All Forum Posts by: Ali Boone

I definitely wouldn't wait Don. Prices are only going up from here and at some point interest rates will be jumping too. Even just from a couple years ago prices have increased in a lot of areas dramatically.

The hardest part about out-of-state investing is finding a really good property manager. You definitely want the manager, they are worth the amount you have to pay them (the good ones are at least), and they'll be able to keep a much better eye on the property than you'll be able to from ND. The property manager you hire, no pressure, will make or break your investment. I've had managers cost me thousands of dollars. If you're just starting and don't know how to pursue the managers, I wrote an article you're welcome to check out-
http://www.biggerpockets.com/renewsblog/2013/01/26/surviving-hell-property-management/

I personally buy the turnkeys. Easier to find, no rehab work, basically hands-off, still good returns. And property managers come with them. There are a lot of good ones in TX too, some of the best managers I know of when it comes to turnkeys.

Good luck in ND!

Don't go for the big banks, no. When banks aren't used to working with investors they can end up delaying the process to the point the buy never even goes through. You'll just have to ask around (maybe another forum post) for lenders people prefer to use for Philly. Lenders are state-specific and I've never worked in Philly so don't know any.

Is that 400-500 after all expenses, including taxes, insurance, and mortgage?

Yes, you can get financing for rental properties. The best place to start is to learn how to run numbers on a rental property so you know while you are shopping exactly what you are looking for. If you don't know what you are looking for, you're either going to have a real hard time, buy a bunk property, or both. I wrote a blog on here on calculating numbers if you want to check it out- http://www.biggerpockets.com/renewsblog/2013/01/19/real-estate-math/

The note with that article is it doesn't take into account anything about fixing up a property. That's yet another animal, and one I'm not personally a fan of doing.

As much as I'm an advocate of using credit cards for real estate, I only recommend using them for rental properties if you include your credit card payment (plus interest) into your expenses and it still allows you to cash flow positively. For instance, if a property will make you 14% returns and your credit card only charges you 7%, then you are still profiting. Just err on the side of caution with those.

As far as rental potential, that has different meanings and not sure which you meant here. One meaning is vacancy rates are low there and lots of people want to rent. If that's the case, it still doesn't say anything about house prices meaning it may be very difficult to find a property that will cash flow.

I agree with Karen Margrave and Jon Holdman. Don't do something you hate, ESPECIALLY if it's a commission-only job. As much as I hate steady paycheck jobs, if you can find one you like better, do that and build your company, all the while having that W-2 income to hopefully let you qualify for mortgages. Even if you don't want to get into residential investments, it never hurts to have a steady paycheck and work history when applying for any kind of loans. Try to think of something way more interesting or bearable for your full-time job while you pursue the investing side (which is significantly different than working in related fields, as Jon says).

Super cool about self-storages... I'm pursuing some of those right now!

Oh, income taxes are FAR from the worst of your problems investing in CA :) The list is endless. I plan to stay here (LA/Venice) forever and I still won't buy here. The numbers just don't work.

Not sure if it helps, but I've bought multiple properties using an investor partner, so I was no cash in. He put up the cash, I took the mortgage and did the work, we split the net 50/50. Infinite returns for me, easy investment for him. Of course I would say only do that with people you would trust completely, and even then get some legal paperwork, but it worked great. I still use that method in pursuing some bigger investments.

Hey Amanda! Where are you from in Atlanta? I'm from there as well, only left about 3 years ago for LA, and most of my investment properties are there. It's a really tough market now but there are still deals there, although I wouldn't count on them being there for much longer. Inventory is nasty thin.

I've met quite a few folks from NY and NJ trying to invest out of state and I live in LA so I of course only invest out of state too. If you want some inside scoop into who the goods and the bads are of Atlanta, I can definitely give you my opinion (offline from here of course).

Hey Esteban. Welcome to US investing :) Kelly N. is right, you should only buy a property that allows for ALL of the expenses to be paid by the monthly rent and then still leaves some leftover for you to pocket. You should never dump any of your personal salary into an investment. Defeats the purpose. I'm not a fan of the 50% rule myself, but it will at least get you in the ballpark.

$31k is a great amount to start with. If you are not a US citizen tho you won't qualify for a mortgage, so be prepared. I also don't personally recommend buying a property for $31k simply because it's going to be a lot lower on quality than I care to deal with. That part is only my personal preference tho and far from a rule. I know of a private lender who will lend 50%, so you could get a $55k or so house with that financing (after adding in closing costs). They lend to internationals but only on certain properties, but those properties are turnkey meaning they are fully rehabbed with tenants and property managers in place which is perfect for someone who doesn't live in the states.

Regardless of which way you go, make sure you tax and entity structuring is in place by a professional because otherwise you will be screwing yourself with major tax consequences. And make sure whoever you buy from is reputable. A lot of internationals have been screwed in the last couple years by buying who knows what properties and not having the right teams on the ground.

The whole deal sounds sketchy, if you ask me. Definitely don't send money directly to a seller. An agent can help make sure everything is in line, but more than that, especially being from another country, you need an attorney who can confirm you aren't getting screwed. Also, if you US property as an international and you don't have the correct tax and entity structuring in place, you will get royally screwed with your taxes.

You absolutely need professionals working with you on this. You're going to be in a lot of trouble if you don't. And don't just go off numbers. In real estate investing, you absolutely get what you pay for. Never just look at price.

I would figure out what you ultimate goal is. Flipping and renting are very different animals, with completely different results and means to do them. Flipping involves a lot of risk, especially if you aren't experienced.

Any reason for why Flint or Toledo?