All Forum Posts by: James Likis
James Likis has started 8 posts and replied 47 times.
Post: The Short Term Rental Loophole
- Investor
- Boston, MA
- Posts 47
- Votes 22
@Stephen Nelson I understand why this scenario works. Does it also work if you choose to operate a STR for, say, 6 days out of the year, materially participate in it, and therefore meet the criteria to use passive losses against active income? Is there any stipulation with this that the STR has to operate a certain total numbers of days? Does your scenario only work because it's started in December and carries through the operation of the STR through the end of the year?
Post: Starting Direct to Seller Marketing & Outreach
- Investor
- Boston, MA
- Posts 47
- Votes 22
To increase our potential deal flow for fix & flips, we're preparing to start direct to sell mailing campaign. What are the most important tools to have in place as we get this going? We're planning to start with mailers and then cold calls to follow up.
We're thinking for incoming leads a google voice number, website to collect seller information, and an acquisitions email address through our google domain. What else? Any and all advice appreciated as we get started!
Post: Investment Property HELOC
- Investor
- Boston, MA
- Posts 47
- Votes 22
@Tim Lucas what an incredible resource! Thank you!!
Post: Getting used to the Rental Property Calculator KC MO
- Investor
- Boston, MA
- Posts 47
- Votes 22
I appreciate that breakdown @Milton Chamberlain. One of our properties is in Marlborough and it has been a pain. We’re investing in KC from out of state and would like to get into the multi family space down the road. Good to know about this little pocket for multifamilies.
Post: Any opinions on buying rentals in Grand Rapids?
- Investor
- Boston, MA
- Posts 47
- Votes 22
@Philip Beckwith that seems like a fair assumption on average. That lower acquisition cost can, though, payoff over time with the goal being buy and hold as rentals.
Post: Lawsuit Regarding Jackson County, MO (Kansas City) Property Tax Increases
- Investor
- Boston, MA
- Posts 47
- Votes 22
Thank you for sharing this @Andrew Syrios!
Post: Any opinions on buying rentals in Grand Rapids?
- Investor
- Boston, MA
- Posts 47
- Votes 22
@Philip Beckwith how did you find the deals that you moved on last year? MLS or off market? I'm currently scanning the MLS while also trying to connect with wholesalers for some off market opportunities.
Post: To split the bathroom or not
- Investor
- Boston, MA
- Posts 47
- Votes 22
I’d also be inclined to keep the property as a 3 bed / 2 bath and with a larger master bath. A 3 bed / 3 bath in Boston seems fairly rare, but don’t know that the 3rd bath helps much value proposition wise.
Post: Handyman or Handyman assist
- Investor
- Boston, MA
- Posts 47
- Votes 22
Hi @Nathanael Isaac Flaugher, my partner @Jami Rahman and I are just getting started investing in Grand Rapids. Connecting with you now.
Post: Cashflow ready houses. Too good to be true?
- Investor
- Boston, MA
- Posts 47
- Votes 22
Quote from @Michael Smythe:
@Yash Tamta you can make anything look good on paper!
Deals like you describe are typically aimed at newbies that don't know anything about reality.
Often, you're being sold a Class C or D property that's using Class A or B numbers.
You don't find out until after you buy these properties that:
The tenants aren't performing
There's a lot of deferred maintenance
Tenants are trashing the properties
The tenant pool is NOT what you thought
Recommend you first figure out the property Class you want to invest in, THEN figure out the corresponding location to invest in.
If you apply Class A assumptions to a Class B or C purchase, your expectations won’t be met and it may be a financial disaster.
So, when investing in areas they don’t really know, investors should research the different property Class submarkets.
Here’s our OPINION for the Metro Detroit market (use as a template for your target area!) that we’ve learned in our 24 years, managing almost 700 doors across the Metro Detroit area, including almost 100 S8 leases.:
Class A Properties:
Cashflow vs Appreciation: Typically, 3-5 years for positive cashflow, but you get highest relative rent & value appreciation.
Vacancy Est: Historically 10%, 5% the more recent norm.
Tenant Pool: Majority will have FICO scores of 680+, zero evictions in last 7 years.
Class B Properties:
Cashflow vs Appreciation: Typically, decent amount of relative rent & value appreciation.
Vacancy Est: Historically 10%, 5% should be applied only if proper research done to support.
Tenant Pool: Majority will have FICO scores of 620-680, some blemishes, but should have no evictions in last 5 years
Class C Properties:
Cashflow vs Appreciation: Typically, high cashflow and at the lower end of relative rent & value appreciation. Can try to reposition to Class B, but neighborhood may impede these efforts.
Vacancy Est: Historically 10%, but 15-20% should be used to also cover tenant nonpayment, eviction costs & damages.
Tenant Pool: majority will have FICO scores of 560-620, many blemishes, but should have no evictions in last 2 years. Verifying last 2 years of rental history very important! Also, focus on 2 years of job/income stability.
Class D Properties:
Cashflow vs Appreciation: Typically, all cashflow with zero or negative relative rent & value appreciation
Vacancy Est: 20%+ should be used to cover nonpayment, evictions & damages.
Tenant Pool: majority will have FICO scores under 560, little to no good tradelines, lots of collections & chargeoffs, recent evictions. Verifying last 2 years of rental history and income extremely important to find the “best of the worst”.
Make sure you understand the Class of properties you are looking at and the corresponding results to expect.
What else can we assist you with?