All Forum Posts by: Josef Hardi

Hi Adam, 

I would be following this thread as well, curious what insights people will share. 

Just a bit of experience from my last refi. I refi'd  and cashed out my primary residential property back in January 2022. I spoke with the same lender about the possibility of purchasing another primary home residence, and he said he can help after 6 months. Which I think is a fairly short period of time considering basically I am switching a primary residence.

In short, perhaps after a period of time, you can claim that the primary residence is no longer a fit for you and legally you can move on to another property while renting out this primary residence.

Hope that helps!

Amazing, thank you for sharing!

Hi Austin, 

Are you referring to rent-back scenario? Where the buyer allows the seller (or existing tenant) to remain the property, after it is sold?

My agent said that it's typical to offer a FREE 29 days rent back period. Then if they need more time, you can offer 14-30 days at your per diem cost of your mortgage payment. For example $3k mortgage payment = $100/day, then the seller would pay $100/day to stay at the property. 

Do be aware of the risk in doing this. If it's a tenant, they do have tenant rights, especially in California.

Best!

Hi Rebecca, 

Thanks for sharing, that is an interesting perspective. I personally don't agree with these homeowners, but it's good to be aware of it. I think the ones driving up prices is actually homeowners who gets so emotionally attach with a property that they are willing to bid up way over the asking price. Plus we just have a limited number of inventory. 

In general, I try to avoid properties that have HOAs associated, hopefully I won't run into these types of "rules" in the near future.

Thanks again!

Hi Dustin, 

As a new investor, I often find myself second guessing and doubting my calculations / decisions. Just remember that with real estate, time is on your side. As long as you are investing in a fairly decent area. I actually made the worst ever decision back in 2007 purchasing my first property, by 2008 my property had halved in value. But with time, everything corrects itself. 

Also- listening to the podcasts of successful real estate investors, pretty much all of them screwed up one way or another. They all learned from it, and did not give up.

All the best, you got this!

Hi Tyler,

Are you a licensed contractor? If so, that's an awesome asset that you have. Especially if you are experienced enough to take on a BRRR project. I am not super familiar with the Cincinnati, Ohio location. A couple of suggestions:

1. First you need to know what loan you can get. I would recommend calling a broker, like https://www.the1brokerage.com/ and/or like what Donald mentioned above, try contacting hard money lenders.

2. If you do have access to these great deals, make sure that they are indeed great deals. I mean, have the numbers to support it. Because hard money lenders will essentially need a detailed plan (including costs) before they would consider your application. Be prepared to provide market values once the property is refinance (taking into consideration the projected interest rate).

3. If you have made this solid business plan, other than money lenders, you can also try to get funding from your family / friends. Or even investors here from BP. I think you can offer a lot being "boots on the ground", especially if you are a licensed contractor. 

All the best!

Hi Steven, 

In terms of the subdivision, I am not super familiar with how it works. My friend was able to put down $10k, and secure the pricing that they offered. But she didn't actually get access to the home until a year later. When will you know what is the final cost they are asking? It's hard to do an analysis on a moving target. Is it possible to do some sort of a refundable down payment, and then reconsider when you know the final cost of the house? 

In terms of construction prices, I think it's not just tied into the supply chain issue. As long as there's still low inventory (in your local area), then prices will continue to go up, especially since the value of money continues to go down. 

A couple more points to consider:

1. Will you be cash-flowing on your current SFH if you rent it out? You can do a quick check on the rental market using BP rental tool, or rent-o-meter. Or contacting a couple of local property management.

2. If it does not cash flow, will you be able to justify it, at least with appreciation rate? And most importantly, will you be able to afford a negative cash flow?

3. Will there be HOA on the new subdivision? And will the number makes sense (once you have an estimate of home price) taking all expenses into account?

It's hard to do, but analysis is best done taking your emotion out of it and just sticking to the numbers. All the best!

Hi Nicole, 

A couple of questions for you:

1. Is your rental property located in the city of Los Angeles or in the county of Los Angeles? You would have more protection in the county of Los Angeles.

2. I think it's best you consult to an eviction lawyer to know what options you might have. Because it's harder to evict tenants who have been late on rent. The local government offers higher protection to tenants who cannot pay, more than those who are able to pay rent on time. 

Worst scenario would be for the tenant to state to you: they cannot pay due to COVID (no certification is needed). And if they state that, you cannot evict them or demand rent until 2023. Please contact an eviction lawyer as soon as possible, and try to work with the tenant so they do not miss their payment.

Hi Kyle, 

I am also a new investor, I'll offer up a couple of thoughts for you:

1. Do you have money to invest in right now? Or are you just starting to save up $2-3k? Regardless, do start to save up. 

2. If you do have some money towards downpayment, perhaps you can consider an FHA loan (3.5% - 10%), but do check if the numbers work out for you. Because remember FHA loans have really high PMIs (our lender quoted about $600/mo PMI for a 800k loan, 3.5% downpayment). Also, not sure about your market, but in So. Cal offers with FHA loans is considered a weaker offer when compared with a conventional 20% offer. You would have to increase your offer price to be more competitive.

3. If you do not have the money towards downpayment, you could always save up until you have enough for an FHA loan or 10-15% at least for conventional loan.

4. I am not sure how much equity you have in your current primary residence. But if it makes sense, you might also try to get a HELOC on it (they typically allow up to 80% LTV). I would only use the HELOC in case there's a great deal and there's an exit strategy to pay off the HELOC in the near future.

5. Keep in mind that the loans for duplex/triplex/fourplex will have a higher interest rate, and higher minimum downpayment.

In short, run the numbers, maybe try to get a pre-approval to get a sense of how much you can purchase. And learn your market, so you know what is a good deal when it presents itself. 

All the best! I can see success in your future :)

Welcome Jonathan! I am also new here, and I agree with you, I think we are in the right place!