All Forum Posts by: Jonathan Rivera

Quote from @Justin Goodin:

Here’s why many investors switch to commercial multifamily  👇

Let's say your rental property makes $200/month in cashflow.

Which is $2,400 annually.

This will WIPE OUT your cash flow:

❌ HVAC repairs

❌ Turnover costs

❌ Roof Repairs

Not to mention, you will most likely need 20% down to buy a rental.

$200K is a starter home these days.

→ How many rentals could you buy each year?

→ How many rentals would it take to replace your W2 income?

This is why many investors switch to multifamily investing.

Your typical new investor isn’t going to start off in commercial multi family because they can’t afford it or it’s hard for them to raise money for a 30-50 unit building. So if it comes to starting out like you said, I do believe single family 1-4 units is the way to go until they can eventually build up to get to multi family.

Hey guys, 

I know most of the time it’s important to buy in a landlord friendly state so this way you’re protected in case of an eviction & it’s in favor for you, the investor.

My whole strategy has been to have tenants that have vouchers to section 8 bc of payments being guaranteed depending if tenant needs a lot of assistance.

My only issue is that I am in a tenant friendly state here in NJ. I originally wanted to invest out of state but part of me wants to be near where I invest. So the next state over that’s more affordable than here is PA.

My question is, although both states aren’t landlord friendly, the fact that I want section 8 tenants instead of normal tenants, do I have an advantage over the eviction process?

Being that section 8 tenants average time in a property is 7-8 years, they are under the housing authority, they also wouldn’t want to lose their voucher, especially if they waited years to get in and much more.

Am I safe investing with this method in a tenant friendly state?

Quote from @Kiernan LaFaver:

From a management standpoint, a duplex or multiplex would likely be easier to manage as it’s still a single property. Cash flow might also be more beneficial with a duplex since there are more than one units being rented out. Is it your first rental property? While a duplex may be more ideal for a property manager and cash flow, there’s also twice as many things that can go wrong with the property. Two furnaces, two hot water tanks, etc. 

if it’s your first property, I personally think taking an “easy” property would be a good way to get your feet wet in the investment world as a trial. Learning metrics, learning how to screen tenants, projects that you can/can’t handle, etc. Whether the “easy” project is a single family or a duplex really depends on your personal goals

Yes this will be my first investment into real estate out of state. I personally own a personal home for the past 7 years so I kind of understand what can go wrong and things of that nature besides being a landlord, I never rented where I live just yet.

i do agree with you, I’m still okay with going after a single family especially if it’s a great deal, why pass on it but, I do want to take it easy whether it is a single family or not, a duplex would still be a little considered easier compared to like a triplex or a quad.

As I continue to gather up my strategies & game plan on investing out of state, the more I think of which investment makes more sense for myself. Since I'm investing out of state I can't house hack! I also can't use a FHA or any loan that requires me to stay in the unit for a year.

I do like single family but, at the same time a duplex and up to a 4 unit seems more interesting.

I look at this and wonder, if I plan to rehab one house, I’m better off working on a two units for the same effort of time it will take for just one unit single family. I feel like I can scale a little faster eventually down the road vs single family.

thoughts?

Quote from @Brandon Goldsmith:

C and B areas are typically where a lot of investors target, but everyone has different goals. As others said, it’s best to drive some neighborhoods of the market you are looking into. @Jonathan Rivera

Yeah unfortunately this will be out of state so I can’t drive around lol

Quote from @Duarte Marques:

Quote from @Travis Biziorek:

Quote from @Duarte Marques:

Quote from @Travis Biziorek:

These numbers don't seem to add up. What market is this?

$100k for $2,400/mo gross rents... it's just not likely to happen.

 It would be a section 8 rental, the fair market rent for section 8 (hud gov site 2024) on that zone is 1200 for a 2 bedroom, since it's a duplex it has two units with 2 bdr so the total rent would be 2400 (both section 8 tenants). The duplex you can buy around 100k-150k turnkey. 

Oh, I understand all of that. Crystal clear. I own 14 doors in Detroit and 3 are S8. 

But you didn’t answer my question. 

What market is it?

Also, FMR’s do not mean that’s what you’ll get. Lots of people thinking this is a guarantee. It’s not. 

I'm new at section 8 rentals, do you usually get a lot lower than FMR? And how long was the process to get the house section 8 approved (all the paperwork, inspection, until a section 8 moves in)? I was looking in the Ohio area.

 You’ll probably get very similar rents without section 8 unless it was a 3 bed room which will pay a bit more. I do like your thinking but I don’t know if I would want two section 8 tenants amongst each other…and in Ohio, as much as I’ve been looking there. Idk where you getting a full turnkey duplex unless it’s in a warzone area or a D class area..

Quote from @Nicholas L.:

@Jonathan Rivera

go to it and walk around

Sure i can, but right now I’m investing out of state, so I’m not going to keep going back and forth to find an area I like. 

Hey, 

How can I determine what kind of neighborhood I’m investing in? Is there a software that people are using to determine if something is an A class neighborhood or D class neighborhood?

What are some tactics you guys are using to know if this is an A,B,C,D area?

So I was wondering if I can still use a FHA(first time home buyer)…

Here’s my situation, My wife purchased a home before we got married & everything is under her name. She used a conventional loan for the purchase.

We soon will buy a new home but, since we are married this time around both our names will go on that property and we will use conventional again which makes it look like I already purchased a home before.

I am wondering if I can still use a FHA since I never used it before & yes I do understand the regulations that I have to live there for up to a year before I can fully rent out the property which will most likely be used for a duplex.

Any feedback thanks!

Quote from @V.G Jason:

You won't get cash flow OOS properly. You may see it on paper, but the reality is it's going vanish.

If you're comfortable house hacking, probably a better choice. But really depends on your goals here. Are you trying to be an REI or trying to be a shrewd guy and have RE as another part of your arsenal? If it's the latter, definitely house hack. If it's the former, still househack unless you're investing in one of the better growing areas that you anticipate large growth in and can view yourself as a speculator.

How wouldn’t you get flow as an investor out of state? So, if he lived there it would make a difference? According to his post it seems like he will invest regardless as time goes on whether it’s one or more properties. Personally i have many friends that invest out of state and they do really well and cash flow as a OOS investor.