All Forum Posts by: Jon Reed

Just get the standard insurance coverage for an investment property then tack on an umbrella policy for yourself. That will cover any weird incident that occurs on the property or even for other life events that have nothing to do with your real estate investing. 

(I am not a insurance salesperson... I am just a big fan of umbrella policies) 

Yep! It only gets illegal if you do not offer for everyone equally. If a person signs up for a 2 year lease but you don't like them as much and don't offer them some cookware then you can get into a discrimination lawsuit.

However, in my experience... non monetary incentives have been a waste of time and money. People would be much happier if you offer them their last month free if they sign a 24 month lease... or half off their last month... something that gives them incentive to stay for 24 months. If you give them a free deep fryer then they can move out the next month and you are the one losing.

Both options are great options... just have to decide which one you want to start with and just do it.

I would personally house hack first since in our area that would provide me more ROI than renting + buying an investment property out of state. However, those figures may be different for you in FL.

I would look into a new insurance company. If they are not able to work with you to extend the 45 day deadline then it sounds like they would be a pain to work with for any issues/claims in the future. 

Many of us have been/are in the same position you are in.

If you don't like your job then finding something that pays as much or more and switch. However, do not leave your job and try to dive directly into RE investing... you will just be shooting yourself in the foot because getting money is so much easier when you have a day job vs. trying to live off the cash flow of each property you purchase.

My advice... Get a job that you don't hate (you don't have to love it.. or have it be your dream job.. it is just short term). Cut your expenses so you are only living on 40-60% of your net take home pay. Use that extra money to invest... in RE... in stocks... in something which will drive you to financial freedom.

Also, start listening to the Bigger Pockets Money podcast... you will hear tons of stories of how people earned their Freedom.

I would run your numbers again and review your comps. Based on your figures if you have just a 10% increase in renovation cost then you cut your return in half. 

What do you think the value of the home and property are as-is? At 10K, you could just demo the home and sell off the lot for a quicker and lower risk return.

The first and most important question.

Can you provide me with three references who you have done work for recently?

If they so no... or get sketchy... or ask why would you need that.. or say yes and then never get them to you... then ditch them no matter what.

Everything is a good idea if it matches your given risk tolerance, skill set, and provides you with the ROI you desire. We can't tell you if it is a good idea for you personally or not.

This just sounds like a bad idea... 7 people with no real experience or knowledge in real estate pooling all their funds to buy a single multi-family property. 

With that many people you will run into some major conflicts between the group which could end up killing the entire plan. 

If you are all about going forward then you all should sit down with a lawyer and get an LLC drafted up that covers how the group will handle the countless issues that are ahead. (yes this will cost a lot of upfront but save you 10x that amount in the future)

My opinion... start off by yourself. Spend a year saving money and learning all you can about Real Estate and then buy your first out of state deal as a single owner LLC. Then if it goes well, have your friends become private money debt investors in your next deal... or just continue on by yourself with the help of a hard money lender.

There is no single 'right way' of approaching negotiations with sellers. For one home you may have to point out all of the renovations you have to do and justify your offer. Other times the seller doesn't need any of that in order to come to a mutually beneficial agreement. 

In my opinion, you should go into every negotiation with a few different strategies on how to approach the conversation and then adapt to the conversation based on the seller's response.