All Forum Posts by: Kenneth Garrett

@Alexa K.

I like this deal. I have many rentals in the Midwest, not quite as low as your numbers but none the less if I can get cash on cash of at least 25% annually in 4 years, I have a rental property with no money in. I just moved to Florida and I agree the prices here are much higher. If the plan is to hold long term the ARV is not as important. It doesn't mean disregard it, but it does provide you flexibility. I concur with @Joe Villeneuve have the work done now.

@James Spevak

I agree with @Nate Sanow use Zillow, Redfin, realtor.com, etc. Milwaukee like a lot of big cities ARV's can very from neighborhood to neighborhood or in some cases street by street.

I would find comps in the same neighborhood paying attention to which street your on. Definitely use the criteria or at least similar. If it's a SF then compare bedroom/bath, square footage, style of house (1 or 2 story, basement yes or no) age, etc. Use the photos on line to look at amenities and see how your property compares to there's. Look at what's currently on the current as competition. Even those they don't provide actual comps it does identify competition. If you ARV is 200,000 but the competition is at 185,000 that is something to consider. In todays ever evolving economy use recent comps.

If you are trying to calculate rental numbers use the same method. I use Zillow and rentometer for rental numbers. I don't find many rental properties in the Milwaukee/Chicago markets use the MLS much. Of course a broker can help, but you still need to analyze the comps they are using.

 Added about 15% to bookings

@Greg Schreffler

Age is irrelevant. Starting is the only thing that matters. I started at 50. I studied the first year and observed what others were doing until I found my strategy. My method was utilizing the BRRRR process. I did very well. Did some flips as well. Bought some student housing, STR, etc. I kept my mind open to other types of investments. Partnered with people who had no credit or experience. I networked like crazy. Attended lots of REIA meetings and real estate investing conferences. Hang in there what makes each us different are those of us that actually took the leap versus those who just sat on the sidelines and never took their shot. Take the shot.

@Dylan Spain

Don’t over analyze things.  Analysis paralysis keeps many people from ever starting.  I’ve seen many people buy all sorts of programs and have never made an investment.  Find a strategy and stick to it.  It’s ok to have an experienced investor review a purchase.  When your starting out a mentor or someone to go to can definitely help.

@Account Closed

My first year I exclusively used VRBO.  Second year I added Airbnb.  The first Airbnb guest decided to have a family reunion of 20 plus people.  I prefer VRBO, but anything can happen on either platform.  Adding Airbnb will help you get more bookings, most likely.  

@Max Gradowitz

I get that we are looking for smoking deals and as an investor the deal is never really sweet enough. I think a lot of us wonder if we could have gotten a better deal. It sounds to me the offer came from an investor who figured you were in a bad spot and you needed to unload the property or get out from underneath it.

Clearly it’s a ridiculous offer. Seems to me he threw it out there to see what sticks. I would counter at 10% interest an equally ridiculous offer. Maybe I want to see what sticks.

@Randy Smith

I agree with both concepts. Initially I was all about cash flow, but I didn’t spend the cash flow. I banked the cash flow for more cash flow properties. I used my W-2 to take care of daily bills. In the process I was creating growth which became generational wealth. Generational wealth was always my goal.

@Gina Shumway

I like to use small local banks and credit unions near your rental property. I would definitely get your property rented prior to the refinance. I have used a number of DSCR loans and having the property producing income is a plus. Without a tenant in place then only projected rents are calculated versus actual rents.

Based on how well your rehab went, I was always able to out pace market rent by my actual rent. This increased my DSCR ratio. My goal was always 1.25, but generally I would be in the upper ones and a few times I hit 2.0 or better. This gave me way better terms at the bank.

@Jace Perez

This is definitely economic market driven. When prices were not so inflated a SFR might bring in $500 a month cash flow with a mortgage. While today that number might be under $300.

Some count on appreciation and aren’t so worried about cash flow. Most of my rentals are in the midwest so appreciation is fairly modest. You would definitely want to look at cash flow.

A $100 cash flow for a property today is not something I would do without having some other value driving the property as in appreciation. $100 would get all eaten up over a furnace/air conditioner replacement or some other large expense. It’s just not enough to make it worth the investment. I would wait for better opportunities.