All Forum Posts by: Andrew Holmes

@Joshua D.

Josh: Come up with a number you want to live on in terms of cash flow then multiply it by 1.2 times. 

So let's says it's $ 10,000 from cash flow then scale up to where you would have $12,000 per month and focus and get the properties paid off. So a little extra than you need. 

I think on BP we come from our points of view. You have to figure out exactly what you want and then work that plan. Sometimes just buying more and more for the sake of it just another rat race. 

If you are like some of us that are buying more just to grow and love it then just get the properties you need set aside and you can grow your portfolio as large as possible if you love real estate. 

Your numbers seem to be good from the info provided. 

I have often wondered what is rich or well off? I am talking about purely passive income from rentals. 

Yes it is subjective and will depend on the individual but I was wondering what the BP community thinks. Would love to hear some input. 

In mind there are 3 stages

1. What you need to live on to meet a decent quality of life?

2. What do you want?

3. What are your dreams? The number for dreams can be way to crazy and high. So would love find out what some of the fellow BP contributors consider good. Is there an average?

@Ceej Charles

If you are buying as owner occupied keep an eye out for HUD multi family. You can still get some amazing deals during the owner occupied period.

1. Only buy areas with B or C avoid high crime and economically depressed areas. 

2. Poor quality properties attract poor quality tenants

3. Have a set of rules for your tenants follow them. 

4. If you want to do charity and help some one don't make them your tenant. Help them give them money or help them in any other way. Just do not help them by putting them in your property. It always come back to bite you. 

5. Only sign 2 year leases minimum. 

6. Tenants like an employee. Set the ground rules from the min they make contact. If you are firm but fair you will attract people who will fit that mold. If you compromise then you will keep running into goofy tenants. 

7. If you fail to screen and train your tenants then you tenants will own your investments rather than you owning the investments. 

@Andrew Acuna

I think it depends on the size of your portfolio and religious you are about followup with different methods to get the tenants to change something. 25 -30% will adopt the change right away. Rest 50 will adopt things one a reminder or 2 goes out. The remaining 15 to 20% will be the hardest. 

Email, text and snail mail. Sometimes call and follow depends on how you can grab their attention. 

@Thomas Orgler

Any property built before 1978 may have lead based paid because after 78 lead based paint was not manufactured. Any property that is sold now will have a lead based paint disclosure. That is standard. 

If you have lived in area where you are used to a lot of newer housing this may be something new but in most parts of the country majority of the housing is built before 78.

There is nothing to be afraid of properties built before 78. If the property has chipping paint then it's easy to address that issue. 

If you have tested for it then you must disclose if lead based paint was found. If you have never tested then the standard disclosure says the property was built before 1978 and may have lead. You don't know you have no clue. 

This whole thing is catch 22. If you know you must disclose and it does open up a can of worms. You disclose as per the law that makes sense. Suddenly your tenant come back and says their kid of affected because of your building and health was compromised. Now the question becomes is that you knew and you tested for it and still didn't fix it. It's an interesting dilemma. 

@David Garrison

You will meet four types of people

1. New folks that are dazed and confused. (We all started there)

2. People who know everything there is to know but don't do anything.

3. People who talk a lot and will sound like they know what they are talking about. They may have done anywhere from 2 to 4 or 5 deals. They talk act and sound like they know their stuff. 

4. People who have done a lot of business but tend to quiet. They will take more in that they share. They will be selective in what they share and who they share that with. 

Networking is great but everything is not as it appears. 

The best part about real estate is that there are not secrets. If someone says they have done XYZ. Then verify and do your research before you believe anyone. 

If someone is really successful then the tree should bear the fruit it talk about. 

Look for long term consistency rather than people who just hit a home run. 

@Lawanda Curtiss

The place to start is by knowing your score, current level of debt. 

When you are talking to lenders are you talking to residental lenders, commercial lenders for investment properties, hard money lenders or brokers. 

Most of the time is you the lenders requirements there is no reason for them to run your credit. You can always fill out a loan app if you want for give them your PFS. They can look at it and tell you what is doable and if their loan programs will fit. 

Brokers are notorious for promising all sorts of things and not being able to come through because they are just the messenger. You need to go to the decision makers. 

What are you to do? Flips or rentals. That will dictate who you should go to. 

Have you talked with any private money folks in your area?

On wholesale deals that were purely assigned we have done quite a few at $ 22,000 to $ 25,000 per deal. 

On Deals that were back to back closes max a wholesale deal $ 55,000

@Iniabasi N Imeh

If you work a lot and assuming you like what you do and are paid well for what you do (This is up to you if you feel happy and want to continue what you do). 

1. Figure out what you want

2. Set a money goal (Assets accumulated or monthly cash flow goal)

3. Think through a strategy goal (Wholesale, Flip, Cashflow/Rental Properties)

For people who have full time jobs and are well paid at their full time job. I categorize them as busy professionals. Just my opinion the best strategy for them is rentals. 

So if you goal is $ 8,000 per month in cash flow. 

Then you need 10 paid off properties each month that cash flow $ 800 per month after all expenses. 

So you need 4 years to build and

7 - 8 years after that to pay them all off from your monthly cash flow. 

I am just basing on what is possible here in Chicago suburbs. 

Just don't get distracted by 10 things that are possible. Most people don't reach their goal because it is so easy to get distracted with so many different things in real estate. 

Pick one thing and if that strategy works well for you. If it is getting you progressively and steadily closer to your goal then stick with it.