All Forum Posts by: John Warren

I have been researching 3 and 4 unit properties in my area, and it seems like the prices are all a little bit high. I suddenly discovered that 5-6 unit properties are better deals than the 3 and 4 unit properties. Can I owner occupy these properties if I take out a commercial loan? I know that I would have to put down 20%, but it seems like it might make more sense and I could get better cash flow. What do you all think?

Maybe just give it some time. My wife and I took almost three years to get to the point where we were both ready to give up the "comfort" of a single family home and make the jump to house hacking. 

I used a leaf blower on my apartments. That worked pretty well on all the built up lint.

So yesterday I viewed some very interesting properties. They were four duplexes with identical flour plans in an A area. They have a lot going for them, but some pretty serious risks to. I am curious what the BP community will think of these numbers.

List Prices: $159,900

Each unit has 2 beds and 1.5 baths

Rents: $1150-1200 per side ($2400 per unit)

Taxes: $12,700 per year (ouch!)

Bad News: These are located in a flood plain, and have flooded before. I would need to hold flood insurance on them.

The Good: A comp recently sold right next door and taxes are down to $6,000 per year.

Thanks for the feed back everyone! I forgot to mention that I currently own a fourplex, and the management has not been very stressful thus far. This has led me to believe that I could probably manage a larger property just as easily, especially if I could have enough units to cover lawn service, snow removal, etc.

We just purchased an occupied fourplex three months ago. We had a lot of upfront expenses to comply with the town, but this month we will see 500-600 in cash flow! It has worked out great having the units occupied because everyone is paying on time. I am sure if they were not paying this could have been very stressful...

Hi everyone,

I have done a ton of reading on buying both 2-4 unit properties and I have also done a good amount of research on buying apartment buildings. I believe that the larger apartment buildings is where I want to end up, however, I was wondering if now is really a great time to jump in or if I should be looking for more 2-4 unit properties for now. Here is my thought process:

1. I may not have enough money to get into some of the larger apartment complexes where economy of scale starts to take affect.

2. I can lock in 30 year loans at silly rates right now. I currently have one four-unit building at 4.2% for 30 years.

3. Interest rates are going to rise... I feel like prices may be a bit inflated due to the last 4-5 years of low interest rates. Won't prices fall once interest rates rise?

I would love to get peoples opinions! I would love to get into some 5+ buildings so I can do a value add strategy, but I am definitely worried about the interest rates rising on those commercial loans in the next few years!

Thanks for all your encouragement everyone! I loved your definition of JOB #Mark Elliott. That has become abundantly clear to us in recent months! I will definitely be giving updates as we go. Hopefully in the next 6-8 weeks!

We decided to take the plunge. A year ago my wife and I outlined three different plans we could take to start investing. We were all set to go with a very conservative plan when some very unsettling events happened involving my employment. Although I am still employed, we decided to execute our "crazy" plan so that we would never have to feel tied to a job in the future.

Step 1- Sell our home in a beautiful suburb for around 100k in profit. We have owned for three years, and I have rehabbed the whole place.

Step 2- Sell our extra car for 9k.

Step 3- House Hack! Thanks @Brandon Turner and @Josh Dorkin for inspiring us to make this step. We almost did this anyway before I found BP, but you guys helped us believe that this could/should happen!

Step 4- Immediately purchase another multi family property! This would bring us to three income properties in one year! (we already own a four unit nearby).

Step 5- Use the savings from living frugally to rinse and repeat!

So are we insane or does this look incredibly exciting?!

I am attending southwest suburban landlord meetings in Berwyn. My first meeting was awesome and I got a reference to a great contractor. I highly recommend it if you are in the southwest burbs.