Mentone, IN · Member since 2018 · 18 posts · 11 votes
7 days ago I didn't know about the serious cash flow potential I can gain by buying a duplex and house hacking. Someone in my business niche made me open my eyes to REI and I have been studying every free hour I have. With that said, I need to move soon and I don't want to rent as my old plan was going to have me do.
How realistic is it for someone like me to obtain a Fair to OK deal (my expectations are low since I have no connections or experience). My goal is a duplex that I can live in and have a little cash flow from the property on top of being rent free.
Good news is I hear Indy is one of the top cash flow cities in the country. From my limited searches though i struggle to see a 1% property so far on Zillow, Realtor, and the like. Can you set my expectations for me a bit? Thank you!
If I were in your shoes I'd be looking at 3 or 4 unit buildings. Duplexes can be tough to live rent free AND cash flow. It's likely you'll need those extra couple units to make that happen and down the road you'll be happier you have a 4-unit if you continue to acquire properties.
If I were in your shoes I'd be looking at 3 or 4 unit buildings. Duplexes can be tough to live rent free AND cash flow. It's likely you'll need those extra couple units to make that happen and down the road you'll be happier you have a 4-unit if you continue to acquire properties.
A good property is definitely attainable. It's important to remember a few things:
1. The money you make on real estate is made in the buy of the property. Trust your numbers and don't overspend.
2. Your pool of properties to buy will depend a lot on what you're looking for. You might have more luck finding some distressed properties, as the added work can deter the more casual investors who don't want to deal with more than just a cosmetic rehab.
3. Remember to stay objective and unemotional when it comes to buying real estate. Don't feel attached to a property and understand you won't land every deal.
Buy your friend a drink @Fred Ewert and congrats on finding BP. I was like you a few years ago, didn't know what to expect. The best advice I can give you, is be patient. Find out why you want to invest (really dig into it), develop your investing criteria, AND stick to them! This is where the patience part comes in. Also, lean on the community here. I see you're new at the forums, but you'll find this is an extremely helpful community.
@Fred Ewert - Cool to see someone here from Mentone! We used to belong to the Mentone Flying Club (though based in Rochester) Spent a bit of time flying in the area.
Are you moving to Indy or do you currently live there?
You may have trouble finding good deals on any website. Indy is a lot like Memphis and deals are bought up quickly and typically off-market.
If you aren't already going to as many Indy REIA meetings and other local REI meetups, start doing that. Talk with other investors and wholesalers and get on their buyers' list - especially if you are a cash buyer.
If you aren't a cash buyer, ask around for agents who specialize in areas where you want to live and in small multis.
Best of luck! I'm excited about your new adventure!
Good properties are out there, but they aren't always unarguably apparent. Distressed properties are more abundant than rent-ready/turnkey properties, so I wouldn't remove the distressed from your searches. If you're willing to put in some work to clean a distressed property, you might end up getting significantly more for your dollar. On that note, do your research on each property without much emotion. Don't fall in love with anything until it's yours and shows you why you should love it. Staying objective and investing by the numbers won't hurt you a bit.
@Ryan Murdock Thanks for the advice. Looks like things are very competitive in Indy. Enjoyed the knowledge you provided on that podcast too.
@Alex Huang I will be keeping an open mind. I think I will try to go outside of the 465 loop before I start thinking about properties that need repair based on steeper learning curves related to that. I am hoping to buy within 3-4 months so I am very limited on time.
@Elizabeth Wilson Nice, it is a small world. Yes, I do live there now but do business in Indy often which is why I want to move there. That is something I plan to work on are the connections element to REI, so I will check out some groups on and offline.
@Bijoy Shah Thanks for the input. I will most likely be listening to a few podcasts about distressed properties. Before I knew this expectation my plan was to stay away from any kind of place that needed repairs since it isn't my strong suit.
Hey there @Fred Ewert ! I feel your pain. Finding properties via the MLS (Realtor, Zillow, Redfin, etc) seems so hit or miss. Like you, I wish I had a good REI focused realtor/broker contact in the area. So far, I've been trying them out by working with the selling agents on specific houses in my areas of interest (Emerson Heights / Little Flower).
There seem to be lots of good class B houses, and lots of class C, and 'war zone' SFH's available - have you seen that $19K 4Br house with no furnace, and no hot water heater south of Fountain Square? I can't tell if the neighborhood is class C or war zone, so I'm planning to get boots on the ground in the neighborhood next week.
+1 to joining local REI groups (Meetup.com, Facebook, etc), and networking with other like minded RE Investors. I'm happy to help colleagues muck out, clean up, and do general dirty work for pizza, beer, and the return of the favor (aka. barter). Could beers be in our future? PM, if you're up for a beer and/or lunch between 3/1-3/4.
Best of luck out there! Keep reading, but be sure to ACT. You can't get back the TIME your money could be growing in properties. Everyone needs a place to live, why shouldn't they be able to have four descent walls and a roof, and an investor who cares about more than the monthly rent check?
@Bruce Lee Thanks for reaching out. That could be possible because I will be in town that weekend for non-REI business but I really want to make some time to drive some of the areas of interest so I will keep you posted. I am curious to what data made you zero in on Little Flower/Emerson Heights neighborhoods?
My investment partner (girlfriend) is a long-term resident in the area, knows it well - which areas are up-and-coming, etc. When I learned what area she lived in, I did due diligence toward buying a primary residence for myself, and immediately saw the investment possibilities. Rental investing does not work well in my current area - the overheated Seattle/Bellevue/Redmond WA housing market where I've lived for the past 20+ years. In this HCOL area, it's very hard to make deals pencil in.
@Bruce Lee Just now looking at your response. That is cool you live so far away, I'd like to visit Seattle one day. Me, I am only 2 hours away and go to Indy once a month on business. But, I don't drive around looking for properties so my experience isn't the most valuable. I've read a lot in the last year on the Indianapolis sub-reddit so I have at least an idea about many of the locations in the city.
@Neil Goradia Thanks for the help. At this time I think my best bet is on finding a turnkey company because I don't have the time required to build a team for rehab, pm, etc. Unless you somehow wholesale turnkey multi-families :)
7 days ago I didn't know about the serious cash flow potential I can gain by buying a duplex and house hacking. Someone in my business niche made me open my eyes to REI and I have been studying every free hour I have. With that said, I need to move soon and I don't want to rent as my old plan was going to have me do.
How realistic is it for someone like me to obtain a Fair to OK deal (my expectations are low since I have no connections or experience). My goal is a duplex that I can live in and have a little cash flow from the property on top of being rent free.
Good news is I hear Indy is one of the top cash flow cities in the country. From my limited searches though i struggle to see a 1% property so far on Zillow, Realtor, and the like. Can you set my expectations for me a bit? Thank you!
Living in a duplex that pays all of your living expenses & puts money in your pocket while also paying a mortgage of 96.5% of the cost of the property......Negative.
However, buying a duplex with very little down & dramatically reducing your living expenses while paying down your mortgage instead of your landlord's is NOT bad. That's as good as it get my friend. Lower your expectations & get out there & grow your net worth. Move out 12 months later & do the whole thing again. Do this over 10 years & all of a sudden you are the owner of a $1 million+ portfolio.