All Forum Posts by: Kevin Laurion

Hello. The few items I see that you (maybe) missed were capital expenditures (CapEx), Lawn/Snow care expenses, and $1,500 for maintenance might be kind of lite if the property is older/not updated.

But if you are projecting ~$3k a month in rent, that is almost 2% of the purchase price, which is very good, and you should be able to make good cash flow.

@John Woodrich thanks for the reply, and I’ll be meeting with Tim to discuss financing shortly.

We put ~55K into the property up front and we will put ~10k in to achieve the anticipated $300k appraisal value. If it comes in lower, that's okay, we will adjust once we have true numbers. I'm still in the education/learning phase of our REI journey.

But ultimately I’m looking for advice/experiences that people have gone through that have maybe been in our situation. Or something of its sort. My wife and I want to educate ourselves on all the financing options available so we can make a decision that works for our goals/ambitions.

Kevin

@Jordan Moorhead@Tim Swierczek@Ivan Widman@Joe Schaak@John Woodrich

Good Morning fellow investors.  I just wanted to update everyone on my wife and I's progress and also ask a few questions and maybe get some tips for our next steps in an RE journey! 

We closed on our side-by-side duplex in north Minneapolis (just south of the new Top Golf by 694 and 94) on Nov 8th and jumped right into reno and additions. We got a construction loans to help with those costs and took the property from a 4/2 to a 5/2 by adding a basement bedroom on one side. We inherited one set of renters, and started showings on the updated unit mid Dec and had our new renters move in Jan 8th. The whole process has gone pretty smooth (overall) and we are excited that both units are fully rented with what we feel are good tenants and now we can "relax" a little bit. I don't see a lot of people share "their numbers" on here but I guess I will go against the grain (hope that's not an issue). We were able to purchase the property for 240K @ 4.6% IR and used 11K for reno to add the bedroom, for a total purchase of 251k. We are receiving 2,600 a month for rent now and plan to increase that to 3,000 when we fix up the unit with the inherited renters this spring (as they aren't paying much). So the total numbers with the aforementioned purchase price along with 10% for CapEx and Main each and all other costs (taxes, Ins, S/W/T) are:

-Equity once the second unit is updated = ~$100k

-Monthly Cash flow of ~$869

-CAP = 9.37%

My wife and I had a smooth transition into RE and we are looking to expand, maybe not right away, but once the dust settles a little more.  We are looking in the next 6-12 months so we can re-coup some cash reserves and make sure we're getting the full buying/landlord learning experience under our belts.  Since we have a construction loan at 4.6%, we are thinking about doing a cash out refinance and are looking for advice/tips on this. We wont be doing owner occupied so the next down payment will have to come from us. I've started reading books/watching videos on cash out refinancing but I'd love to chat with someone who has done this first hand in the area. I'd love to learn more about how this affects my taxes as well.  

With all the info you see above and your expertise, what would you do going forward?  How would you go about expanding in RE? Is a cash out refi our best option for the scenario described above? 

If people would be more comfortable sharing their opinions in private, don't hesitate to message me. Lastly, thank you to all have helped us thus far in our RE journey.  We are still new and learning but it has been positive in our eyes thus far.  

Kevin

@Joe Schaak @Tim Swierczek @Ivan Widman @Jay Schultz @Alyssa Strom @John Woodrich

Morning! Just got an accepted offer on a traditional duplex in North Minneapolis. Needing to get an inspector in there early this next week. Who does everyone recommend? Thank you!

@Jordan Moorhead thank you for the reply and your insight.  I would put the snow/lawn on the tenants to keep monthly expenses down.  I am in an industry where we work of "worst case scenarios all the time" so my mindset is always to think that way.  So I will have to make sure i dont always use that mindset when running numbers.  Thanks again for the reply. 

I've also heard a lot of positive things about the realty services you provide so i will be reaching out soon to maybe sit down with you and my wife to discuss next steps in the process. 

@Tim Swierczek

Thanks for the reply Tim. I put 1650, because most the comps are newer as I started. Newer as in the age of the property is like 10-20 years old where this one is 80+ years old. So I’m assuming that a 1920’s house that is updated won’t fetch the same rent as a 2005 house that is updated. If that makes sense. Should I not be doing that?

And if I’m seeing rental listing for 1800-2000, then I would want to be at the lower end of that spectrum to keep the vacancy periods shorter. And maybe even have a “buffer” in the market turns and higher rent properties aren’t renting for as much. But again, I’m new so maybe I’m being to cautious.

@Joe Schaak @Tim Swierczek @Jordan Moorhead @Jay Schultz @Ivan Widman

Can i get your thoughts on how Im running the numbers for this SFH property that was just listed? the address is:

1106 Wakefield Ave, Saint Paul, MN 55106

I have the estimated numbers that i enter into my calculator and then the final numbers I get as well. I put in the CapEx,utility estimates , and snow/lawn in the "other" section. I put the rent price at 1650, but most newer comps are 1800-2000. Any insight on if Im computing the number right or accurately would be GREATLY appreciated!

@Joe Schaak @Jay Schultz 

Thank you both for the insight on your personal experiences in the RE world thus far. I appreciate it!

Jay, I did know about the meetup last night but unfortunately my wife had to work at the hospital so I was on daddy daycare duty. But I absolutely plan to attend many of these soon so I hope to shake your hand at some point and introduce myself.

Joe, my wife and I purchased our first home last year and had the unfortunate scenario in that the air of our furnace and AC were both overlooked by us (first time buyers) but I was more disappointed that our inspector didn’t mention that they were both 20 years old. But ya live and learn so I wont be making that mistake again. And that is one thing I really want to learn about and get more information from local RE investors is how they run the numbers and how they assume expenses in the area. I’ve never done a reno or much house repair so I don’t have a great idea of how to run those types of numbers.

Again, I appreciate it guys and will reach out if I have any additional questions.

Kevin

I’m located in the twin cities and am looking for advice or to network with RE experts on the methods or ways people find off market listings.

I understand everyone here is looking for this same thing so message me if that’s best. But I’m absolutely wiling to put in the time/effort to send letters or knock on doors if need be. Just need some ideas to get myself started. Not looking for free handouts, just advice or pointers. Thanks.

Hello,

My name is Kevin Laurion and I want to introduce myself to the Minnesota forum group. You can take a look at my profile for a quick background on my family and I as I don’t want to bore you with that. Haha.

My wife and I are new to the real estate investment game and we're looking for advice/help/pointers for people that have been there, done that. We are looking for a property at this point to purchase and hold. We want to go SFH or Multi family, but we'd be open to either if the property/location/numbers are right. We live in the northern metro suburbs so we would want to keep the property semi close (within an hour) to us as I'd like to manage it ourselves, to start at least.

I have been watching the public markets for some time now to get a gauge on what type of properties are listing for and also selling for. We are very fortunate in that we can save ~$4k a month and have saved ~$80K, thus far in which we are comfortable spending ~$65K of that for the initial purchase/reno upfront costs. We would then look to do traditional financing for the remainder with a purchase timeframe being this late fall/early winter as this is a little bit “better” time for buyers.

Questions I have for current investors/rental owners:

• -Will the amount of money listed above be able to get use a decent semi-fixer upper property that will have some cash flow after a few years? Not looking to get rich over night, but don’t want to be losing money long term.
• -A number of the listed duplexes in the MPLS/STP area are mostly pre-1930 era. What are the major pitfalls with these properties? I am comfortable doing general reno and maintenance, but not full renos with the electrical/plumbing/etc.
• -I want to learn as much as possible before my purchase, so doesn’t anyone recommend a podcast/book that will help me as a first-time buyer?

I’d love to and will attend some of the MN Meetup get togethers to shake some hands and meet others in the industry. Please message me or comment if you have any insight or 2 cents on the aforementioned questions. Your time and knowledge are greatly appreciated!

Kevin