All Forum Posts by: Corey Hawkinson

@Corey Hawkinson Correction: I’m under contract on a 5-unit, not 6-unit.

@David Levin I might be a unique example because I lease through a program, but I have a lot of demand for the studio and 1-bedroom units. I have more vacancy in my 2-bedroom units. Maybe I’m crazy, but I like smaller units. I would buy a small motel to lease out if the right opportunity presented itself. I was ready to start marketing to those property owners prior to finding my current deal.

@Tucker Mortier I agree with James on going off-market. It will NOT be easy though! You’ll need to network and work very very hard but you can find deals. I’m not as good as James but I am under contract on a 6-unit for $340k that rents for $3,800 in the greater Twin Cities area. Possible value add, but I’m not quite sure yet on that piece. The best part is that I was the only investor that knew about the deal.

You’ll find better cash flow going a little further out, unless you’re comfortable in North Minneapolis or East St Paul. The competition is pretty intense right now so my recommendation to anyone trying to be successful is to do things that others are not doing. For me, that means networking with lead sources that others don’t know about. Find a path that others are not on.

@Alyssa Davis flexibility on timing could be a great help if the owner is looking into that route. I know that was very important for me during my last 1031.

I personally would not say junk removal unless the owner considers it junk. You’re probably correct that it is junk, but the owner might think it has value.

@Meredith Mihm This looks pretty good. It depends on the city that you’re referring to. If you have room to raise rents it could be a very good deal. Efficiency/1-bedroom units seem to always be in demand. People like living alone.

I would say go for it.

@Michael Gary I started with less than $30k, but that was also in 2012 and I was not in San Fran. Does your job keep you in San Fran or are you able to work from anywhere? Because I’m a huge fan of house hacking but that might not be an option for you in your area.

I’m less of a fan of out of state investing but that could be a good option for you. If you pick this route you can start now with $30k.

@Will Pritchett We just booked on Airbnb. Although we booked a house for our purposes, the competition on Airbnb was rooms at 2 local motels. I can PM you the location if you want to go to AirBnB to see what I’m referring to. So yes, motel/hotel rooms can be listed on AirBnB. The ones I’m referring to are small motels with 5-15 units.

@Carrie Christian My quick online search says that Georgia is similar to most states that a landlord can generally enter the property for a non emergency with 24 hour notice.

With that said, I would need to know what the non emergency really is to know whether or not I would recommend going against the tenant’s wishes. Sometimes it is just better to keep good relations with the tenant, though you also don’t want them walking all over you. It’s a balancing act.

@Collin Milone There was very minimal rehab outside of those items. We replaced 2 windows. That was it. So we focused more on the management side. The property rents by bedroom. We increased from 5/8 bedrooms rented at time of purchase to 8/8 within 3 months of the purchase. The full occupancy has mostly held since the purchase which was 1.5 years ago.

The property has been our best property! Purchased for $425k, minimal rehab, it rents for $6800/month so the cash flow works well. Plus we bought it through a 1031 exchange so in terms of actual cash invested it truly has been a home run!!!! In terms of down payments this property was purchased with only $7.5k. With fees we’re probably in for $20k on a property with monthly cash flow of $1.5k and equity of $100k.

To clarify, the $7.5k down payment was on a previous property that we bought to owner occupy, then turned into a rental and later sold to do the 1031 into this property.

@Tom Horn The lenders are giving you good advice. #3 is the lowest interest rate because that’s your primary home and it is locked in long term. That’s going to be a better rate compared to a loan on an investment property. I’m not sure on the exact numbers but let’s say that investment properties will be 1% higher for interest rate.

Another thing to consider is the tax breaks for the investment property. Talk to a tax pro, but it’s possible that taking a 4% interest rate on the investment property will be better than 3% on the primary home if you can write off the interest instead of getting no tax break on the primary. (All of that is just a possibility, I’m not saying that’s your exact situation)