All Forum Posts by: Jeff McCaskey

@Sam Rose 

Hey Sam, sounds really interesting about the 40 unit thing. 

Do you have one in mind actually or are you just asking such a broad question???

I don't want to be hard on you here but I fell like I have to be. You are asking a very broad question as if buying a 40 unit is like asking "hey can you grab me a Pepsi from the fridge". 

Probably in the least this is a 400K project but you're in Jersey so it's got to be much much higher than it would be here in Kansas, unless you're buying slum low down junk that you shouldn't be looking at anyway.

This would be a pretty lengthy and involved decision and you would need to have a lot of knowledge about a wide variety of things to even approach this kind of project.

Most people will probably try to help guide you in some fashion and by all means please don't think I'm trying to be negative or have a mean tone to my text here. But from what I can gather about your experience, mostly from your post, is that you are very new. 

Why would you think someone could take the time and energy to "in an instant" teach you or convey the amount of knowledge this would take to pull off??? People ask these types of questions not just here but in general and it happens all the time. If someone wants to take on such a project by themselves then you should put in the work required ahead of time and not ask for help on this level.

I would recommend that you find a smaller place to start and gain some experience before looking at a project like this. You will likely be in trouble with this one.

RE investing for many people, is largely positive and fun but it also requires an enormous amount of hard work over a significant amount of time. And for your question to be so short, dramatically lacking in detail and about such an expansive type of investment - well it really just looks as if you really don't have any idea what you are doing. And to ask for that level of help without earning a stripe or two, well it can appear as a little offensive actually.

@Joel Owens was really kind to you in his response, he must be a good guy.

Like I said Sam, I don't want to be a jerk but I'm just a little shocked at your request. If you have questions, by all means don't let me influence you using BP for any reason now or in the future. Hell I'll even try to contribute to help you out but just as Joel asked you several questions, I don't even know where to begin to address your post.

@Louis Cavallaro 

I would echo what you got from @George N. . 

I did some research on an opportunity to buy a park almost double that size a few years ago and I can offer this info for you.

- Was told that a park at what would be peak occupancy is considered to be 95% leased space. With this being said and your park size 42/46= 87.5% occupied which means you do have some room for improving park revenue "potentially"

- I could have never financed the deal I was looking at. Owner wouldn't carry and it was about the same price as this park, like 700K or something, would have to get out my notes from the conversation to be specific. However there was a major concern about the infrastructure there as well. The park did eventually sell, twice I think, and it has had some major repairs performed - water system was shot and that is VERY expensive to replace as well as some paving that had to be redone which is also not cheap.

- Parks are becoming more scarce as time goes by, mostly due to municipalities not allowing new park permits to be issued for new park construction and older parks being decommissioned for a few reasons I can't articulately recall at the moment.

That is about all the solid I can do for you. Just make sure you do your due diligence or do it twice if need be.

Good Luck!!

@Sharon Young 

Welcome to BP!!!

@Baxter Stegall 

If it were me............

I would buy it to control the property first of all - living next to it and enjoying it so much.

If you will get good appreciation then that is an up side as well.

If you don't buy it and things do get hot like you seem confident about, well someone else will probably buy it later and you won't have any say over what happens over the fence.

It will likely get developed in some form at some point so you might as well keep it the way YOU like it while you live there and not worry about it after you decide to move on from the area.

Question is: Will you want to/be able to keep up with mowing, tree trimming/clearing etc etc basically maintenance of it while you own it - or want to for that matter??

Welcome!

Yeah you live in a dense area population wise and it can be competitive in the housing game. REO inventory is clearing and things getting back to normal. I don't know your market (I did live near Puget Sound for a while) but I would suspect that prices in the Portland metro are rising again at a decent clip.

Ways to find deals, do some more looking and reading first and you will be able to put it all together nicely. Maybe we can chat more later on after you finish some additional homework lol.

Driving for dollars is simply, well, a BP term i suppose (only heard it here), I would just explain it as getting in your car and driving around and area you want to invest in and look for property that might be a candidate for you. Stop and inquire, talk with neighbors etc etc. That seems to me to be the first basic instinct that is non web based when being a brand new guy to the game just starting out.

@Jered Sturm 

Very cool man!!! Very cool!!!!

Congrats and hope you guys get that 50 unit asap!!!

Jeff

@Chad Duncan 

I echo what they others said here. If you just do the math based on what you shared already then this deal loses money so that's as far as you need to go with it. Throw it out and forget it. If you do this deal you can forget going across the country and investing, you could go broke over the whole thing and that is the wrong direction to be headed. SO that's good news because you now know what a bad deal is so stick a feather in your hat and look for better numbers.

You say you're in Portland, I find it impossible that within an hour of the center of Portland that there aren't any good deals. It sounds like you were looking for strictly MFH???? That still can't be the case. I think you may want to go back and do some more research and reading, get a few books, listen to some additional pod casts and refine some of the methods used to find deals.

There are a ton of ways to find property:

Direct mail

door knocking

networking

craigslist

call adds or signs for rent and ask current landlords if they are willing to sell

driving for dollars

MLS

various RE agents

delinquent tax records/paper publications

re-purpose a building

etc etc

If you were looking for MFH then yes switch to SFR. One they can be easier to handle starting out, easier to finance, easier to manage than several units/people, and they are more abundant as well. And don't forget an exit strategy, the pool of buyers interested in SFR is much much greater than the number of buyers interested in MFH. So if you found and bought MFH and even if it was a nice deal - if you wanted to/needed to remove it from your portfolio, how much more difficult will it be to sell?? Your potential number of buyers is far far less so you could run the risk of being stuck with it for some time. With a deal like the one posted here, that could be a catastrophic situation.

I see looking back that you mentioned house hacking with this property, so if that's the case then it's a different situation than the straight forward investment and i guess that is up to you what you want to do with it. I have considered living in units that I own in the past but I never made a purchase decision based on that at all. I ran numbers and bought the property, later entertained the idea of living in a unit, always decided not to. So for whatever it's worth that's my opinion and I always run a deal as an investment and should I choose to live in one at some point in my life I guess that is a bridge I would have to cross later but at least I know the deal will cash flow and make money regardless of where I personally choose to sleep at night.

Running a rental is also different than personal ownership. Rentals and flips etc are business, should not involve emotions. A personal residence however often involves more than just running the numbers and can have plenty of other influences in the final decision. So mixing the two in my mind doesn't seem like the best set of circumstances, especially starting out. Also involved in a personal residence you would make different choices on how much to invest into things like fixtures, flooring, paint color/quality etc etc etc vs what you would choose for a rental which most often are less expensive materials and really not custom in any manner shape or form, so your "home" for a couple years might have all kinds of more expensive inputs and then end up as a rental unit later which may or may not be a good use of money after all.

Go get some books recommended on this site and others that you can google that come up as similar to. Read read read and read. Then after you have done some homework and are fairly prepared then I would ask for bits of advice you need to fill in the blanks. That's the best thing you can do, other than read all kinds of stuff here online though it won't be in order as in the books. Watch the podcasts too!!!

Probably depends on several different factors Steve. Every market and what comprises that market is different than the next. You would have to be more specific and since your're in Houston, be more specific about you and what you want out of your investing. I'm sure there are many people here who know that market, I however don't know anything about the Houston market.....

Jeff