All Forum Posts by: Corin Prendiville

I agree with Carl's strategy, but make sure that the cash out refinance won't affect your ability to mortgage a new home in Dallas before you do. Your other option is to sell the Arkansas property and use the cash generated from the sale of that to buy 2 properties in Dallas or a higher-end duplex that generates more cashflow and pay off your CC debt. You can write out each option and see what the cashflow benefit will be roughly before you pull the trigger on anything.

The benefit of moving your real estate close by is you won't have to rely on a property manager for those 2 properties and can save the 10%, and if you like doing small work yourself like painting, etc you have the option since its close by. I think property managers are great if you can't handle tenants yourself or outgrow that job of self-management but if you want to learn how to invest knowing how to do it yourself is worth the 10% imo (if you already know you can't handle tenants then ignore that advice! It is definitely not for everyone.)

I would 100% before doing anything else get in communication with a good mortgage broker and find out what your options are and if your intended strategy will work from a financing perspective. I don't know what your equity is in the Arkansas property so what I said may not work for you as well. 

Good luck! If you need any help here in Dallas from an agent or even just looking for a contractor hookup/loan officer I'm always interested in helping new investors get started.

I think Austin will see further appreciation and there is a place for appreciation plays in your portfolio but I also think with the population transfer into Texas as a whole you will see all tides rising in Texas over the next decade. For that reason I personally positioned myself in Dallas where I see growth and cashflow returns to be a bit stronger than say Austin over the next decade, I think at this point though Austin is the clear winner if you are buying a flip properties and looking to 1031 exchange your way up to larger properties the scale is on a completely different level. I'm playing the buy it, set it and forget it strategy and somewhere I can get a reasonable return while I hold it is very important for me at this stage in my investing career, perhaps 10 years from now I'll have a completely different objective.

I'm not sure if you intend to live where you are buying but keep that in mind as well if you are, for your own sanity. 

Hi Jennifer,

I'm a real estate investor and agent in the DFW area. I agree like others have said that it depends on the level of involvement you want in running the property, STR is a lot like buying a tiny hotel and will require more management but has the upside of potentially more profit if purchased in the right area and run properly. It sounds like with your current lifestyle a LTR would work better for you but that is a choice you have to make on your own! One of the most profitable ways to run a STR is getting a large bedroom place near the airport and renting it by the room, but that is management intensive.

Some people are open to doing both and buy the deal not the strategy. There is an advantage to that in that you don't lock yourself into a single-minded track where you can only see a deal from the perspective of a long-term buy and hold, maybe it allows you to see a flip opportunity, or a highly profitable STR opportunity that others are blind to. Just make sure if you do STR that you find a good cleaner who has reasonable prices and ideally get something that works financially as both a STR and LTR for your first one. You want an out if STR ends up not working for you if that is the path you take.

The fastest way in my opinion to get out of the daily grind is to find ways to increase your income and decrease your expenses, every strategy works but the more capital you can pour into investments the faster you will reach your goals. If you ever need anything feel free to reach out and I wish you luck on your journey as a real estate investor!

Hi Christopher, 

Welcome to Dallas! Do you run your own company for garage doors or working under a guy? Either way I'm actually looking at replacing a garage door on a rental I'm fixing up send me a DM and I'd be happy to connect. 

Hi Talia, welcome to Dallas! Moved here about 3 years ago from Seattle and don't regret it one bit.

A few Texas specific tips I figured out after moving here: Read up about foundations and proper foundation care if you haven't (for your first single-family). Make sure you understand how your insurance handles roofs and take a good hard look at the roof of any property you plan to buy (can figure most roofs will cost you a bit under $10k to replace if you have to do it without insurance), and lastly do a double-check on those property tax numbers w/ out the homeowner exemption because it will 1000% be your biggest expense after your mortgage. 

I haven't read all the replies but I'll say the unpopular thing and suggest you get into a house hack situation somewhere you are happy to live and ideally is also a decent place to invest (although don't discount long-distance investments). I don't know your work situation but I would basically put in whatever cash you need to in order to a) get in (if you have no job or a new job you might not be able to finance) and b) attain cashflow neutral or positive. That might be 40% where you live or 20% and it depends on what kind of house/neighborhood you are happy living in. If you can house-hack though you will free up a large amount of your financial power to grow your net worth quickly. Get a 4 or 5 bedroom + place if you can and rent out every spare bedroom.

I also think when you are new trying to skate by with minimal CF on each deal is a very risky proposition, because its easy to make calculation errors or discount expenses that you didn't properly account for and then end up in a tight situation, with that much equity your primary goal should be to not lose it. 

Once you get comfortable with how to operate a rental and have your financial affairs in good shape you can always refinance your 2-3 properties and buy more. This isn't even the best market to be leveraging, unless you find a deal, but you are new so you probably don't know what a good deal looks like anyway. 

Oh and start learning how to spot a good deal :) some of that will just take practice by buying a bad deal. 

Welcome to BP Jacob! I live up in The Colony, TX, I mostly try to invest in a 30-45 minute radius to myself and I own properties in Dallas and Irving currently. If you ever want to grab a drink or lunch and chat reach out! I am always looking for fellow investors to connect with who trade contractor contacts and investment strategies. 

It would have to be personal to you, some rules to follow are 60% leverage on your total equity, or another way to look at it is if you have $6,000 a month in debt service those assets should be bringing in $10,000 a month in revenue. If you have a job you can account for that and you can go over 60% but from that point on you begin to increase your risk. 

You basically always want the option to have an out on an investment say you are in financially bad position can you liquidate your property when needed? If you have 95% leverage on your assets you cant liquidate. In a down market when the picking is good it might be worth leveraging that much but in this market i would not over leverage. 

If you have 6 revenue streams then you protect yourself from unexpected downturns or the loss of a job. So finding ways to increase your income or create a new revenue stream adds additional protection from cashflow constraints that can force you to liquidate assets. Its all risk assessment and to a degree personal to your goals.

If you are staying in the DFW you should 1000% keep it and if you are comfortable start renting out the spare bedrooms for extra cash. 

The market conditions today are not what they were in 2008. Its highly unlikely that the market will crash to the levels it did back in 2008 anytime soon. We have nowhere near the build rate we did then, we have significantly more inflation coming down the pipeline which will artificially increase home values further and DFW is a growing market which will protect it to some degree from any financial downturn. 

Timing the market is a bad idea, almost everyone who says they did it just got lucky with the market timing. It ends up just being you sitting on the sidelines for years until you realize you have lost 30-50% gains in equity while you waited for some ethereal crash. Trust me I sat on the sidelines with a million waiting for the crash and it cost me a lot of money.

Just never buy anything you cant hold onto in the event of a downturn. Build multiple streams of income, have multiple investments, keep some cash reserve and dont over leverage.

I just wanted to second what @brucelynn said. When you are new there is a lot of free information that you can gain quickly to acquaint yourself with the market. Once you have done a deal yourself and learned the basic mistakes you can determine if paying money for coaching is worthwhile to you. I would read as many books as you can on deals, watch youtube videos from investors (who arent trying to sell you 40,000 coaching programs), and listen to podcasts.

If you want to get into multifamily but have not invested in RE before i would recommend starting off with a duplex to quad and learning the basics of the game and see all the expenses, headaches and challenges that come with running a property on your own. That will get you thinking about stuff you never would have known to think about (or know in theory but really know when it happens to you). 

I would not dump 40 grand on a course out the gate personally. Unless i was 100% confident it was legit and i had another million or two in the bank to invest as well.