What happened to you BP? Where are the new investors?

31 Replies

Local Kansas City, MO investors - what happened to BP? 18 months ago I had limited investing knowledge. While I had been investing for a decade I had only acquired four BRRR properties in that time frame. BP forums were awesome then! I spent hours each day reading them and asking questions. The forums were filled with other newbies asking questions about certain aspects of investing, seeking mentorship, and inquiring about the KCMO market. Numerous experienced investors responded - simply to pay back all the knowledge they have been given.

In the last year, we have been investing/flipping full time.  Additionally, I became a licensed MO agent and general contractor. The lessons we have learned and knowledge we have acquired is vast. (we: conduct our own marketing, develop our scopes of work, have our own crew, manage the renovations, stage our own properties, and then market them)

With two young boys and starting a business, we have been busy, to say the least. Finally, I am getting caught up. My hope was to log onto BP and return some of the knowledge I had been given.

However, I mostly see in the forums now are people marketing their own properties or asking for referrals.(those of us that have great referrals don't mind sharing but we don't hand them out like candy on Halloween night. We want to ensure that the great subs we have are referred to great clients) 

Forum questions posed by new investors are far and few between now.

If you are a new investor I implore you to not be shy. Post in the forums. Ask a question. No one will ridicule you and you might be surprised by the answers you receive/the network you can create online. Additionally, you can save yourself thousands and thousands of dollars on costly mistakes simply by asking.

Best of luck to you all and I am looking forward to answering some tough questions.

great subs are so hard to find.. most folks simply are not going to refer them to the competition and risk losing them.  its dog eat dog out there these days when it comes to the sub trades.

and great job getting properly licensed in all facets to be a true investor contractor reseller.

You're joking, right?

I just did a search of "newbie" and limited the results to the last month and got 1382 forum posts.

Clearly that's not scientific, but my own personal perusal of BP over the last couple of months indicate that newbies are here, they're asking questions and it's business as usual.

I have to agree with Linda. I only got started in the past 3-4 months, and it has been a tremendous help! Maybe it is less than it was, but, please believe me, the site is still amazing!

@Dan Krupa I have just barely started becoming active on BP, I am a newbie and have been reading/learning/advice seeking the last couple of days. I have reached out to a couple of KC investors looking for advice outside of the forums and outside of meetups. So far I have not heard back, but I only reached out this morning. I have had people answering my forum posts and sharing stories etc on BP however.

I'm not sure how thoroughly you searched but I see new questions being post every day.  A lot of are redundant to be honest. 

Well of course they are redundant...one can only mess up in so many ways. Nevertheless, people feel as if their question that they’re asking is specific to them(even when it’s not). They want to hear an answer to THIER question. Nothing wrong with it. Kudos to the OP for trying to come “reach down and pick the next investor up”. I’m still seeing plenty of new posts as well though.

I am a newer investor (just bought my first quadplex in Texas this year), but have been following the Kansas City forum.  There are a couple people in this market that have posted some extremely helpful information on the KC area that has helped me decide it will be my next place to invest (Hopefully another quadplex or bigger).  This has somewhat limited the need to start new posts due to how helpful people have been (which is surprising and awesome).  I was forced to start thinking outside the box on what my wife and I were going to do as far as investing when we wanted her to stay home with our first child.  Without this website I would not have been as confident pursuing my first property.  A property that has basically allowed her to stay home for the near future.  Now all I need are a few more properties, and it will be a permanent set up.  I will be visiting the KC area beginning of next year, and will use this website as a resource for more information as I  continue learning.

I think some of you missed my point here:

1. This post doesn't apply to the forums in general but to the KCMO area.

2. If you have been on this site for the last couple of years you would see the difference.

3. This site is invaluable. I applaud all of you using it to learn and grow. My hope is that more new investors will seek out answers to their questions and network. 

I agree with @Dan Krupa completely. And also, thanks for the encouragement to post more - I totally admit to being mostly a lurker.

BP is one of the best sources of life-impacting information out there.

Thanks for soliciting questions. I'm an "unborn" investor and one of the biggest fears I have is buying a money pit. When I listen to BP webinars everything sounds so easy and many people buy places "site unseen". What are strategies to make sure you don't buy a place that has a cracked foundation, mold, poisonous spiders (we lived through that one!), etc. Is it just a matter of getting inspections? I feel like I need to do all this due diligence, but it seems to contradict the strategy of aggressively finding deals and making lots of offers. Thanks for the help!

@Scott Sullivan , buy all those places! Cracked foundations, mold, spiders, snakes in the walls and ceilings (we ran into that helping another investor), etc...  Those are the best deals and the issues you mentioned are easily remediated.  Don't be scared of the properties others are.

After you do this enough you build a team that can tackle anything and you realize almost every issue that you were scared of in the beginning isn't a big deal at all.  

IMO most inspections are a complete waste of money. I have the sewer main scoped each time and if there are foundation issues I call my structural engineer. A structural engineer will shoot you straight and foundation companies have to complete the repairs they state on their report, they can't recommend anything else.  

If you have questions - ask us.  There is a fine line you walk between being aggressive (to get the deals before others do) and following your strategy so you don't lose money. 

@Linda Weygant @Robert Perry

I think some of you missed my point here:

1. This post doesn't apply to the forums in general but to the KCMO area.

2. If you have been on this site for the last couple of years you would see the difference.

3. This site is invaluable. I applaud all of you using it to learn and grow. My hope is that more new investors will seek out answers to their questions and network. 

@Dan Krupa I just realized that your post was in the KC area forum. LOL.   

I wonder if that is an indication of your KCMO market? Less attractive for newbies? Less active? Are you scooping up all the good deals..

@Colleen F. , ha good questions. Not sure to be honest. There used to be a ton of people asking questions here in KCMO before.

Deal wise - there is more than I could ever handle. We are booked out until early 18' and I have people asking me to help them invest/flip all the time.(We do not take outside projects at this time though) 

@Dan Krupa Thanks for your post, would you share some info on 8226 holmes st? How did you acquire the property, what were the reno cost etc? I live 3 blocks south on 79th and Charlotte. We own some rental properties in Independence and have been looking for a flip in waldo or brookside but haven't seen anything come up

@Dean Poff ii , great question. We closed on our seventh property in seven months today. Holmes was only the second deal we have found on the MLS. The property was owner/broker. I had been watching the property and after a price drop I walked it, figured out rough estimates, and then made an offer.

This has been our most complex flip to date. I won't go into what we fixed, the list is too extensive, so I will list what we didn't fix: exterior walls, floor joist on the two crawl spaces, the HVAC ducts, and the furnace. Everything else is new. The project took us four weeks, which is a remarkably short time comparatively.(yes, I am bragging on my crew) Other investors figured it would take 2 to 3 months to complete. 

Our total reno budget including labor was 60k.  While this wasn't a homerun deal but it met our profit margins and more importantly it developed our team and led to a better, more streamlined renovation process. 

I want to stress a couple of things:

1. I think this area is overlooked for buy and holds. When Metro-North mall comes back online I think this will be an even more attractive rental area.

2. I sold our sole flip South of the river last week. It was in Northern Waldo on the border with Brookside. While this was our best profit deal I won't flip South of the river again, for a host of reasons. I would encourage to flip in the area you know best/close to home.    

Best of luck to you and I hope some of this helped. 

Cheers

Ok Dan, how about this.

Jay, maybe you can give your expertise as well

I am closing escrow on 3 Properties next week. They don’t appear to be in a flood zone so I think I’m not to worried about paying for flood insurance. Hopefully, I won’t need it. Also, I am pretty happy with the numbers. Not the best but it’s my first 3 deals. I think I should have started off a little slower.

Maybe you guys can tell me if you think I got a good deal.. let’s run some numbers. All 3 bed/1b

Purchase price
1. $63k in independence, Mo (rents $800 month)

2. $64k in Raytown, Mo (rents $765 until June then I would like to raise them to $850)

3. $64,700 in Kc, Mo (good area of 64134 above
Ruskin) (rents $830 and goes to $930 in June)

Tenants pay all utilities and my mortgage is 4.6% interest rate for 30 year.

#####THIS IS FOR $800 A MONTH RENT#####

-PITI approx $415 a month average for all 3
Properties.
-management $75 each property
-7% vacancy rate ($56 a month)
-13% maintenance ($83 a month)
-1% Incidentals ($8-10 a month)

-Leaves me about $150 a month.
-20% down is $12,800+3000 closing cost
-$15,800/$150X12=$1,800)= 11.9% ROI

Would anyone do this deal?
I thought that was pretty good

Most important! Did I do any math incorrectly? Am I being to conservative or not enough?

Hey Dan

I like the KC area. I just came back from out there where  we offered on two houses. We're in contract on a 4/1 and hopefully closing at the end of the month.

Purchase price of 78K and winter rent of $975-$1050 a month.

I am in need of someone to do some cabinet faces and a little bit of touch up painting before the tenant moves in. Do you have any suggestions or recommendations for dependable and reliable help?

I will be kicking out an interior wall for a closet and turning the walk in closet into a bathroom before long also. I'll be looking for help with that project too.

I really appreciate your local knowledge. I've read some of your stuff already.

I've been meaning to post my KC experiences from last week but I've been too busy to sit down and take the time. :)

BTW, Gates BBQ was Awesome! 

@Marcello Oliveri Maybe I missed it, but I don't see that you include property tax, insurance (not flood insurance as you mentioned), as well as capital expenditure (different from regular maintenance unless you're including it in). Your ROI is probably less than currently.

Originally posted by @Hau N. :

@Robert DeForge Converting the close into a 2nd bathroom is a great idea!  

 Thanks. Theres a small walk-in closet that would be a great second bathroom and a overly large mudroom that is really unneeded. I can push the wall in the bedroom out and make a full size closet and still maintain a half the size of the mudroom without pushing out any exterior walls. In my opinion, a 4/2 is much more marketable than a 4/1. :)

Hau, thx for responding... PITI is principle, interest, taxes and insurance. The cap x was included in the maintenance and 1% for Incidentals.

@Dan Krupa Hey quick question. How did you go about getting licensed as a general contractor? I have wanted to go that route but the lack in "working for a company".. aka proof of experience hinders me as I see that is a requirement. I know how to do everything and have no doubt I would ace the exam. But I fail to meet that requirement. How did you do it?

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