All Forum Posts by: Christopher Lynch

I would look into house hacking a 2-4 unit and using part of the rental income to raise your pre- approval. 

Also, look into the $17,500 RI first time home buyer grant that just came out. This could help. 

If I were you I would try to stick to a 2-4 unit to start. It's very hard to cashflow on a SFH in these market conditions. Unless of course you are looking into a short term rental.

Hi all, 

I currently have a 2 unit and will be hopefully acquiring a second 2 unit this year or a short term rental in a ski town. Still deciding which route to go. The STR looks more attractive from a cashflow perspective.

I have been a licensed agent helping investors buy cash flowing real estate for just over 7 years in the RI market. Many of my friends have turned into investors and it’s great to see so many people build their real estate portfolio. 

Now I want to build a large portfolio of my own. The question is how do investors scale so fast. I know the answer is to raise capital but my question is about structure and mistakes to avoid. 

What are some common ways people structure partner deals when raising capital to build a portfolio? I am assuming both go on title as a joint venture and cashflow is split monthly depending on the percentage of ownership agreement. 
  
What are some best practices about partnerships? 

What are some important mistakes to avoid?

What are reasonable percentages on deals?

Hopefully this post can open conversation and help some investors who want to turn their small portfolios into larger ones. 

 Hi Clemence, I would love to connect. I can inbox you my cell phone number if that works.

There are rental opportunities in every market. Although the market in Rhode Island is extremely competitive right now. We just went to an open house this weekend with a client of ours. 87 Showings in 1 day! 

Low inventory and tons of demand is causing bidding wars throughout the state. Just make sure you run your numbers and make sure you are getting a good cash on cash return if you are going to move forward in this type of market. Interest rate increases and high prices are squeezing the market. It is becoming harder and harder to find deals that make financial sense.

For higher cash flow many investors are expanding their search into places like Westerly, West Warwick, Coventry and Woonsocket. 

I have a couple of recommendations.

Home Safe RI- Many of my clients use them and I used them on my personal property purchase.

Patriot Property Inspections - Auger Enterprises, Inc.- Many clients have also had a great experience here. Certainly one of the more diligent inspectors I have come across. A little more pricey but you get what you pay for usually. 

Welcome, there are some really good options in both areas. Me and my team have sold over 100 homes in RI and we work with many people buying their first 2-4 unit. 

Some investors love areas outside of Providence too. Some places that may be worth looking into more are.

West Warwick- I am seeing good price to rent ratios here.

Warren RI- Right between Barrington and Bristol. It seems to becoming a more popular area with time. Just keep in mind many of the 2-4 unit buildings are old and will need much more of a Cap eX budget for things like basic maintenance. Some homes here are even from the 1800s.

Wickford Village- Prices are much higher here but people love this little town. If you can find something affordable it may be worth looking into.

Providence- Many investors have done well here. There are areas like Elmhurst, East Side and other parts that many of our investor clients like to look in. If you want to look into student rentals that might be an avenue for you also. 

I also personally own a rental property in West Warwick Rhode Island. Feel free to reach out. I would love to help. 

The math is really easy. I do not buy anything under a 15% cash on cash return. I really shoot for 20%. With that math to hit 10,000 a month in CF you would need about $600,000 in capital invested. Not much considering you can do all kinds of creative things like BRRRR, HELOCS and cash out refis.

Get question. STR vs LTR. This is the question I'm also wrestling with at the moment.

I currently own a duplex and it has been a great investment. For my next property I am debating doing another 2-4 unit or going with a STR in NH.

So far this is what I’ve gathered through my research. Short term rentals are higher cashflow but also more management intensive. If you have the time and want cashflow to grow your portfolio faster this might be the route to go. 

With that said to make this run smooth you will need to put systems and processes in place to ensure you can scale and remain profitable.

Long term rentals on the other hand can still offer great cashflow but often times less cash on cash return then short term rentals. They are also much less work to manage. 

Lastly, don’t forget to do heavy due diligence if you decide to go the short term rental route. Many towns are in the process of putting regulations on them. Check the town you plan to buy in and make sure no new changes are in the works. 

Hi There, I am looking into the same thing in NH. Have you found any great towns worth looking into yet?

I am currently in the due diligence process for my second income property. After some research it seems like short term rentals are going to be the best option to maximize monthly cashflow and ROI.

I am currently a couple chapters into short term rentals by Avery Carl. So far this is a great book and has highlighted some concerns I already had. Mainly city regulations on short term rentals. I am worried about setting up a profitable Air BNB only to have it torn down with harsh guidelines and regulations. 

To say that, I wanted to open the discussion and ask for your opinion on what towns I should be looking into in the New England area ( MA, RI, CT, NH, VT).

I have already done some research into the following towns:

1. Newport, RI- Great summer location. However property values are so high it worry's me to high such high operating expenses on the first one. Still doing research.
2. Rye, NH- Great property prices. Close to the beach. Could be a good location. Still doing research. 
3. Conway, NH- This one looks promising so far, but I am unsure about regulations and restrictions. Ski area with many attractions. Might be good for winter/fall rentals.

So, what other areas should I look into? Also, if you have any insight into any of the areas I am already looking into I would love to hear it.