All Forum Posts by: AJ Felix

I have read many books such as J. Scott's flipping and estimating rehabs books to name a few, explored BP site for the answer to my question and read many forum posts but I am still left wondering. I also have read about the importance of the rei team. But, as a newbie I plan to have that team and utilize them; however, the way I plan to obtain leads initially through MLS and direct mail only makes sense to go about it they way I am about to explain. Can someone Please enlighten me?!

I am considering doing one or several things; I want to obtain my real estate license in order to have MLS access personally, visit properties in the local area where I will begin investing, and the benefit of saving on commission. one reason why I am highly considering the license is to be able to learn the art of estimating market values of the properties and ARV's by analyzing comps.

I also considered doing just the beginning appraisal trainee classes to get formal knowledge of the process of determining residential values. I know its just an opinion but in the end I just want to master the skill as an investor. 

Lastly, I considered completing home inspection courses in order to be able to do pre offer inspections while analyzing deals in order to determine offers using the inspection knowledge. In the post offer phase a formal inspection and contractor walk through would be implemented to confirm initial findings and prepare rehab estimates. 

I am not suffering analysis paralysis but while I work and save I just want to make my time worth while so I am prepared to execute with efficiency out of the gate. Besides, my free time is always spent learning something so why not real estate education. I am also not looking for a career in those areas, I just want to use the knowledge and gain access to network to build my business. These would serve as tools to get me to where I want to be. Please let me have your input especially if you are one of these professionals.

@Joe Scaparra @Joe Villeneuve got it, and my freedom would look like $8,500 per month after taxes. 

what are the best books to learn about investing in duplexes or small multi family? 

Do you analyze duplexes from an income approach based on the money that the property generates or like single family homes based on comps of recently sold properties etc?

I want to begin with a duplex but was cautious and thought getting a SF home would be safer to start. The advantages/ disadvantages are more favorable from my viewpoint especially if I am to partner in deals. Not sure, any advice. Partnering would allow me to have a source of income to buy deals at a faster rate. 

I set an arbitrary number of 100k to get started but is 50k enough? 

What about ARV. How would I find that information @Joe Villeneuve?

@Joe Scaparra this post has taken off and has provided me a lot of take aways. Also, my WHY is freedom. I lived up to what people have always told me growing up which was about getting good grades and job etc. I earned a masters degree and make good w-2 income but I realized at 30 years old that I felt trapped. I do not have anything to transfer to my children, I am stuck in the life as an EMPLOYEE and I hate it the most. My goal in life at 33 years of age is to focus on achieving the freedom to wake up and not be obligated to someone else's business but rather my own. I want to work hard to build my own success to allow myself and family choices. I will do whatever I need to get there. My freedom equates to income replacement through cash flow using REI as my tool to get there. I have been working to save money(100k) to get started. I am just focused and work everyday to accomplish small actions that will allow me to obtain the goal such as reading and doing REI book club discussions with my hopeful future business partner and friend , reducing personal operating expenses, Podcasting, posting in BP forums. My heart yearns to achieve my own successful business, wealth, and freedom. My next step when I am ready to buy is to build my team then work toward securing my first deal and repeat.

I want to ask you the some questions. Where and how do I get properties to analyze and practice without wasting anyone’s (real estate team) time if I am not currently ready to buy?

What does "all in mean" in REI?

and any other advice for me after learning about my WHY? 

@Joe Villeneuve quick question. You say analyze properties for more practice. Where and how do I get properties to analyze and practice without wasting anyone’s (real estate team) time if I am not currently ready to buy? 

Oh my fault lol, on the math 10% being $120. Anyway, great advice and makes sense! I’m sure I’ll have other questions to post. Appreciate it! 

@Joe Villeneuve thanks for the insight! will you explain more why it will be at a loss once you refinance? 

what are the arbitrary costs? 

How did you determine that the holding is not the best and the that the equity will be more valuable?

$1,600 projected rent

$120 property taxes

$85 hazard insurance

$50 flood insurance

$45 termite/ pest service

$0 utilities (water, sewer, gas, electricity, garbage,) tenant pays

$0 landscaping (tenant upkeep)

$15 safety reserve

$96 vacancy 8%

$ 120 repairs 10%

$120 capital expenditure 10 %

$120 property management 10%

$829 net operating income

$540 principal and interest 

$289 cash flow

@Joe Villeneuve How about this Joe? This is the other side of the equation for the sake of the example. So, $289 monthly cashflow, Cash on Cash ROI 60.3%, Cap rate 8.3 % ( Not a multi family but just wanted to practice calculating it)

@Joe Villeneuve I understand what you're saying. I just used 25% because I hear some lenders may require that much for an investment property vs 20% so I just go with the higher amount. As for the hold side Of things, the cash flow and operating expenses are assumed to be All favorable. Favorable from what I learned for a SFR is a cash flow of $200 and above. So, for the sake of this example let's just say that I am cash flowing $300 after I factor in all expenses.

@Cameron Tope @Joe Villeneuve Thanks guys! Joe, I was just putting together numbers in my mind to imagine real estate deals in regards to financing and what a deal may look like. I just assumed for the purposes of the example that everything in regards to "hold" portion is favorable. In reality, I would also factor in that information. I understand that portion of it a little better. Just needed more understanding of the "buy". 

What does "all-in" mean in relation to real estate investing purchasing and rehabbing?