All Forum Posts by: Justin Moy

There is no 'missing the boat' with airbnb. We run an airbnb fund that has only seen improved performance in the past months. 

It's all in how you run the properties and how you use competitive pricing, effective marketing, and manage your expenses. Our group is more institutionally sized so that does differentiate, but traffic for our listings is still very high.

Generally an HOA is a dealbreaker for me. They can be a pain to work with and if they're sticklers can definitely cause tons of headache and have lots of fines.

In the residential space many are not looking to cash flow, they're either living there and therefore expect to pay out of pocket every month, and if they're house hacking are likely ok with a very small output of cash every month or breaking even because their 'payment' is a very cheap mortgage or a free living arrangement. 

Others do bank on appreciation, or possibly need to 1031 into something to avoid their taxes and don't care as much about making a cash on cash return.

Track record in an asset class they're investing in. There have been really big operators who have stalled out because they've always done market rate multifamily and then pivoted to something else. Even if it's very similar like market rate multi to LIHTC. 

There are always growing pains on those first few deals so I always dive into their experience in that market and with that niche, being very strict that they have to have worked that exact niche before. Not just in multifamily, but if it's a LIHTC or tax credit deal, I want to see experience there.

 I did which was awesome haha

Interesting how the article cited a few others that have some of the most debt coming due, specifically rise48. 

Some people were able to capitalize on the timing of the market and hit 40+ IRRs but those days are way over.

Commercial banks will look for your experience doing something like this. Without that, you'll likely need significant net worth and liquidity to offset the risk. Even with significant liquidity and net worth you'll likely still struggle to get this financed by a conventional bank or sophisticated lender. 

Commercial lenders are going to want experience so you'll need someone on the team that fills that gap. Depending on how much events your mom did in the past it may or may not fulfill that.

In the commercial space if you're going into a new asset class you'll typically have a key principal who will sign the loan/partner on the deal with you to get you some experience.

I have not heard of someone being accused of discrimination based on a letter. When I was a broker we'd submit letters, but that was also 10 years ago. 

You can probably mitigate the risks here by not mentioning your race or family structure and not including pictures.

I like to look at investments and compare them to what else I could put my money into. 

If you were not to purchase this property, what could you do with an extra $1,300+ a month and the downpayment? 

Could you lend it out as hard money for 9%+ per year? Probably.

Could you do a syndication or fund that will return a 6%+ pref and likely be a 15%+ return on average per year? Probably. 

I know the appreciation is likely high but you're purchasing an additional liability until that appreciation hits or the principal is paid down enough. 

It's more common for smaller property owners to not keep great records. 

I'd ask for bank statements that show rent being collected to prove tenants are actually paying their rent. Utility bills and tax bills should also be available even if they don't keep very tight accounting. 

Other expenses you should be able to project with a good property manager. 

Handling anything that is day-to-day. 

Tenant calls/complaints, new prospect calls/walkins/appointments, managing maintenance requests and issues, sending out renewals, paying the property bills. A really great PM will also keep an eye out on comps and recommend adjustments in price or renovations