Providence, RI · Member since 2018 · 29 posts · 409 votes
7y
Having just recently bought my first property, I know for myself what was holding me back was the fear that I would overpay, especially in this type of a market. I would get analysis paralysis and basically talk myself out of every property I looked at.
I have purchased a few already now I'm trying to either pull equity to buy more or use an investor.
I am having trouble pulling equity because 3 of the property's are condos and the banks wont let me pull the equity out of them.
I would partner with a person who has money but no time or experience. You could also consider selling one of the condos. When you say the banks how many have you asked? Ask a mortgage broker.
@Jacob Gelinas and that is exactly where I'm at!!! And making more phone calls. I have to get better at skip tracing. But I am really having a hard time getting the right ARV of properties.
Great job. Keep hustling. ARVs come with practice.
I personally am waiting on my HELOC to process And I also plan to borrow from my 401 to cover my percentage of my first flip. The longer I wait the more money I can borrow which makes it hard for me to rush into any deal knowing that the more skin I can put in the game the less I will have to pay to a hard money lender. My HELOC will be for 40K which I plan to allocate to my rehab costs and just finance the purchases. My goal is to start with flips until I have enough cash to buy my first rental outright then continue the BRRRR strategy for passive income but still maintaining a low volume of flips because that's where I feel I can profit the most, at least in my market. Maybe it's like this everywhere but in NJ we have such a variance in property type and size and most importantly value that it makes it difficult for me to assess ARV confidently. I can have a $350,000 property literally right next to a $150,000 and sometimes being on one side of the street can make or break your resale price. Adding even more confusion is when I look at comps that have some upgrades compared to one that has none but more sqft. Or I look at a comp and think was the property actually worth that or did they find a sucker to pay that price and I may not be that lucky. This is not going to stop me in anyway but I feel like it just requires more analysis and creates more of a risk for me when even a 20-30k swing could eat up all of my profit on a flip. Lucky for me the more I analyze the better I will become and that's my plan and my goals definitely support that. Other than that financing is financing and grinding for deals..well you get what you put in. So as long as I continue to network with the right people and apply the 3ft rule to everyone else I don't see any obstacles that can't be overcome.
Don't worry about hard money lenders. It's a cost of doing business. Keep studying up to improve your ARVs. You're doing great.
Thanks for putting this question out there. I have been evaluating the prospect of buying a multi-family rental property for a while now. The thing that is holding me back most is understanding pricing. I am not confident in knowing the value of a home. I also, feel like I need to learn more.
Keep learning. Keep looking at multi families but start tracking what price they sell for. See if people are reselling them for a higher price after they've been rehabbed
wasn't the billionaire(s)...not sure, the one I'm aware of was Donald Trump and he openly admitted that he let his guard down, if i'm not mistaken. I think there was a way to know the crash was coming. As Marty (podcast 1) told us how, in hindsight he knew.
I thought that we were at a top 2 years ago but the prices keep climbing. Who knows. Markets do run in cycles.
@Kris L. That’s definitely a smart route to take. Being able to actually see for yourself the properties and the repairs needed. Can I ask what you think about virtual investing ?
I have two properties. One single family that only cash flows $50 per month and a duplex that we also live in. I didn't buy the single family with the intention to rent it out so unfortunately at least the mortgage is paid every month with a little to spare. Right now I'm stuck trying to get my debt to income ratio reduced to buy another with another FHA loan.
Can you sell the single-family and break even? $50 a month is not making you money. If something major breaks that could eat up years worth of cash flow. I'm not saying you have to buy bigger multi families but you do need to find properties that pay you more than that per door.
Investor · Bath, NY · Member since 2015 · 149 posts · 44 votes
7y
Oh I know. Basically right now my mind set is...im not making anything but living in another house that is a house hack is saving me so much that if something breaks we will be okay. However, I will be selling that single family ASAP. We had it on the market for a bit but to break even with realtor fees etc we would have to sell for 99k. If we replace the siding on it and repaint the shutters and front porch we could get that but with aluminum siding it is not likely. I want to sell it within another 2 years due to the capital gains taxes we will face if we dont!
Flipper/Rehabber · Sacramento, CA · Member since 2019 · 1 post · 0 votes
7y
@Frank Patalano I’m new to this. I recently got tricked by my aunt into going to Than Merill’s 3 day workshop. She paid for it I wasn’t out any money just time,but I did learn a lot and I’m motivated, and no I did not get sold on their 40k mastery program. I recently lost my job due to a medical problem. I’m super motivated in real estate investing I just have no money and my credit score went down but I know a lot of people who are willing to invest in me. In 2 days since the class I’ve talked to 2 friends that have equity in their homes and are willing to use it to help me flip some houses...basically what’s holding me back is how to take action and what’s the first steps I should be taking?
Contractor · Erie, PA · Member since 2019 · 1 post · 0 votes
7y
@Frank Patalano capital. I own a contracting business and all my funds are tied up in that. How do i get the funding with my credit already stretched? Power point present to potential investors?
@Frank Patalano I’m new to this. I recently got tricked by my aunt into going to Than Merill’s 3 day workshop. She paid for it I wasn’t out any money just time,but I did learn a lot and I’m motivated, and no I did not get sold on their 40k mastery program. I recently lost my job due to a medical problem. I’m super motivated in real estate investing I just have no money and my credit score went down but I know a lot of people who are willing to invest in me. In 2 days since the class I’ve talked to 2 friends that have equity in their homes and are willing to use it to help me flip some houses...basically what’s holding me back is how to take action and what’s the first steps I should be taking?
You had a family member who is willing to pay for a 3-day boot camp for you. That's awesome. The main thing you need to figure out is what type of investing you plan on doing. Are you going to be wholesaling, Flippin, whatever. read everything you can for a couple days and then decide what type of invest do you plan on doing. Then get out there and start networking and taking action.
Rental Property Investor · Union, ME · Member since 2018 · 161 posts · 104 votes
7y
Bad debt. Never go into mountains of debt without being able to garner revenue specifically from it. I got into some bad debt for assets that, yes they are helpful, but in most cases I could bring in revenue without them. So now I have month to month payments that are hamstringing my budget and keeping me in a job I hate.
@Frank Patalano capital. I own a contracting business and all my funds are tied up in that. How do i get the funding with my credit already stretched? Power point present to potential investors?
That's a fine way. Another idea is to find a property, lock it under the contract, and then bring that deal to your local real estate meaning. Look for Partnerships. There are people out there with money but no time. They want to invest in real estate but don't know how.
Failure is a part of learning. If you don't fail once in awhile then you're not taking enough risk to achieve your goals. I'm going to assume that when you were about 1 year old you started crawling and walking. Once in awhile you fell down. But you got right back up.
Bad debt. Never go into mountains of debt without being able to garner revenue specifically from it. I got into some bad debt for assets that, yes they are helpful, but in most cases I could bring in revenue without them. So now I have month to month payments that are hamstringing my budget and keeping me in a job I hate.
You can still make money with a lot of bad debt but it will take more Partnerships and creativity.
Charleston, SC · Member since 2019 · 5 posts · 0 votes
7y
I think for me it is a mix of failure and fear. I have tried finding a mentor - but no one wants to do that, they are happy to JV. So I keep going, little by little, step by step. I work full-time and need that income to cover my bills and expenses. As a single parent, with little help - finding time to really get marketing has been a struggle.
Gallup, NM · Member since 2019 · 9 posts · 0 votes
7y
Lack of Knowledge! I’m new to the bigger pockets community. As a new member what are some of the best ways to make the most of the lessons and tools in the site as well as best strategy of where to start? Thank you to who take the time to read and comment on my first post!
I can barely find a multi family on the market right now
The best deals are going to be off market. I understand completely. I was networking in Boston yesterday. People were offering me opportunities but I like higher Cap Rates.
I think for me it is a mix of failure and fear. I have tried finding a mentor - but no one wants to do that, they are happy to JV. So I keep going, little by little, step by step. I work full-time and need that income to cover my bills and expenses. As a single parent, with little help - finding time to really get marketing has been a struggle.
Sometimes you may have to pay a mentor from a different market so that you are not competing with them directly. I understand that it is hard. On the joint venture side you can still gain an education by doing that. Do you own a home now? Single or Multi?
Lack of Knowledge! I’m new to the bigger pockets community. As a new member what are some of the best ways to make the most of the lessons and tools in the site as well as best strategy of where to start? Thank you to who take the time to read and comment on my first post!
I haven't used the tools much.
The webinars are great and listen to as many of the podcasts as you can.
As you can see the forums are pretty informative. Ask some questions and many people will be willing to help out.
Could you share what led you to lose money on your first deal and what the lessons learned were?
I purchased land at an auction in NYC. I thought that I knew enough to make money. I was so excited by the hype.
Once I owned it I realized how I knew almost nothing about land development. After finding out that the land was virtually unbuildable, I ended up desperately selling it back to the auction company. Ended up losing about $20,000.