RE Newbie. Vagabond in Detroit

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RE Newbie. Vagabond in Detroit

Zachary Allen
Knoxville, TN · Member since 2016 · 9 posts · 4 votes

What's up BP? My name is Zack and I'm completely new to the world of real estate. I'm a former college athlete and I've spent most of the last 6 years traveling and living as cheaply as possible. Just started teaching in charter schools throughout Detroit and I've realized that if I want to continue my current lifestyle or being able to jump on a plane at a moments notice, I may need to start making some passive income. 

I've worked with a startup in San Diego and I've coached American football in Knoxville, TN and Grenoble, France. I've lived in several other cities for short stints and just moved to Detroit less than 2 months ago. Fast forward to my current obsession with the BP podcasts and my ever growing obsession with reading (I consider myself a writer more than anything), and I'm reading to jump into real estate. And when I say jump in, I mean building relationships, connecting, and continuously learning through BP. For the short-term, I'm interested in multi-family properties (and a good book).

Looking forward to learning from everyone here!

Peace and love

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David Fitch
Investor · Westlake Village, CA · Member since 2015 · 73 posts · 70 votes
10y

Be careful of those anecdotal stories of people killing it ($6k purchase, $1k/mo in rent). If you don't know the area yet, you're likely to end up getting fleeced. Not saying the above didn't actually happen, but there are far more stories of people losing their shirts than the other way around in Detroit, because so many out of town investors were trying to cash in on the low prices, and they relied on infrastructure they couldn't fully vet. 

You might be better off looking in places just north of Detroit (Eastpoint, Hazel Park, Ferndale, Oak Park, Royal Oak, Madison Heights, Warren, etc.) or south west (Dearborn, Wyandotte, Allen Park, Inkster, Taylor, Westland, etc.). Once you have a good sense for what it takes to do your own due diligence, then maybe revisit Detroit proper.  

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  • Ron Walraven
    Investor · Troy, MI · Member since 2012 · 38 posts · 17 votes
    10y

    Zach...best advice to find ll the REIA meetings in the area and attend. Meetup.com is best way to figure out the dates, times and topics.

    1Reply
  • Chris Payne
    Rental Property Investor · Miami, FL · Member since 2015 · 52 posts · 3 votes
    10y

    Welcome Zack! BP is a wonderful addiction. I find that everyone here is open to helping in some way. If you spot a thread or response from a BP member and want to learn more, just shoot them a connection request with your question and they're likely to get back to you. I did that at least 3 dozens times last year and met some amazing investors!

    0Reply
  • Zachary Allen
    OP
    Knoxville, TN · Member since 2016 · 9 posts · 4 votes
    10y

    Awesome, found your group on meetup. Thanks for the heads up @Ron Walraven

    Great tip, thanks Chris! @Chris Payne

    0Reply
  • Paul Timmins
    Specialist · Rockland, MA · Member since 2010 · 7k+ posts · 2k+ votes
    10y

    @Zachary Allen

    Welcome. Have a buddy in Detroit got a brick 2 family for 6K gets 1k monthly cashflow 2 weeks later got another same numbers. Fill in the foundation below.

    Check out the Start Here page http://www.biggerpockets.com/starthere

    Check out BiggerPockets Ultimate Beginner's Guide - A fantastic free book that walks through many of the key topics of real estate investing.

    Locate and attend 3 different local REIA club meetings great place to meet people gather resources and info. Here you will meet wholesalers who provide deals and rehabbers (cash buyers). Find them through Google and meetup.com

    Two Great reads, I bought both J. Scott The Book on Flipping Houses, The Book on Estimating ReHab Costs http://www.biggerpockets.com/flippingbook

    Consider checking out HUD homes for small multi's owner occupied gets first crack.

    House Flipping resources

    http://www.biggerpockets.com/renewsblog/2013/09/28/best-biggerpockets-house-flipping/

    Step by Step Guide to Flipping

    http://www.biggerpockets.com/renewsblog/2014/01/07/flipping-houses/Download BP’s newest book here some good due diligence in Chapter 10. Real Estate Rewind Starting over

    http://www.biggerpockets.com/files/user/brandonatbp/file/real-estate-rewind-a-biggerpockets-community-book

    Good Luck

    Paul 

    0Reply
  • Zachary Allen
    OP
    Knoxville, TN · Member since 2016 · 9 posts · 4 votes
    10y

    Dang Paul, thanks for the resources. I'm already hooked @Paul Timmins

    0Reply
  • David Fitch
    Investor · Westlake Village, CA · Member since 2015 · 73 posts · 70 votes
    10y

    Be careful of those anecdotal stories of people killing it ($6k purchase, $1k/mo in rent). If you don't know the area yet, you're likely to end up getting fleeced. Not saying the above didn't actually happen, but there are far more stories of people losing their shirts than the other way around in Detroit, because so many out of town investors were trying to cash in on the low prices, and they relied on infrastructure they couldn't fully vet. 

    You might be better off looking in places just north of Detroit (Eastpoint, Hazel Park, Ferndale, Oak Park, Royal Oak, Madison Heights, Warren, etc.) or south west (Dearborn, Wyandotte, Allen Park, Inkster, Taylor, Westland, etc.). Once you have a good sense for what it takes to do your own due diligence, then maybe revisit Detroit proper.  

    2Reply
  • David Roberts
    Brownstown, MI · Member since 2014 · 344 posts · 98 votes
    10y

    welcome to the neighborhood

    1Reply
  • Marvin Rice
    Investor · Grosse Pointe, MI · Member since 2016 · 52 posts · 29 votes
    10y
    Originally posted by @David Fitch:

    Be careful of those anecdotal stories of people killing it ($6k purchase, $1k/mo in rent). If you don't know the area yet, you're likely to end up getting fleeced. Not saying the above didn't actually happen, but there are far more stories of people losing their shirts than the other way around in Detroit, because so many out of town investors were trying to cash in on the low prices, and they relied on infrastructure they couldn't fully vet. 

    You might be better off looking in places just north of Detroit (Eastpoint, Hazel Park, Ferndale, Oak Park, Royal Oak, Madison Heights, Warren, etc.) or south west (Dearborn, Wyandotte, Allen Park, Inkster, Taylor, Westland, etc.). Once you have a good sense for what it takes to do your own due diligence, then maybe revisit Detroit proper.  

     Ditto...

    And Welcome...

    1Reply
  • Sidel Murray
    Rental Property Investor · Eastpointe, MI · Member since 2014 · 11 posts · 10 votes
    10y

    Contrary to popular belief there are deals to be had in the city of Detroit, tons of deals to be exact, if you're familiar with the neighborhoods or know someone who is.  Houses can be purchased for $5,000, $1000 even $500 dollars. But beware, in Detroit a $500 house will more than likely be a shell needing a furnace, water heater, plumbing, electrical or duct work. But depending upon the area purchasing a house like this may not be a bad deal. I actually purchased one like this a little over a year ago, it was in an area of town where my partners and I like to buy. The property was purchased for $2,000. The back property taxes were $1,500 and there was a $50 water bill. A helper and I put this house together in 2-1/2 months for a cost of $13k and some change. Once completed I advertised on craigslist and zillow and received an average of 10 calls a day from prospective tenants. After a week on the market I rented the property to a tenant with a section 8 voucher for $850/mo. The taxes and insurance are $2,100/year. This is just and example of the deals that are to be had and the demand for housing in the city. I'll be more than happy to answer any question you may have. I'm always looking for investors that are willing to help with Detroit's rebirth.

    2Reply
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