All Forum Posts by: Andrew Kerr

@Giselle Feiger if you are looking at a $500k and up range, send me a message with your email. I’ll do an intro to the owner of Fuller Land & Development. They build amazing spec homes. I have known the owner for over a decade.

@Steven Singleton I’m sorry to hear you have had a bad experience with your PM.

If you want to make a switch, send me a message. I would be happy to recommend a couple other PM that I have used with my properties. 

@Pasquale Zingarella - I would try to figure out your IRR for the property. If I understood you correctly, and you are getting a 30% return on your cash via your stock portfolio, and you compare that to your IRR for this property and it is less than the 30%, why switch? You would probably be hit with taxes on the sale of stock, and then make less of a return.

Now if you feel that you cannot get the return going forward in your stock portfolio, or want to diversify some, then it might make sense. It really depends on your personal situation.

I would also double check your calculations. Here are my quick numbers on the deal:

$1,600 gross rent

-$570 ish for mortgage

-$160 for management (10%)

-$128 for maintenance (8%)

-$128 for CAPEX (8%)

-$128 for Vacancy (8%)

=$486 month or $5,832 a year (12.9% CoC)

Then you still need to budget for Taxes & Insurance, this would drive down your return further.

@Remy Bonser if you can qualify for a loan on your own, I would say skip partnering with a friend. Do the deal on your own, then have your friend rent a room or unit from you.

I don't do deals in Boston, but do deals in several MSAs. The basic principles will apply. You want to make sure that when you buy the property, the rent you will receive will cover all your costs (mortgage, T&I, maintenance, capex, vacancy, etc..). Run the deal through the BP calculator and make sure the deal works if all the units were rented. The one challenge I have found in higher priced markets is that rents, while very high, are not high enough compared to the sales price, so the deal doesn't make sense.

@Jerry Quintiliano The Federal Reserve is meeting next week, and most analysts predict a rate hike. If that happens, you tend to see mortgage rates go up. 

The Fed could always leave the rates as is, but that seems unlikely.

@Vicki Dungan - I would say yes you should remove it. That is a pretty big invasion of privacy. Outside of that, I would personally never rent a property where there is a camera inside, even if the owner said: "it doesn't work or is turned off". I would want it removed.

@Tarrence Gordwin - for off-market deals, where you are getting the property way below market value (presumably because the property needs work), I like to present my offer in person. I like this route because I can see their body language, and its easier to gauge the tone of their voice. Then you can talk through any objections you have. Then if we have agreed on a price, I pull out a contract and fill it out and have it signed on the spot.

If it is a deal listed with a realtor, I might call them and give them a verbal offer. Then submit it in writing.

@Michael Gustavo if you are looking for loans for investment property, and you plan to hold it in an LLC, New Republic Savings Bank is great to work with.

But if you are a veteran you should look at doing a house hack and using your VA benefits to get a VA loan.

Welcome @Matthew Maggy - I would recommend reaching out to @Tiffany Alexy - She is a Real Estate Broker, she has her own company, does property management and is a fellow investor. I have used her as my agent on numerous transaction; both the buy and the sell side. In addition, we have worked together on a few potential apartment complex acquisitions. 

Be mindful that the Triangle (Raleigh, Durham, Chapel Hill area) is really hot. There are a ton of local investors that are very savvy. In addition, there are a ton of out of town buyers who are bringing in money. It is a competitive market, to say the least.

Good luck with your search! 

Welcome to BP @Ryan O'Leary 

It seems like the condo is your primary residence, so if you sell, you would not need to use a 1031 exchange as the gains can be tax-free (there are limits, so check with an accountant). 

To me, if the property doesn't cash flow, I will not hold on to it. I don't want to lose money every month hoping that the property keeps appreciating. A small pullback in the market could wipe out several years of appreciation. 

If it was me, I would keep the extra rooms rented to lower my living costs and keep saving as much money as I could. Then if the property doesn't cash flow when I moved, I would sell. Then I would take the proceeds to buy a small multifamily (2-4 units) at my next location. I would make sure the property would cashflow with all the units rented. But then I would live in one unit and rent the other. This would let me keep my costs low and let me save money. Then if I got moved again, I would keep the property (as I know it cash flows), rent out all the units, turn it over to a property manager, and start the process all over again at my new base.