All Forum Posts by: Brant Richardson

Look into FHA loans to decrease you down payment. You will have to be an owner occupier though.

Wellsfargo told me I do not need cash reserves until I got to loan number 5.

Smart move going for a high quality property in an area with good shcools. As an out of state investor you need to minimize the tenant headaches.

That's not a uncommon situation when doing major rehab. Is your goal to develop a large portfolio? Are there other properties available that will cash flow better fully financed?
I would want to have it cash flowing $100 per unit after financing. If I could get all the cash I put into it back out and still have it cash flow, that would probably be good enough for me. If that left a lot of equity in the property, like enough for the down payment on a replacement property plus a second property and those deals were available, then I would have to sell.

15 year vs 30 year. With the 30 year you will obviously cash flow better. If you have the self discipline to save all that cash flow and the desire to buy more properties then the 30 year is a good option. Interest rates are good now so it is a good time to lock them in for the long haul. However, 15 years from now you will throw a party and be loving the cash flow when that property is all paid off. Which is better depends on your goals.

As the others have said, 1 or 2 bedroom units tend to have shorter term tenants.

My goal is to have 3 or 4 bedroom homes in nice areas with good schools. The idea is to have a stable family move in and stay there while the kids go to school, hopefully K-12 and beyond.

4 bedroom places may not rent for very much more than 3. They cost a little more to maintain- bigger roof, one more room to paint, another room that needs new carpet, a little more property tax. They cost a little more to buy in the first place. With that said, a 4 bedroom house would be very desirable for a larger family. If you can find a 4 bedroom that fits all your other criteria and is priced similar to 3 bedroom places you should grab it in my opinion.

These families will be frustrated with one bathroom. Ever tried to get 3 kids ready for school with one bathroom? As mentioned, one can be added. If you find the right property where it can be done with out too much difficulty, like in the basement, then you have quickly added value.

I want to be paid 7k to take a cash flowing property with 29k in equity. Your hooked now, you'll have a hard time getting another high like that one though.

-200 is a liability not an investment, cross your fingers and hope for appreciation. I would sell if it did not cash flow +100/mo at a bare minimum. That is after mortgage, tax, insurance, 10% vacancy, 10% repairs, and in my case 9%property management. I know nothing about the Charleston market so I don't know what the numbers on a good investment look like there.

@Ben Wakefield

@Ben Wakefield

Ann Arbor is probably one of the worst areas in Michigan as far as rent to purchase price ratio go because it is such a desirable area to live, but vacancy would be low because there is great tenant demand. Still way better than Southern California. You probably would not have to go far outside of Ann Arbor to get better returns, certainly not all the way to Detroit.

High-Functioning Autism - Classic. Yes, FHA, that will teach me to post at 12:13 AM when I should be in bed.

Travis mentioned the 203k loan which is really nice because you can finance the rehab costs too. I'm not sure, but I think you have to have a contractor do the work though.

You should be able to find property in Michigan that cash flows very well after paying for PM. Do you still have family there?