Newbie Entering REI in North Carolina - HELP

9 Replies

Hey everyone! My fiancée and I are looking to purchase our first property for Real Estate Investing in NC. We live in the Charlotte area which seems to just keep growing in population.

We would like to purchase a condo or single family home to use as long term investment property using a conventional loan with an LTV of 80%.

The process seems overwhelming and determining where to look is what I am struggling with. I would like to find a location of high demand in the area so that the property isn’t sitting vacant for over a month.

How do you determine the best location with demand?

Originally posted by @German Hall :

Hey everyone! My fiancée and I are looking to purchase our first property for Real Estate Investing in NC. We live in the Charlotte area which seems to just keep growing in population.

We would like to purchase a condo or single family home to use as long term investment property using a conventional loan with an LTV of 80%.

The process seems overwhelming and determining where to look is what I am struggling with. I would like to find a location of high demand in the area so that the property isn’t sitting vacant for over a month.

How do you determine the best location with demand?

German, awesome that you joined!

 

Hi German!

Welcome. I am fairly new here as well. I wonder, do you listen to all the podcasts? I basically went through all of them and then finally decided to get a membership due to being ready to actually buy property. Are you wanting to buy outside of Charlotte? One thing I know is that condo's are tricky, and to check HOAs/ community rules to make sure that it is allowed to buy and not owner-occupy the unit. Single family is probably a better bet. Also, think about what brings people to the area, such as job market, new infrastructure, tourist area, etc. Check Facebook Marketplace and Craigslist and see what rent inventory looks like and also what is being rented and for what price. Most cities need rentals for people who are not ready or able to buy, so you can't really go wrong. It depends on your own standards of what type of tenants you want, so therefore, what type of property you want to buy and what is within your budget. Use the calculators and it will show you what you need to know! I cross reference with zillow and real estate sites to see what they say rent would be, as well as projected expenses, and see what the calculator tells me. I am investing out of state (I'm in Oregon, investing in Texas) and I have been reading Long-Distance Real Estate Investing by the brilliant David Greene, and it has SO MUCH VALUE. So if you are trying to invest farther away, get that book, ASAP!

Hey! @German Hall great move on joining BP lots of friendly investors on here that share tips or advice that is a game-changer. 

I work as an REI agent in the CLT market and it is crazy right now. Most places listed on the MLS go at least for the asking price if not more within 1-7 days of being listed. We have .5 months of housing supply so you have to be very aggressive in your offer and how quickly you submit the offer. I have seen places near downtown go within two hours of being listed.

Coming in with a conventional loan a high Due Diligence amount along with a high EMD is needed to remain competitive inside the 485.

Originally posted by @Brandon Despras :

Hey! @German Hall great move on joining BP lots of friendly investors on here that share tips or advice that is a game-changer. 

I work as an REI agent in the CLT market and it is crazy right now. Most places listed on the MLS go at least for the asking price if not more within 1-7 days of being listed. We have .5 months of housing supply so you have to be very aggressive in your offer and how quickly you submit the offer. I have seen places near downtown go within two hours of being listed.

Coming in with a conventional loan a high Due Diligence amount along with a high EMD is needed to remain competitive inside the 485.

Hey Brandon! Appreciate that insight. I am going through Zillow listings and seeing properties go up and into contract quickly. I have just started reading about REI and actually just submitted my application for taking the NC Real Estate Broker exam. I don't have much capital to invest in from savings (maybe $15k - 20K that i feel comfortable with putting up).


I have been thinking about using an Equity Loan from my current house that I live in. Just estimating, there is approximately 50K in equity built up over the year of owning this property. What are your thoughts about using an Equity Loan for purchasing an investment property? Please know that I have 0 construction/handyman experience so I would like to buy a property with little fixes. 

 

Originally posted by @Trinity Carrick :

Hi German!

Welcome. I am fairly new here as well. I wonder, do you listen to all the podcasts? I basically went through all of them and then finally decided to get a membership due to being ready to actually buy property. Are you wanting to buy outside of Charlotte? One thing I know is that condo's are tricky, and to check HOAs/ community rules to make sure that it is allowed to buy and not owner-occupy the unit. Single family is probably a better bet. Also, think about what brings people to the area, such as job market, new infrastructure, tourist area, etc. Check Facebook Marketplace and Craigslist and see what rent inventory looks like and also what is being rented and for what price. Most cities need rentals for people who are not ready or able to buy, so you can't really go wrong. It depends on your own standards of what type of tenants you want, so therefore, what type of property you want to buy and what is within your budget. Use the calculators and it will show you what you need to know! I cross reference with zillow and real estate sites to see what they say rent would be, as well as projected expenses, and see what the calculator tells me. I am investing out of state (I'm in Oregon, investing in Texas) and I have been reading Long-Distance Real Estate Investing by the brilliant David Greene, and it has SO MUCH VALUE. So if you are trying to invest farther away, get that book, ASAP!

Trinity! Thanks for reaching out. Great point about the HOA with the condo's. I am open to do Long Distance REI. Just makes me nervous not being in the area. However, I would not be opposed to it especially if there is cheaper housing and better chance of cash flow. How did you determine Texas? I know big tech from Cali are moving into Texas so that is a great choice. Did you fly in to view the properties and make your decision?

Since you are out-of-state, are you using a property management company or do you have family/friends that help? Another reason I am nervous about long term is because of having to pay for property management. Not sure how much will be taken out and how much that will affect my cash flow.


Sorry for the million questions but I am excited to start and want to hone in on how to effectively make the right decision. 


Thanks in advanced!

@Trinity Carrick & @German Hall

Fun fact that nobody thinks about HOA's are an uncontrolled cost that will only increase over time. I have dealt with rentals in downtown San Diego that due to the HOA wanting to repaint the building and having issues with doorways increased dues by $175 a month (this was a 14 story building). The rental was mostly an appreciation play with minimal cash flow and the HOA increase killed the remaining cash flow and STR's was not allowed.

Just something to think of as well. 

@German Hall well things have just recently come together and I will let you know if the deal goes through. Just signed the contract today actually! I had visited San Antonio last November on a little vacation and really saw the potential. I did just go down there last week and checked out specific neighborhoods and looked at about 12 houses. The reason I chose San Antonio is because my plan is to have short term rentals. I knew San Antonio wasn't just a "tourist" attraction for short term rentals, but it is a military city, there are a lot of corporate groups and large companies who have people visiting often, which means many forms of occupancy opportunity. I also just loved the city and felt like it was right. Austin (another city that I love) is very up and coming right now, and there was no way to get in there at this point with my budget. I have been doing a ton of research to build confidence to make the jump in a completely different market, but just like everyone says, finding the right people helps.
I did research for realtors that understand and encourage real estate investing and have their own investment properties. I ended up finding some really cool people who have both a real estate and a property management company and they own their own short term and long term rentals. In the course of flying down there, making the connection, and looking at places, the realtor actually showed me one of their personally owned Airbnb's. He showed me the numbers, showed me the house, and actually ended up telling me that they would consider selling it to someone who would want to keep it an Airbnb, and use them for management.(They have made money off appreciation, and they want to grow their management portfolio.) We came to some very agreeable terms and I am very happy with this decision! They will be managing for me, and I hope to use them for future deals and partnerships in regards to them finding me deals knowing that I will use them for management. So far, it is working out and I'll keep you posted! Just do as much research as you can! Also, I am still very new to this but I am very happy with the research that I have done, the connections made, and the possibilities.

@German Hall

How far away are you looking to purchase? I am in the Hendersonville/Asheville area and we definitely have high demand here. I am a real estate agent so if you send me a message with more details I can help you find something in this area or refer you to an awesome agent in the area that you are looking if I don’t service it.