All Forum Posts by: Jack Medford

Thanks for the great post @Marcus Auerbach! I have a question about this remark from your post:

"Existing homes sell at a median of $162,500. Anything new less than 30 minutes commute starts at 350k. The majority of new homes are sold between $400 and $600k."

It sounds like you are saying new homes are selling way above market, even if comps for comparable (yet older) homes are for much less. Is this correct? Are you seeing this even in neighborhoods that have values well below the median price?

I have just been talking with a distressed seller who has a property that likely needs to be torn down and rebuilt. I assumed the cost was too much, but it sounds like that may not be the case. 

@Rumi Tever do you have a contact for MB Financial? I'm also looking for loans in Milwaukee around those price ranges. 

@Emily Rokser Here is a link to her website where the book can be found along with a lot of other helpful links. The actual book can be purchased from here. 

@Adam Harlan the meet ups are held at 7pm at The Brink Lounge. You will often find a member or two (i.e. me) enjoying a drink at the bar around 6, before things get started. Next meeting should be August 1st. 

@Gina Smith definitely start with Dawn Anastasi's e-book, as well as her website, coreprop.biz. Her e-book does a nice job of breaking down the neighborhoods and gives a good intro to the city as a whole. In addition, her website provides recommendations for various contractors. Each reference I've used from her site has worked out well for me. 

I also suggest using Trulia crime maps to get even more info about the various zips and neighborhoods. When first starting out, I compared Dawn's neighborhood grade with Trulia's crime map. If both lined up with what I was looking for, then I added the neighborhood to my target area. 

Being from out of state, are you planning to stick to the A and B class neighborhoods, or are you ok with dropping to the C's as well? I definitely recommend avoiding the D's, although even some zip codes classified as D have ok pockets. 

To give you a general sense, Dave and I focus on 53209, 53215, and 53218, but we also consider "worse" areas like 53210 and 53212 if we get the right neighborhood. We target neighborhoods that classify as B on the high end, and C- on the low end, so some of these may not be right for you depending on your goals. 

This is getting kind of long, so I'll give one last starting out advice for now... Don't chase returns down the rabbit hole. A 2 bed in a nice neighborhood wont go for much higher than a 2 bed in the hood. This leads to a lot of newbies (including myself) to chase deals into bad areas. Luckily I didn't buy anything, but I did waste some time driving to Milwaukee and analyzing deals that were only going to be a long term headache. 

Happy to help more if you have any questions. Send me a message or ping me here. :)

@Nick Portillo It depends how you are finding your leads, and also the team you have in place out here. Are you getting off market deals? Do you have contractors and property management ready to go once you have a property under contract?

If you answer no to both of those questions, I'd suggest doing as Marcus said, figure out who you want to rent to and then look for well kept "turn key" homes. Start slowly with this strategy and build from there. Once you have a solid base, then try out your first rehab project. 

As far as cash vs financing, I'd suggest financing. This will allow you to spread your money over a number of deals and scale faster. Still start slow though. @Brie Schmidt can tell you more about buying too many homes too quickly. Although, it seemed to work out for her in the long run. 

@Nick Portillo how are you planning to buy these properties? Cash, traditional financing, something else?

If you're paying cash you can likely find the cash flow you're looking for in each of those areas, but with financing it will become harder, especially in nicer areas like 222. I primarily look in 209, 210, 215, and 218. I use these as guidelines, as there are areas of each that I wont buy in.

If you haven't already, I'd suggest checking out @Dawn Anastasi's e-book through her website www.coreprop.biz. She gives a pretty decent breakdown over the different neighborhoods of Milwaukee. I used that along with Trulia crime maps to get started with targeting the neighborhoods I'm looking for. 

Lastly, welcome to Midwest investing! I'm originally from Long Beach, so a word of caution for a fellow SoCal investor. The numbers in Milwaukee look insane! Don't go chasing cash flow into the rough neighborhoods, especially investing from out of state (unless you have an amazing local team) Personal suggestion would be to stay away from anything in 206, 208, 212, and 216. Just a general rule of thumb. There are ok areas of each, but it will be hard to determine that from the west coast. 

Best of luck!

@Isaac S. check out http://www.coreprop.biz/. I've been using that site to gain connections in the area, as well as learning the spots to target and which to avoid. The ebook she offers is only $6, but details the various neighborhoods pretty well. 

@Account Closed check out www.coreprop.biz. It was put together by Dawn Anastasi (past guest on BP Podcast) and has a bunch of resources for the Milwaukee area. On the site she has an e-book for sale that covers the grade of each zip which you might find helpful. Also on the site is a list of various contractors who do various types of work (general, electrical, plumbing, etc). 

@Garrett Davis check out http://www.coreprop.biz, if you are interested in Milwaukee. @Dawn Anastasi put the site together and has a lot of resources to help get you started. I'm in Madison, but recently purchased a duplex in Milwaukee. The only reason I felt confident doing so was because of Dawn's website. Specifically, I recommend the e-book she offers for $5.99. On top of that, she lists good quality contractors on her site for free. I can also recommend a good property management team if you don't want to manage the property yourself.