All Forum Posts by: Henry Lazerow

I work with a lot of younger professionals and this is pretty common for those who are early in careers without a ton of savings. If you have cool parents who will help your investing definitely take them up on it. Just be sure it's a low risk deal for example a buy and hold don't go using them trying to do your first flip, etc. 

I think the FHA statistic is something like 26% of FHA loan down payments were aided by family members. It's a pretty common thing.

Have your broker set you up on auto alerts for each day at 12:00 noon. When you see a good deal offer aggressively and jump on it! There is also something called TAN where brokers post listings a few weeks before market.

I closed 10 mil last year off MLS/TAN and all the deals were cashflow positive on north side. Only small percent of deals in mls work but if you look every day you will easily find the ones that work. Forget 1% rule though that rule is made for lower price properties where cap/ex is a higher percentage of gross rents. A $500k property at .8% in a good area is more true net profit then a $100k property at 1% in some rural C class area. Factor in total yield not just COC.

In Hermosa you can find 1% easy there is one up right now at 1%. In Pilsen/Heart of Chicago there is one that hits almost 1% up right now also. Little Village has gotten super hot and the likely appreciation is kind of priced in right now but some cashflow deals here and there. Tri Taylor there is a deal almost 1% up right now. Lots of deals out there. 

Make sure you are running analysis using market rate rents with quality photography/marketing and not the mom and pop decade old month to month style rents you often see listed in the MLS.

This 100% "I dont pass over dollars to save pennies. I close deals. Too many people pass over good properties over a few grand, which is just absurd."

As a realtor who works mainly with investors I see this all the time. There are two sets of people. My successful repeat clients who buy a deal if the numbers work and don't care about going up 1-3% and another group who low balls and ends up never getting a deal they then eventually give up and never get into investing. 

I will say probably depends on your market. In Chicago the north side is growing and in strong demand. In somewhere that is more of a buyers market what works may be very differant. 

At least in Chicago no one really loses earnest money (within reason). You can always pull some bs that the loan can't close off that contingency, etc. Even if they tried to take her earnest money refuse to sign the earnest release form and there is now a cloud on the title making it difficult for seller to legally sell property to someone else. 

Better option though if she likes the property just fix the roof should be able to get it fixed for much less then $20k if you shop around and then you will have a new roof for many worry free years. 

Nice flip! This looks like a quality real rehab and not just a cheap cosmetic job. 

The rehab costs $147,500 as per what the GC listed in their permit. (Looked it up haha)

As a first time investor doing a 203k I could see you getting quotes $250-300k easy though. These guys probably have their own crew or are the GC themselves. 

I don't want to name bank as everyone gets differant deal but there is one that can do 15% down interest only on these type of builds and then you refi out into 25% down permanent financing with the equity gained basically BRRR before flipping. Some people use cash for the rehab but usually financing. 

I have seen the start to sale on lots of these type of north side projects. Feel free to PM me any questions. 

Computer science is a great major and should land you a job where you can easily finance your first projects right out of college. The days where you could buy for little money and see huge appreciation cash out refi and quickly build multi million dollar portfolio are gone. It's a lot slower now that we are far past the recession and it takes more capital now to grow. You can still get rich in real estate but it takes more money and more time. 

P.S I am a Realtor and have also started two successful businesses. I have a college degree and it definitely helped get my foot in the door through a real estate internship during college. 

Usually if something doesn't sell it's due to being overpriced. BUT sometimes you get a really bad realtor. Believe it or not there are a lot of realtors out there who if the property doesn't sell first month they think they are wasting time showing it and just start to ignore all showing requests. I have had this happen multiple times in the class C neighborhoods where properties are lower priced and you have bottom tier realtors. A good way to know if this is the case is to send a fake tester email to your realtor pretending to be someone interested in the deal asking for a showing. This will also help you gauge how quick their response is. 

Add them to a parents credit card with a long credit history. I have seen this bump scores up in a matter of weeks. 

You need some reserves. I work with clients in your similar situation and I always tell them you need at least a credit card you can charge $10k to if the property needs a new roof, etc. 

A lot of people don't realize how quick a property can be ruined. I have literally seen a 3 unit building that was $500k at one point get a roof leak doesn't fix it and it drips water through all 3 units making a giant hole in the building rotting out wood, etc. where you can see from 3rd floor to basement through the hole. LOL don't buy properties without reserves.

The one biggest factor I have found in decreasing vacancy is in unit laundry and pet policy.