All Forum Posts by: AJ Singh

@Douglas White

hemlane is a good self management tool to pre screen tenants before showing a rental. First 30 days is free.

i agree with all posters to educate yourself and not get in a legal nightmare.

 @Scott Blackwill

You have to be a real estate professional to get the bonus depreciation tax write offs. All these writeoffs are added back to as capital gains when asset is sold. If asset is refinanced after a few years, then a portion of LP investment is returned .

Any annual paper loss can write off the pref return for that year and rest can be carried. 

Right now multifamily syndication has a lot of following but due diligence has to be done before investing a dime. 

The real winners are GP teams of asset manager , capital raisers , key prinicpals, property managers etc. Look at all the misc fees being charged before the asset has even performed at proformas. 

Dont mind paying the fees once asset is stabilized and paying returns as promised. 

Single family and multifamily ownership has a lot of headaches but the 1031 exchange can roll over your capital gains every time.

My two cents

@Aamir Shah

Check a local commercial bank for bank notes. They will be around 4.25 to 4.5% for a 15 year note and will not show up on your credit report. So you can rinse and repeat 

They will be held by the bank only. usually only 65 percent of appraised value is loaned out.

one important thing on real estate syndications is they are highly illiquid, you are holding paper in a LLC while a single family rental is your physical asset. you can get a HELOC against your assets. Some of the RE syndication do go south , every deal is not a homerun but the deal sponsors/partners are always the winners due to the acquisiton fee, asset mgt fee, asset disposal fee etc. Due dilligence is a must in syndications.

James Kandaswamy's book Passive investor is a must read if you are going that route.

@Amit Bajpai

As an OOS investor, that is a difficult market but has excellent cash flow if tenant stays around.

Best of Luck!

@Diane Tycangco

With five years of investing in memphis, i agree with @Stephen Akindona. Our vacancy is minimum and gets filled up quickly. It really depends on the neighborhood and what seasons does the lease start in. winters are a little slow in leasing.

If you have a good prop mgt co, its not hard to evict a non paying tenant. If the tenants are qualified right, you should not face the problem. Under the current moratorium, January is the earliest one can evict in the pandemic. Collections have been 100 percent in our portfolio since march and we have actually received rent bumps in some rentals due to low supply of rentals

B class neighborhoods are the best to start in but I dont think you can get a house under $125k nowadays. Unless you can buy off market from wholesalers but will involve rehab costs. This strategy will give you equity in your investment as opposed to buying from Turnkey/ MLS. Lot of turnkey activity is in specific zip codes/neighborhoods. Do your due diligence before committing to any contract.

Due to low interest rates, Bidding is fierce in entry level homes right now.

@Kelli Loo

I would add Roof, Ac and Furnace replacement to the rehab. Looks like they are close to shelf life 

Since its owner occupied, some other issue may be there once vacant so budget for those. 

Hopefully you are paying 60 to 70% of ARV so it can be sold at a profit after BRRR is complete. Since its Memphis, where some neighborhoods have become hotbeds of turnkey activity, please do your due diligence to the location. ARV change by the streets in some neighborhoods. Make sure its at least a B class neighborhood.

A physical visit to memphis and understanding neighborhoods are critical to investing in that city.

@Duane Alexander

buying turnkey means paying market price. You can buy off the MLS then. Property managers can definitely help you with rehabs but they may charge a supervising fee.

@Ellie Perlman

great points especially # 1 and #3 about syndicator's own skin in the game. Right now capital raisers are frequent part of the deal sponsor teams. Why do we need big groups of deal sponsors to run an asset and also need to engage a property management company  to execute a business plan of exterior and interior rehabs to bump rents...

@Ronald Rohde

Thanks for the insight. i Stand corrected

@Austin McAnena

Start exploring in riverside and san bernadino county. Plenty of rehab opportunites and closer to your area to manage

also pockets in los angles counties e.g. long beach, bellflower, paramount, around the 710 freeway may have opptys for you as well.

When you evaluate Turnkeys in OOS, make sure not to pay over comps.