All Forum Posts by: John Barrett

@Nam Trang What is your reason for creating the LLC? In my experience, people tend to feel like they need to create a complex legal structure when a relatively cheap umbrella policy would provide adequate protection. We waited until we had multiple properties before creating our LLC structure and still also carry umbrella coverage.

I would suggest determining if the costs of the LLC ($'s setup / maintain and regulatory compliance) makes more sense for your situation and an umbrella policy.

John

@Alyssa Miller Unfortunately, you are trying to purchase a highly sought after asset type in one of the hottest markets in the country.  Sounds like you have your budget and financing locked in as you mention you are ready to go.  Besides speed and price, is there any other things you could do to make yourself more competitive (higher earnest money, focus on sub-market, etc).

Your experience is very common for many other buyers today.  Use this time to keep saving your money and position yourself to be ready / lucky when the right opportunity comes up.  Also, don't forget to network with other investors in the area you are interested in.  There are still a number of meetups happening virtually.

Best of luck,

John

@Thomas Larsen what would you like to learn about?  There are many facets to real estate investing and it would be good to try and focus on the area that is most interesting to you as you get started.  I know most people will tell you to niche' down, but I would advise that you start with a specific area of focus and then branch out from there.

There are a lot of meetups that have moved to virtual at the moment and this would give you an opportunity to network with many investors from lots of the areas you have mentioned.  This will allow you to start building out your network and find the areas of investing that best match with what your skills and goals.  Hope this was helpful.

Best of luck,

John

@Felix Poulin Happy to help. Your strategies do not have to be either or. While most people look to pull their investment in the property back out as soon as possible, this is not the only way to complete a BRRRR. You could start with house hacking a duplex, improve the property overtime to increase the value and then complete the BRRRR a few years into it.

In general your first property is not usually a home run, so don't use that as your bench mark.  Rather, the gains can come from reducing your living expenses/taxes, learning new skills and pay down debt.

Regards,

John

@Zeb Rodes You should check out BP episode 394 as the guests on that show were talking about what you are wanting to do and they are located in the Tri Cities.  While I have never personally done any wholesaling, I do know that it can be a lot work.  This is in no way to discourage you from going this route, just to make you aware so you can set your expectations.  There are a lot of threads on BP, books and podcasts from people who will walk you through the process, good & bad for wholesaling.  Even though it can be tough, there are a lot of people who are successfully investing this way.

Best of luck with all your investing.

John

@Felix Poulin Welcome to the Pacific Northwest. It's really difficult for anyone to answer the questions you have asked as it is really dependent on what is important for you.  I will make an attempt but please note these are just my opinions.

1.) Good time to purchase - This depends on how long you anticipate living here.  If you think you will move in just a few years (1-3), I would keep renting.  The transaction costs on the purchase will represent a significant cost and you will have taken on market risk.

2.) If you find a property that is too good of a deal to pass up or your plans are to be here long term, a house hacking situation would be your best option for starting.  It will allow you to get into the property for the lowest down payment but will likely make the performance as a rental property less attractive due to the high debt servicing costs.

3.) You want to learn as much as possible but also don't be afraid to bring in expert advise.  We hire trusted professionals for their expertise so that we do not have to know all aspects of the law, medicine or taxes.  There are a lot of agents and lenders here on BP that you can reach out to. 

Best of luck,

John

@Rob W Saunderson The influx of people causing prices to rise means that your strategy and pricing expectations will need to be adjusted.  This is really hard to do as we naturally anchor our pricing expectations based on what we have paid in the past.  There are always deals in every market, but they require that you are able to either move quickly or see an opportunity that is overlooked by others. 

The other option is to look at moving just outside of the current hot area and focus on those "in the path of progress".  As such, it's really important to focus on understanding which areas are in highest demand and why.  This way you can focus on those areas that have the highest likelihood of above average appreciation (not guaranteed though) and factor that into your purchasing decisions.  I think your investment should generate at least your minimal acceptable level of cash flow and then ideally be in an area that you expect will have greater than average appreciation.

Hope this was helpful.

John

@Manco Snead I think it is important to understand the number of people moving to and from an area.  This will give you insights into the long term economic viability of the area and can inform where you choose to invest.  Regardless of where the new people emigrating from, I think the challenges are basically the same (increased demand, stress on  infrastructure and services, etc).

The real question is how are you going to use this information to alter your investing strategy?  Change is going to happen regardless and it's not something we can generally control.  Therefore, I think the best strategy is to focus on the things that are within your control (market selection, asset allocation, investment type).

John

@Theresa Walters The answer to this question is entirely dependent upon you, your interests, strategy and goals.  I think the best place to invest is near where you live.  This makes it easier to know the market and self manage your property.  This is entirely my opinion and others will view your question completely oppositely.

I would suggest making of list of all the things that are important to you and you are not willing to compromise on.  Then I would make another list of things that are important but you would be willing to concede for the right deal or opportunity.  Finally, I would make a list of the items you don't want to do or plan to out source.  With this information, you can start to formulate what type of investment you are looking for (wholesale, flip, buy & hold, etc.) and what level of investment you want to make (no rehad, light, heavy, full gut rehad, etc.).  Investing is personal and while you should look at what others are doing and learn from them, ultimately you need ensure you are aligned with your goals.  I can understand if this seems like a non-answer to your question, but I do think it will help you to come to the real answer you are looking for (your own answer).

Best of luck,

John

@Ian Wagner Congratulations on getting your property under contract.  What areas of Everett are you looking at?  I have properties in north Everett area.

Are you working on a flip, buy & hold or BRRRR? Did you go with a single or multifamily?

John