All Forum Posts by: Jonathan Greene

First of all, you have a very good approach two deals in, one that will serve you well as you grow. If you have no prior building experience at all, I would focus on off-market property marketing. You can do this via mailers, driving for dollars, signs, but those all have to come with a lead capture system. I suggest this because you are only looking at MLS deals. If you had your own off-market funnel your price point to get in would be lower and because you have the experience of having two rentals locally, you have some built-in credibility and experience that will help you. Capital as you grow is always an issue, but you've done well with your first two. With what you've done I don't think finding financing to grow your business will be an issue, but the more you can secure your own off-market leads the more spread in your deals.

That is good advice from @John Errico. The taxes are the main issue in East Orange, they are unusually high given the price points. I like both East Orange and Orange, but I think if you are investing and holding, you want to stay as close to the train line as possible. The newer Arts area in Orange by Highland is nice and had a ton of turn over. Bloomfield is already too high, I think the prices are maxed out, but like a lot of areas, deals pop up, but SO many investors are on them. I like Belleville as an option, I have one under contract there now. The train access is not there, but the bus is.

Re: Newark, I sold a flip on a half-duplex across the street from 3 burned out buildings near Branch Brook and my client did very well. We didn't appraise at the contract price, but worked it out and it was still a win-win from a unit bought at sheriff's sale.

@Dillon Dale I really think 10k is a bare minimum, especially on a multi, but if you have 15k in reserves you really do not have to worry. Great plan for the future.

@Dillon Dale that's a big one, especially for new investors. The calculators value it as a per month option but don't usually factor in a 5-10k reserve which I think is necessary for any purchase, at a minimum. Is that what happened or were you just cutting it close on the closing amount? It's great you will have a better way to fill the reserve this year!

You have to learn Newark before committing to a purchase. Newark has some very good spots for BRRR and even some of the spots that others will discourage, I find still have some value at the right price. Newark gets a bad rap a lot of the time, there are many parts of Newark that are solid and you can still get many deals there. Newark values can run differently block by block based on the amount of foreclosures or burned out homes that have not been renovated or kept up. Absentee properties can be an issue as well, but I do like Newark as a spot to BRRR.

@Marion Lee Of course, a Master en suite is always preferable, but some floorplans just won't cooperate. I've received similar feedback, but usually it was because the buyers and the agent didn't have full view of the market yet. Like they had not seen enough houses to know that not all of them will have en suite and when you get a flip everything is basically new opposed to the other homes they will find with an en suite, but no HVAC and old windows.

@Timothy Douglas If you didn't hit local REI meetups, that is the #1 best way to just force yourself into the mix. If you are consistent with that, good things will follow.

@Johnoson Crutchfield What?!? I'm glad that worked out. I order a survey every time with title. Once in a while it will save you from something major, but more often than not I find some old easements or extra property in a yard that extended farther than I thought.

@Lynnette E. I know people claim they can make a house smoke-free again, but it just can't work for me. My sense of smell is like bionic so I can't even flip smoke houses because I can't go inside them. I'm glad you finally got it worked out, but the air ducts hold more in than we think when the company doesn't do it correctly. That air duct job to remove smoke should take 4-5 hours in my opinion with double bleaching.

@Tim Harwick For a lot of people who get stuck right before starting in REI it's for similar reasons. In my opinion the best jumpstart is just to see properties. So sometimes making friends with an agent/investor who has access, if you don't, can spur the whole thing. Until you are seeing a bunch in real life it's almost like an online game, but you have to make it real.

@James Wise I hope no one else got hit with a giant lawsuit like that one, but most of us know what's behind that one.

@Sri Tulls When you say evaluate, were those in-person viewings or was this all OOS/online evaluation? Even for people who don't want to or can't invest in their local market, I think it's of the utmost importance to see 25 homes at least before even making offers. It's the only way to really get it in real life. If you saw that many, at least you were ready to offer by having your financing lined up when you did. Too many people see good deals, but can't get them because their financing isn't solid so 2020 should be a huge upswing for you.

@Account Closed thanks. I think "He is not a tile guy" could apply to every lesson where we gave a non-expert a shot at a new project. When we are rushed on time and busy with other projects, we tend to cut corners with someone we know and as you said, "Don't cut corners" is what should sit in our mind all the time. At least it was fixable.

@Tim Rostro what you describe makes sense to me because you are focused on long-term goals. Sure, this one came with a few more warts, but you know the location is where you want and you accept it will run light for the first year, but then grow. I like it. It's a good lesson though for new OOS investors who don't think long-term that the short-term can be unexpected when you don't visit.

@Ola Dantis I think one is coming in late 2020, but I am still looking. I have been more focused on flips though instead of holds, but as long as we know we can ride out a dip and the deal is good, we will be ok on the other side of that dip with the holds.

@Scott Passman It sounds like you are making lemonade out of some bruised lemons. Good move to do a few more upgrades while you are at the floors.