All Forum Posts by: Cassi Justiz

@Evelyn Tilman, What price point and specific area?
Under 250k I'd lean towards nicer LVP. $250k+ I'd start to consider wood look tile over LVP in the main areas. Above 300k or in higher end areas I'd definitely do wood look tile with nicer carpet in bedrooms. 

I haven't seen additional value given to wood look tile over LVP, but it will be more of a buyer preference once you get into the higher price points. Several mid-range builders have started included it as a standard option, so it's becoming more of a norm in that 250k+ price range. 

Hi @Brett Tvenge, @Eric Velazquez

Mustang and Yukon are some of the favorite areas for the investors that I work with. There's not always a lot of opportunity for value add opportunities because of the demand and generally newer age of homes in these areas, but both towns are really favorable for turn-key investments. 

Mustang and Yukon are both fairly small on their own, so if you are looking for a property manager exclusive for one of these two areas you may have a hard time. It's not uncommon for people in OKC to commute, so most of your OKC based property managers are happy to manage in Mustang and Yukon. OKC is fairly spread out but generally pretty efficient for commutes. You can usually get from one side of the metro to the other in under 30 minutes, so it's not uncommon for people to live in one area and work in another. 

If you guys need property manager recommendations for these areas or have any specific questions on the areas, I'd be happy to answer questions or give any recommendations!

Hey Kalvin, 
I'd recommend checking out some of the meetups. Here are a few of the popular meetups for investors. The past year has been a little hit or miss on meetups, but most of them are back to in person. 

https://www.renascentmastermind.com/new-events

https://www.wp.millionairepossibilities.com/

https://www.okcreia.com/Default.aspx

https://www.meetup.com/Oklahoma-City-Investor-Happy-Hour

Hey Dillon, 

You might have a hard time qualifying for conventional financing on your own with just a part time job. If you have someone that would be willing to co-sign a loan with you (parent, grandparent, etc) that would definitely increase your lend-ability. I think one of the easiest ways to get started is to buy a small home that you can house hack. Multifamily homes tend to be more expensive, so don't think that's the only way to make it work. If you could buy a smaller 2 or 3 bedroom home and rent out the rooms, that would also be a great option.
I think your idea of getting licensed would be a great if you plan to make real estate your career. Realistically, you could knock out the getting licensed over a few weeks over a school break. You could also look into wholesaling. It's a little lower start up cost and also has a huge upside as far as income goes. It's a little easier to find an agent mentor than a wholesale mentor, but they are out there! I'd see if there are any meetups in your area and try to meet other people in the business. They can point you in the direction of people that are doing what you want to do!

Hey David, 

That's an awesome place to start. House hacking is almost always beneficial if you can get in to something at a reasonable price. I'd probably start on the lending side of things first. There are a few local lenders that offer 3% down conventional options. I'm not 100% sure if they are duplex eligible or not. We've got a couple of duplexes under contract right now for buyers and one for ourselves, but it took plenty of rejected offers before we were able to lock anything down. I would say the biggest pointer will be to be patient, offer as soon as you see something that makes sense and come in with your best offer up front. You'll also want to have cash for appraisal gap coverage. The duplexes we've got under contract right now were all significantly over list price with the all but one of them having a counter offer for the buyer to pay any difference between appraised value and contract price.

OKC has a low inventory of multifamily units and even fewer that will work for owner occupants. Just shoot your best shot and you'll eventually land on something! 

Congratulations! 

That sounds like a solid investment opportunity. I personally don't raise rents immediately. I keep people month to month for a little while before locking them into a lease. Once you decide that you want to keep them on as tenants, then I'd do a small increase. 5% a year increase is usually the higher end of what someone will tolerate. 2-3% per year is pretty normal for rental increases. More than that and most tenants will start shopping for a new place.  

Is it common in your area for the owner to provide water, trash and sewer? That's the one thing that sticks out to me with these numbers. In my area, tenants almost always pay for their own utility services. 

Something to keep in mind is that even though you are "budgeting" for it, vacancy, cap-ex and maintenance is still income until you spend it. You'll have $700+ deposited into your account each month after paying fixed expenses. It won't take long to build up a hefty reserves account with that cashflow amount. You may end up spending that money on maintenance, repairs, etc, but it still replenishes the next month. I don't budget specific percentages anymore. I look at total cashflow after fixed expenses and how long it will take me to build up 5-10k in reserves. (In your case, it would be about 6 months to build up 5k in reserves). With 10k in reserves, I know that I can handle almost any vacancy/cap-ex/maintenance combo that is less "insurance claim" damage. 

 I wouldn't budget as much for vacancy since it's unlikely that BOTH units would be vacant at the same time. Unless you're really unlucky, you shouldn't have to pay two months of mortgage out of your reserves per year. 

Hopefully that helps! It's a different way of looking at expenses and it's definitely not for everyone, but it does help to remember the difference between true fixed expenses and budgeted "expenses."

It's almost impossible to ballpark foundation repairs without being able to see the property or the extent of the work needed. I've seen foundation repairs ranging from $500-30,000+. The best choice would be to have a structural engineer and/or foundation specialist come out and give you an estimate and scope of work. That way you'll have a great idea of what those repairs are going to look like and be able to make an informed decision. 

I wouldn't write it off yet. But you'll definitely want to have something in writing to figure out what kind of repairs you are looking at. 

Check in with your local community banks. Those are the banks that know the area and would be most likely to lend there. 

Hard money is an option, but usually it's a VERY expensive option if you can find someone that is willing to lend in your area. Since it's rural, you'll likely have a hard time finding someone that isn't local to loan out there. 

I still think going the cash out refi route would be favorable. Ask the local investors who they are using and you'll eventually find a small bank that can make it work.

You've already received a lot of advice considering the pros/cons of small town vs big city investing. I'd like to chime in on a few of your target markets. I have rental property in Lubbock and OKC. Lubbock seems to be SLIGHTLY less competitive (but still competitive). If you are looking for C/D class rentals/BRRR properties, Lubbock seems to have more of them available for lower prices than OKC. Rents in Lubbock seem to be higher. My VERY limited rehab experience in Lubbock seems that the pricing is quite a bit higher for materials (Flooring pricing was wild, even at the "investor friendly" places). Home purchase prices are pretty similar. HOWEVER, taxes in Lubbock are almost double the OKC tax rates. This varies a bit based on what specific parts of each town you are investing in, but it's a good ballpark.

Either option could be good. It will just depend on what you are looking for and the connections you can make in each market.