FL · Member since 2018 · 422 posts · 210 votes
    4y
    Quote from @Mohammed Milord:
    Quote fro:
    Quote from :

    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 :)

     @Khaled Morad Please tell me more!


    Let’s chat! I messaged you so as not take up any more space on this great Q and A :) 

    0Reply
  • Jamie Rai
    Member since 2022 · 9 posts · 6 votes
    4y

    Hey Jonathan, Thank you for your time. How would you suggest I approach a real estate agent about helping me find deals as a newbie investor?

    2Reply
  • Rich Hupper
    Broker / Investor · Tewksbury, MA · Member since 2008 · 1k+ posts · 351 votes
    4y

    The brrrr method is discussed a lot and I have tried to implement it many times with purchases. Does Brrrr work best when there are 5+ units? The numbers never seem to work on a single family or even  a two family unless you get the property for such a steal and it doesn't require hundreds of thousands in reno work. 

    My understanding of a true brrrr is you buy something, renovate, rent refinance and repeat. However the refinance part rarely ever allows you to pull all your money out. Some money is left trapped in the property. Banks only want to give you 20 to 25 year notes and require a 75% ltv. 

    1Reply
  • Rich Hupper
    Broker / Investor · Tewksbury, MA · Member since 2008 · 1k+ posts · 351 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


     Probate deals are the best deals in my opinion. Local agents usually are looking for deals just as hard as you. You need to get in with an estate attorney who will funnel you probate deals. Or at least allow you to bid on them. All of my deals are usually probate deals that I have been cultivating relationships with the decision makers over months or years.

    Its not easy. You might speak to someone for several years then all of a sudden its sold because you stopped following up.

    2Reply
  • Carlos Fernandez
    Member since 2020 · 7 posts · 5 votes
    4y

    Hi Jonathan,

    Do you actually still use the 1%, 70%, and 50% rules when looking for properties or have you move past this?  Are these rules mostly for novice investors, or do experienced investor such as yourself still find them useful? Of the three, is there one you have found more useful than the others?  Is there one you would rather not use?  Thanks!

    0Reply
  • Joseph Milano
    Rental Property Investor · NJ · Member since 2017 · 17 posts · 6 votes
    4y

    Hey Jonathan,

    I also live in New Jersey, and wanted to start expanding into wholesaling to keep funding my rental portfolio and open up more opportunities to make money. Since I am familiar with south Jersey and some of the surrounding philly burb's I wanted to target these areas, specifically 3 bed 1-2 bath homes in decent areas I wouldn't mind owing rentals in. A couple questions for you.

    1. Do you have or know where I can find a specific assignment and/or sales agreement that explains to the seller my right to assign their contract, and that the end buyer will be responsible for purchase and closing cost? 

    2. If you were starting out again in wholesaling right now, which lead generating techniques would you start with, and how do you separate yourself from the major wholesalers in the area who are likely also contacting the same people?

    Thanks in advance for your help!


    1Reply
  • Somer Wheat
    Member since 2022 · 10 posts · 3 votes
    4y
    Quote from @Jonathan Greene:
    Quote from @Somer Wheat:

    @Jonathan Greene

    Hello, thank you so much for an opportunity to ask questions. I am just starting out and I am interested in birddogging for a few months and maybe eventually wholesaling before I actually buy my first rental property. My question is, where do I find established investors to bring deals to, and what is the best software, apps, to research deals and find comps on the area of a property? Thank you so much for your time


    Go to local REI meetups both in-person and online and start to see who is really doing the majority of wholesaling in your area. If they run it like a real business, there is a better chance of legitimacy and bird dog opportunities there. You want to network so you can make sure the experience you get with someone is worthwhile. Everything starts with building relationships. For comps, true comps, you need MLS access, nothing else will be accurate enough. It depends how you like to prospect. You can use DealMachine if you like driving for dollars or PropStream if you like list building or List Source for old school list building. Hope this helps.


     Yes it absolutely does help.  Thank you so much for your reply!

    1Reply
  • Stephen Hoff
    New to Real Estate · DFW · Member since 2022 · 2 posts · 0 votes
    4y

    Hey Jonathan, 

    I live in the DFW Texas area and I am for a trustworthy mentor that will help guide me through my first rental investment purchase. Any ideas on who I can chat with about that?

    0Reply
  • Chase Sobinski
    Member since 2022 · 1 post · 0 votes
    4y

    What are your thoughts on airbnb rentals? Asking as someone who is looking to get more into the real estate field.

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

    Hey Jonathan, Thank you for your time. How would you suggest I approach a real estate agent about helping me find deals as a newbie investor?


     A couple of good tips for this:

    1. Don't oversell where you are at. If you are new, be new and explain what you are looking for even if it's hard to find an agent in the beginning. Don't say how many deals you will do before you do any. We've all heard that before.

    2. Go to real estate investor meetups and find investors who are also licensed and work on-market. Those agents know what to do and like to help a lot of the time.

    3. Target three towns and an investment type so you don't have them running all over.

    I hope these get you 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
    WebsiteView Page
    0Reply
  • Jonathan GreeneBusiness Member
    OP
    Real Estate Consultant · Madison, NJ · Member since 2016 · 6k+ posts · 7k+ votes
    4y
    Quote from @Rich Hupper:

    The brrrr method is discussed a lot and I have tried to implement it many times with purchases. Does Brrrr work best when there are 5+ units? The numbers never seem to work on a single family or even  a two family unless you get the property for such a steal and it doesn't require hundreds of thousands in reno work. 

    My understanding of a true brrrr is you buy something, renovate, rent refinance and repeat. However the refinance part rarely ever allows you to pull all your money out. Some money is left trapped in the property. Banks only want to give you 20 to 25 year notes and require a 75% ltv. 


    You aren't buying in the right areas then. BRRRR can work in any and every market for any type of property. We like BRRRR on single-family rentals. If you take Philadelphia as an example, most of our investors take all of their money back out and then some. 60-75k buy in (nto always available now), 10k lipstick, 1200 rent, 120k appraisal. Deals like this happen all the time.

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


     Probate deals are the best deals in my opinion. Local agents usually are looking for deals just as hard as you. You need to get in with an estate attorney who will funnel you probate deals. Or at least allow you to bid on them. All of my deals are usually probate deals that I have been cultivating relationships with the decision makers over months or years.

    Its not easy. You might speak to someone for several years then all of a sudden its sold because you stopped following up.


     I like probate deals a lot, but you have to understand the heir issue. To do probate well you need to know who the heirs are and their power. If there are 3 heirs, it ALWAYS goes like this - heir 1 wants to sell right away and just get whatever you can (great heir). Heir 2 thinks they can flip the house for profit, but does not have the money to do it so wants to partner (boring). Heir 3 wants to live there for free while the other two wait.

    I think probate leads require good dialogue and very good people skills in the face of death. My dad was a probate attorney so I was always understanding of the process.

    [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 @Carlos Fernandez:

    Hi Jonathan,

    Do you actually still use the 1%, 70%, and 50% rules when looking for properties or have you move past this?  Are these rules mostly for novice investors, or do experienced investor such as yourself still find them useful? Of the three, is there one you have found more useful than the others?  Is there one you would rather not use?  Thanks!


     Hey Carlos. I use the 1% rule just as an estimate, but in NJ no one hits the 1% rule. .75% would be solid here. I don't use any other percentages at all. I am old school, I do all the calculations in my head for renovation while on-site and do the comp research before I go so I can focus on what my spread can be. I am an asset collector so if there is upside later I will take on a project that others won't because I have better vision.

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

    Hey Jonathan,

    I also live in New Jersey, and wanted to start expanding into wholesaling to keep funding my rental portfolio and open up more opportunities to make money. Since I am familiar with south Jersey and some of the surrounding philly burb's I wanted to target these areas, specifically 3 bed 1-2 bath homes in decent areas I wouldn't mind owing rentals in. A couple questions for you.

    1. Do you have or know where I can find a specific assignment and/or sales agreement that explains to the seller my right to assign their contract, and that the end buyer will be responsible for purchase and closing cost? 

    2. If you were starting out again in wholesaling right now, which lead generating techniques would you start with, and how do you separate yourself from the major wholesalers in the area who are likely also contacting the same people?

    Thanks in advance for your help!



    Hey Joseph. I have an off-market sales agreement tailored for NJ if you want it, just DM me. You can edit it, but should have both of those in there. I've never wholesaled, it's too murky. I give deals to my investors in return for them listing their flips with me and I do wholetailing more where I close and lipstick it and the relist it. To start wholesaling in NJ, it's tough. South Jersey is ok for it though, Philly is already full. The only way to separate yourself is to get good deals and not try to take too much of a spread in the beginning to build up your buyer database. I would take 10k on a wholesale if I could give it to an investor who will come back. Your numbers (repair cost and ARV) have to be accurate to be of any value. Hope that helps.

    [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 Hoff:

    Hey Jonathan, 

    I live in the DFW Texas area and I am for a trustworthy mentor that will help guide me through my first rental investment purchase. Any ideas on who I can chat with about that?


     Let me just run through my DFW database and can connect 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 @Chase Sobinski:

    What are your thoughts on airbnb rentals? Asking as someone who is looking to get more into the real estate field.


    Overall, love them. Read Avery Carl's BiggerPockets STR book, it's great. But they require strong upkeep and management or high payment for that. Good Airbnb owners who self-manage are meticulous with their systems and also understand that the aesthetics equal cash on STR circuit. The house has to look amazing and have pro photos and amenities to scale or just be in the best area and be clean.

    [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
    0Reply
  • Joseph Milano
    Rental Property Investor · NJ · Member since 2017 · 17 posts · 6 votes
    4y
    Quote from @Jonathan Greene:
    Quote from @Joseph Milano:

    Hey Jonathan,

    I also live in New Jersey, and wanted to start expanding into wholesaling to keep funding my rental portfolio and open up more opportunities to make money. Since I am familiar with south Jersey and some of the surrounding philly burb's I wanted to target these areas, specifically 3 bed 1-2 bath homes in decent areas I wouldn't mind owing rentals in. A couple questions for you.

    1. Do you have or know where I can find a specific assignment and/or sales agreement that explains to the seller my right to assign their contract, and that the end buyer will be responsible for purchase and closing cost? 

    2. If you were starting out again in wholesaling right now, which lead generating techniques would you start with, and how do you separate yourself from the major wholesalers in the area who are likely also contacting the same people?

    Thanks in advance for your help!



    Hey Joseph. I have an off-market sales agreement tailored for NJ if you want it, just DM me. You can edit it, but should have both of those in there. I've never wholesaled, it's too murky. I give deals to my investors in return for them listing their flips with me and I do wholetailing more where I close and lipstick it and the relist it. To start wholesaling in NJ, it's tough. South Jersey is ok for it though, Philly is already full. The only way to separate yourself is to get good deals and not try to take too much of a spread in the beginning to build up your buyer database. I would take 10k on a wholesale if I could give it to an investor who will come back. Your numbers (repair cost and ARV) have to be accurate to be of any value. Hope that helps.


     That is very helpful thank you, I appreciate the guidance and resources!

    1Reply
  • Rich Hupper
    Broker / Investor · Tewksbury, MA · Member since 2008 · 1k+ posts · 351 votes
    4y
    Quote from @Jonathan Greene:
    Quote from @Rich Hupper:

    The brrrr method is discussed a lot and I have tried to implement it many times with purchases. Does Brrrr work best when there are 5+ units? The numbers never seem to work on a single family or even  a two family unless you get the property for such a steal and it doesn't require hundreds of thousands in reno work. 

    My understanding of a true brrrr is you buy something, renovate, rent refinance and repeat. However the refinance part rarely ever allows you to pull all your money out. Some money is left trapped in the property. Banks only want to give you 20 to 25 year notes and require a 75% ltv. 


    You aren't buying in the right areas then. BRRRR can work in any and every market for any type of property. We like BRRRR on single-family rentals. If you take Philadelphia as an example, most of our investors take all of their money back out and then some. 60-75k buy in (nto always available now), 10k lipstick, 1200 rent, 120k appraisal. Deals like this happen all the time.

    Thanks Jonathan. Thats good to know. It must be the area I am in. I am about to purchase a single family soon. 250k purchase. 50k to 70k rehab arv is 520k. LTV 520k x.75 = 390k. So we are good there. But I will take a smaller loan at 320k so it cash flows better. 30 year at 5% Principal & Interest:$1,717.83,Taxes:$375.00,Insurance:$116.67,Total Monthly Payment:$2,209.50.

    Rent hopefully will be 2700/m

    Thats the other problem I run into sometimes I can get all the money out on the refi but the property barely cash flows. 





    1Reply
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