All Forum Posts by: Fang Underhill
Fang Underhill has started 12 posts and replied 51 times.
Post: What is your rental equity expectation?
- Posts 54
- Votes 13
Originally posted by @Rob Gillespie:
@Fang Underhill that completely depends on the market.
If you’re investing in a strong market that has great appreciation then you can pay market value for it.
If you’re in the market like Cleveland Ohio that has minimal appreciation then I do not believe you should be into it for more than 70% loan to value. The properties I sell to my investors usually have more equity than 30%.
Also take into consideration the terms you’re getting and the cash flow.
Best of luck!
Thank you for your reply, Rob. " The properties I sell to my investors usually have more equity than 30%." before repair costs or after repair costs?
Post: What is your rental equity expectation?
- Posts 54
- Votes 13
Originally posted by @Kevin Hunter:
35-40% equity
That's so terrific !!
Post: Investment in Syndication
- Posts 54
- Votes 13
Originally posted by @Jodi DeCarlo:
We closed on an 316 unit A class multi-family building north of Ft. Worth, TX with our equity partners. What type of returns are you guys getting on your deals? Is everyone still investing in multi-family? Any investments in hotels or industrial properties available?
Congratulations on your syndication! I am in DFW area too.
I did have investors bidding on hotels (most hotels are half off but Collin county already sells higher than 50% off). Industrial is nice but very high priced. We actually look into investing in small strip centers-buying cheap now and starting renovation and permit, and waiting for economy recovery.
Post: Building affordable Housing in Orlando
- Posts 54
- Votes 13
Originally posted by @Matt Nico:
Hey Central Florida,
Has anyone ever tried or have personal experience in building or buying affordable housing? Im beginning to start to look at parcels of land to buy and develop rather than keep buying SFH's. I want to be able to build a type of small development with eco-type homes where they can be rented out cheaply.
If you dont have experience, what do you think of this strategy? I feel like its a great way to improve my community, make passive income, and also solve a problem of affordable housing
I love affordable housing! I think everybody deserves a place to live! Eco friendly homes are so good for our environment. Keep on dreaming! It will come.
Post: Residential or Commerical
- Posts 54
- Votes 13
Will you do residential or commercial ? i know the topic is very broad. Just want to spend a minute to think about it tonight.
Residential pros: less risk, steady
Residential cons: management, return
Commerical pros: higher return, less day to day management
Commerical cons: more capital, higher risk
What do you think?
Post: What is your rental equity expectation?
- Posts 54
- Votes 13
Originally posted by @Kenneth Garrett:
So your investors stay in the deal. You'll need a pretty good deal to pull that off so they receive a decent return on there money. I prefer private lending and I refinance them out 100%. The deal needs to have enough fat in it to work for everyone. I have completed many BRRRR's where the cash flow was in excess of $400 after everyone is paid back and the refinance has been completed.
That's better deal than what we got then.
You get 100% of the property appreciation and $400 cash flow with no money in the deal.
Us is 70% of the property appreciation and $490 cash flow with no money in the deal.
Way to go! Keep up the good work!
Post: What is your rental equity expectation?
- Posts 54
- Votes 13
Originally posted by @Jonathan R McLaughlin:
@Fang Underhill no, more than that. The commission is only one part you have closing costs for any loan, tax liabilitynot to mention accounting and legal fees you incur from adding to portfolio. I'd say closer to 10%
Ok. 10% equity is better than nothing.
Post: What is your rental equity expectation?
- Posts 54
- Votes 13
Originally posted by @Kevin Hunter:
@Fang Underhill, it is that delicate balance between overleveraged and too much dead money. I think 60-65% is that sweet spot for value add deals and overall portfolio numbers...
60-65% means?
Post: What is your rental equity expectation?
- Posts 54
- Votes 13
Originally posted by @Kenneth Garrett:
So your investors stay in the deal. You'll need a pretty good deal to pull that off so they receive a decent return on there money. I prefer private lending and I refinance them out 100%. The deal needs to have enough fat in it to work for everyone. I have completed many BRRRR's where the cash flow was in excess of $400 after everyone is paid back and the refinance has been completed.
Well done, Kenneth! That's a great return and a total win-win.
Post: What is your rental equity expectation?
- Posts 54
- Votes 13
Originally posted by @Fang Underhill:
Originally posted by @Kenneth Garrett:
If your taking about the BRRRR strategy then you should shoot for 75%-80% LTV after rehab. Run your numbers so the rehab forces the equity. Although, the concept of the BRRRR strategy is to get all your money out, that is not very realistic many times. I generally end up with $5000 stuck in. This allows me to have all my money out in 12 months via the cash flow.
Will you have any cash flow after BRRRR?
I did a trial run for one case. I do not know whether this is better or not than BRRRR. We sell 30% shares to investors and we end with $400-500 cash flow and $10k to our pocket.