All Forum Posts by: Brendon K.

So I'm out in Austin Texas, and my situation may be pretty close to what a lot of other really competitive markets are so I thought I'd post in the general forum.

Currently:

• I'm with a roommate that's pretty unbearable but I don't want to move into another bad situation
• I just cleared 34k in down payment, 25 from saving up plus another 9 from an old retirement fund that won't be needed. If my math serves me, I could probably get an 800k fha if it made sense.
• Pretty much perfect credit.
• Austin is pretty saturated. LOTS of competition has driven the prices up to incredible levels. The same house that was 150k five years ago is easily over 300k now. 
• I'm spending 800/mo for an apartment right now. Spending much more than that wouldn't make sense.
• My job makes it impossible to live out of town. I have seen some duplexes that make sense out of the city limits.
• I'd like to get into a multifamily and "house hack" but most of the multifamilies don't add up to a starting investor:

Here's a typical one. 590k at 4.176% interest is around $3,897/mo. The MLS has each of those units earning 1050/mo. If I were to live in the 4th, 1050x3=3150, nowhere near the 'live in the unit for free' that Brandon Turner speaks so highly of on the podcasts. This is pretty much typical for everything in Austin.

The typical single family goes for over 300. This is still over 2k/mo so it doesn't make sense.

I could stay in an apartment owned by someone else, but then I'm not building equity, something I badly need right now.

In the future:

• I'll need as much disposable income as possible because I'd like to start doing wholesaling and will need money for advertising through yellowletters and through the web. I figure wholesaling will be an easy entry for someone who has absolutely no idea how much repairs cost. 
• I'll be wholesaling until I can afford to flip with cash, and at that time I'll have the information I need to make it a good flip.

Are there any more advanced techniques I could use to get my living situation straightened out? Have you guys had luck getting substantial deals in multifamilies through contacting existing landlords directly, and how do you find them when they haven't posted on the MLS? Any other suggestions?

Ok, reached out to both. I'm open to other ideas as well, but thanks for your help so far. I'm ready to buy immediately but it's tough getting into this stuff.

I'm ready to buy a 2-4 plex with traditional financing, moving into one of the units and "house hacking". While some are saying it's impossible to come out with free rent around Austin, I want to see if there might be someone on this site who can help find something that will be incredibly cheap for me (please don't just say it's impossible, thank you).

Ideally I'd like to be located within ten miles of 78726 where I work my day job. I don't need to make a profit, but I need to keep my payments as low as humanly possible, including property management fees. I feel that a monthly cost of less than $500/mo should be easily obtained, considering the rather huge plot of land. Payments should be based off someone with perfect credit and minimal down payment.

* As far as cedar park to the north

* East as far as the domain

* SW as far as steiner ranch hudson bend, etc

I can do traditional or fha, no problem. Already approved. Show me something that's within my budget and I'll jump all over it, as long as the loan companies approve the condition. Thanks

BRRR method if possible. If you can't, it really just depends on if you want spontaneous profit or to get paid over time. You could also do something like "I'm going to use it to pay for a BIGGER rental if I flip it today"

1) Don't listen to the first person who knocks at your door. 

2) Financial advisor

3) "Pay for it with assets" -Kiyosaki

I've reached out to a few wholesalers and they're telling me that even though I have a very responsive lender lined up who has all of my information, has run my credit and background checks, and has already pre-approved me, that conventional mortgages are just too slow to buy a wholesale property. What gives?

That's a lot of sales-looking claims. Can you provide numbers and further evidence?

Seems like wholesalers in Austin don't exist. I've been looking for months and haven't found a single one that markets to my price range, and barely anything outside of my price range. Do they not exist, or are they just really reclusive? 

It occurs to me that we could possibly use data from previous sales to mathematically find average house sales for different areas. Some thoughts:

• Appraisers use a weighting system to figure out how much the value of a home should be. When you break it down, it's simple comparison using numbers. 
• Zip codes and neighborhoods do a poor job of isolating different zones of value. You could have three different zones inside a zip code, one for poor houses, one for medium income houses, one for rich houses. Additionally, one type of zone could go into another zone. You could have a rich area going through three zip codes, surrounded by a band of poor areas.
• The one thing appraisers don't have is a specific mathematical way to determine zone. You look for zones that are similar in how "nice" they look.

What if we were to make some kind of algorithm to draw zones that have nothing to do with zip code or neighborhood? Something to say, "as a baseline, this is how much a 3 bed/2 bath should cost", and it's part of this zone that our program thinks should statically hold a standard deviation of values for other houses? 

We have all the data we need from previous sales, except maybe "does this look like a high end home or not?", which could easily be provided by someone doing data entry at lower wage. How would you go about making such an algorithm, using as little human input as possible?

Just doing a little research for an idea I had. Thanks!