All Forum Posts by: Austin Johnson

I always hear 'go join a local meet up! its so easy!' except it isn't because there was a local meet up but it stopped because of low attendance. I'm sure others have this same issue

joining a mastermind group has been MASSIVE for me. being able to chat with, bounce ideas off of and act like a sponge and absorb everything people are saying has propelled me forward. 

@Saurabh Patel if you're simply running numbers to verify/ learn there is nothing wrong at all.
what I would do is go to the county website and see if they have taxes listed (I know Tulsa does for example. the county I work for does not but if you call I'll answer and gladly give you the taxes). from there use the taxes per year as the insurance as well. (so $650 in taxes means make the insurance $650 as well) this might be off but is closer than you can imagine.

keep an eye on the upcoming recession as well. one thing I've been doing is adding 2-3% vacancy to the current rates based on my assumption of damage the recession will have. it's so hard to talk via forums. I'd love to chat sometime if you have any questions!

I just assume nothing will change, interest rates will forever be at historic lows and tenants will always pay!

I'd adjust the 28% to 35% (10%PM, 5% for each Maint, Capex, Vacancy, Insurance and tax) obviously verify the values before closing.

for caluclating interest rates I use a forward curve. 
https://www.chathamfinancial.c...

I try to predict where the rates will be when I want to refinance, I then underwrite with those projections. so if i buy now, two year refi (just making up a refi target) july 2024. predicted based on the forward curve is 2.68%. plus 2%. so 4.68-5% projected in july 2024. 
that's how I'm doing it.  I would never buy at 5.5% and assume in the future you can refi for 3%. if you do that, please get into Multifamily so I can poach your deals when you have to short sell. 

man, if your taxes in Houston are more than vacancy, maint, and cap ex y'all in trouble.
I'd call the county assessor's office and ask what the tax bill is currently and if it will be changing. (if the seller has made changes and it hasnt posted yet) 
yes, absolutely the 35% is rough! it's a rule of thumb. never purchase based on run of thumb. use the rule of thumb then adjust 1 by 1 to fit the actual picture. so use 5% as a rule of thumb, call the assesor and find out the actual. adjust it. 
use 5% insurance, call an insurance agent and get an actual. 
use 5% vacancy, call a local agent and get an actual. 

honestly, I would venture into a network of syndicators and network with them. learn and grow. 
I'm part of a group that is free for the first month (and a massive payment of $40/month with no contract after the first month).
get in a group, meet people, read their input and what theyre doing. then apply it to yourself. ill message you more information as well. 

I'd speak with a syndicator and see what your options are as far as being passive and making a massive return. I'd be happy to talk!

in addition to the comments above, depending on the size of the endeavor you're going to need a team anyway. (unless your plan was to rehab it, manage it and operate it yourself?) why not build out a team now or partners? 

rule of thumb is 35% expenses.

10% PM 5% Maint. 5% Capex 5% vacancy 5% insurance 5% taxes.

if the numbers looked solid, then you find actuals. [call for insurance quotes, factor the real vacancy rates, figure cap ex via inspection,get PM qoute, etc)
the first thing I would do is find the actual taxes owed per year/month. you're paying more in taxes than you are in all other expenses? is this located in Commie-fornia? 

finding deals in Detroit in theory wouldn't be hard...regardless why accept a headache when you don't have to?