All Forum Posts by: David Ribardo
David Ribardo has started 3 posts and replied 183 times.
Post: 50 year old NEWBIE in Lehigh valley PA

- Real Estate Agent
- Allentown, PA
- Posts 193
- Votes 177
Shane, good luck! Finding a good contractor in my opinion is the biggest challenge for new investors. It's easy to find good contractors, but they will charge you an arm and a leg. It's easy to find someone willing to do the work cheap, but they don't always do it well.
My recommendation is to get at least three contractors to walk through a property with you. This will give you an opportunity to discuss rehab with them, get a feel for their style, and evaluate their professionalism. Before you meet them, have a written list of what you are looking for them to do. This will avoid the awkward moment when they ask what you want, and you say "umm... an investment property rehab?" and they just roll their eyes. It's even better if you have a standardized list of finishes picked out, this will save you a ton of time.
Post: Newbie here in Lehigh Valley, PA

- Real Estate Agent
- Allentown, PA
- Posts 193
- Votes 177
Hello @Juli Febbraro! I made the transition to being a full time agent last year and couldn't be happier. I did a "jump in with both feet" transition, going from Army officer to full time agent. It gave me the motivation I needed to be successful from the start.
My biggest bit of advice - talk to several teams before you decide on where to hang your license. There are huge differences between the business models and team dynamics in different brokerages. Find one that fits your goals and personality. Don't just talk to the broker, but talk with an agent or two to hear what things are like from their perspective. Look for one that has low to no fees, and allows you to keep a high percentage of your commission from the start- they are out there, I promise!
Post: New investor in NJ. 100k budget

- Real Estate Agent
- Allentown, PA
- Posts 193
- Votes 177
@Rushda Hakim, within your area I'd recommend looking at the Allentown and Philadelphia markets. Both have been appreciating strongly with good economic growth and have strong rental demand. I personally think the laws and taxes are more investor friendly on this side of the river, but that's not to say that people aren't crushing it in NJ as well.
I recommend new investors start by setting long term goals, and working backwards from them to come up with a plan to get there. What are your goals? What's your risk tolerance and level of involvement you are looking for? With the resources you have and current market conditions, what strategies will be the best to get there?
When evaluating markets, I like to look at the average rents, average days on market, and average cost to purchase. I then can use these numbers to come up with an expected rate of return for my money. For example, in my old neighborhood of DeRidder Louisiana, I can expect to get $760 / month in rental income for a $100,000 property... but in certain areas in Allentown, I could expect to collect almost $1,800 for that same $100k property!
Post: HELOC/HEL for down payment or Owner Occupy first Duplex?

- Real Estate Agent
- Allentown, PA
- Posts 193
- Votes 177
@Christopher Bongo, If you move to Allentown and house hack, what would you do with your current home? Would that work as a rental, or could you sell it for a profit?
One other option to look into would be USDA financing. They have a multi-family program which could allow you to purchase your next investment property with very little cash out of pocket, as long as it is in a rural area. This wouldn't work in Allentown, but anything more than a few miles north of Rt. 22 would qualify. https://www.rd.usda.gov/programs-services/all-prog...
I would be careful not to over-leverage yourself at this stage in the game. If the market takes a turn or your next deal doesn't go as planned it would be very easy to get upside down on your property and have trouble making ends meet. You should talk to a loan officer to determine eligibility. Most big banks will follow FHA guidelines, but some of the local banks / credit unions have more aggressive products and can lend with higher LTV or DTI limits once you have some experience.
Post: Feedback on potential deal

- Real Estate Agent
- Allentown, PA
- Posts 193
- Votes 177
@Jose Romero, I agree with @Basit Siddiqi - the asking price is too high to be a good deal, and I wouldn't expect to be able to add a third unit based on a typical property in the neighborhood. To buy at a 10% Cap rate the seller would need to come down to roughly $100k. I wouldn't get too excited about this one, since there are currently 16 duplexes in the neighborhood listed for a lower price.
Post: estimating rehab costs

- Real Estate Agent
- Allentown, PA
- Posts 193
- Votes 177
@Michael Prasto. If you can pay cash up front, I always recommend going that route. You won't have to pay interest as a holding cost, and when you do get it rehabbed, you can then refinance and keep it as a rental, or sell it for a flip. Don't write your options off though, you could do a 203k loan which would include both the property and the maintenance budget!
If you have to ask about getting an inspection or not, you need to get one! A contractor will ask you "what do you want me to do with this property". If you don't know what work needs to be done, it can make for a very awkward moment! (I may have done that when I first got started) A home inspector is there to look for problems with the structure, fixtures, and utilities and provide suggestions on the best way to repair or mitigate them. In addition, if you get a home inspection, typically that is another point in the transaction where you can use the results to negotiate for repairs or a lower price.
Post: Facebook lockout -- help needed

- Real Estate Agent
- Allentown, PA
- Posts 193
- Votes 177
Joe - the best way is probably to call them. I had a friend get locked out after their college email address was deactivated, that worked for them.
Post: Auction, Title Insurance, and Quit Claim Deed

- Real Estate Agent
- Allentown, PA
- Posts 193
- Votes 177
Kwame, you definitely need to talk to an attorney for proper advice. You most likely will need to do a suit to quiet title which will then allow you to sell it. Based on what you described, the person with an ownership interest that was not notified may still be able to take action. There have been instances where people have let their property go to sale, get purchased by an uniformed new investor who immediately starts rehab, and then recovered it, basically getting a "free renovation" at the expense of the investor.
Unfortunately, this is not on the city. On the Lehigh County upset sale website, it clearly states "All properties are sold WITHOUT GUARANTEE OR WARRANTY WHATSOEVER", and "It is recommended that potential buyers seek the advice of an attorney and research the property". I recommend you focus on clearing the title, and accept the legal fees that come with it. It's a lot better to pay a lawyer several thousand bucks and be done with this deal then sit on it and pay the holding costs that will be racking up.
I work with clients to buy at these sales, and we hear about this all the time. Of the hundreds of properties at each auction, only a small percentage are good deals. Properties can come subject to hidden liens, be occupied and require ejectments, and I even know a guy that bought one not knowing it had burned to the ground!
Disclaimer - I'm an agent and cannot offer any legal advice. I recommend you talk to an attorney.
Post: Any good wholesellers in Lehigh Valley area?

- Real Estate Agent
- Allentown, PA
- Posts 193
- Votes 177
Hey James!
Some general info on sales channels. You will get the most money by listing with an agent, and selling it to an owner-occupant. It's a great time to be selling, as there is not a lot of inventory on the market and demand is high. A well priced unit will get multiple offers its first weekend on the market.
Next would probably be a for sale by owner, which if you know what you are doing, can save you the listing agent's commission, and sometimes even both commissions, making it more profitable. On the flip side, I just closed on one of them that turned into a nightmare. The sellers thought they knew everything about real estate, and their stubbornness almost caused the deal to fall through several times. I only recommend this route after you have done a few sales.
Following that, I'd list it on the MLS as a investment property. Investors need to make their profit, so they generally will offer less on the same property than an owner-occupant.
Selling it to a wholesaler will be your least profitable route. They will give you a price that allows them to make their profit, AND an investor to make their. However, there are times when the convenience of this route is worth it, such as if you need quick cash to close on your next deal.
Post: estimating rehab costs

- Real Estate Agent
- Allentown, PA
- Posts 193
- Votes 177
Hi Michael, there are a few different ways.
If you have a good agent, they should be able to walk you through the rehab costs as you walk through the property. That will give you a rough estimate and let you know if the property is worth your time. For me, as an investor and agent, I am always looking at what level of rehab will yield the most profit.
A second frame of reference will come from your home inspector. They should be able to give you a second opinion, which will be more focused on structural integrity and code standards.
Paying a contractor is a great strategy for learning. It sets an expectation of spending a few hours walking around a property with them answering a million questions. I recommend doing this with a few contractors, so you get a variety of opinions and see their different approaches to the same property.
Lastly, you could be like me... buy dirt cheap slumlord property, and learn to fix it all up yourself by watching youtube videos. I did that for my first six rehabs, and it's given me a much better ability to work with contractors. It's also the only way to do an almost-full rehab for less than $1,000 of paint, drywall, tile, lights, and caulk! It's work, not investing, but learning that skill set really has helped going forward.