New Member from Atlanta GA

Rental Property Investor · Atlanta, GA · Member since 2019 · 1k+ posts · 872 votes

5y

Hey @Damien Lee, welcome to the BP community!

First off, fantastic intro post! You've obviously put a lot of thought into this and are more serious than many new investors.

However, those goals are pretty massive so do not be discouraged if you fall short. Even if you only complete a quarter of your 2021 goal, you'll still be well on your way. 10% ROI is pretty significant in a market like Atlanta. As you've alluded to, you won't find this in Midtown. You might in some of the outskirt counties or if you look South down to Newnan and McDonough or East out to Conyers. But even then, 4 buy&hold deals at 10% RO,I in the Atlanta MSA, would be very awesome. Your best bet for these kind of returns is sourcing off-market deals directly from sellers.

Now, when you talk MF I'm assuming you mean residential and commercial, correct? But you probably would like to scale up to commercial? I, personally, do not know any commercial guys (other than the real big ones) buying in ATL right now. I know some that would love too but cap rates are just too insane here due to low supply and sky-high demand. My advice would be to start looking elsewhere for commercial stuff. Residential is a little better but not by much. Supply is still very low and demand high. Every once in a while I'll see something pop on the market that makes sense, but those don't last long and typically attract bidding wars. However, there are a number of submarkets here with plenty of small MF stock so direct marketing could work well if you're willing to put in the time.

Love your plan to analyze a deal a day. However, by only looking in Midtown you will be losing one important aspect of deal analysis: learning your market. You already know Midtown and know it's not a realistic place to invest as a beginner, so why not start analyzing deals in other parts of the MSA? Yes, Midtown is totally fine for the first week of deal analysis just to get your feet wet, but past that you aren't really fully utilizing your time. Oh, and you can share your deal analysis directly with individual BP members or here, in the forums. Make sure you add some comments and don't just post the calculator analysis. If you're still looking for some help with deal analysis, here is a fantastic youtube series that @Mitch Messer put together.

And, please, feel free to reach out anytime if you have questions or just want to chat!

[email protected]404-737-0018

1 Reply

Tony AngelosPro Member

Real Estate Agent · Member since 2019 · 192 posts · 131 votes

5y

@Damien Lee It seems like you really have all your ducks in a row and now you're trying to move forward. There is a forum on here to post deal analyses, also, find a mentor (likely on here too) who you can run stuff by. Once you analyze enough, it becomes like muscle memory.

I think @Brenden Mitchum gave you some great advice.

2 Reply

Damien Lee

OP

New to Real Estate · Atlanta, GA · Member since 2020 · 25 posts · 23 votes

5y

Hi all, thank you for the warm welcome and sorry for the late reply! I'm still trying to get used to BP and haven't figured out email notifications yet.

@Brenden Mitchum Thank you for your advice! I understand that the goals I have are massive and also know not to be discouraged by the goals I've set. But I've decided to aim high and adjust as necessary. You are correct that I'm referring to residential and commercial properties, but I don't plan on looking at commercial MF until at least 3 years of learning the ropes with real estate investing. Although that may change depending on how comfortable and successful I become with the goals I've set for myself.

I especially appreciate what you mentioned on analyzing deals out of state. I was hesitant on analyzing deals in a different market due to the time that it would take for me to learn about comparable rent prices but now I just realize that's silly since it's something I need to do anyways. I'll stick to my plan of starting off with analyzing deals in Atlanta for now and move on to a different market when I feel ready, or 2 weeks pass. Plus if posting those deal analyses helps out another investor then even better! It also helps that my lease will be ending soon so I'm also looking for a house hack that would work as a rental after leaving but most of the properties ITP have HOA rent restrictions and don't cashflow well. Besides that, it would be a great idea to look out of state and practice finding deals + eventually find one. Could you clarify what you mean by MSA?

@Tony Angelos Thank you for the insight! Do you know if there's one specifically for practice? I don't want to clutter the forum with deals I'm not serious about and waste somebody's time without them realizing I'm posting for practice/someone to try and pull off that offer if they wanted to try.

Again, thank you both for all the amazing advice!

1 Reply

Brenden MitchumBusiness Member

Rental Property Investor · Atlanta, GA · Member since 2019 · 1k+ posts · 872 votes

5y

@Damien Lee

Big goals can be great but consistently falling short of impossible goals can be counterproductive. There is certainly a sweet spot there and setting goals should not be taken lightly for this reason. Setting good goals is definitely a skill that is improved with practice. But, starting big is certainly better than starting too small since you don't really know yet what the ceiling is (or if there is one).

You actually misunderstood my advice about analyzing deals. My advice was to look outside of Midtown, not outside of Atlanta. I highly recommend staying in Atlanta for your first deals since it's a fantastic (but tough) market and it is where you're most familiar (right?).

Highly recommend house hacking your first deal. This is definitely the best way to get started if you're younger and able to move. If you need to stay ITP for whatever reason, take a look at Westside or Oakland City/West End. If you aren't totally married to ITP, the world is your oyster OTP - tons of options in the suburbs.

MSA means "metropolitan statistical area." It really just means the Atlanta "area." There is no real concrete definition or any clearly defined boarder for the Atlanta MSA, but if you google image you'll get a good idea what counties are considered part of the MSA.

[email protected]404-737-0018

1 Reply

Tony AngelosPro Member

Real Estate Agent · Member since 2019 · 192 posts · 131 votes

5y

@Damien Lee Check out this one. Probably the right place for it. Good luck!

0 Reply

Dmitriy Fomichenko

Solo 401k Expert · Anaheim Hills, CA · Member since 2012 · 18k+ posts · 6k+ votes

5y

Originally posted by @Damien Lee:

Hello everyone!

*TLDR at bottom*

Intro

My name is Damien and I’m excited to have recently joined the BiggerPockets Community! I’ve just recently been introduced to real estate investing and Bigger pockets by a friend so I’m very new. I’ve decided to educate myself with the real estate books here and follow Brandon’s advice on analyzing 1 deal a day. Ultimately I plan on investing in RE using mainly rentals and the occasional BRRRRs (if I can find them) to become financially independent and transition to a job I have more passion for.

Plan for BP

Since I’m just starting off I’m going to try analyzing deals in a market that I know well (Midtown Atlanta, GA) and post it in the BP community! (If anyone knows if there’s a place for something like that please let me know). Midtown is pretty awful in terms of cashflow opportunities so to counteract that and get better at deal analysis, I’m going to analyze the deal with the current asking price and then counter offer with a deal that would make sense for my goals. I’ll include all of my assumptions and the reasonings for why I’ve priced things as I have. My hope is that anyone interested in Midtown or just helping a newbie out will come check and point out any mistakes I made or anything I might have overlooked.

Eventually, I'll start analyzing deals in a location that's more viable for cashflow. I also want to give back to the community (who hopefully helped me improve my deals) by analyzing one deal for a random person a week and also helping out newbie investors like myself. But until then, I’ll just be here trying to improve my skills and network. Once I’m confident in my deal analysis I want to find people to partner with me and invest in multi-families in another state that offers better opportunities.

My REI Plan

My overall plan is to start off focusing on rental properties, specifically single family homes and then shift my focus towards multifamily homes. The first single family home will be to get used to property management as well as ease into being a real estate investor, and from there then it's full speed ahead! Each rental property will be aiming for at least a $200 monthly net cash flow per unit or a 10% ROI. BRRRRs will just need to net cashflow of at least $50 a month since they're more about building equity with low and no money down. I plan on using mostly low and no money down tactics from PML/HML/Family and friends or partners.

Yearly plan

Year 1: Buy at least 1 property, get used to it, and aim to have 4 by the end of this year. Main focus will be multifamilies

Year 2: My second year will be about maintaining and getting used to REI while I plan to get at least 4 more properties.

Year 3: Optimize my process and buy at least 10 more properties

Year 4: Fully optimized and ready to go, buy at least 24 units (2/month).

Year 5: Continue to optimize and buy as much as possible

Let me know what you guys think of my plan and if you have any advice! Of course this is just a rough outline as plans are liable to change :) I’m excited to meet everyone and get started on my real estate journey!

TL;DR

- Completely new investor from Midtown, Atlanta, GA

- Want to invest in Rental properties and the occasional BRRRRS
- Will analyze and post 1 deal a day on the BP community
- Analysis will include all assumptions, ROI on asking price and what the purchase price would need to be to be a good deal
- Goal is to become FI off rental income and transition into a different career
- Looking for someone to partner with to invest in Multifamily homes in a location that makes sense (for me)

If anyone knows where I can post practice deal analyses for feedback please let me know!

Yearly plan

Year 1: Buy at least 1 property, get used to it, and aim to have 4 by the end of this year. Main focus will be multifamilies

Year 2: My second year will be about maintaining and getting used to REI while I plan to get at least 4 more properties.

Year 3: Optimize my process and buy at least 10 more properties

Year 4: Fully optimized and ready to go, buy at least 24 units (2/month).

Year 5: Continue to optimize and buy as much as possible

Use HML/PML/Partners to fund purchases.

Damien, glad you joined!

0 Reply

Damien Lee

OP

New to Real Estate · Atlanta, GA · Member since 2020 · 25 posts · 23 votes

5y

@Dmitriy Fomichenko Thank you! Excited to have joined!

0 Reply

Damien Lee

OP

New to Real Estate · Atlanta, GA · Member since 2020 · 25 posts · 23 votes

5y

@Brenden Mitchum

I think I know what you mean. I've set quite a lot of goals for myself for the new year and the first week was fine but it's only the second week and I can already feel myself burning out. Do you have any tips or know nay good resources that give advice on practical goal setting?

And understood. Atlanta is definitely the market I'm most familiar with, I've visited and lived else where but this is the only area where I actually understand the rent prices as before housing was either provided or not much of an issue. But this is also why I'm mainly looking ITP for now. I don't have a car and would need to take the Marta to get to work (although we're working remotely right now I anticipate we'll have to go back to the office when Corona is over) and as such I don't know much about OTP. If I were to look OTP I would definitely have to look somewhere near Buckhead. And I'll definitely take a look at the MSA!

0 Reply

Brenden MitchumBusiness Member

Rental Property Investor · Atlanta, GA · Member since 2019 · 1k+ posts · 872 votes

5y

@Damien Lee

Just shot you a message with some goal tips.

However, wanted to address your second paragraph here. My first piece of advice would be to stop looking for homes and start looking for a reliable, cheap (under $5k) car. If you think you're saving money by not having a car, you're dead wrong. Being tied to the N. ATL MARTA neighborhoods, you'll be losing money every day renting or even house hacking there. Personally, I would love to not have to own a car for a number of reasons but it just really isn't possible in ATL unless you shell out big $$ for living. This is even more true as an investor since you need to be flexible to succeed here.

If you really don't want to get a car, you're better off looking south along MARTA for housing/investing.

[email protected]404-737-0018

0 Reply

Holly Barrett

Real Estate Agent · Dawsonville, GA · Member since 2017 · 206 posts · 144 votes

5y

So exciting! Kudos on putting your plan down on digital paper :) Brenden is giving awesome advice, I agree with everything he is saying. In my experience $200/door cash flow is much more doable in tertiary markets.

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New Member from Atlanta GA

New Member from Atlanta GA

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