All Forum Posts by: Charles Pope

Long thread, but an interesting read.  Essentially, markets change and investors must adapt to the changes.  We got spoiled with low interest rates, great terms and rising rents.  It does not last forever.  

So, what am I doing for SF LTRs? I'm still BRRRRING. I look for cheaper houses requiring a higher level of rehab. I buy and rehab with cash. My goal is to get total cost at or below 75 to 80% LTV of ARV. I refinance total cost (or leave a little in the deal). I target a rent/cost of 1.25% or higher (1% rule). I get 20 to 25% forced equity or better, yearly equity from principal amortization, yearly tax depreciation and break even cash flow or better. Over time, rents will increase, values will increase and hopefully interest rates will comeback down.

Example.  I invest in a smaller markets in Alabama.   Here is a deal I’m looking at right now.  It’s off market.  Purchase price is $60,000.  Rehab cost is 15,000.  ARV is $100,000.  LTV = 75%.  Rent is $950.  Forced equity = $25,000.  1% rule = 1.27%.  Cash flow is $50/mo.  Yes, I would like to see more cash flow.  If I had done this deal 1.5 years ago, it would have cash flowed $200/mo.

I'm not finding these deals on MLS. You have to work a little harder, but it can be done.

Andrew. Congratulations on your first deal. Buying below appraised (as you have) is an excellent way to leverage a property. I invest in Oxford area and get 85% LTV on my loans. 85% of $65,000 is $55,200 which would cover your purchase price. If you are located close to Oxford High, rents should be about $700 to $750. You should cash flow positive. Great job. Keep looking for good deals like this one.

Sadly, I agree with Peter on this investment.  $1750 in rent for $277,000 purchase price???  I don't see this one cash flowing or the ability to cover upcoming capital needs. Madison County is a great market, but the numbers have to work.  

Have you heard Jimmy Buffett's new song... "Mailbox Money"?  I enjoy a few checks in the mailbox... how about you?

@Chandler Jones.  I need a recommendation for a roofer in Anniston.  Can you provide one?

I am located in Albertville.  I invest in Calhoun County.  I have apartments and single family rentals.  I would be interested in the meet up.  Thanks

How has COVID 19 impacted the real estate market?  Is it still as hot as it has been?  I am a long term investor focusing on multifamily.  We have vacationed in cabins in the Smokey's for 20 years.  We are ready to invest.

I am located in Albertville.  I invest in Calhoun County.  I have apartments and single family rentals.  I would be interested in the meet up.  Thanks

Tim.  Curious.  What were the existing rents and how much are you raising the rents?  Are you making any renovations to get the higher rent?

Thanks Andrea.  Let me know if something gets set up.