All Forum Posts by: Dan Bryskin

Next five steps:

1. Take a hike. I mean a vacation, clear your head.

2. Zero down on geography and type of investment. Do you want to invest close to home or you are wide open? If close to home - what is the most interesting market segment around you? Single family, multi, commercial, vacation rentals? Or say you want apartment buildings. What is the area with the best return on apartments?

3. Figure out your strategy / advantage. Acquisition strategy, management strategy, value add strategy, disposition strategy, capital strategy   

4. Execute

5. Enjoy

ROI - well it depends. Can I make 30% ROI on a traditional rental? No. Can I do that on a flip? Easy. Can I make 15% on vacation rental? Yes.  Are they way more work / risk then traditional rentals? Yes. Would my numbers change if I go 50 miles from my area? What if I am in a different city / state?  Absolutely. 

Loan - leverage has power so is cash. For example, I buy single families for cash. The once I buy are not finance-able. That cuts my competition down. My advantage - my contraction company. My disposition strategy - retail sale of rehabs. I leverage my holds though.

Your struggle - you don't have a strategy. To come up with one, run numbers and talk to people. You are evaluating risk vs return vs amount of work involved over time and geography for different RE segments. Personally, I look at 50-200 listing a day every day, 2-20 houses a week, and I am not even buying. In RE you always make your money on your way in. You better come prepared. As @David Faulkner stated, you don't need to show strangers your bank account, but why not to ask a best broker close to home to help you find some opportunities for your relative who has about a mil to invest?

Good luck.

@Albert Bui

Most GC's in my area are at around 20%. So, on 120k project, they will want 24k directly to them. Other ways they make money is by marking up labor, materials, keeping rebates etc. So, on 120k project GC would be looking to make 30-50k, typically about 40k, so the project would end up costing you about 150 - 160k. Hope that answers your question.

Here is what we did in the past: Solid wood threads, don't have to be expansive wood. Pine is fine. Plastic or rubber runner, covering almost the whole step. We took our time to install it with embedded nuts in the step and bolts instead of screws. Hardware is matching the color of the rails. It is safe, durable, and can be easily replaced, whole or in sections. Clear plastic with pattern insures traction and let's color of the painted steps come through. I wish I had pictures. Best of luck.

@Albert Bui I am a licensed GC, 120k is my cost all in, done with my crew. It is hard to speculate on other people cost structure. The way we did this one, we are pretty close to 50/50 between labor and material. Now, I can't imagine doing a project like this for 20%, which seems like a going rate for GC services for other people. 

@Shaun M. - Interesting questions. My single biggest challenge was funding. I am not starting projects unless they are fully funded. 

@Scott Harper - city gets houses from the county, how and why - I don't know ... county gets houses for unpaid taxes.

@Glen Dall - N Minneapolis, around Penn & Broadway

@Evan Bell

1. We work on 2-6 projects at any given time. 

2. I made a deal with the city, city wanted it torn down, I offered to rehab it instead. But you get what you pay for :) Deals like this are a lot of work ... 

@John Cushing

Paid $1 for it, spend about $120k on the rehab, was on the market for $175k for 2 or 3 days before we got multiples. Accepted the number significantly over asking, will update on final once it closes.

@Evan Bell

Running multiple projects with one crew, took us about 8 months.

Making Minneapolis better one house at the time. Gut and rehab, including new roof, siding, windows, electrical, plumbing, hvac, drywall, fixtures, flooring and door knobs :) Took forever to do and 2 days to sell.

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@Ben Volkman

I will disagree with some folks here. Don't pay debt. Let inflation do it for you. But seriously, answer a few questions:

1. Can you borrow money? What is your borrowing capacity?

2. How much cash do you have?

3. What is your risk tolerance?

3. What are your investment options?

Run some scenarios in excel. Say your student loans are at 4%. After tax deduction, you are paying 2.5%, may be. Can you invest and generate 10-20%? If you can - why would you pay 2.5% debt? Also consider the inflation, that's what paying off our national debt :) What do you think inflation will do to your debt in 10 years? What will it do to your assets? Also, consider - having a baby will add expanses and reduce time you have available. Don't get all workout over measly 120k in debt. If you are successful in real estate, you will have one or two more zero's in your debt column. At any rate, you are doing well, good luck.

West of Penn is better then east, north of Broadway is better then south, north of Lowry is better then south, north of Dowling is better then south, north of 44th is better then south, north of Memorial Parkway is better then south. Stay away from the thoroughfares and you will be fine :) Best of luck.