All Forum Posts by: Shawn Coverdell

what type of cash flow can you expect to receive in Vancouver area?  Area seems expensive vs rents. Be sure you can cash flow to survive any upcoming market down cycles. Were due. 

Something is not right it seems. Rents are pro-rated daily to date of closing. You should make one wire normally then any overs are refunded to you with a check. If any at all. Should be fairly simple. Get another title company to close it. 

I use the BP calculator for the coolness factor, seems accurate enough. I found however, that if you stick to one farm area, you can just know. I mean once you get a few you can compare possible deals with one you currently own. I found that knowing how to estimate rent quickly and confidently with a quick walk through, or even drive by is key.  If you know you see one listed for 85K and you have one similar that you paid 65K (cash flows nicely), adjust for appreciation for time between purchases, Repair costs up or down. Make offer right there.

basically, buy one that works, then compare others to it. Maybe it needs a roof. Subtract 5K from offer. Move on to the next one. 

Being able to do this quickly allows me to make a cash offer within the hour if necessary, offer is subject to self inspection in 5 days. This allows me time to go home and run BP calculator if accepted. Or even if countered. 

I should add, I use the BRRRR method with one added condition. I don't mind leaving a little bit behind if I don't get all back at refinance stage. 5k-15k left in the deal is fine with me. This takes away the stress of trying to pinpoint ARV. Makes appraisal stage fun too. "This one should be worth 90K", appraiser says 80K were happy! Appraiser says 100K, we do a happy dance, This probably freaks out alot of people but for example we just did 3. one will actually bring us more cash out than we put in, one will about break even, and the third will leave 15K behind. Kind of a break even on 3 nicely cash flowing homes. You just sort of get "cautiously comfortable" Sometimes it don't even seem real.

Without some level of comfort, I don't think you can do this.

Yes, entitlement zombies are many. I will only help someone if they have the cash. I tell them Step 1) donate television to Good Will to free up your time. Step 2) Work overtime or 2 jobs until you have 30K for a down and some shine money. 

I never mention Step 3 because it usually ends there. I follow up in a month to see how far they get. They usually complain about how broke they are as they sip on a 4.00 flavored coffee. 

Funny, but sad too.

We bought a home that came with a tenant. We were told by previous PM that if we raised the rent they would move. So we raised it. They stayed. The difference is there month to month, leases are rare in our area. Cat pee and fleas. We were not anticipating that they might stay. Well, we decided to let them be for now. too much work currently but when we find time to do a full shine on this one we will try to get them out. 

how much can you rent it for? Lets say you can sell it for 120K, In order to rent it you would need to rent it for 1,500 range for it to make sense. That is if no major repairs are coming due in near future as well. 

I have 2 beaters. one just sits mostly unused. But it is there in case the other one sputters to a stop.

You most certainly can. If someone is selling there selling. Regardless of how you stumble onto it, if it's a deal it's a deal.

To me it seems, and I could be wrong, but it seems regardless of what the market is doing there is room for investors to make moves. upward markets build equity that can be borrowed to multiply number of boxes/doors. Downward markets. less equity, but if you have lots of cash flow you can buy up empty boxes on the cheap. for buy hold investors it would seem if you are not selling, a crash would be a great opportunity to scale if you are well balanced with great cash flow.  I guess I will find out when it comes. 

Take a second job. waiting 2 years for example is missing out on 12K in cash flow, and another 12K in appreciation (super conservative), add a few more K's for debt pay-down amounting in additional equity. with just one SFH.

Get one!