All Forum Posts by: Jake Steven

Thanks for all the info everybody! That's what makes this site so great.

My wife and I are probably going to pass on this deal, mainly because of the HOA costs.

We are going to be financing, and it just doesn't seem possible to make this deal cash flow positive.  An added wrinkle is that I don't know how comfortable I am trying to haggle my family member down on price.  While the area is great and the price is decent, I think I would prefer a standalone building rather than a condo.

Anybody?

We recently had a family member offer to sell us his condo. It's in a great area, and the offer price is slightly below that of other comps in the area. Market price is around $180k, we can get it for $160k (using conventional loan, 20% down maybe 4.5% APR. We have good credit. He has a renter who pays $1300/month.

But the HOA is $400 a month! This seems like a lot and between HOA fees and taxes, it probably won't cash flow, but that got me wondering about something:

The condo is in a somewhat small building, only 8 condos. Should I assume that the HOA is being managed by those 8 owners? If this is the case, how much control might you be able to exert over where those HOA fees are being spent, considering you're now 1/8th of the HOA management team. Let's say you know what you're talking about and can actually spend the money wisely.

Thanks Mark for the response.

The plan is to do most of it ourselves at first.  Later on that can be adjusted I suppose.

I guess what I'm most concerned about is finding an expert who can help us navigate the world of loans, taxes, and legality.  I know that traditional mortgages aren't always an option depending on how much work the property requires, whether or not it is a primary residence (this will NOT be our primary residence, we'll rent it out), and so on.  I just want to make sure that we are leveraging our money in the best way possible.  We want to optimize the size of our down payment against interest and taxes, etc.

"You should be able to get a conventional loan and not have to do anything to elaborate."

This is interesting.  I thought we would be limited to mortgages or hard money lenders.  I wasn't aware there were other options.  This is why we need a professional! I can't imagine we would have much trouble getting a loan.  We have 750+ credit score and a decent amount of cash.

Thanks for the recommendation of Quickbook.  We use a service called Quicken, which is similar.

I'm leaning towards talking to a CPA first.  I think, if anything, they would be able to point us in the right direction.  

Hello,

My wife and I have saved up about $70,000 for the explicit purpose of investing in some local real estate.  We want to buy and hold, but that strategy can be adjusted should we find a more efficient means of investment.

Our very first step is to go talk to some professionals (CPA's, bankers, attorneys, real estate agents, other investors, etc).  But I was wondering who we should talk to first as we build our team.

Should we get in contact with an agent first to start looking for property?

Should we talk to a CPA with real estate experience first to start figuring out the financial details?

Should we talk to a bank first to figure out financing options?

Should we talk to attorneys first to figure out the legal side of things?

Who is the most important team member?  Where should we start?

My gut tells me that a CPA is the best place to start because they can give us more general advice about how to most efficiently leverage our cash.  Ultimately, the advice we get from this first professional will guide where we go next.

Thanks for any insight!