All Forum Posts by: Mathew Wray

Hey Tyler, 

Where overseas are you? I hope you're enjoying the experience! 

First things, first, I'd raise the rent to market on the ADU. Unless there is a friend or family member who you are helping out with lower rent, you're not doing yourself any favors. Depending on where in inner SE you could certainly get more out of it. Potentially the house too, depending on how big/amenities.

A HELOC seems like a decent option, if you can find a bank who will help you out since the property is rented. It's possible a local bank (I can check with mine for you) will understand you're out of the country and that is why the property is rented. But, I could also see other banks treating it like the rental it is and not wanting to HELOC it for you. Do you know what an extra 100,000 would do to your cash flow? Are you still able to put away cash as a reserve with that?

I'd save, save, save while you're overseas. You're right, there are incentives for home ownership (even under the new tax plan) but to buy a fixer upper, you're going to want more options than just an FHA 3.5% down loan which will limit how much of a fixer you can get. You could always sell the property and 1031 it into a larger income property, but I'd rather continue buying more. Is there room/zoning to subdivide the house/add on to create more equity or cash-flow that way?

In the meantime, I recommend continuing to educate yourself, hone in on a few neighborhoods, and start working with a lender now. Even if you don't plan on buying for another year, you'll know what you need to show as a self-employed couple to qualify and how to start that process sooner. 

Best of luck!

Mathew

Hey John,

I know of an attorney in Hood River who does a lot of purchase contracts for commercial properties. I’ve got a request out to him to see if he’s got a referral for you or if he’d be able to help you out himself. 

Will be in touch. 

Mathew

Hey Toby,

Welcome to Bigger Pockets. It sounds like you’ve got a lot of questions and have heard about different ways to make money in real estate. 

You’d probably be well served by sitting down and spending some time searching the forums, reading the free downloads, listening to the podcasts, and educating yourself on the numerous ways you can succeed in real estate. 

Ability to work doesn’t seem to be a problem for you since you picked up the phone and started cold-calling. Now you owe it to yourself (and future partners/clients) to educate yourself and understand what happens when you get someone on one of those calls who is interested. 

Best of luck to you! 

I agree with Richard, we make our own luck in many aspects. Just because it's not a pocket listing doesn't mean it's not a good deal. People do make mistakes on the mls-I've seen units with ADU's and rentals bringing in income with no corresponding price adjustments. Like Richard found, sometimes there are deals to be had, you just have to consistently look and put in the time. Steve is right too, there are a lot of overpriced duplexes but with 99% garbage, it still means there's 1% gold, you know?

Kevin, you should also look at the condition and terms of the property that sold cheaper: were there zoning issues, was the foundation bad, did the buyer have all cash and the seller needed to close quick? Maybe there’s more at play. I can’t tell you about your market, but it may still be a good deal at $260. Or, it could be way overpriced and you need to move. Do some more research, run your numbers, and if it still works make an offer. Now is a great time...lots of people are distracted with the holidays and you never know what is acceptable to someone else. 

Best of luck!

Mathew

Hey Doug,

Congratulations on your first purchase! Whereabouts in North Portland?

Are you looking to act as the GC yourself and just use subs or are you looking for a good GC to handle the scheduling and timing of all permitting and work?

It’s tight trying to find folks who aren’t already on other projects so I’d recommend using a GC for your first rental like this. I believe a couple are here on BP and may chime in...

@Daniel S McNabb

Best of luck! Take pictures and let us know how it goes!

Mathew

Welcome back!

Best thing to do is what you’ve said you already are-talk to everyone you interact with and educate yourself. 

Best of luck! 

I love what @Account Closed said about planning for a future where STRs can easily be converted to LTR. You don’t need to look too far into the future or dig too hard to imagine legislation severely impacting these units. 

Even more important, to me, is her points about not upsetting the existing tenants/violating leases. Their income is obviously more consistent and predictable and I wouldn't want to jeopardize those funds. I look at it like the ADU is gravy to their meatloaf. Don't drink the gravy if you don't have the meatloaf, you know?

Search Portland Air BnB and you’ll find plenty of examples of what to do, how to market, and what dangers to avoid when over-building/rehabbing. 

Best of luck!

Mathew

Good morning Shane,

I’m sorry to hear you lost your HVAC company, but it sounds like you’ve gotten back on your feet. That experience and your skills will be invaluable down the line. 

A couple thoughts:

Have you talked with a lender to see what your approved for? You said you were approved for 3.5% down loan through FHA-did their maximum line up with your maximum? Did they have concerns with your debt load?

While you’re young and have the energy, you could probably tackle a purchase and debt pay down at the same time, but I’d have some concerns. There are always more costs than expected to start and maybe your numbers are a bit on the “best case scenario” side. I’d be more conservative in your profit estimates. Can you detail your assumptions out in a little more detail on the expense side? 

I also understand you don’t want to delay. Can you pick up a side job or do contract hvac repair to pick up some extra cash and accelerate your debt pay-down? If not, I’d recommend taking all the steps to start the purchase process to educate yourself, while understanding that starting 27K in the hole may haunt you later. Better to pay it down while you’re looking and make a dent in your debt while not sidelining your purchase path.

That’s my .02 cents. If you need help or want specifics, please feel free to reach out. 

Best of luck,

Mathew

Hey Greg,

I’ll send you a PM and see if I can lend you some of my experience in helping myself and others make that first mental leap towards their future. 

In addition to my experience, I know there are a couple meet-ups around town that may be able to alleviate some of those concerns. 

Best of luck!  

Mathew

Hey Gage, 

Congrats on putting a semester behind you and planning ahead!

I think the cons of an internship are pretty obvious: at best, low pay, and more likely no pay. No glamour. The pros however, are numerous, not the least of which is practical, real-world experience. 

What type of internship are you looking for? What’s your degree in? What skills do you want to walk away from the summer with? I’d start with those questions and work backwards from there to arrive at the “where” of the internship. 

Best of luck and please let us know if you land anything!