New to Real estate investing, Richmond VA.

New to Real estate investing, Richmond VA.

Mechanicsville, VA · Member since 2016 · 1 post · 0 votes

Hello,

I am new to RE investing, and trying to soak in as much information as I can. I've been a lurker on the forums, and would like to introduce myself, since I think I am going to be posting and learning from here a lot.

We are most interested in buy-and-hold, as opposed to flipping, to be honest, we won't be able to do any renovations ourselves. So, we are looking for a turn-key investment to rent. 

We are home owners, and not much interested in house-hacking since we like our home for now.

I understand buying a new construction is not ideal, since it would not give us best ROI. However, low maintenance costs and potential appreciation is something that allures us into it, from a newbie point of view. Plus, with so many new constructions coming up in Richmond, VA this option is very tempting.

Can someone guide me to resources to learn more about pros and cons of buying and holding new constructions.

Thanks!

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Investor · Richmond, VA · Member since 2016 · 1k+ posts · 2k+ votes
9y

Welcome to BP!    While I understand you don't want to do work yourselves, I'd personally suggest looking at recent flips over new construction, pretty much.. anything over new construction.    Most renters want nice and clean, and wouldn't want to pay the bigger $$ for a brand new house..  If they have $$$, they will probably buy, or it will be a very short term rental... not to mention, if it isn't rented, that's a huge burden on your back.     Also, if you hire a management company, they'll take 10% off the top.  I just don't see a few hundred dollars as exciting, especially if you're putting up big $$ for a new construction.. think about it, if it's just a washer or dryer that need to be fixed, or new coat of paint, make sure to look at houses from a renters standard--not your own.   Hope this helps!

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  • Investor · Warner Robins, GA · Member since 2015 · 1k+ posts · 490 votes
    9y

    Hello Kay! Welcome to BP!

  • Shawn AckermanPro Member
    Real Estate Entrepreneur · Mid West, East Coast · Member since 2015 · 3k+ posts · 1k+ votes
    9y
    Kay Gupta welcome to BiggerPockets
  • Rental Property Investor · Carlisle, PA · Member since 2013 · 1k+ posts · 543 votes
    9y

    @Account Closed, welcome to BP.  Tons to learn here.  Check out the podcasts and the resources.  Good luck!

  • Houston, TX · Member since 2013 · 1k+ posts · 114 votes
    9y

    Hi  and Welcome to Biggerpockets @Account Closed

  • Rental Property Investor · RVA · Member since 2016 · 5k+ posts · 4k+ votes
    9y

    Hi @Account Closed. Couple of pros & cons on buy & hold from my perspective:

    Pros: 

    • Financing is pretty easy and you can fix your interest rate for a long time, up to 30 years. 
    • If you happen to buy in a growing submarket you can do quite well.
    • Compared to investments like stocks & bonds, you get a solid asset you can go and see.

    Cons: 

    • Individual tenants can hit you pretty hard, whether through unpaid rent or damage. 
    • Your money is tied up in one asset, one location, and one tenant altogether. 
    • It takes a long time to replace your income with SFRs. 
    • You can get hit with big CapEx items that'll gobble up your cash flow for some time.
    • The value of SFRs isn't based on anything in particular, just market sentiment. Never ever count on appreciation to make a return.
    • You'll probably end up doing at least some management on yourself.

    Turnkey isn't as straightforward as putting your money down and getting a cash flowing asset. It'll greatly benefit you to learn all you can on asset valuation through BP's free information and everything else that's out there. Learning how to analyze deals will keep you from paying too much.  Like Warren Buffett says, you make your money when you buy, not when you sell. 

    Depending on how much money you have to invest, you could consider investing in a private placement/syndicated deal.

    Come to REIAs in Richmond! There are a lot of people there who were once where you are now.

  • Investor · Richmond, VA · Member since 2016 · 1k+ posts · 2k+ votes
    9y

    Welcome to BP!    While I understand you don't want to do work yourselves, I'd personally suggest looking at recent flips over new construction, pretty much.. anything over new construction.    Most renters want nice and clean, and wouldn't want to pay the bigger $$ for a brand new house..  If they have $$$, they will probably buy, or it will be a very short term rental... not to mention, if it isn't rented, that's a huge burden on your back.     Also, if you hire a management company, they'll take 10% off the top.  I just don't see a few hundred dollars as exciting, especially if you're putting up big $$ for a new construction.. think about it, if it's just a washer or dryer that need to be fixed, or new coat of paint, make sure to look at houses from a renters standard--not your own.   Hope this helps!

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