All Forum Posts by: Gorden Lopes

Hi @Avinesh Ram

I am OOS of state investor in Huntsville and I agree with @Dave DeMarinis that although Huntsville is a great market it really depends on which zip codes you are buying and many other factors.

Even before looking at any properties I would recommend start by talking to realtors, PM and other investors to get a overview of what areas to avoid and what numbers to expect. I have been using RCPM as my property manager and I have been happy with them. 

If you read through the threads in the Huntsville forums you will get a tons of information as well. I personally like this below discussion that happened few months back.

https://www.biggerpockets.com/forums/597/topics/520388-huntsville-alabama-path-of-progress

Hope that helps!

Cheers!

Hi @Danny Randazzo

Thanks for sharing your story! It trully motivates people like me to take small actions every day and replying to your post is one of them!

I have been working in silicon valley rat race for the last 10 years and 3 years back read "Your money or your life" which just changed everything for me! And then stumbled upon the great BP podcast and forum! After 8-10 months of reading RE books, listening to podcast and cold calling other investors I purchased my first SFR! That same year I bough another SFR and did a BRRRR! I just recently closed on a quad couple of months back and slowly but steadily inching towards a life where my money works for me rather than the other way round!

As any RE investor I am trying to learn as much about multifamily investments as I can by just following folks like you who have found success! 

Cheers!

Hi @Einat Menashe

I usually rely on Rentometer to give me a rent estimate and I also look on Craigslist and Zillow rents to see how much houses in the neighborhoods are renting for.

As for establishing a relationship, once you have done a deal with a realtor I am sure you would have established enough trust and if you are really using a realtors help in a wholesaling deal then there are ways where the realtor can be compensated in the wholesaling deal. And once a realtor has a incentive to help you things will be much easier.

Hope that helps!

Hey @Clayton Mobley!

Thanks! Means a lot coming from you!

Hi @Samuel Garrett

I am receiving 700$ for the 2 units and 625 for the other 2. There was some mess up on the leases from the wholesaler side which he did not mention up front and I made a stupid mistake of not following up on my request and ended up being a messy affair after we close where the tenants from the 625$ units said that their existing lease from the previous owner has not expired and they will not pay 700$ rent. Their existing leases expire in Feb/March, so I am waiting on that to expire so that I can bump them to 700$.

I am using Professional Management Services, LLC. I am trying them for the first time so its been just couple of months, so its still honeymoon period! :) So cannot really give much review on them. They have been good in the last couple of months i have used them.

Investment Info:

Small multi-family (2-4 units) buy & hold investment in Huntsville.

Purchase price: $222,000
Cash invested: $60,000

4 unit multi-family with 2/1 each unit, separate water and electricity meter. Found this through a well known wholesaler and this was my first multi-family and first time buying from a wholesaler. Mad few rookie mistakes during negotiations and learned a tons of things, it was not a smooth process but was finally able to close. The quad already had existing tenants so it started cash flowing from day 1; with my very conservative estimate I think this will cash flow atleast 500 per month.

What made you interested in investing in this type of deal?

The property was in one of the zip codes that I was looking for and the property need almost zero rehab.

How did you find this deal and how did you negotiate it?

Got this deal through a well known wholesaler. It was listed for 245K and one of the investor I spoke to said that at 245-250K this is a good deal (which was not the case). I ran my numbers and came up with a 240K offer, and my offer got accepted. I had ran my numbers based on 4.5 rate quoted by my loan agent but ended up getting 5.625, due to which I backed out of the offer and was ready to loose 1k ED but the wholesaler came back and we negotiated the price down to 222k.

How did you finance this deal?

Conventional financing, 25% down with 5.625 rate.

How did you add value to the deal?

Did not do any value add.

What was the outcome?

I am getting total 2650 per month total rent from this one and with PITI and expenses I think I will cash flow atleast 500 per month. Not a home run but hoping to build on this experience and buy some more multi-families in the near future.

Lessons learned? Challenges?

Learned tons of lessons on this one
1. Never ever trust the numbers of wholesalers as they always over value so always double check.
2. Who ever wants it the most is always the "looser" in any negotiation. I realized that I over bid on this one and so I had a frank conversation with the wholesaler and gave him my 1k ED and walked out of the deal. He came back to the negotiation table and I was able to negotiate a number which worked for me.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

I would recommend my loan agent Ashli Williams from the Fairway Mortgage Corporation. With her help I was able to close this deal in less than 3 weeks.

Investment Info:

Small multi-family (2-4 units) buy & hold investment in Huntsville.

Purchase price: $222,000
Cash invested: $60,000

4 unit multi-family with 2/1 each unit, separate water and electricity meter. Found this through a well known wholesaler and this was my first multi-family and first time buying from a wholesaler. Mad few rookie mistakes during negotiations and learned a tons of things, it was not a smooth process but was finally able to close. The quad already had existing tenants so it started cash flowing from day 1. It has just been couple of months and so far things are looking smooth. With my very conservative estimate I think this will cash flow atleast 500 per month.

What made you interested in investing in this type of deal?

The property was in one of the zip codes that I was looking for and the property need almost zero rehab.

How did you find this deal and how did you negotiate it?

Got this deal through a well known wholesaler. It was listed for 245K and one of the investor I spoke to said that at 245-250K this is a good deal (which was not the case). I ran my numbers and came up with a 240K offer, and my offer got accepted. I had ran my numbers based on 4.5 rate quoted by my loan agent but ended up getting 5.625, due to which I backed out of the offer and was ready to loose 1k ED but the wholesaler came back and we negotiated the price down to 222k.

How did you finance this deal?

Conventional financing, 25% down with 5.625 rate.

How did you add value to the deal?

Did not do any value add.

What was the outcome?

I am getting total 2650 per month total rent from this one and with PITI and expenses I think I will cash flow atleast 500 per month. Not a home run but hoping to build on this experience and buy some more multi-families in the near future.

Lessons learned? Challenges?

Learned tons of lessons on this one
1. Never ever trust the numbers of wholesalers as they always over value so always double check.
2. Who ever wants it the most is always the "looser" in any negotiation. I realized that I over bid on this one and so I had a frank conversation with the wholesaler and gave him my 1k ED and walked out of the deal. He came back to the negotiation table and I was able to negotiate a number which worked for me.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

I would recommend my loan agent Ashli Williams from the Fairway Mortgage Corporation. With her help I was able to close this deal in less than 3 weeks.

HI @Asa Ifill

Great job on hustling and finding this deal. Reading your post I feel that there are tons of foundation issues with this house and the thing with foundation issues is that you will get different quotes that will range from 15k - 60K! And there can be many hidden issues that might not show up in the inspection as well!

As a investor who is just starting out I would recommend either pass this opportunity or really lowball the heck out and have 20k-30k of margin of safety. 

My personal principle of investing is that I don't touch any property which has foundation issues as there is no easy way to estimate the repair.

All the best and do keep us posted on what you decide!

-Gorden

@Lane Kawaoka

Congratulations Lane! Two deals in such a short span! You are definitely on a roll!

Good stuff buddy, you motivate guys like me to hustle more! :)

@Dennis Cobos

Congrats on your first rental investment! 

I am a fellow huntsville investor from Bay area and have couple of SFR and a quad. I am currently using RCPM and have been happy with them. I really love Huntsville!

We have a bay area Huntsville investor group and I would be happy to add you to that group and you will get many recommendations from there as well. PM me and I can give you more info.

-Gorden