All Forum Posts by: Jason D. Lewis

@Ruchin Patel

5% CoC???

I don't think I would even give anything a second thought if it wasn't brining in at least 17% CoC.

I know you're not happy with 5%, but if that is what you're finding, you may as well simply look to lend money.  with private lending, you can expect to see 8 to 10% with little risk after the fees are paid.  That would be an easier way to get some true passive income.

@Ryan Williams

Hey Ryan, welcome aboard.  

I have been told Edmonton is the way to go.  heading there in the new year and looking to grab a few sweet producing units.  I was cautioned however, that Edmonton is a real "B" with those nonconforming suites and hearing your story certainly seems to confirm it. 

Was it a neighbor, too many cars, unset tenant? any idea as to who tipped off the city?

All the best brother!

Jason

@Mitch Heenan

Hey Mitch,  Welcome to the site.  It has been great for me and I hope the same for you.

I'm coming to PG the second week of January.  looking at getting a couple fourplexes.  I have been doing research like crazy and met a few great people from this site as well.  

Have you purchased in PG yet, or still looking.  curious as to what road you took and if you went into the VLA.

thanks,

Jason

@Timothy Sheets

Hey Timothy, go find local mortgage brokers and see if they have a rolla dex with private lenders. My group has about 12 + that we shop deals to, whenever they come up. I cant stress enough, having a strong mortgage broker is key to success in this business. I started as a broker first and then moved to REI, but seeing the big shots come and go, is what exposed me to the possibilities. Anything is possible when you have the right strategic partners.

@Tommy Johnson

Hey Tommy, Not sure I understand the situation.  are you asking if you should use your equity to buy the property?  If you have someone coming directly to you with a purchase that makes sense, I would lock it up in contract, take some time with ensuring it is properly vetted, then after your inspection, renegotiate with the seller and get a lower price based on the deficiencies you find.  I myself always look to buy with 20% equity in a home, so with you having over 65% equity, I'm sure you're leaving yourself enough of a cushion and the possibility to go back into it again, if another sweet deal appears.  Good luck.

I would also add, that the duplex taxes will be higher and those rent rolls don't appear very sexy, but perhaps that is your market.

Jason

@Aaron Rowzee

Hi Aaron, we are going to need more information to properly provide any advice.  Are the storage units just gravy on top? What is your expected vacancy, who will manage, taxes, ect.

I suggest you complete your own estimated numbers based on what you feel it will be able to produce.  Go ahead and run some fake ads and push your rents higher to see if you get bites, or just to tell how hot the market is.  The gross/net numbers wont work for anyone if they come from the seller, reason will be that his/her financing wont be the equivalent to yours, or you will simply run it differently.  Keep digging, get information on everything imaginable, be confident that you can find good tenants (who wants what comes with it).  

IMO I never want to buy someones investment if I'm simply taking over what they did and expect to get the same results. How can I trust they did things the way I want them done.  "We" should be able to run the "business" better, which will produce better results.  With my purchases, I usually get the realtor, or seller telling me how great everything is and how well the investment worked out, but it's all nonsense, because I had already identified five or ten items that they had been doing incorrectly, which means the only person I trust, is, me, my gut and my instincts.

I know I didn't provide much help, but I think you still need to complete a proper analysis.

I look forward to seeing an update.

Jason

@ben 

@Ben Brenner

I always suggest to find a good mortgage broker.  They should have strong relationships with appraisers and a broker can select their own appraiser for the job.  They can hopefully get an appraiser to do a drive by appraisal and get it appraised at a value that will allow you to take out the added equity.  Worst case scenario, you're out the appraisal fee. (200 to 400 bucks)

But first I strongly recommend to find a strong broker who you can trust to find solutions to these problems.

@Account Closed

Thanks for the insight. 

Side note, nothing about it is illegal. It will all be done correctly under the BC tenancy act. 

I agree about the press however and that's the kind of constructive feedback I was looking for. Thanks for the late reply and on a Friday night to boot!

@Robert Hastings

Not sure exactly on the situation in Phila, but here, what I do is the following:

• Get your Mother in law to tell you what the home will sell for and how much commission the buyers agent will take
• Go to your lender and ask what you can be pre approved for assuming you have no house debt and the down payment from your sale.  be sure to calculate all costs, so you know what you'll actually have
• get your home ready and put it on the market
• once you get an offer, counter with a higher deposit for protection and a completion that suits your needs
• now go into the wild and find your new home
• once it is found, secure a completion that is before yours
• if the buyer of your home bails, you'll have the deposit as some sort of security (on a 300k home, 15k is reasonable)

Alternatively, you could simply flip a few of those steps.  go buy a home first and set a longer completion, which will then give you time to sell your home.

Also, depending on your income, you could qualify for both homes and then sell your first at your leisure.  you will buy the second home as a primary, which should lesson the down payment and then your lender can use your first home as a rental and use the income to offset the debt.  don't worry about finding a renter, they should be able to create a rental report.  again not certain on the us, but i suggest you find a good mortgage broker who can strategize with you.  In Canada their fees are paid by the bank (usually) so there is no cost.

Hope so of this helps.  Also suggest against using the mother in law, even if it saves some cash.  you should search out a real professional.  only reason why i assume she isn't, is because she should have provide this information to you and linked you up with people who could make this work.  At least interview a few others and it wont hurt her feelings as she isn't netting any coin anyway.

all the best,

Jason

@Thomas Lorini

If you're ever in Vancouver, lets link up.  You'll find a lot better cash flow in BC, although the deals are harder to find.  Rent is astronomical on the coast, as most people from Canada come up this way.  Seems like a lot of work for only 4k a year.  i just turned a property on Vancouver island that cash flows 37k a year and the costs are almost exactly in line.  60k down, 20k renos, so close, but i guess not exact.

@Jay C.

Although I get your point about transparency, I'm more curious on your thoughts about the refi. in Canada, you can only refi 80% LTV, so he does still have a decent amount of equity in the first home. I understand you use investor funds, but are you stating that leaving the 20% in the home is still cavalier? I tend to feel that this is a decent buffer and as Thomas mentioned, he's not a flipper or speculator, so in the event of a correction or downturn, he can still line his homes with renters, albeit the rents could drop.

Interested to hear your thoughts, Jay.  Thanks!

Good job though and i enjoyed the post and discussions from the group.