All Forum Posts by: Brett Hennessy

KwikSet is the way to go if you are in it for the long hold. Buy a new set once per house and then changing the lock for turnover is a breeze.

Thank you everyone for the replies and advice. 

@Stone Saathoff BRRRR is a good way to go. I had success with it in Huntsville a few years ago on two C- properties. These days the market is so hot here that it is difficult to find good BRRRR opportunities unless you are looking to take a C- to a C+. I have since sold both properties as the turnover costs and headaches outweighed the cash flow. Have upgraded to B+ properties in a better equity growth area. Keep up the good work in Texas!

@Taylor L. I have been studying up on multifamily for about 18 months now. Would like to get in that game, but like you pointed out time is always short. I do like your suggestion to leverage modestly. Definitely makes for a safer investment.

@Eric Schmid Thank you Eric, solid advice.

@Whitney Hutten Really appreciate the guide, it is a great read. I have been struggling a lot lately with defining my strategy. I think I know my Why, but could use some help focusing which steps I need to be taking to get there. I have been investing in buy and holds for 8 years now, with 7 currently in the portfolio. I did one flip, one 1031, am invested in a syndication deal with Jake and Gino, have a SDIRA parked with some folks doing flips. Starting to feel like I am chasing every shiny thing. 

@Joseph Crunkilton Appreciate the advice, I will check out @Zach Lemaster. Glad you are having success with Rent to Retirement, have heard nothing but good things.

@Luke Stewart Thank you Luke.

@Chris Clothier Chris, hadn't considered refi on the existing loans. I will look into that. Never too much detail, really appreciate your thorough analysis and plan. Thank you for taking the time to think it through and for sharing. I like how you broke it down into three separate investments each enveloping its own strategies within the strategy.

@Jesse Daconta Its true, single family after a few becomes a good deal of work. Ultimately I would like to reach the point where I hand off management and get my time back. Or, invest a higher percent of the portfolio into truly passive syndications. My issue with syndications though is ROI. The deal I have been in for a year now has failed to reach its projections. Even when it does level out and reach those projections the profit is taxed reducing it to 6%. It is to commit to 6% when you know, based on your other investments, that you could be making 15-30% on that same capitol.

@Josh Walker This is a good idea. I had considered it but hadn't done any research into HELOC rates or how they are structured. I really like the idea of using it as a rental property rainy day fund. What type of interest rates and duration have you been able to lock down?

@Account Closed No doubt cash flow is great. In my experience it is essential, but is not actually where money is made. I know there is tons of debate on this, but for me, cash flow has always been a very necessary safety buffer that keeps the machine moving and growing. Where I have seen the biggest gains is in the sale from both sweat equity and lucky market timing. If you buy right in the right area and hold for 5-10 years properties can easily double in value. If you buy a 200k property and it is cash flowing 500 a month that would be 60,000 after 10 years. Pretty sweet. If it was bought in the right area, it may have doubled in value earning you 200,000. Even if it doesn't double but only increases 5% per year that is still $100,000. The first 5 years of my quest was focused on cash flow and using it to pay off my personal mortgage and vehicle payments. Then I sold my first house and realized where the majority of the profit came from. Not saying you should ever bank on appreciation just that you should look in the areas where it is most prevalent and always make sure there is adequate cash flow in a deal to carry you to appreciation

@Dave Wolcott Thank you Dave. This is exactly why I am trying to find a better use for that trapped equity. The struggle I have with the syndication is the return. Most seem to offer 8 or 9%. After paying 2.75% interest and 3% tax on the syndication profits, ROI is getting a little low for the risk of mortgaging 90% of my primary residence.

Much to digest and figure out. Will update this post with my final direction. Thank you again to everybody for your time and thoughts.

Going to take advantage of low interest rates and refi my primary house out of construction loan. Locked down 2.75%. Have the opportunity to pull out an additional $150 in equity and wondering the best use. Considered buying a single family house all in at $150, rents for $1300. Thought about paying off two currently owned and financed single family houses with loans at 4.85% or possibly something totally different. Don't have the time for any more flips and prefer buy and hold benefits to syndication deals. Appreciate your thoughts.

Thank you Scott.

Jessica, I left that to my agent George Lensch this time and it was a lot easier then trying to do it myself.

Samuel, thank you for the good questions. I chose this property primarily for its location, but it also met a lot of other good criteria. Specifically, brick construction, good bones, needed about $35k of improvements which allows me to offset other cash flow in 2019. I am self managing. My strategy has always been to fix em up right in the beginning to eliminate most problems for the first several years making self management easier. I would have been present during the tree removal. Contractor put a small hole in the roof and it took me 3 months to get $200 back from him. If I had been there to oversee I would have with held my cost to fix it from the original payment.

Peter, it is renting for $1850 on a 12 month lease. My apologies, I may have entered the total cash invested incorrectly. I put 30% down $73,500 and $5,500 in closing costs. Rehab was another $34,000. Property is 1880 sq ft.

Investment Info:

Single-family residence buy & hold investment in Huntsville.

Purchase price: $245,000
Cash invested: $79,000

Attractive B class property within 1 mile of HSV medical district.

What made you interested in investing in this type of deal?

Long term hold for (fingers crossed) equity gain along with good cash flow.

How did you find this deal and how did you negotiate it?

Zillow. It had been sitting for 6 months. Negotiated them down $30,000 from asking price.

How did you finance this deal?

Small local bank.

How did you add value to the deal?

Yes, put $34,000 into a new HVAC, Paint, Lighting, Tree Removal, and a few other odds and ends.

What was the outcome?

So far so good. Renters in place in October 1, property is performing as expected.

Lessons learned? Challenges?

Upgrading to B class is worth it.

Difficult to keep a good contractor busy enough to keep loyal.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

George Lensch (AGENT)

@shawn costley I have been pleased with their services. George Lensch was an agent for me first. He did such a great job that I went with his company's property management too.

North Star Property Management has served me well. I have been living in Huntsville for four years and currently hold 3 properties there. North Star is a smaller Management Company allowing them to provide a higher level of attention. Best of luck!

Thanks Rekha,

I found them through MLS. How is your search for the perfect first property coming?

Brett

Hey Mike,

I am in a similar boat, what did you end up doing and how did work out?

Hi Everybody,

My name is Brett Hennessy and I live in Smyrna Georgia. I have been dabbling in buy and holds since 2012. I have three under my belt and just learned about BP. I'm very excited to have found this community where so much valuable information is being shared. My goal is to continue to acquire more buy and holds in the Marietta Georgia area. I hope to learn some ways to find really great deals on the buying side and get a better education on how to utilize equity in my current properties.

Thanks for reading,

Brett Hennessy