Investor In Miami, Florida

14 Replies

Hi BiggerPocket Members! My name is Thomas Franklin. I have owned Commercial Properties and have rehabbed and sold several homes. My REI Experience began, in 1998. Due to insufficient Asset Protection, I was wiped out, in a divorce. I have noticed the Real Estate Landscape has drastically changed over the years. My goals are to generate capital through rehabbing distressed homes and selling them, in the Retail Marketplace. With the income generated, I intend to build a portfolio of Residential Multifamily and Commercial Properties.

The problem I have encountered is locating deeply discounted properties, in my market, to get my Action Plan in gear. If anyone understands my frustrations and challenges, I would kindly accept wisdom, direction, the steps you took when you were in this situation, and/ or help. I would sincerely appreciate and welcome any input. 

Hi Thomas I'm in Miami as well (Coral Gables specifically). I mostly buy and hold, but have done a few flips as well. If you want to connect or have any questions about the local market feel free to send me a message.

Good Luck!

Hi Nick,

Thank you, for your input. I also held properties, in Coral Gables and Little Havana, before my divorce. Now I am back on the ground floor, with a strong drive and determination to succeed as well as create a portfolio of buy and hold properties. I would like to discuss what you are currently doing and the trends you see, in the Miami Market. I sent you a Colleague Request. In the near future maybe we can meet, when time permits  

Welcome Thomas! 

I am relatively new to REI but on a consistent path to increasing my education, and have recently relocated to Aventura.

Although it was some time ago now, I'd love to hear about the type of commercial properties you owned. My plan is to owner occupy, and jump right into commercial multifamily, essentially skipping the "SFH" phase most people seem to do.

Hope to run into you sometime!

Hello @Thomas Franklin ,

The South Florida market is getting harder and harder to find deals, especially Miami.  However, not impossible.

With the way the market is, I think a whole seller is your best ally. 

I know that in previous markets investors didn't have to rely on whole sellers at all, however sometimes it's worth paying the finder's fee if the number still work.

Anyhow, we've worked with RE professionals all over the state for over 25 years. I'm going to message you my contact information. Let's get some deals going!

@Joshua Pavao 

It is very wise, of you, increase your REI knowledge. It is equally important to keep abreast, of the market where you wish to invest. Miami has many municipalities consisting of varying demographics and varying pocket economies.

You asked me about what Commercial Properties I owned. I primarily owned Apartment Buildings, in Little Havana and Coral Gables. For Little Havana, there was nominal property appreciation, great cash flow, and a very low vacancy rate. The majority of Latin Renters are like planting a tree. Once they move in, they rarely move out as long as they are treated fairly. For Coral Gables, there was huge property appreciation and a lower cash flow, and a higher vacancy rate.

I kept the total number of units per building to less than 35 units. This was my magic number, to self manage. One strategy I utilized is I had an onsite Property Manager that was a tenant. This was factored into my initial Vacancy Rate Calculation, during my initial number crunching. There was a Management Agreement in place that was specific in the duties and responsibilities, of the manager. The manager was given a 90 probation period where I reduced their rent 50%. After the 90 days, if I was satisfied with their performance, they would live rent free as long as he/ she continued to perform. The Management Agreement contained a clause that if he/ she failed to perform, at any time, they had the option of paying full rent or finding another residence. Having Onsite Management negated the need for me to deal with late night trouble calls, rent collection, serving various notices, overcoming a language barrier, etc. This strategy increased my monthly cash flow 8-10% because I did not utilize a professional Management Company that typically charge 8-10%, of the gross rents collected per month, as their monthly Management Fee.

If you are looking to owner occupy, you may want to consider starting out, with buying a Duplex, TriPlex, or a Four Plex. Assuming you have a respectable FICO you can buy, with a FHA Loan (3-5% down, a 30 year amortization schedule, and a residential loan rate). You live in one unit and let your tenants pay the mortgage and other property expenses. This will give you experience as both a Landlord and Property Manager. The downside is you will need to live there, for a minimum of one year; AND because you closed personally, you will not have Asset Protection, in the form of closing in the name of a LLC. If you want to close in the name of a LLC, Mortgage Lenders will offer you Commercial Loan Terms (25-30% down, a 15-25 year amortization, and a ballon due in 5-7 years). This is what I am encountering, in the current Mortgage Industry.

If you think you will go FHA and then Quit Claim the property, to a LLC you run the risk of the lender discovering a Title Transfer and activating the Promissory Note's Acceleration Clause that will call the Note due in 'x' number of days.

I hope this information helps. Please let me know, if I can assist further and let's connect as colleagues.

I too have had some issues finding an investor friendly realtor.  Last year for me was mainly filled with performing deep analytics on hundred of properties, placing offers on several, only to be beaten out either on price or to all cash buyers.  I've taken the time to strengthen my cash position and network with some other like minded investors and feel I am in a much stronger financial position to aggressively go after the right deal.  The problem now is finding that great deal.  If you want to connect, or have any good investor friendly realtors in mind feel free to share or message me.

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