Buy and Hold
Oak Ridge, TX · Member since 2014 · 21 posts · 2 votes
Howdy! We own one investment property in College Station, TX (CS), home of Texas A&M University 'Gig 'Em. We currently have both our college students and one renter in that 3 br, 2 bath home. It is in an area that is growing and where I believe we will attract young families or college students once our children graduate. I would like to acquire a few more (at least 2) additional properties in College Station for the rental income to have options regarding the 9 to 5 once our children graduate.
I'm here to learn more about the best way to acquire profitable properties but I'm very debt adverse, how to learn more about my desired market and managing properties (or hiring that out). So basically I want to learn A-Z for buy and holds.
Welcome ,owning property in a college town can very profitable the risk is of course college students can tear up the property .I have noticed rentals in college towns can get great rent and still be in bad shape kids don't care for them it is the location .
My son is at college renting basically renting a dump with 4 other students paying top dollar, the house is close to the Engineering building he walks to class.
Welcome to Bigger Pockets! You can search the forums for many topics to help answer questions that may have been discussed previously. There is a wealth of knowledge on here. Good luck on your property search.
Welcome to BP. Might I first suggest you learn the difference between good debt and bad debt? Unless you are planning on buying all your properties all cash, then you'll have to get past the debt adverse mindset.
@Darlene Tyson welcome to BP!
Being debt averse is a bold strategy ... what kind of debt are you trying to avoid? Debt in general? Debt in your name? High interested debt?
@Darlene Tyson Welcome to the community, of BiggerPockets! The people here have a vast amount of knowledge and are more than willing to share their experience and provide sound insight and advice. Be sure to check out the forums, the blogs, podcasts as well as other parts of this amazing website and like minded community. I am located, in Miami. I am a Rehabber as well as a Buy and Hold Investor. You may want to connect with various Mortgage Brokers as well as researching various BP Forums as @Donna Salmiery suggested. If you haven't already, you may want to subscribe, to the BiggerPockets FREE Newsletter. Try an Internet search, on Blanket Loans. One thing to consider is Personal Asset and Liability Protection as well as the Tax Advantages, of owning properties, in a LLC and the risk of owning property, in your personal name. Please free to reach out, to me, if you feel I may be of assistance, to your Real Estate Endeavors. Much to your success!
Thanks for the encouragement Donna.
Welcome to Bigger Pockets! You can search the forums for many topics to help answer questions that may have been discussed previously. There is a wealth of knowledge on here. Good luck on your property search.
Thanks for the encouragement.
Welcome to BP. Might I first suggest you learn the difference between good debt and bad debt? Unless you are planning on buying all your properties all cash, then you'll have to get past the debt adverse mindset.
I'll consider your mindset Simon. Thanks for replying.
Howdy! We own one investment property in College Station, TX (CS), home of Texas A&M University 'Gig 'Em. We currently have both our college students and one renter in that 3 br, 2 bath home. It is in an area that is growing and where I believe we will attract young families or college students once our children graduate. I would like to acquire a few more (at least 2) additional properties in College Station for the rental income to have options regarding the 9 to 5 once our children graduate.
I'm here to learn more about the best way to acquire profitable properties but I'm very debt adverse, how to learn more about my desired market and managing properties (or hiring that out). So basically I want to learn A-Z for buy and holds.
Hello and welcome to BP! Location of the property is probably number one. You are in a good town. You might do best around the school. Just stay close to town. I am 59 years old and I was born and raised in Dallas Texas. I have been in the construction business since I was 17. I went to college and got a business degree that emphasized real estate. Right after I graduated I got a broker license. Regardless of what I had I stayed in construction. I closed a few deals for other people. My Dad was in real estate for about 40 years and I learned a little bit from him. I found BP about 6 months ago and I am still trying to decide what to do. I am 59 years old and luckily I have been married to a woman who is a computer programmer and has been saving money for about 25 years. If you think I can help you please contact me at any time. Always do the numbers and make sure that they are real. Pick a Team that you can trusts and do make sure they have experience and local. Good luck!
@Darlene Tyson Welcome to the community, of BiggerPockets! The people here have a vast amount of knowledge and are more than willing to share their experience and provide sound insight and advice. Be sure to check out the forums, the blogs, podcasts as well as other parts of this amazing website and like minded community. I am located, in Miami. I am a Rehabber as well as a Buy and Hold Investor. You may want to connect with various Mortgage Brokers as well as researching various BP Forums as @Donna Salmiery suggested. If you haven't already, you may want to subscribe, to the BiggerPockets FREE Newsletter. Try an Internet search, on Blanket Loans. One thing to consider is Personal Asset and Liability Protection as well as the Tax Advantages, of owning properties, in a LLC and the risk of owning property, in your personal name. Please free to reach out, to me, if you feel I may be of assistance, to your Real Estate Endeavors. Much to your success!
Thank you Thomas. I really appreciate your suggestions and will look into them. I've been listening to the podcast but plan to dive deeper into all that BiggerPockets offers. Such a great resource. Blessings with all your endeavors.
Howdy! We own one investment property in College Station, TX (CS), home of Texas A&M University 'Gig 'Em. We currently have both our college students and one renter in that 3 br, 2 bath home. It is in an area that is growing and where I believe we will attract young families or college students once our children graduate. I would like to acquire a few more (at least 2) additional properties in College Station for the rental income to have options regarding the 9 to 5 once our children graduate.
I'm here to learn more about the best way to acquire profitable properties but I'm very debt adverse, how to learn more about my desired market and managing properties (or hiring that out). So basically I want to learn A-Z for buy and holds.
Hello and welcome to BP! Location of the property is probably number one. You are in a good town. You might do best around the school. Just stay close to town. I am 59 years old and I was born and raised in Dallas Texas. I have been in the construction business since I was 17. I went to college and got a business degree that emphasized real estate. Right after I graduated I got a broker license. Regardless of what I had I stayed in construction. I closed a few deals for other people. My Dad was in real estate for about 40 years and I learned a little bit from him. I found BP about 6 months ago and I am still trying to decide what to do. I am 59 years old and luckily I have been married to a woman who is a computer programmer and has been saving money for about 25 years. If you think I can help you please contact me at any time. Always do the numbers and make sure that they are real. Pick a Team that you can trusts and do make sure they have experience and local. Good luck!
Thanks for reaching out Michael. I've been blessed with a great spouse also so we share that in common. Being in construction and in Texas I do have a question. As part of my guidelines for what to invest in, I'm thinking I should only consider homes 5 years old or less considering I want to buy and hold. The though is that it will allow me to own the home for a while before having problems like foundation problems, replacing roofs, A/C units and the like. Knowing construction in Texas, is that sound judgement or am I limiting my choices too much and should consider home a little older?
Welcome ,owning property in a college town can very profitable the risk is of course college students can tear up the property .I have noticed rentals in college towns can get great rent and still be in bad shape kids don't care for them it is the location .
My son is at college renting basically renting a dump with 4 other students paying top dollar, the house is close to the Engineering building he walks to class.
Howdy! We own one investment property in College Station, TX (CS), home of Texas A&M University 'Gig 'Em. We currently have both our college students and one renter in that 3 br, 2 bath home. It is in an area that is growing and where I believe we will attract young families or college students once our children graduate. I would like to acquire a few more (at least 2) additional properties in College Station for the rental income to have options regarding the 9 to 5 once our children graduate.
I'm here to learn more about the best way to acquire profitable properties but I'm very debt adverse, how to learn more about my desired market and managing properties (or hiring that out). So basically I want to learn A-Z for buy and holds.
Hello and welcome to BP! Location of the property is probably number one. You are in a good town. You might do best around the school. Just stay close to town. I am 59 years old and I was born and raised in Dallas Texas. I have been in the construction business since I was 17. I went to college and got a business degree that emphasized real estate. Right after I graduated I got a broker license. Regardless of what I had I stayed in construction. I closed a few deals for other people. My Dad was in real estate for about 40 years and I learned a little bit from him. I found BP about 6 months ago and I am still trying to decide what to do. I am 59 years old and luckily I have been married to a woman who is a computer programmer and has been saving money for about 25 years. If you think I can help you please contact me at any time. Always do the numbers and make sure that they are real. Pick a Team that you can trusts and do make sure they have experience and local. Good luck!
Thanks for reaching out Michael. I've been blessed with a great spouse also so we share that in common. Being in construction and in Texas I do have a question. As part of my guidelines for what to invest in, I'm thinking I should only consider homes 5 years old or less considering I want to buy and hold. The though is that it will allow me to own the home for a while before having problems like foundation problems, replacing roofs, A/C units and the like. Knowing construction in Texas, is that sound judgement or am I limiting my choices too much and should consider home a little older?
I am glad that you got back to me. If you want be in luck, make sure you keep a reserve. I think if you look at a home it is good to buy a house that is older just make sure you know what to expect. The older it is the bigger the contingency line. Make sure it has some sort of cash flow. You did not tell me if you are planning on hacking or have a financing letter. It is probably wise to do so and get one. It will help you offer faster and give you a little confidence. Always do the numbers and make sure they are real. Feel good about it before you make an offer. Trust your gut. Good luck!
Being debt averse is smart in my mind, too, but not all that popular here on BP. Already you've received advice to google blanket loans (gag) and to learn the difference between good debt and bad debt. That has it's truths, but most on here have broken 'risk meters' I have found. Wise and strategic leverage has its place and is a very personal decision. Blind fear of it is not the way to go either. Find your happy medium!
Welcome to BP @Darlene Tyson! Glad to have you!
As Billy Smith suggested.. Be careful of the students damaging your property. My mother works maintenance at UMass in the dorms and she says those kids make a flipping mess despite threats of being written up or fined. Though, I have a friend who rents a multi exclusively to students and she has little problems. She rents primarily to girls, has an ironclad rental agreement signed, takes a large security deposit and visits the building often. So it's a good strategy just take every precaution. If you are offering a clean, safe place for the students to live that their parents feel good about you should have no problem keeping it occupied.
Renting primarily to girls is generally illegal... At least the intent
Hello Darlene,
I live in Bryan, TX and just recently got into the "buy and hold" game in College Station as well. I am a newbie when it comes to leasing, property management and finding deals but thought I would introduce myself. Good luck with your endeavor and let me know if you need anything.
Marc Murchison
Howdy! We own one investment property in College Station, TX (CS), home of Texas A&M University 'Gig 'Em. We currently have both our college students and one renter in that 3 br, 2 bath home. It is in an area that is growing and where I believe we will attract young families or college students once our children graduate. I would like to acquire a few more (at least 2) additional properties in College Station for the rental income to have options regarding the 9 to 5 once our children graduate.
I'm here to learn more about the best way to acquire profitable properties but I'm very debt adverse, how to learn more about my desired market and managing properties (or hiring that out). So basically I want to learn A-Z for buy and holds.
Hello and welcome to BP! Location of the property is probably number one. You are in a good town. You might do best around the school. Just stay close to town. I am 59 years old and I was born and raised in Dallas Texas. I have been in the construction business since I was 17. I went to college and got a business degree that emphasized real estate. Right after I graduated I got a broker license. Regardless of what I had I stayed in construction. I closed a few deals for other people. My Dad was in real estate for about 40 years and I learned a little bit from him. I found BP about 6 months ago and I am still trying to decide what to do. I am 59 years old and luckily I have been married to a woman who is a computer programmer and has been saving money for about 25 years. If you think I can help you please contact me at any time. Always do the numbers and make sure that they are real. Pick a Team that you can trusts and do make sure they have experience and local. Good luck!
Thanks for reaching out Michael. I've been blessed with a great spouse also so we share that in common. Being in construction and in Texas I do have a question. As part of my guidelines for what to invest in, I'm thinking I should only consider homes 5 years old or less considering I want to buy and hold. The though is that it will allow me to own the home for a while before having problems like foundation problems, replacing roofs, A/C units and the like. Knowing construction in Texas, is that sound judgement or am I limiting my choices too much and should consider home a little older?
I am glad that you got back to me. If you want be in luck, make sure you keep a reserve. I think if you look at a home it is good to buy a house that is older just make sure you know what to expect. The older it is the bigger the contingency line. Make sure it has some sort of cash flow. You did not tell me if you are planning on hacking or have a financing letter. It is probably wise to do so and get one. It will help you offer faster and give you a little confidence. Always do the numbers and make sure they are real. Feel good about it before you make an offer. Trust your gut. Good luck!
Thanks Michael.
Hello Darlene,
I live in Bryan, TX and just recently got into the "buy and hold" game in College Station as well. I am a newbie when it comes to leasing, property management and finding deals but thought I would introduce myself. Good luck with your endeavor and let me know if you need anything.
Marc Murchison
Thanks Marc and blessing to you too.
Welcome ,owning property in a college town can very profitable the risk is of course college students can tear up the property .I have noticed rentals in college towns can get great rent and still be in bad shape kids don't care for them it is the location .
My son is at college renting basically renting a dump with 4 other students paying top dollar, the house is close to the Engineering building he walks to class.
You know I've heard that from friends who have their students in other colleges. It may be something I need to look into in CS. I've focused primarily on newer properties in family friendly neighborhoods so I could attract young families or students. Thanks for the reaching out Billy and I wish good things for you and your son.
Howdy Darlene, and welcome to BP! College Station is a great market. Rents are strong, and for the most part, Aggies tend to be more respectful of the properties than other campus communities. The most important thing is to find the right deals. I tend to agree with you on buying new construction. You can both maximize rents and minimize cap ex. If you get into the right neighborhoods, new construction will also appreciate more quickly than other properties.
I also would suggest finding an excellent property manager, that fits your personality. I can recommend a few in town if you would like. While they do consume some of your profit, a good manager can prevent all kinds of problems, will maximize rental income, and will handle all the headaches.
I would love to meet you and your family next time your in town. Let me know if I can help y'all in any way, shape, or form.
Best wishes & Gig Em!
Tyler Bradfield
C/o 2014
Thanks Tyler and please do share your property manager recommendations. I appreciate the help. Congrats on your recent graduation!
@Darlene Tyson welcome to BP!
Being debt averse is a bold strategy ... what kind of debt are you trying to avoid? Debt in general? Debt in your name? High interested debt?
Thanks for the welcome Jeremy. In answer to your question I'd say all of the above. I like the idea of being bold, hahaha; best wishes.
Investment of any kind is all about risk management. Nothing at all wrong with being conservative, but if you try to completely avoid risk you will most likely not achieve a very good return. There are a ton of ways to manage risk, but to illustrate I will share my favorite method below (not saying this is the only way to go, just trying to illustrate):
Buy a distressed property (that doesn't qualify for financing) for all cash. This can be done at auction at the courthouse steps, for example. Buying a property like this all cash means that you eliminate competition from any retail buyers, and get a discount accordingly, but the risk is that the house needs work. So, you work with a title company to validate that the property has clear title with no tax liens, etc. ... that risk has now been reduced. How much will that work cost? You are in construction, so you should be able to estimate those costs ... if your worse case repair costs plus your purchase costs put you in at significantly under comparable retail sales, you can mitigate that risk and earn yourself some equity. Plus, if you gut the place to the studs and build it back, you'll know that everything is in tip-top shape to turn it into a rental, even more so than with buying a 5 year old turnkey property and you're into it for far less than that property would cost. So then you fix the property and rent it out. You have a great newly remodeled house in a nice neighborhood that will likely attract good tenants, and you screen them to validate income, credit history, references, etc. You've now mitigated the risk of getting a bad tenant. Rent it for a year ... now, you know you have a solid property, you know after a year you have a solid tenant, you know how much the operating expenses and rental income are, you've taken much off those unknowns and risks off the table, so you can now safely cash out refinance it to a level you know will cash flow (since you've validated the numbers), and can take that cash onto the next deal. There's a system for buying one rental house per year, mitigating your investment risks all along the way. Get the idea?
Howdy! We own one investment property in College Station, TX (CS), home of Texas A&M University 'Gig 'Em. We currently have both our college students and one renter in that 3 br, 2 bath home. It is in an area that is growing and where I believe we will attract young families or college students once our children graduate. I would like to acquire a few more (at least 2) additional properties in College Station for the rental income to have options regarding the 9 to 5 once our children graduate.
I'm here to learn more about the best way to acquire profitable properties but I'm very debt adverse, how to learn more about my desired market and managing properties (or hiring that out). So basically I want to learn A-Z for buy and holds.
Hello and welcome to BP! Location of the property is probably number one. You are in a good town. You might do best around the school. Just stay close to town. I am 59 years old and I was born and raised in Dallas Texas. I have been in the construction business since I was 17. I went to college and got a business degree that emphasized real estate. Right after I graduated I got a broker license. Regardless of what I had I stayed in construction. I closed a few deals for other people. My Dad was in real estate for about 40 years and I learned a little bit from him. I found BP about 6 months ago and I am still trying to decide what to do. I am 59 years old and luckily I have been married to a woman who is a computer programmer and has been saving money for about 25 years. If you think I can help you please contact me at any time. Always do the numbers and make sure that they are real. Pick a Team that you can trusts and do make sure they have experience and local. Good luck!
Thanks for reaching out Michael. I've been blessed with a great spouse also so we share that in common. Being in construction and in Texas I do have a question. As part of my guidelines for what to invest in, I'm thinking I should only consider homes 5 years old or less considering I want to buy and hold. The though is that it will allow me to own the home for a while before having problems like foundation problems, replacing roofs, A/C units and the like. Knowing construction in Texas, is that sound judgement or am I limiting my choices too much and should consider home a little older?
I am glad that you got back to me. If you want be in luck, make sure you keep a reserve. I think if you look at a home it is good to buy a house that is older just make sure you know what to expect. The older it is the bigger the contingency line. Make sure it has some sort of cash flow. You did not tell me if you are planning on hacking or have a financing letter. It is probably wise to do so and get one. It will help you offer faster and give you a little confidence. Always do the numbers and make sure they are real. Feel good about it before you make an offer. Trust your gut. Good luck!
Sounds like good advise Michael. Thanks!
Investment of any kind is all about risk management. Nothing at all wrong with being conservative, but if you try to completely avoid risk you will most likely not achieve a very good return. There are a ton of ways to manage risk, but to illustrate I will share my favorite method below (not saying this is the only way to go, just trying to illustrate):
Buy a distressed property (that doesn't qualify for financing) for all cash. This can be done at auction at the courthouse steps, for example. Buying a property like this all cash means that you eliminate competition from any retail buyers, and get a discount accordingly, but the risk is that the house needs work. So, you work with a title company to validate that the property has clear title with no tax liens, etc. ... that risk has now been reduced. How much will that work cost? You are in construction, so you should be able to estimate those costs ... if your worse case repair costs plus your purchase costs put you in at significantly under comparable retail sales, you can mitigate that risk and earn yourself some equity. Plus, if you gut the place to the studs and build it back, you'll know that everything is in tip-top shape to turn it into a rental, even more so than with buying a 5 year old turnkey property and you're into it for far less than that property would cost. So then you fix the property and rent it out. You have a great newly remodeled house in a nice neighborhood that will likely attract good tenants, and you screen them to validate income, credit history, references, etc. You've now mitigated the risk of getting a bad tenant. Rent it for a year ... now, you know you have a solid property, you know after a year you have a solid tenant, you know how much the operating expenses and rental income are, you've taken much off those unknowns and risks off the table, so you can now safely cash out refinance it to a level you know will cash flow (since you've validated the numbers), and can take that cash onto the next deal. There's a system for buying one rental house per year, mitigating your investment risks all along the way. Get the idea?
David this sounds like a very good strategy for mitigating risk, so thank you for laying it out for me. I'm working a full time non-RE job and I'm not in construction, I was asking a question of one of the respondents that was in construction in an earlier post and may not have done it the best BP way, I think that is why you thought I was. I also live in another city. I'm not sure I'm ready for this full scenario quite yet but I definitely get the idea and it is pretty sweet. Is this your model? I've heard on some of the pod cast of wholesalers who I think find the deal and may even the make-ready work you noted above then sell them to investors. Do you know how that works? I'm guessing it has to make sense from the investor's perspective as well as the one finding the deal some how or it wouldn't be done. I'll do more research on BP but since you've been so helpful thought I would throw it out there. Thanks again.