Buffalo, NY · Member since 2014 · 82 posts · 75 votes
I'm looking to form a networking group of people who specialize in under 30k properties for cash flow. I propose we share ideas to help each other maximize our success!
Real Estate Investor · Fort Wayne, IN · Member since 2013 · 168 posts · 78 votes
12y
I buy houses in the $18,000-$23,000 range, typically put $3,000-$5,000 in them and then rent them for $650 a month. @Matt R. is right about the roof and furnace, they are profit delayers.
The key is to know the area or work with someone who does.
There is more to investing in any house than just working the numbers ahead of time to see if it will have positive cash flow and those are the factors that will kill you.
1. Contractors that you can trust, that do the job correctly and go above and beyond for you since you're not around.
2. A property manager who can rent the house to good people and make sure they are holding up their end of the contract.
People who buy expensive houses have the same issues, their tenants just drive nicer cars. It's all a process, just jump in and learn the lessons good and bad.
Flipper/Rehabber · Bronx, NY · Member since 2016 · 168 posts · 168 votes
9y
Every proprietary have ever bought was under $25,000 in the outskirts of Philly. Great investments as long as you have good contractors, time management, and research the areas.
Although, these properties were bought at an amazing price, remember they are priced to sell this way for a reason. Not all of them, but be prepared to expect the unexpected !! Such as squatters, thieves, shady contractors! (who think the word investor means RE tycoon)
Low income neighborhoods, low income population, etc. But there is always money to be made, just do your homework and you should be good!
Investor · Coppell, TX · Member since 2008 · 2k+ posts · 646 votes
9y
Hello and welcome to BP! The price of the home is not as important as a couple other things when you are thinking about investing that kind of money. The "class" that it is in. The neighberhood looks, any amenities, and the management of the property. Some people do well in that environment no netter what it is and some are not. What kind of reputation does that area have? Do you take electronic payments of rent. Are you looking at SFH 's or MF complexes? One might do better than the other. You might be better off having a property management company that knows that neighberhood as opposing to do it yourself. The man agent company or yourself must be stick on the tenant screening. Will section 8 be available to you.
You might be only into sales of the houses. If you are not financing you may have a hard to have product available in that neighberhood. Is it available with public transportation? Is it in walking distance to a bus stop? Is it within walking distance to school? What other type of financing available? Is it worth the rehab it needs? Is their a crime rate down there? If the price is comparatively low or high for that area? You might ought to talk to city building inspectors that work in that area to get their rules and opinion. You might have an easier time with a class "C" home in a nicer neighberhood. Safety of the product is important to your sucess and your safety if you are planning on managing those properties.
Rental Property Investor · Philadelphia, PA · Member since 2015 · 94 posts · 58 votes
9y
Wow, 18 pages! I started on page 18, was enthralled, and read backwards, 17, 16, 15... from top to bottom.
I think my brain retained everything?!?
I'm happy to see so much excitement in this market. Surprised only two Philadelphian posters, well, outskirts, but close. There are so many under 30's on the market here. I've got two, in a year and a half of investing. They are night and day. The cashflow is insane, and I've learned a few lessons.
#1 - Purchased for 28K, put 7K in, house is in the path of development. Took plenty of time screening and interviewing tenants, I get my $750 early every month. It is a dream.
#2 - Purchased for 16.5 K, put 8K in, same neighborhood. House came with tenants. BIG MISTAKE. The people were very nice, had a job and disability payments... and a disabled son. I couldn't morally kick them out. I worked out a deal with them; $750/month + a to do list of repairs I would perform. First month was right on time. I got to work. 2nd month was not. After a few sob stories, and my unwillingness to continue work without collecting rent, they are leaving.
Future #3 - I will be sure to screen and choose my own tenant. At cap rates over 25%, it's hard to resist these deals. The hardest part seems to be finding good tenants, who also care about the neighborhood.
In old dense cities like Philadelphia, be sure to make friends with the neighbors, show your face, be vocal about your intentions of creating a nice place for nice people to live. I have word of mouth deals jumping out all over the area. Just waiting for the right one!
Investor · Philadelphia, PA · Member since 2014 · 351 posts · 80 votes
9y
@Matt N. I'm an investor in Philly, all of my holdings have been sub $50K with the last two being Sub $30K. My rents are $920, 850 and $850. You are right, the cashflow is great. The most important factor is tenant screening.
I am under contract for another near Temple (17th and Dauphin), purchase and renovation should be under $35K
How do you finance your deals (If you don't mind my asking)?
Syracuse, NY · Member since 2014 · 73 posts · 22 votes
9y
I bought my first property as owner-occupant for a hair under 55k in Syracuse. A duplex that, through house hacking, I squeezed an extra rent out of it - pulls in $1850 in rent.
Investor · Philadelphia, PA · Member since 2014 · 351 posts · 80 votes
9y
@Matt N. I would say my only "strategy" is being as diligent as possible. I use a screening service I met at a Meetup in Philly. I usually get red flags from tenants just by talking to them
Philadelphia, PA · Member since 2014 · 25 posts · 7 votes
9y
@Matt N.@Ryan Cameron Hey, I'm in the area. Recently just purchased two at 40K. Both found off the MLS with section 8 tenants. Where are you all finding your deals?
Property Manager · Virginia Beach, VA · Member since 2016 · 2k+ posts · 2k+ votes
9y
I wouldn't say I "specialize" in properties under $30K, but I have bought plenty of them. I've also bought plenty above $30K. The lowest I've ever paid was $4K. That one I turned into a storage lot and have rented it for $350/month for many years. I pIaid $8K for another that was a complete rebuild (not new construction). We spent $40K to create a small 3/1 that has been rented to the same SEC 8 tenant since we put the house into service in 2012. We are getting a low rent, compared to our other SEC 8 rentals, because the tenant doen't work, but we are happy with the $1100 we get each month. Another we bought for $27K, did zero work to, and sold it on a land contract for $60K on a 20 year note @ 8%. There are lots of options, and all of them are terrific!
Rental Property Investor · San Antonio, TX · Member since 2011 · 266 posts · 158 votes
9y
Pyrrha Rivers check out Pentagon Federal Credit Union--they offer HELOCs on non-owner occupied houses.
This week I'm reaching out to PFCU to start the HELOC process.
I recently bought a $30k VA foreclosure in my area. I need the HELOC to buy more!
-Andrew
None · Virginia Beach, VA · Member since 2014 · 126 posts · 50 votes
9y
For many of you that apparently do not know where to start looking for below 30K properties, this is the first place I look.
The way I search it is that I do not put any search criteria in the box, I just click on submit, and then go to "Lowest Price Button" on the menu bar, even though I try to stay local. You just might find a home in a good place you would like to visit or even take a vacation at.
Investor · New York City, NY · Member since 2016 · 3 posts · 3 votes
9y
I have a couple of 30k to 35k homes I have under my belt in very solid C/C+ neighborhoods in the midwest. These needed about 15k to 20k work (all in about $50k) and rent for between $900 and $1,000 a month. It seems like a lot of the numbers I'm seeing on this thread look even better than my #'s.. all in costs at under $30k for somewhat similar rents to what I'm getting at $50k.
I wasn't able to go through all 19 pages of this thread, so I may have missed this, but I'd love to hear where a lot of you are looking for these deals. MLS, Auction, or via other channels?
Investor · Brunswick, GA · Member since 2016 · 19 posts · 5 votes
9y
I haven't been through the whole thread, but I'm interested to know if the group of people who specialize in cheap houses discussed in the first post was ever formed. I'd be interested in learning more about how to rehab and turn over properties cheaper. I own 30 mobile homes that we bought for under $10k each and rent for around $500 per month. Everyone says you can't make money doing this, but I am, and I am looking to buy more. I have some strategies that I have learned, and I would love to hear what others have experienced so I can continue to increase my profit margins and grow this business under this model.
Investor · Brunswick, GA · Member since 2016 · 19 posts · 5 votes
9y
@Ronda R. I started researching real estate investing probably two years before my wife and I bought our first house in 2015. I house-hacked that one, which had two apartments on the back of the property. Then, at the end of last year I partnered up with a business associate and was able to buy 30 trailers in two parks. We are currently looking at three more parks, totaling 56 more park-owned trailers. In my area, no one rents lots. All of the trailer parks are nearly 100% park-owned homes. We have been able to have substantial cashflow, which will only increase once we catch-up the deferred maintenance the previous owner left us.
Investor · Atascadero, CA · Member since 2015 · 238 posts · 90 votes
9y
So you own the park and the trailers? Nice. Space rent alone in our little town is over $650 a month. Doesn't include a trailer for $150,000 (on the cheap end)
Investor · Brunswick, GA · Member since 2016 · 19 posts · 5 votes
9y
@Ronda R. Yes, all of the park owners I have spoken with in my town own both the land and the trailers. We also own a deep well on our property, and we charge the tenants for water. Out of our two parks and the three we are looking at now, there are only two lot renters at current. One pays $75/month, and the other pays $100. I love the trailer park model where the tenants own the trailers and pays lot rent. I just haven't been able to find one where the math makes sense one in our area.
And I am not sure you could find a trailer in the state of Georgia that costs $150,000. The top-of-the-line double-wides in our area are $50-60k brand new. Hell, the 2,700 square foot house my wife and I bought with the two apartments and a half acre was only $110,000. A trailer for $150k in our area better come with 30 acres. In fact, I just searched Zillow for a trailer in my town over $150k and nothing came up. I was just posting on a BP article earlier today that I think a lot of this is regional. In some places you may not be able to make money on $30k houses, but in my area, the numbers make a lot of sense.
Redmond, OR · Member since 2017 · 98 posts · 36 votes
9y
Hey all,
Do you guys calculate capitol expenses, management fees and annual repair costs into your valuations on these 30k properties? Can anyone show me an example of how they do that? I'm not sure if it's just the Minnesota taxes or if I'm doing something wrong, but I cant seem to make the numbers work on the few that I've run.