All Forum Posts by: Joe P.

As a Temple alum its always interesting to me to see how that area is evolving. 7th and Cecil B used to be an absolute warzone, and now there are huge multi's and student housing being dropped in all along there. But you still have to get from 7th to at least 11th to be within the campus.

So a lot of this would depend on the neighborhood, the number of rooms you can rent out, and the condition of the property. If its truly a good deal you're buying either distressed under-market and putting in the work to be able to refinance and maybe break-even or better while someone pays your mortgage, I assume. But if its 2 bedrooms at 7th and CBM, you're buying a 200k house, and you can rent a room for more realistically 500 bucks to a student? Meh.

If you're able to share some of the financials we can decide if its something worthwhile?

Jimmy - what can we say? Its beautiful. I'm hoping it serves as a launching point for more in the area! Well done! The real values comes from the parking, I think. Unless they make collapsing cars or start teleporting people, the ability to have 1-car parking near center city will be worth its weight in gold.

Every transaction is a chance for one party to not be in agreement with the other. That's for rent days, maintenance issues, discussing any item, etc. Your needs and your views are not the same regardless if they are family or not.

This is a business -- would you want to do business with family? I sure as hell wouldn't and I love my family. It is for that reason I leave them out of my business life. Plenty of fish in the sea to rent to.

Wow @Jimmy O'Connor that thing is a beaut. Any more pictures to share? Would love to see the finishes. 450k in Brewerytown - 5 years ago people would have laughed. Now you can't build them fast enough!

It can be block by block. Since I don't live in Gloucester City I typically ask my PM what she thinks about certain parts of town or a specific address.

Yes, you should be checking flood zone maps from FEMA as it will indicate if you need flood insurance. Some lenders will not underwrite your loan without it. Bigger banks require NFIP-backed policies; my guy/mortgage company requires NCIP-backed which is substantially cheaper. If you're buying cash you don't need flood policies, obviously.

GC is a blue collar town and you don't typically hear about people moving there proactively, unless they're interested in the school district (they build a new HS right around the block from my duplex) and a lot of renters try and get in there during the mid-late summer to get their addresses in GC proper. Otherwise, most people work somewhere in the area and need a nice, quiet place to live - parts of GC provide that.

You'll have issues finding quality tenants for different reasons everywhere, so set your criteria and only rent to those that meet it. But realize its a blue collar town and finances for tenants may reflect that. If they can afford $2,000 in rent, they'll move to a town where their finances reflect that.

I would argue this would depend on your goals.

If you're looking to buy an investment property, lets say for 25% down of a 250k property, and make about 200 bucks a month in CF? Absolutely not. That's a total waste of time to have a loan against your 401k.

Now if you are BRRRRing and can pay back your loan and keep some profit for yourself, and get a cash flowing property...maybe. I'd prefer to do a HELOC for something like that, though, because the rates are better and typically access to funds is easier and more straightforward, and usually the HELOC is interest only for several years, allowing you to truly rinse and repeat.

I have a duplex in Gloucester City. I think the small town vibe produces different results. You should be buying for cash flow in these areas because the appreciation isn't like big cities, at least short term, unless some big company comes nearby or the gentrification spreads. I like GC because the proximity to Philly gives it a chance to be something good, like we're starting to see with Camden.

Smaller towns have small town problems, like bureaucracy in inspections. You're also dealing with a blue collar tenant pool, so expect a lot of paycheck-to-paycheck and Section 8/housing assistance. There are pockets of town that are good and some not so good; check in with local PMs or other investors who can tell you where to look.

I don't know about metrics, I'm looking for potentials rents to purchase price in anything I buy...and I want to cash flow so when I perform my estimates, I try to be as conservative as possible.

The Book of Flipping Houses and The Book on Estimating Rehab Costs, both by J. Scott, is everything you need.

There's also Buy, Rehab, Rent, Refinance, Repeat: The BRRRR Rental Property Investment Strategy Made Simple by David M Greene but I like J's books.

What amounts/percentage are you using for CAPEX? I'm in the process of a SFH BRRRR right now and I am using 10% (of $1300 rent) for CAPEX and 10% for mainteance -- too high, too low, just right? I assume there won't be much CAPEX in the beginning but this should help to build my reserves. I also want a healthy maintenance budget since a tenant will get in there and there will no doubt be (hopefully) small items to contend with...