All Forum Posts by: Frank B.

Thanks for the insight Frank B! Curious why you wouldn't consider repairs into that figure for rent?

For all of the successful Buy and Hold investors:

What percentages do you use for the following when evaluating a potential buy and hold income property:

1) Cap Ex

2) Management

3) Vacancy

4) Repairs

Thanks in advance!

Alright so now for a new update!

I sent out 5,000 zip mailers without offers in it and got so many responses I thought I was gonna go crazy! Haven't counted yet but it's about 200 something range of call backs.

Of all those call backs I got, if I remember correctly, about 8 "deals" out of it and quite a few warm leads. A few of them were ready to sell and accepted my low offer but they were inherited properties and the new owners were still grieving and gave me a date of when we can start the buying process ( most of them a month or two later and some of them needed like 5 months).

Also, I had three AMAZING deals where the seller accepted I think like 40% of ARV but the deals never went past that. Two of the sellers wanted references and after I sent them references they were still unsure because they thought it was too good to be true!

And the last one, she was upset about the $100 contract deposit after she received the contract to sign and said she wanted 5k to 10k so I sent a new contract back with a 5k deposit cos I KNOW i could sell it within a couple of hours of having it under contract but she stopped answering my calls after that second contract went out. I literally phone stalked this woman. Probably called her like 6 times a day for a whole week! The problem was I think I may have sounded a little desperate over the phone with her but that one deal would've made me 60k! Heck yea I want it! Oh well.

So basically that mailing would've netted me some serious money. In the almost 200k range! But my sellers were in disbelief that I would actually purchase their property. Since then I've been working on my phone and selling skills and have been taking note of what I was doing wrong. Soon after, I had gotten a call from some loan guy when I was applying for some capital money to ramp up my business but he sounded soooo desperate over the phone and I was like "ew! Is that what I sound like to my sellers?!". I blew him off because of it and that taught me a real lesson. DONT SOUND SO EXCITED AND DESPERATE THAT THE SELLER ACCEPTS YOUR LOW OFFER! It makes the sellers think it's a scam or that something is off.

That same month I sent out another mailing (postcards) with offers in it this time to a VERY targeted list and I got so far out of the like 10 calls to 1,000 names I got one seller. She accepted my offer that was in the postcard because it was an inherited property but it turns out she has two properties to sell! This one is going to be a little tricky because she has a tenant in one of the properties that she needs to evict and both properties are in a D or F neighborhood. I'm definitely lucky to get her though. My goal is to make $10k for each property. We're finally signing contracts tomorrow. Wish me luck! I'll come back with updates in a month or two.

Good luck everyone and thanks for all your support and awesome comments! I hope I can help another newbie out these to realize that this business is EASY and you can make some serious money despite it being tedious and overwhelming at times.

Thanks for the reply.

I just want to confirm - maybe I used the wrong terminology but in my example, I think I am calculating the tax based on income.  I just called all of the expenses a deduction (though I forgot insurance), but I think I still get to the same taxable number.  Is this right, or am I off base here?

Also you are right, I had a typo and divided 160k by 37.5 instead of 27.5.  The depreciation deduction should be $5818.