All Forum Posts by: Andrew Dean

@Bill S.

Sorry you had to go through that.  Denver and Salt Lake City shouldn't be too different, but every property I purchase, I pay $100 for a meth test.  Not sure why it's $400 there.  It paid dividends for me on one of my buy and hold properties, as I reduced the purchase price $5k, had them pay all closing costs, waited 3 months for them to certifiably mitigate the unit and pay for all carpet replacement.  I didn't realize beforehand that I would need to re-texture all the walls, but if it ever happens again, would probably be able to negotiate that as well as painting.  I think your first buyer that backed out missed out on a great opportunity to get the home at more of a discount. 

I agree with @William Hochstedler on contacting MACU. 90% LTV on a non-owner occupied loan is fantastic. You'll be looking at a little higher interest rate, but requires only 10% down. I recently met up with a loan officer at a BP meetup and he told me about a new fannie/freddie product that is 15% down but also loans you money to rehab on top of that. I believe he told me that you would have to use the money to rehab within 6 months or so. Keep calling banks/credit unions, as they sometimes have some nice portfolio loan products that might be what you're looking for.

@Joseph Hennis

Hi Joseph!  Thanks for the post and for having the courage to post your portfolio.  I am impressed with what you have done so far.  With that said, it sounds like you and your wife fall more on the conservative side of investing, which is great and if you are in it for the long haul, you will have great success financially.  There is nothing wrong with buying properties, paying them down and holding onto them long term, if that is your strategy.  

However, I am much more aggressive and would have to agree with @Ryan E. on this one. Getting a HELOC on some of that equity would be a great vehicle to obtaining additional properties that cash flow better. I know there are credit unions/banks that will give you up to 100% on non-owner occupied properties, which is great if you want to pull as much out.

Looking at a few of those returns, I would seriously consider doing a 1031 exchange on all of your properties in Utah and finding something better.  With how things have appreciated and how high rents are, those numbers don't look that great.  There are so many great deals, even with how hot this market is right now.  

@Justin Williams

Sounds like house hacking is the way to go, if I were in your shoes. I would look for an attractive property in the SLC/Utah County area where you could put a low down payment (FHA if you haven't used it already) live in it, slowly rehab it as you live there while subsidizing your mortgage, then either selling it or holding it longer term. I like Provo/Orem because there are 2 huge universities and a very low vacancy rate (1-2%).

@Kesi Ika-Kioa

I agree with @Lance Card. There are multiple Real Estate Investment Associations out there. SLREIA, Utah REIA are the two in SL County. Go join one, soak in all the knowledge, take experienced investors out to lunch and pick their brains. If you're looking for mentorship, there are a lot of local investors that offer annual mentoring for a couple thousand dollars or so that is pretty valuable.

Hi @Andy C.

I've looked into those multi-family units quite a bit and here is my take:

Pros: New builds, low maintenance, high rents, GREAT rental market.

Cons: very high priced, inflated cap rates by sellers.

May be better for casual, less hands on investors with a lot of cash (or virtual investors). Most investors I talk to steer clear. I don't see as much upside on these, as I prefer the BRRR method more, but to each their own.

@Stephen Bagnani

Great post, I admire your desire to turn things around in your life.  Hopefully you take advantage of this great momentum.  I live in Utah and although some say the market here is "grim," I beg to differ.  I have purchased 3 properties in the past year and they've all been great investments.  However, with that said, the best market to start in is the market you live in and are familiar with.  If you're willing to relocate to a market, get familiar, do your research and network locally, then that is a great move.  If you just want to pick a great market and invest remotely, it is much easier to make grave mistakes.  When I started, I didn't have much, so I began by house hacking.  It worked awesome for me, but I also had a full-time job that I used to qualify for loans.  If I had to start from scratch and didn't have a job, I would probably go the real estate agent route.  You would have to wait some time before you could qualify for a loan, but it would be worth it.  There are also other ways you can start investing without needing to qualify for a loan.  IE- wholesaling, seller-financing, etc.  I would also steer clear from paying big money for real estate education.  You can find most of what you need to learn from local real estate investor clubs and networking.  Also, the internet is FULL of info if you just start googling.  

Thanks @Caleb Rigby, this was very thorough.  I appreciate you sharing this info!  Keep up the good work!

@Lian L.

Just saw that you wanted to paint the brick black.  STEER CLEAR!  ABORT!  Gray is really in right now with white trim.  It looks modern and people love it.

@Lian L.

I'm in Salt lake as well.  Painting the brick isn't too expensive and it does make it look much nicer.  We just painted our 4plex near Liberty Park for about $1400 total.  Keep the shingles as is, not worth it for a buy and hold.  You can do some landscaping, but keep it pretty simple as you're not selling it.  You can put some trim around the downstairs windows as well inexpensively and it makes it look nice, or some nice shutteres.  Change and paint the doors for sure.  Keep the car ports as is.  It will be a hassle to build all of that and for what you're looking to do, not worth it.  

The most important thing is to be able to rent for as high as possible.  What are you doing to the inside in order to do that?  Carpet?  Paint?  How are the bathrooms/kitchens?