All Forum Posts by: Kevin Ellerton

You said it has all the downsides of renting, but I'm not seeing that. The downside of renting is throwing $1500/mo away with nothing to show for it. Here we would be throwing away $350/mo HOA (maybe similar to cap-ex on a house), but would hopefully be able to sell the coop in a few years, for around what we bought it for, or maybe more (or maybe a bit less). During that time we can make $1700/mo renting out the coop while traveling… deduct $350 HOA and it's still $1350/mo profit… still $16k per year. So it would pay itself back in around 9yrs. I don't see how that's the same downsides as renting… sounds like a slightly crappier version of owning a condo

Thanks @Shane H.!

>> Im not sure how you BRRRR the house youre living in.

Our plan is to live there first for a while and then rent it out later (for the rest of the BRRRR) 😃

As far as Meditation Magazine… we are in 1000s of stores in 20+ countries, with 7000+ paying subscribers. Decent revenue. ALMOST break even. I don’t know when we will be profitable. Hopefully soon 😂 and yes, it’s a passion business, but I hope it will also be a profit business


my question is more along the lines of:

is the house a much better investment than the coop? Is it worth risking the “bird in hand” to try to catch a better bird?

I forgot to mention, the houses in Gulfport have nice backyards. We could put in a swing set and a kiddie pool and the baby would have a great quality of life.

The co-op has a nice pool but doesn’t allow kids under 3yrs old to use it.

The houses in Gulfport are also in a quieter area (the co-op is next to a major road and has some street noise)… this would be great for me to be able to record video/audio for my meditation business.

So overall I think the houses are better quality of life and better investment. I just don’t know if we will be able to find one, and don’t want to lose the great opportunity we have in hand in Sarasota 🤷‍♂️ 

Ok, obviously I should buy the house, right? Why would anybody buy a co-op?

Well…. the situation is not so black and white.

My wife and I recently had our first baby! She’s a one year old girl now 😃 

We’ve been living with family for the past two years and it SUCKS to live with family with a new baby. We need a place of our own… but rents are through the roof.

We are running a startup and have no real personal income but have $150k in savings.

We found a crappy house in Child’s Park, St Petersburg (next to Gulfport). The ask was $125k. With $10k of work it could have been worth $180k. We bid $140k. Somehow we got out-bid and lost the deal 😔 

In our disappointment, we put a $140k offer on a $145k co-op in Sarasota. 15min drive from Siesta Beach… best beach in the USA! It’s a beautiful co-op. Turn-key. If it was a condo in that location it would sell for $200k+

And… we have an accepted offer 😳 🤩 🤯 

I would be excited but… then I remembered about the BRRRR. I could BRRRR a house. I don't think I can BRRRR this co-op.

For one thing, there’s nothing to RRenovate.

Worse… the co-op building (44 units with a pool and everything) was built on a 99-year land lease. So banks can't lend on the units. That's why it's so cheap… that's why we can afford such a nice apartment in such a nice area (similar units in the building rent for $1600/mo)… but it also means we can't RRefinance and RRepeat 🫤 There goes my dream of a 100-unit BRRRR empire 🤦‍♂️

So… we have a "bird in the hand" … an accepted offer on a place we would love to live… but it doesn't seem like a great investment property, and it doesn't seem to lead toward my real estate BRRRR career goals.

So… should we back out of this co-op deal and wait for another deal to pop up in Gulfport instead?? I actually just hired a lead generation guy on Fiverr (like 5min ago) to find the contact info for every homeowner in Gulfport… I’m gonna cold call them all over the weekend before our due diligence period ends on Monday, to see if I can find any off market deals 😂 

And another confounding factor here: the co-op board is now negotiating with the landowner to try to buy the land and turn the co-op into a condo! If that happens, the co-op goes from $140k to $200k overnight… this could foreseeably happen in a year or two from now!

So… it seems to me that the co-op is a bird-in-hand, a place where we would like to live, and potentially a lottery ticket if it goes condo… but really not a good option for my favorite real estate strategy (BRRRR)

On the other hand, if we find a house in Gulfport (my favorite neighborhood), we can BRRRR it (my favorite strategy)…. But we might lose our "bird-in-hand."

So what do you think??? Should we buy the Sarasota co-op? Or roll the dice and try to find an off market deal on a house in Gulfport?

Thanks @Matthew T. and @Jason Brown! That is extremely helpful, and answers all of my conceptual questions. Now I'm just left with the concrete questions of "how do I figure that out...?"

.... how can I find out which position the lein is in, and how can I find the amounts of the other liens (like municipal leins)?

... how can i find out if there are squatters & tenants? Do I need to actually go knock on the door? Not the easiest thing to do during pandemic 😂 

... how can I find out about past-due HOA fees, past due property taxes, municipality liens, and tax liens on the previous owner?

Thank you guys, I really appreciate your help... I think this is all need to know in order to be able to finally move forward with this and get out of the hamster wheel of renting :-)

Hi! My wife and I are looking to buy our first property in Miami. We have around $80k that we can put down, but neither of us has a traditional job that we can use to get a traditional loan.

We found the Miami-Dade foreclosure auction website and it seems like a place where we can pick up a property for under $80k, all cash.

But we're not sure we understand how foreclosure auctions work. For example:

1. If a property is being auctioned that has a $150k mortgage, and we win the auction with a bid of $70k, do we need to pay the outstanding balance on the mortgage? Or does the $70k "wipe out" the mortgage?

2. Is it possible that the property has other liens against it, aside from the $150k mortgage? If there are other liens, do those get wiped out by my $70k as well? If not... how can I make sure that the property doesn't have any other liens against it? Do I need to hire a title company, or is there a way that we can check for ourselves?

3. Is it possible that the property has a squatter in it, or some other major problems? If so, how can we do due diligence?

4. Is there anything else we're not thinking of, that we should be looking out for?

5. Is buying on a foreclosure auction stupid in the first place, because the properties are essentially "on the market" which means that we are unlikely to get a below-market deal?

Thank you so much in advance! 🙏

Thanks for the tips guys I really appreciate it.

From reading BiggerPockets books & forums, it seems like most investors are able to get loans relatively easily. Does that mean most investors have "day jobs" that provide income, and only work on property investing on the side? Or are they using rental income to qualify for new loans?

Hi all! N00b investor here.

My partners and I want to get started with a career in BRRRR.

We have access to around $100k of cash between us, and good credit, but none of us can show substantial income on tax returns.

We are located in NY and Miami - expensive markets. $100k won’t even buy a distressed property let alone give us capital to fix it.

We want to get an FHA loan or something to give us leverage but I'm worried that without income we won't qualify for a loan.

What can we do to get started in BRRRR? Is there a loan we can qualify for without income? Is there any way we can qualify for FHA?

Great analysis! I wrote a thesis a few months ago that QE Infinity is going to drive real estate prices way up. Recent rise in prices validates my thesis to some extent. But I’m new to investing and maybe I’m oversimplifying. What do you think?  https://www.notion.so/thinkemp...