All Forum Posts by: Johnny Wolff

@Marco Morkous - have you considered house hacking in Nashville?  The house hack in a hot market is definitely best bang for your investment buck in terms of monthly net worth gain - for a variety of reasons (appreciation, leverage, interest rate, out of pocket $)

Understand that the cash flow might not be there - but it's very unlikely that you'll increase your net worth 6 figures from a cash flowing property in meh market in a couple of years. I'll bet you could do that in Nashville if you bought right with and FHA loan. Just something to think about.

I took that approach in Austin in 2017 and it has worked out very well.  And if I wanted to I could sell and buy 3-4 cash flowing properties today.  Not bad for $10K out of pocket to start out with.

Welcome, @Cesar Gomez!  My first few deals were out of state.  I think its a great way to get started.  We're here to support you - let us know if you have questions.

Think @Colby Fryar - hit it on the nose here.  Starting with D/F property to rehab as your first ever real estate investment isn't advisable.  A few notes on these types of areas:

-Can you cash-out refi in the area?  Banks sometimes are not open to loaning in these types of areas (East KC is a good example - cash purchases are the only options)

-Is there at least 2 good property managers willing to take the property in such an area.  You're going to hate your life if the answer is "no," your property starts having issues, and life gets too busy for you to be heavily involved on an ongoing basis  It has happened to me.  It's seriously the worst.

-A true F area (legit 100 out 100 on crime scale...like east KC) is pretty dangerous.  Are you comfortable going out there to supervise?  Will good contractors be willing to work there?  How will you protect your property whiles it's vacant/being rehabbed?

A D/F areas are really towards the advanced level of RE and should definitely be tackled by experienced folks whose business revolves around the benefits and challenges of that type of real estate.  There is a reason the cash returns are highest in D/F areas.  Just like penny stocks, there us some appeal on paper, but there are tremendous risks.

Conversely - A areas may have the lowest cash yields, but like blue-chip stocks, that's because they are high quality, liquid, and much less risky...and I'd recommend getting as close to that as you can, with your first investment.

Hi @Kevin Lee -  we actually do the exact service you're describing in the DFW (and KC) metros.  A few perks to working with HomeRoom:

1)  We don't charge property management fees (typically 10% monthly plus 1-month's lease-up fee)

2)  There is no mark upon the properties / no finders fee

Send me a DM if you'd like to chat.

Yeah - if you really want the deal - I'd just go with their lender.  You already have all the documents and it won't take nearly as much effort this time around.  The "hard" credit hit really doesn't materially affect your credit (like a point or two typically - and sometimes not at all).

If you're even looking for props here in KC or DFW hit me up.  Happy to chat :)

Hey @Sheilla Vidal - that's a bit strange.  We have a list of recommended lenders at HomeRoom, but we're fine when folks choose to use their own lenders.  

Agents are not allowed to receive compensation for referring to lenders but we do HIGHLY recommend investors use them because having a trusted lender makes the whole process go so much more smoothly for everyone and lenders who aren't experienced in the RE investment space lose deals because they are not able to solve investment-specific problems quickly enough.

Do think they should have given you the "why" - sounds like that might have been lacking.

Sent you a DM - would be interested in this as well for HomeRoom.  Thanks Andrea! 

Great question @Christopher Gill.  Following this post as we'd love to know the answer to this as well.

@Javen Wilson - one way to actually do this, is to buy a primary residence with local down payment assistance.  I did this with a duplex in Austin in 2015.  Total out of pocket was less than $1K.  Not all counties/cities have this - but some do...and there is nothing preventing you from moving to one that has it.

There isn't a way to do this on an ongoing basis without considerable off-market sourcing, rehab, and refinance work - that I'm aware of though.

@Gary Coop - check out Austin Fruechting (BP podcast #239).  He's done what it sounds like you're hoping to do.  I play poker with him on occasion (and we've had a few RE conversations over the last couple of years).  Think its important to understand some backstory that the podcast might not explore:

1)  Austin is pretty close to genius level smart (or might actually be one)

2)  He started investing in RE very soon after college and it took him many years to get the skills to move at this scale

3)  It's not passive when it gets to that level.  It's a business...even if you have a great property manager (which Austin does - I use her too).  Austin does have all the flexibility to travel that he wants to etc - but he's pretty engaged in ongoing deals which takes time.  I think the question is, is this the business you want to start?

Anyways - think its a cool long term goal and I wish you luck!