All Forum Posts by: Jamie Jones

@Jalen Sowell I find myself in a very similar situation as yourself with comparing investing in Nashville versus my small and cheap hometown. I own a primary home and 2 long-term rentals in the Nashville area that have done GREAT in appreciation growth but just okay in cash flow, and I own a duplex in my hometown that has done GREAT in cash flow, but probably not appreciated at all. 

It all comes down to what your goals are. Why are you wanting to invest? What gets you more excited: getting some extra income each month in the form of cash flow OR building huge amounts of wealth over the long term from holding property in one of the fasting growing metros in the country? 

The best thing is you don't have to choose one option in exclusivity to the other. It sounds like you have a solid savings rate with your current income, so maybe if you buy a couple cheap properties in your hometown that cash flow really well, you can increase your savings rate and buyer a Nashville property. That way you can get your strong cash flow from the cheap properties and the long-term wealth building from your Nashville property. 

Let me know how you decide to proceed! 

What is your personal goal with real estate? To have enough cash flow to quit your day job, or to slowly accumulate wealth through appreciation, debt paydown, etc.? If your goal is solely to achieve financial freedom from cash flow, then MAYBE it makes sense to sell, and pay cash for another rental in a cheaper market or a couple down payments on more expensive properties. 

However, I often think we can get in our own way in the name of needing to take action, when often times, especially with real estate and money, time is our best friend. In your scenario, it seems like you would be trading something very valuable just to hope to obtain the same thing. 

My recommendation, without knowing anymore information, would be to hold tight. If you are wanting to scale and build your portfolio, then talk to some lenders on ways to tap into your equity and put that to work. Then you get the best of both worlds - you hold onto your fruit tree while simultaneously using its fruit to grow more trees.  

Hi @Sam Chicquen, I am located in Mount Juliet (suburb about 15 miles from downtown Nashville). Happy to help anyway that I can. 

@Josh Duncan got it. A hard money loan or private loan may be your best bet then, since you only need the money short-term. The though part is with no prior experience, it is a lot tougher to get that type of financing. If the property is owned free & clear you could explore seller financing, or subject to if there is a loan on it.

Assuming you have other income sources, and the cash for the down payment, you could always look at a conventional loan as well (will be cheaper than hard money). The property would have to be in good enough shape to lend on though, which sounds like it would be if you only need a minor rehab.

@Engla Farm reach out to @Elliott Hallum! He is an investor and also president of REIN (Real Estate Investors of Nashville).

@JD Martin what if the tenant in the other unit (it's a duplex) has a German Shepherd? Feel like it's not a very good look for me to deny someone when they clearly know I've accepted others with big dogs. 

Hi BP, I am curious the process others use when screening potential tenants to fill a vacancy (with a standard 12 month lease). I own 4 buy and hold units and have a fixed standard I use that weeds out a lot of folks that don't qualify, i.e. 3x the rent in monthly income, no evictions, min. credit score, etc. 

My question is, do you accept the first person who applies and meets your standards, or give it 5-7 days, let multiple people apply, and then take your pick of the best applicant? 

To give a real world example: I have a couple that applied who qualify and are very interested. Their credit is okay (upper 600s with a few medical collections), and have enough income to qualify - although he is starting a new job soon so there is always a bit of uncertainty there. They also have a Great Dane, which makes me a bit nervous, just due to their enormous size. However, I feel as if I can't not accept them due to the dog, because the tenant in the other unit (this is a duplex) has a dog as well - not as big, but also not a "small" dog. About 24 hours after they applied, I talked to another lead who wants to apply, who has a 780+ credit score, is a nurse with more stable income, lives alone, and has no pets. 

So, should I (or am I legally obligated to) accept the first applicants who applied and meet my minimum standards, are wait a week, get multiple applicants, and cherry pick the best one? I also don't want to lead people on and get their hopes up. This is people's home and livelihood, and it is not something that I take lightly, but also want to pick the best tenant possible that will pay and take care of my property. Any advice is appreciated. Thanks!  

Hi @Josh Duncan is the property you are looking to buy going to be a long-term buy and hold, or will it be a fix and flip? The answer to that question will likely determine a lot about the best way to finance the property, along with your personal financials. I am located nearby in Nashville and happy to help anyway that I can - please feel free to PM me. 

 Thanks for the explanation @Caroline Gerardo, that all makes total sense. Was actually reading a few articles on it this morning that highlighted a lot of issues that you mentioned, plus a few more. 

This situation reminds me of one of my favorite quotes from Thomas Sowell "Economic policies need to be analyzed in terms of the incentives they create, rather than the hopes that inspired them."

I use Turbo Tenant and it does everything that you have mentioned. No complaints from me so far.