All Forum Posts by: Forrest Williams

@Tyana Blackledge @Nate Pena I'm a big fan of the live in flip/house hack. I'm currently doing my 4th in the Chicago area. Several reasons why I think everyone should do a house hack: It teaches you repair skills you don't have. I could spend $200-300 on a plumber to install a bathroom faucet, or I can spend an hour learning how to do it via youtube, buying the parts, and doing it myself. Now I know how to change a faucet next time I need to, and I saved money.

It's a cheaper point of entry. Instead of getting a hard money loan or having to save up 20% for a down payment, you can get a house for between 3.5 and 5%. Get a dated one that needs a few improvements. While you live in it, you can fix up or upgrade items when you get the funds. Speaking of-

You can fill the house with roommates and start making money from the start. If you have a couple friends, great! If not, craigslist, Airbnb, Zillow, and Facebook marketplace are all great ways to find roommates. Just make sure they know you'll be doing some upgrades.

If you buy a house and it's your primary residence, you have to live there for one year. If you want to sell it and avoid capital gains tax, you have to live in it two years. So don't feel like you need to rush your repairs for a three month turn around. When you're done with it, you can keep it and rent it out or sell it, hopefully for a profit. Either way, I think house hacking is the best possible way to start your career. Why pay someone to mentor you when you can be your own mentor? That being said, feel free to reach out if you want any tips or to talk about experiences. Good luck!

A friend of a friend is looking to get her mobile home sold in Joliet, and is having trouble finding a RE agent who cares about mobile homes. Anyone have a good recommendation?

@Anthony Panepinto I don't know the Toronto market, so I trust you that it's super expensive. I found that in Chicago as well, so I looked to the suburbs and found something that works for me. It may be worth expanding your search radius. 

In regards to your plan- if you're up for it that's great. I would try to secure funds from family and friends first. If you buy a building that needs 20k, but can only raise 5k, you'll be in trouble. However there are other ways to improve your cash flow other than raising rents. Maybe your garbage bill is crazy high and it would be cheaper to get a dumpster. Do you have parking spaces you can charge for? Can you cut down on snow removal or landscaping by doing those yourself? If the building is big enough, you can cut down on expenses and raise the value that way. Buildings with more than 5 units around here tend to mean commercial loans.

Another great option is owner financing. If you can find someone to sell it for a smaller down payment, then a balloon payment in 1-2 years, you can use some cash to fix and refi at a bank to cash them out. Just make sure you can qualify beforehand! Good luck, sounds like a fun project to me. Hit me up if you want any more armchair investor advice.

Blue Store's card can be used for 0% financing for 12 months (I think) or flat 5% off all purchases. I do that and pay it off every month.

Not sure your numbers add up. In the states, lots of banks look for 20% down for a multifamily, even owner-occupied. If you spend your $200,000 on the down payment for a $1,000,000 multifamily, that leaves you with $0 to spend on renovations and the like. You probably won't be able to increase the value that much for free. 

If you want to BRRRR something, you need to find a house where the ARV is equal to $285,000 or so, if you're all in for $200,000. That can get you a 70% refi to get your cash back out. You may be able to get as much as 75-80% out depending on the bank.

I don't want to discourage you, you definitely have the funds to get started. Where I'm from, Chicago area, you can certainly BRRRR a multi family for $200,000 all in. You're just dreaming a little too big . . . for now.

@Marc Desrosiers great point. I do that with the blue box store too. Have you ever looked into their $50,000 project loans or anything? The rates seem high, but if you're doing a smaller place with a fast turnaround it may be worth it. 

To address your question @Joshua Lira, partners are another option. I've done deals where my partner finances everything, and I do all the work. I've also done house hacks where I pay for everything, and with roommates and my 9-5, fix the house over the course of 2 years or so. It takes more time, but it can be done if you don't mind drywall dust on occasion.

Welcome Darren! What are some of your real estate goals?

Something that has helped me with my communication skills is knowing how to contact each person on your team. There are many options nowadays, email, texting, phone call, facebook message, etc. Find the method your contractor/agent/lawyer likes to use, and exclusively use that method to contact them. I've texted contractors who I've just gotten off the phone with, and it's like yelling into the ether. Some people have full voicemail boxes like you mentioned, meaning voicemail is NOT a good way to contact them. I email my lawyer; she instantly gets back to me. Learn each person's preferred method and they will be easier to contact. 

Not a real estate example, but I had a employee who would only communicate with me via snapchat. That threw me for a loop. I was 24, but it was enough for me to feel like I was 80.

There are many ways to buy property that are much less sketchy. Check out zillow. Talk to a real estate agent and get set up on an MLS alert for your area. You aren't going to smash it out of the park on your first one most likely, but there are deals to be had without going to a wholesaler you know nothing about. What market are you looking in? Southern California?

For sure listen to @John Warren, I've been to his meetups a few times and they are great opportunities to meet people and learn.