All Forum Posts by: Jonathan Greene

Quote from @Jonathan Greene:

Quote from @Collin Hays:

I think you missed on the "year to recover from a 1-star review."  Those reviews are just part of it, no matter how much we try. Furthermore, 1-star reviews serve to demonstrate legitimacy of the ranking system. I would be leery of an product or service being promoted that has zero negative reviews.

A 1-star review is often not realistic and will tank the algorithm in your first year for sure because it's not balanced out yet. I completely agree that no one should have all 5-star reviews because it looks fake, but a 1-star is also hyperbolic and crushing to your business when you are new. Much different than a 4-star that is realistic.

This happened to me and it hurt my rating for a long time. We are above 4.8 now, but it’s been a climb. This person was one of our first guests and a scammer who found one small thing and complained about it to Airbnb demanding a refund. I agree with everything said in this post, it is a hospitality business and superlative customer service is a must.

Quote from @Isadore Nelson:

Quote from @James Hamling:

@Jonathan Greene to piggy-back on what your laying down here: 

I believe a core component of the "problem" is a gross over & mis use of "Cash-flow". 

If everyone would simply eradicate that from there vocabulary and replace it with "Realized PERFORMANCE". Than maybe with adjusting the vocabulary to REALIZED performance and UNREALIZED performance, we can start correcting understandings. 

There is realized gains & profits, and UN-realized gains and profits. As well as UN-realized expenses. And YES, far FAR too often I am seeing people stack up UN-realized expenses at a compounding rate, to give selves a false sense of "profit" on whatever monthly/quarterly capital there moving around. 

Remove "Cash-flow" from the vocabulary. 

Use Realized and Unrealized PERFORMANCE in place of such. 

Does size of mortgage paydown become a factor here? Like I can do a BRRR on 600k property with no cash-flow or a 150k property with $300 monthly cash-flow, but do not have the same investment vehicle, and it is the same cash that is doing both, as for the 600k purchase I'd be using the same 100k towards hard money loan.

Look, I am rather regimented when it comes to hard money; that a HML should ONLY ever be used for short term transactional purposes.

That means knowing NOT hoping for the exit from HML.

Strategies that use hope, is how people get burned, bad. 

I see it somewhat regular of people who got into a "deal" with HML, to do a Brrr and now it's half done reno and there desperately trying to sell it as-is to bail them out.

And then I look like the bad guy bringing $0.65 to the dollar for an out for them, because there too blinded to realize the other options are more like $0.45 on the dollar. 

It happens, a fair bit. And most don't survive it. 

My opinion is follow DSCR standards. Because you gotta have multiple exit strategies.

If a "deal" only has 1 profitable exit strategy, it isn't a "deal", it's a bull-trap. 

@Jonathan Greene

This was a very interesting read. I proudly call myself a 'deal killer,' and I say that with no hesitation. As a 3rd-party real estate consultant that has no skin in the game other than what I charge, I provide exactly what you've described—unbiased, no-nonsense, and straightforward advice. Over the years, I’ve witnessed both newbie and seasoned investors get misled by various players in the real estate game, from wholesalers to contractors, realtors, property managers. Turn-key operators, etc. 

My reports don’t always ‘kill the deal,’ but they do shine a light on critical information investors may not be getting from their team. The funny thing though is while many new investors do not see the value of such services, seasoned investors often see the worth. After all, spending a few hundred dollars now is far better than risking hundreds of thousands later.

I just did this exercise - I liked ranking them so I could look at the big picture. I dislike the door count as a metric also. My RE journey over 2 years ago was to acquire lots of doors and I've completely changed my strategy. I actually sold a Class C a few months ago - I saw the writing on the wall after one Class C, very likely no capital gains after all my passive losses. No more inexpensive Class C properties OOS for me. 

I had a couple of people suggest to me to sell my appreciating Bay Area SFH so I could acquire more "doors" and theoretically "cash flow" more with OOS properties. Going into the unknown and buying multiple SFHs/duplexes or an apartment complex OOS and my property taxes will skyrocket (property tax is reasonable thanks to Proposition 13 in CA). Raising the rent and value add on my higher quality properties will get me more net rental income than continuing to buy.

Happy New Year!

Quote from @Jonathan Greene:

Quote from @Miguel Del Mazo:

We have 3 2/1 condos in our portfolio that attract traveling professionals (medical or otherwise) and a triplex that we essentially BRRR'd down to the studs. When we built up the triplex, we set it up so that each of the 11 rooms can be rented out individually (all BR, except 2, have their own bathroom behind an electronically locked door). Each BR even has its own mailbox and key.

The triplex is much more popular with traveling work crews for specialists in the trades and insurance relocations, so if we were to do it again, I would probably worry less about making each room it's own rentable space and save a little bit of those costs. 

All that to say, I really like small multifamily for MTR. It offers flexibility as a landlord to be able to offer more or less rooms as needed, protection to the landlord in that you can hedge with adding LTR or STR to the mix, and simplification to the business as your only dealing with one address. Throw in that you can dramatically increase the value of the property once you show consistent rent rolls much higher than when the space was used for LTR, and you have a big win.

All of this depends on your market having demand, of course. 

You nailed it with the traveling work crews. They are the most underserved market for MTR that is out there right now. And it makes sense that you don't need so many baths, but I liked the thought of building it out like that because I think long-term, there is still value in it if someone wants to buy it and do full coliving or sober living would be ideal.

I definitely don't regret having done it that way, but for someone starting out when money is tighter, it's not necessary. The two 4-bedroom units even have two full-size washer and dryers each! 

Co-living is going to grow and grow as time goes on (but maybe less so in my neck of the woods, to be honest). Sober living hasn't much of a foothold in NE GA from what I can tell, but there is a lot of need for traveling crews that work in specialized areas of the trades. 

To help support that avatar, try and have on-site parking and ideally a place where a large work truck can be parked without issue (think fully decked out F-350). 

Thanks @Jonathan Greene! You're 100% correct, as always.

@Travis Boyd, 19 of my MTRs are in multifamily properties. No issues with MTRs in duplexes, triplexes, and quads. Also no real issues with our 5 arbitrages in an apartment complex. It's easier to scale with multifamily properties due to income potential and operations. I really like having multiple opportunities to make income from 1 property, including a worst scenario of converting all the units to LTR. If 1 tenant isn't paying rent, at least another tenant will. Being able to shuffle leads from MTR to MTR is a huge bonus and you can benefit from the economies of scale faster. 

Operationally, it's easier in multifamily and you'll have cost-saving opportunities as well when it comes to certain expenses. If you're scaling your rental portfolio, you have to scale your operations as well.

Having said that, I have friends who only have single family MTR homes and do extremely well at scale. It takes more effort and there's more risk involved (therefor more reward), but it just depends on your goals and how you want to get there.

As far as focusing on areas with high demand for travel nurses, that's just 1 tenant-type of many in a changing landscape. Many of the level 1 trauma centers will likely have a need for travel nurses, but the need for travel healthcare professionals in hospitals changes based on many factors: temporary shortage of staff in a particular unit, budget, patient census, conversion to per diem instead of travel contracts, etc. You can find some absolute MTR gems near smaller hospitals that aren't so obvious but ultimately, housing supply in the area is something I'd say is more important coupled with your amenities. One of our MTRs is in an area with extremely low supply that we've had a waiting list for it one summer. That unit with the waitlist is the only pet-friendly home (duplex) with a fully fenced-in yard accepting more than 1 pet, including larger animals. 

I can go way deeper into finding good MTR markets, pursing tenants other than travel nurses, property types, scaling operations through systems (my specialty), renovations, etc but it's much harder to do in a thread. Shoot me a DM - I'm happy to chat, although BP is kind of wonky for me, especially on mobile. I also also co-host a weekly Zoom Q&A on MTRs called MTR Office Hours in a Skool Community.

We have 3 2/1 condos in our portfolio that attract traveling professionals (medical or otherwise) and a triplex that we essentially BRRR'd down to the studs. When we built up the triplex, we set it up so that each of the 11 rooms can be rented out individually (all BR, except 2, have their own bathroom behind an electronically locked door). Each BR even has its own mailbox and key.

The triplex is much more popular with traveling work crews for specialists in the trades and insurance relocations, so if we were to do it again, I would probably worry less about making each room it's own rentable space and save a little bit of those costs. 

All that to say, I really like small multifamily for MTR. It offers flexibility as a landlord to be able to offer more or less rooms as needed, protection to the landlord in that you can hedge with adding LTR or STR to the mix, and simplification to the business as your only dealing with one address. Throw in that you can dramatically increase the value of the property once you show consistent rent rolls much higher than when the space was used for LTR, and you have a big win.

All of this depends on your market having demand, of course. 

Quote from @Jonathan Greene:

You could have stopped after "I came across this PML via Facebook." We all knew the rest. Facebook is the last place you want to find private money.

 whats unfortunate is real estate professionals are still advertising to us newbies Facebook is the place to find the lender.