All Forum Posts by: Douglas Mcqueen

@Demetrius Walker The benefit comes from the financing, owner occupied mortgages generally come with lower down payments, and lower interest rates. Also there are a slew of government programs that only apply to owner occupied dwellings (4 units and below) such as FHA loans, VA loans etc.. at the end of the day it just depends on your financial situation and how much $$ you want to put into the deal

For example rates at my local credit union as of this morning

Investment Property

15yrs (max) 2.525% with 25% down

Owner occupied 

Conventional 30 years 2.75% 5% down

FHA: 2.9% 30 years 0 down

@Jaylan Auguste First off I applaud you for getting this far, it may not seem like much but you are light years ahead of most.

I am 40 yrs old, I have been in Real Estate in some form or Facet for about 10 years, the one asset that we can not control is time.  I first read Rich Dad Poor Dad about 12 years ago and like most I found it profound, it started me on the path I am on today and from there I read many more books as you are now doing.  

If 40 year old me could sit down and have a conversation with 18 year old me the best advice I could offer would be to take significant action as early as possible.

I would read three books in order, Who Moved My Cheese by Spencer Johnson, Make your Bed by Admiral William McRaven and Set For Life by Scott Trench.  Then take action follow the plan laid out in Set for Life and just run.....

Take a long hard look at what your goal is, figure out the best strategy to accomplish that goal and then work towards it everyday, take action any action and move towards that goal, even if the movement in the beginning is small and seemingly insignificant.  Those small actions equate to big gains as they compound and by the time you are 40 you will be able to do whatever it is you want in this life.

Wholesaling is a great entry into the business, but remember it is a job once you stop working the money stops coming and it takes a lot of work to be successful at it, make sure that it fits into the strategy to get you to your goal!

It all depends on what your goals are and how much you want to be involved.  We are working a project now on an 8 unit that we are tearing down to the sticks and building back up, the numbers worked for us and we stand to do very well once stabilized.  These are the properties we target specifically for this reason, we don't normally even look at "rent ready" unless the numbers are really really good but find typically in our market that is usually not the case.

At the end of the day for us its about the numbers, if they work for us then the condition of the property is a mute point.  The bigger the project the more involved you have to be regardless of how much you contract out, you still have to run the project and protect those numbers, rehabs and repairs can get out of hand very quickly and your grand slam turns into a man on first or worse.

If you have the time and energy to devote to the project and the numbers work I say go for it! but if not then re-evaluate your goals, your needs and your wants and find a strategy that better serves that end, BRRRR is "A" strategy but its not the only strategy and it doesn't best suit every goal.

Figure out where you want to be, then work on how you will get there if you plan the route before the destination how will you ever know when you have arrived?

epending what stage in the process you are in you have a couple options, typically the seller will provide a rent roll at a minimum during the initial stages, we typically ask for a rolling 12 (covers the last 12 months and states what they owed, what they paid and what the balance is or was)  This is usually a document they produce in an excel type format.

Once you get to the due diligence phase we ask for tax returns and or bank statements showing the deposits to verify that the rent roll is accurate and that what they are telling us lines up with what they are telling the government.  Again this is ideal and not all property owners are reporting accurately to Uncle Sam, that is why we request bank statements as well.

Another option if the bank statements and tax returns are not jiving is to send the tenants an estoppel agreement which is more or less a statement from them to you of what they have paid and when and the terms of their lease as they understand them.

@Jared Boedeker here is what i have used in the past for initial contact

Dear John Reese,

My name is xxxxxxxxxxxxxxxx and I own a local Real Estate Investment Company investing in Hampton Roads. I’m an active member of the local investing community. My business partner, xxxxxxxxxx, and I are looking to make investments in the community.

I think your property at xxxxxxxxxxxxxxxxxxxxx is a great complex, I’m wondering if you have any interest in selling it. (Or any other building you would consider selling)

I am willing to pay fair market price for properties that fit our investment goals. Please contact myself or Neil at xxxxxxxxx or by email at Doug@xxxxxxxxxx if you would like to start a conversation about a possible sale.

We appreciate your valuable time. If you are interested please contact me at your earliest convenience.

We can close on a suitable property in the next 30-60 days.

We can save you tens or hundreds of thousands in real estate taxes.

We are serious buyers and don't want to waste your time.

Have a great day,

xxxxxxxxxxxxxxxxxxxxxxx

Ph: xxxxxxxxxxxxx

BulMac Properties

PS. No Commission, No Expensive Appraisal, just a fair price.

@Caleb Barnum Good afternoon and thank you for your service. The BRRR method is a great way to break into investing and if you couple that with house hacking you can get in for very little money down. Your particular situation qualifies you for a VA loan which you can use to purchase a property up to and including 4 units, the caveat being you must reside in one of the units. One potential pitfall however is that the property must pass a VA appraisal process, one requirement of that process is that the property is livable by VA standards which will limit you on the scope of work required on prospective properties.

In order to be successful in this method you must also have a good handle on current value, and after repair value and be able to nail down repair costs, a miscalculation on any of those three variables and what seems like a good deal could burn you fast.

The best advice I can give you starting off is first to figure out what your goal is, you want to invest in real estate but to what end? Real estate is a great opportunity to build or preserve wealth, it can be a means to lower your housing costs, provide passive income, preserve and build on accumulated wealth or to help accumulate wealth. You can be active or passive, and there are a myriad of different ways to do both hence the overwhelming part. So again figure out what your goal is for your real estate journey, once you know where you want to be its easier to figure out how to get there.

Market research is key, the better you know the market you are operating in and who the players are the easier it will be to find what you are looking for and also know what you are looking at. Market research where tell you where you want to be and where you don't, and give you a good idea of what to expect out of a certain area or submarket, this will allow you to move quickly and surely when an opportunity presents itself and help you with valuations.

Analyze everything, start looking at the properties you pass everyday, pick one and research it from address to strike price do this until you are able to get it done quickly and efficiently don't wait until there is a deal in front of you to try and figure out how to analyze it, its to late to figure out how that game is played and what numbers work and don't when the contract is in front of you do that home work before hand when the clock isn't ticking.

Finally this, Networking is key both online and in person, look into local REI groups and get active on the forums, get used to talking to people about RE and your goals.  Talk to folks in the area you want to invest who are out their doing it and see what's working and what is not.  Reach out and touch everyone you can, Agents, owners, sellers, buyers and other investors do not solely rely on MLS and Zillow to find what you are looking for. You can absolutely find a deal on the MLS and Zillow but just remember so can everyone else and once it hits the market the price goes up! Ask questions, ask a lot of questions and read books that relate to your goal, I have found that most people in this game are super helpful and want to give back, all you have to do is ask. Always try to add value, give more than you take, follow up and follow through that's the key to networking and building relationships in this business.

@Saemi Jung The beginning can be overwhelming to say the least there is ALOT of info out there and a ton of strategies. the best advice I can give you starting off is first to figure out what your goal is, you want to invest in real estate but to what end?  Real estate is a great opportunity to build or preserve wealth, it can be a means to lower your housing costs, provide passive income, preserve and build on accumulated wealth or to help accumulate wealth.  You can be active or passive, and there are a myriad of different ways to do both hence the overwhelming part.  So again figure out what your goal is for your real estate journey, once you know where you want to be its easier to figure out how to get there.

As @Amber Forkey said Market research is key, the better you know the market you are operating in and who the players are the easier it will be to find what you are looking for and also know what you are looking at.  Market research where tell you where you want to be and where you don't, and give you a good idea of what to expect out of a certain area or submarket, this will allow you to move quickly and surely when an opportunity presents itself.

Analyze everything, start looking at the properties you pass everyday, pick one and research it from address to strike price do this until you are able to get it done quickly and efficiently don't wait until there is a deal in front of you to try and figure out how to analyze it, its to late to figure out how that game is played and what numbers work and don't when the contract is in front of you do that home work before hand when the clock isn't ticking.

Finally this, Networking is key both online and in person, look into local REI groups and get active on the forums, get used to talking to people about RE and your goals. Reach out and touch everyone you can, Agents, owners, sellers, buyers and other investors do not solely rely on MLS and Zillow to find what you are looking for. You can absolutely find a deal on the MLS and Zillow but just remember so can everyone else and once it hits the market the price goes up! Ask questions, ask a lot of questions and read books that relate to your goal, I have found that most people in this game are super helpful and want to give back, all you have to do is ask. Always try to add value, give more than you take, follow up and follow through that's the key to networking and building relationships in this business.

If you take a look at my blog here on bigger pockets i have detailed how we find target properties, research and contact the owners, and get to and negotiate our deals.

Good luck on your journey I hope it all works out for you as i am sure it will, please don't hesitate to reach out in the future!

@Olga Kostrova another option you can look into is 30+ term rentals, most STR rules are for stays up to 29 days. "long term" usually trips at the 30 day mark, these seems problematic as it does take away a lot of the market if you are looking to pursue the Air BNB model and weekend warriors during the summer months but there is a local market for 30+ days and folks are doing quite well as there is a large contractor, nurse, government presence in the area... just food for thought.

As far as true STR goes reach out to planning in Va beach to get the actual information regarding what is and what is not allowed and where. the HOA or Condo Association can tell you yes or know as far as what they allow but the city will be the ones who come down hard if its not allowed where you are at. They have been cracking down in VA beach and the surrounding areas and i know they search through listings on sites like Air BNB and VRBO looking for violators. Its well worth the phone call or email ahead of time then get hit with fines, fees, and sanctions once you go live.

@Corey Chonsky Awesome!  We love networking with other local investors and are very excited to be working in Ocean View!

We Walked past the building yesterday it looks fantastic you guys are killing it! Would love to hear more about your dealings with the city and what the hurdles were!