All Forum Posts by: Mareno Rathell

I purchase in high crime areas. I usually get duplexes in decent condition for about $22k and put a couple of Grand into it with myself doing the work. I make $700 per unit per month.

I have all long term tenants who pay on time all the time and they take care of my places. I find most landlords in high crime areas just want the cash but don't duo their due diligence when screening tenants.

Ultimately if you screen properly, have a well taken care of property and you are a good landlord, you will get good tenants.

@Mareno Rathell type-o. The max we would pay for a condo or single family home is $15k.

My wife and I are using the BRRRR methodology. We don't pay anymore than $15k per unit. So a single family home or condo we would pay $25k max. Duplexes we pay $30k max. I do all of the rehab work myself and usually don't spend more than $2k per unit for rehab materials. This included paint, carpet, tiled floors, toilets, tubs, kitchen cabinets, bathroom vanities, plumbing, electricals and drywall. I usually have a unit completed and rented out within two months of taking ownership. Taxes on the properties are as low as $220/yr to as high as $1200/yr. We only pay water at about $50/mo per unit. All of our units pull in $700/mo. After rehabbing we easily more than double the value, not triple but more than double. Then on to the next one.

I hear you should put your properties under an LLC to protect yourself, your savings & your home from anything that may arise from a lawsuit associated with one of your properties, but I wonder if that is just something people stated repeating to others without knowing if it's factual. I've heard a good lawyer could find holes in that setup and wipe you clean.

@Jason DiClemente, would it be fair to say that if the seller was to pay closing it would most likely be against the profit the wholesaler was making. So if the Wholesaler was originally looking to make $3000 profit, he would now only receive $2000 due to the buyer refusing to pay closing?

The last several Wholesalers I’ve worked with had the buyer pays all closing cost in their canned contract as though it’s a given rather than negotiable.

So my question is, is it common practice to just assume buyer pays closing when working with a wholesaler?

I purchase properties in the $20 - $40k range and would like a realtor who don't mind showing the lower end, lower cost properties.

@Dawn A. Thanks Dawn.

Hey Angel, we get them where ever the deal is at. Our first one was MLS and the others were from Wholesellers. In fact I will be meeting a Wholeseller tomorrow regarding a duplex in pretty good condition that has been family owned the past 20 years.

I’m suspecting I should be able to get it for about $21k and I’ll put about $5k into it to update it. I’ll be doing all of the work myself, so the $5k will be for materials. 

To answer your last questions, we are doing cash purchases and they are located on the north side of Milwaukee. 

I believe we have been successful with our renters because we screen big time, turn away a ton, don’t make decisions based off the heart but rather by gut feeling mixed with facts and looking a person in the eye. Plus we only (off the record) consider single mothers with young kids and a career with a good working history. They tend to be low/no drama, family oriented, driven , quiet and take care of our property. 

As far as the location goes, I like the low entry cost with the rent potential. I have friends who spend 8 to 9 times more for their property in a better neighborhood but the rent is only slightly higher than what I’m charging. 

@Michael Henry, regarding finding the deals, we don’t participate in auctions or properties were a ton of people are interested. They seem to just bid up the price on each other. We just look for that properties that seems to slip under the radar that people tend to mis-judge.

The one Duplex we purchased with a side driveway was being sold by a lady who lived there for over 19 years. Her kids just had a new garage built that summer with all new concrete foundation and driveway, new glass block windows in the basement, new 7’ fencing in the rear, new fuse boxes with surge protectors built in , recent roof and a lot more I still don’t know why it sat on the market for 18 months but we picked it up for $35k.

Also we’ve noticed people are despite make a deal by years end, so December seems to be a great time to negotiate.