Bluffton, SC · Member since 2018 · 63 posts · 205 votes
Well, I am pleased to say that I finally got my first property in Columbus GA renovated and rented. I purchased the property on auction dot com for $25700. Renovations costed $12,000.
I am all in for $37,700.
On December 31st I signed a 12-month lease with my new tenants for $1050 a month. Can you say super excited! Now I am trying to decide whether I should refinance and take the cash out or just keep it going and save up the cash to repeat the process in another year or so. I purchased and renovated using my savings so I don't have a mortgage on the property.
Marysville, OH · Member since 2018 · 39 posts · 41 votes
7y
Congratulations on your first property.
You could consider BRRRRing. Depending on the current value you could get all your investment back out for the next deal or build your savings back up.
Congrats on your first property in Columbus!!! That rent to purchase price number (above "2% rule") looks like what I see in the Macon/Middle Ga area. I would definitely BRRRR this deal and roll that capital into another deal. Leverage in real estate to build wealth is your best friend, but again as you will hear on BP, this comes down to "your" personal goals/strategy as there is no right or wrong path.
Quick question, have you already talked to a bank/appraiser to see what the new valuation will be since renovated and now rented out?
Congrats on your first property in Columbus!!! That rent to purchase price number (above "2% rule") looks like what I see in the Macon/Middle Ga area. I would definitely BRRRR this deal and roll that capital into another deal. Leverage in real estate to build wealth is your best friend, but again as you will hear on BP, this comes down to "your" personal goals/strategy as there is no right or wrong path.
Quick question, have you already talked to a bank/appraiser to see what the new valuation will be since renovated and now rented out?
Thanks for the comment. I like the BRRRR process but I also like not having a mortgage. I haven't spoken to a bank yet. Do you have any recommendations for portfolio lenders in middle/southwest GA?
Rental Property Investor · Union, KY · Member since 2018 · 33 posts · 22 votes
7y
@Karam A Tascoe: Congrats on this investment. That's great. I am biased but I have to side with my peers that are in favor of the BRRRR strategy. I think it's a great way to scale your business while maintaining cashflow. If you opt to not do BRRRR, then you'll need to come up with cash for each individual investment via equity partners or funded through another source of income.
Bluffton, SC · Member since 2018 · 63 posts · 205 votes
7y
Originally posted by @Account Closed:
@Karam A Tascoe: Congrats on this investment. That's great. I am biased but I have to side with my peers that are in favor of the BRRRR strategy. I think it's a great way to scale your business while maintaining cashflow. If you opt to not do BRRRR, then you'll need to come up with cash for each individual investment via equity partners or funded through another source of income.
Thanks for the response Charles. I understand that to move quicker BRRRR might be the best method but I have to admit i like owning my properties outright without a mortgage. I have a pretty good income from my fulltime job and I won a home inspection business so I can generally put about 35-40K away a year. I think saving up and doing them one or two at a time may be a solid solution unless I can find someone to partner with. I just don't want to carry mortgages unless it really makes sense like a multifamily or small apt complex. Im open to suggestions if you have had some success.
The other caveat is when the market crashes this year or next year, will these houses appraise enough to be able to do a decent cash out refi? I know people say we can't worry about the market but I know from the 2008-2009 debacle that a house that appraises at 85K today will struggle to appraise at 60K when the bottom falls out. Will banks even want to do cash-out refi's when the market crashes? So many if's it makes me super cautious and nervous.
Miami Beach, FL · Member since 2015 · 33 posts · 13 votes
7y
@Karam A Tascoe huge congrats I also stay in South Florida and it'd be great to link up and get some coffee. I see you live in Miramar I have a rental in Cooper City Florida but I'm currently living on an island above Miami Beach in North Bay Village. I'm going to connect with you and I'll message you in a bit, pleasure to meet you and congratulations on your purchase. It'd be great to link up and do another deal on auction
Rental Property Investor · Kalamazoo, MI · Member since 2018 · 117 posts · 235 votes
7y
@Karam A Tascoe
Cautious and Nervous are brothers you want to spend a lot of time with until the market stops performing at record highs and the Feds start lowering interest rates. The stock market just took a plunge and looks to have even more room to dive, and real estate will follow absolutely. My suggestion, keep buying outright and snowballing next purchases with cash flow until you’re catching beautiful deals at the bottom of the market. At that point, you’ll be poised to go 20% into as many properties as you can handle! You’ll be able to retire in style if you do the next 8 years well, and I hope the best for you. You seem like a nice guy, and more of those kind of people deserve to be multi millionaires.
Rental Property Investor · Las Vegas, NV · Member since 2018 · 9 posts · 6 votes
7y
@Karam A Tascoe congratulations on your deal,super exciting! I am also interested in auction.com and would love to know more about the process,as I am looking to purchase my first rental property in the next 6 months. Again congrats
Tacoma, WA · Member since 2018 · 24 posts · 21 votes
7y
@Karam A Tascoe
If this is your first deal why would you need a portfolio lender?
As to your original question, I think it all depends on your goals. Sounds like you enjoy the stress free life of outright ownership. Maybe that paired with the whole rent check every month will be better than owning a whole bunch of houses cash flowing a lot less per house. More houses can equal more stress.
@Karam A Tascoe
If this is your first deal why would you need a portfolio lender?
As to your original question, I think it all depends on your goals. Sounds like you enjoy the stress free life of outright ownership. Maybe that paired with the whole rent check every month will be better than owning a whole bunch of houses cash flowing a lot less per house. More houses can equal more stress.
I believe I would need a portfolio because the refi would probably be slightly under 50k. Banks and credit unions in my area will not lend on less than 50K. Again, Im just learning so I am open to learning from you if you have some other ideas
@Karam A Tascoe huge congrats I also stay in South Florida and it'd be great to link up and get some coffee. I see you live in Miramar I have a rental in Cooper City Florida but I'm currently living on an island above Miami Beach in North Bay Village. I'm going to connect with you and I'll message you in a bit, pleasure to meet you and congratulations on your purchase. It'd be great to link up and do another deal on auction
Actually I live in Bluffton SC but I would still love to meet for coffee. Im in Miami for work about every other month
@Karam A Tascoe congratulations on your deal,super exciting! I am also interested in auction.com and would love to know more about the process,as I am looking to purchase my first rental property in the next 6 months. Again congrats
With most of the auction websites you have to put a deposit or earnest money down on your credit card. With Auction dot com, the earnest money is $2500 to bid. If you dont win the auction they release the hold on your money. If you win the auction the earnest money goes to the purchase price. They will send you a contract to docusign and you will generally have a week to wire funds to the auction site from your bank. In about 30 days you close just like you would with a traditional purchase.