All Forum Posts by: Matt Alvino

Hello all,

I have a 4-family property on a very small block. Only 5 houses on the entire block. The neighbor across the street is a single-family home, but the house is set back all the way on the alley. So they have a big exposed front yard that borders the alley access and has a tall chain-link fence around the entire yard. There is a lot going on in that yard. Kid stuff (i.e. trampoline, playsets) as well as random storage, that would typically be found in a backyard. It's not a full on junkyard, but its close and definitely not a pleasant view.

A potential tenant recently backed out of the process after seeing the neighbor's yard. My question(s), what is the best means to handle this?

- A conversation with the homeowner (possible renter)? This feels like the right thing to do, but curious if this opens up issues if it doesn't go well.

- A letter to the homeowner?

- Go straight to the city to lodge a complaint? 

-Something else?

Thank you.

TL:DR - picked up my second 4-family. Purchase price $120k, with maybe $40k in repairs/capex the first year. Looking to get rents to $600/mo and cashflow over $400/mo.

Hey all. This post won't be as organized as my first deal post (https://www.biggerpockets.com/...), but excited to have closed on my second deal. 

I started the year doing another 90 day Bigger Pockets Challenge, this was successful for my first deal, but if you all remember the craziness the year started with, the second attempt was unsuccessful. After the 90 days had run their course I kept an eye on the market, but definitely not as closely. However, as that challenge was ending I found investor agent @Alicia Sierra after reading a comment she left on another post that sounded very helpful. She sync'd me up with her partner Jessica Loose and Jessica kept an eye out for me. For like 7 months... 

Well, a 4-family hit the market for $150k in a C-level neighborhood that Jessica sent my way. We knew it needed a roof and likely a new lateral line. Rents in the area can easily get $600/mo so I assessed the deal and could offer $128k. Which was promptly declined for another. That fell threw. And then another. That also fell through. And then it finally fell to me. We negotiated to $130k and got it under contract. I think the other deals fell through because the property does need some work and the three current tenants do not speak English (Vietnamese and French speakers), two of which didn't even have leases... Did a walk through with my property manager, Peter MacKercher, and when he said "$130k feels right for this," it gave me a ton of confidence that I had at least assessed the deal pretty well.

This was an "As-is" listing, but the inspection came back with a lot. We expected a lot, so it wasn't a shock, but we needed to negotiate a bit more. After reassessing, we countered at $117k, they countered back at $120k and I figured it wasn't worth arguing over 3k at this point. 

Day of closing, Tuesday Oct 11th, my Closing Disclosure changed 4 times... arguments over the prorated rents and utilities with the sellers and the title company apparently got heated... 

And now, the deal details.

Purchase price: $120,000

Convention 30-year loan @ 7% with 25% down ($30,000)

Planning $40,000 in repairs the first year or two (roof, lateral, kitchen/bath updates) and possible another $40,000 over the next 10 (more updates, HVAC replacements).

Targeting ~$450/mo in positive cashflow after all units turnover and updates are made (~7% CoC ROI). ~$250/mo in cashflow off the bat.

I also am fairly confident that this property is on the "path of progress" and could see over $700/mo in cashflow in 5-ish years. This may also mean it might be a bit of a "slow burn BRRR" and I can pull some money out to finance a future deal.

Want to thank my agent again, Jessica Loose. She put in a lot of work and had tons of patience to see this though. Highly recommend her to anyone needing an active agent that finds deals and brings them to you.

Pictures are a little hard to tell sometimes, but is the driveway even really needed? It doesn't appear to be going to a garage, so it feels more like a parking pad. I know you can't tell the inspector "we promise not to use it," but would it be cheaper to just demo it outright? Can you just cover it with sod...? (mostly joking)

Hey Lewis. I'm in StL City and looking in C-ish neighborhoods right now due to how crazy prices have gotten. Places like Bevo, Dutchtown, Marine Villa, Mount Pleasant, Carondelet, and Patch. However, some of these areas can be very block to block so I find myself driving properties to ensure there is not more than a couple vacant properties in a 2 block radius.

If you are more of an upscale investor, Shaw is where everyone seems to be. St. Louis Hills, Southampton, and Northampton are the next tier down, but the prices versus rents simply don't make sense based on my numbers.

Happy to give you some more deets Orvil. Got the property for $249,900 (which was about 10k over asking, used an escalator clause to get here). Based on my formula (8.3% vacancy, 10% repair, 5% CapEx, 10% prop mgmt, plus mortgage/prop tax/insurance and utilizes), I came up with $400+ in monthly cashflow and ~8% CoC ROI. Now, I predicted rents of $700/month per unit, median in this area is ~$750. After the offer and getting the rent rolls, I learned that all the units were currently rented for $550 and the units are in very good condition. One unit is vacant, another tenant is leaving end of May. So I can raise rents on two units to market immediately. On paper, the deal takes a big hit with the below market rent, but once it gets to market, it hits my numbers and makes me happy. Especially for a first deal. Just going for a single right...?

Hey Leigh,

Yes, found the deal on the MLS and it's in STL. I had assessed about 60 deals to that point and then two hit the market the same day that made sense.

Looking off-market may be my next challenge. Wanted to get in to the game on this first one and get some experience.

Hey everyone, 

Closed on my first investment property just shy of a week ago. A big part of my success, besides the podcast, was committing to the 90 Day Challenge. I started on Jan 28th after a Brandon Webinar, made my first offer on Mar 31st (~63 days later), and closed on May 4th (~96 days later). I wanted to attach the spreadsheet I created to track my journey, but realizing now I can't actually attach a file... So this post is a lot less epic than I planned... However, I will copy the table in here, this will likely be hard to read, but hopefully helpful to some...

Any day where I do not have notes is a day where I either assessed deals or researched rents. I plan to make some sort of a checklist out of the other notes I kept along the way. Here is the table of my journey:

My goal is to show other newbies out there that taking this big first step is possible and the 90 Day Challenge really helped me stay committed to making progress every day. Keep the faith and something good will happen.

Hey all,

Just closed on my first deal and want to replace the fridge and stove in a vacant unit. The fridge is especially beat up and currently standard white. This building is probably a low B or high C grade. So I don't want to overbuy, however, I do want to get rents up and justify that as well. 

My question to you all, what would you go with?

• White again due to its affordability and the class of property?
• Stainless steel due to it being in demand (at least I think it is)? 
• Slate due to it being like stainless, but not as hard to keep clean?

Thank you

Hey all,

I am new to the game and waiting to close on my first deal. While I anxious await, I am trying to get educated on items that I need to account for going forward. One of those items is to start a relationship with a lawyer for likely future needs. However, I am learning that there are at least three types of lawyers you may need as an investor. My question is, of these three types of lawyers, what are they typically used for:

- General lawyer (what's general stuff...?)

- Real estate lawyer (I am in Missouri so I don't have to have one for deals, but may for other reasons)

- Eviction lawyer (may be self-explanatory, but maybe not...)

Thank you