All Forum Posts by: Henry Lazerow

For every 100 deals I run through of 2-4 units I send out maybe 2 or 3 of them to clients so around 2-3% of deals cashflow in nice area. You have to understand though those other 97% aren't bad or they wouldn't be selling they just aren't for you. Lots of people buy with higher down payments or look more to live in unit and focus on appreciation/paydown/rent growth. 

If property appreciates 2.5% a year at 25% down that's a 10% return. If you are house hacking and put 5% down you just made a 50% return in 1 year. Huge!  

The mortgage principal paydown comes to 5-7% return depending on rate at 25% down. 

Lots of people do this with 0 APR cards for the rehab cost. Sure I guess if you had really cheap houses could buy it with a card but the whole point is that you refinance before the 0 APR promotion is over otherwise you would have a horribly high rate mortgage. I had a client fund $50k rehab mainly off cards. If you have good credit there are lots of cards that give 0 APR.

You can then transfer the money through PayPal or various sites for 2-3% fee. Sometimes get 1% cash back and it comes out not much.

I have helped a few clients with their cash out refi by putting together a sheet with highest comps last 12 months. If there are some comps in that range the appraiser can usually make it happen. When the time comes feel free to reach out and I can put together a sheet for you (free) from the MLS.

In regards to what gets appraisal high... Add in unit laundry, add bedrooms, etc. Kitchen updates can help if you go to stone, etc.  Deck over garage helps a lot just did a 2 flat in Logan Square with a roof deck and appraiser was saying how impressed he was with the deck. 

I have lots of clients getting quotes so see many in last few weeks. Current rates owner occupant 25 down are in high 3s. With low down programs when count pmi it's in low to mid 4s. Non owner occupant is from 4.5-5.2 quotes.

Call Wells Fargo they tend to be the one buying these low rate mortgages from various brokers. They lend in all states so you could even call a Chicago one and have them do your loan. These are all Chicago rates. 

Saved up a bit more. You want money for down payment + RESERVES for any repairs. Then do house hack where you put down 3.5% and live in a unit. Add a seller paid closing cost credit to offer. 

I did it and came out perfect. Used higher quality 6mm luxury vinyl plank from Floor and Décor.

The 3-4s in my market are 500-1 mil so refi out half the money makes for a very successful project creating significant equity and any refi fees take up a much smaller percent then lower priced markets

NO. What a lot of people don't realize is even if we have a "mild" downturn FED may just drop rates which will strengthen real estate prices. Real estate prices directly correlate to interest rates they don't directly correlate to stock market, etc. just look at how real estate prices held out during the dot com bubble.

My personal strategy is too always be buying in the ups, downs, etc. It's nearly impossible to time the market.

Congrats! Check out house hacking. Buy a 2-4 unit in area you want to live. You will need 3.5-5% down. Almost all my clients add a closing cost credit so seller pays your close costs. Overall it's not too much capital and most lenders allow gift funds. 

I am not in your market but feel free to PM if questions in general on how it works. I closed 10 million of these last year it's my niche across the lake in Chicago. Your market is much cheaper then mine which gives you an advantage. If you can afford a 4 unit go that route they tend to cash flow the best.