All Forum Posts by: Matthew Becker

How much cash do you have to invest?  Have you considered just putting money in a fund?  

I don't know NC, but a new home for $400K will be hard to get $3200 in rent in most places.

You can hit numbers like that on rehabs.  If someone knows where you can get $3200 on a brand new $400K home in a nice place that will appreciate, let me know as well.  

I put backsplashes in almost every rental, and $500 is pretty cheap.   It matters what the condition of the place is.  Does the countertop go straight into the wall, or does it have a tiny backsplash?  If it has a small backsplash don't ad anything it will look crapy.  I generally buy and rehap it completely at the beginning to maximize rent.  

Send images and a floor plan and it would be easy to tell you how to upgrade. 

How much is your rent?  Are there other things that need to be upgraded?  Can you raise the rent?  Here is one I just did.  It is cheap and simple. 

Hartford -  That is a pretty liberal place.  So you could be screwed.  Liberal judges are much more likely not to follow the law than conservative judges.  Your state is probably not landlord-friendly like a red state is.  I lived in Boulder, CO, for years, although the judges were anti-landlord.  They will still enforce the law if someone is ridiculous, and this is.  

Does your lease specify late fees and payment dates?  Do you charge late fees every time they pay and send them a ledger?  Do they pay the late fees?   You can go back and charge late fees on every month they were late.  If they pay the rent in two payments and pay you late fees monthly, then maybe just keep them.  I have had tenants do that; one still lives in my place after 10 years.  They pay rent late almost every month.  

 If a judge considered ADD a handicap, it would be ridiculous but these days everyone is handicap or some quack tells them they are when they are in grade school scaring them for the rest of their life and feeding them pills like the chief from one flew over the cuckoos nest.  But even if someone has no arms and legs, they still have to pay rent on time, or you can charge late fees and evict them.  So the ADD being handicap does not matter.  

In summary, property should be sold in liberal states.  You can invest in liberal towns but not in Red states. It is the best of both worlds.  Liberals make friendly cities, and conservatives are pro-business.  

You also need a lawyer who is not an idiot.  

I suggest giving them three days, going to court, and seeing what happens.   Even if you lose, it will be a great learning experience. But I doubt you will unless you had the same half-wit lawyer write your lease.  

Denny Crane Never Lost Never will.  

How much was the loss?  I am guessing you do your taxes?  Do you have an accountant? Do you want an accountant?  They are pretty cheap, and good ones pay for themselves.  Especially ones that are tax advisers.  I used to do my taxes for years.  I spend about 20K a year on it, but it makes me more than that in savings. 

Sweet.  Do you need any advice or just saying hi? 

Commercial leases are different and need a lot of other things.  

You could have an attorney write it up. Then, if they mess up, you are covered by E&O insurance. Call around and find one who has done it. They will have a boilerplate lease that you can tweak, and it will probably cost you $200. Then you have one.

You can call a commercial agent and ask them what lawyer they use in some cases you could pay them to write it up.  

If you put in terms, you can have AI write it.  There is probably a legal AI bot out there now.  

Are you doing the remodeling, or are they doing the remodeling?  This will need to be specified. 

There should be commercial bankers or credit unions that do. 

Do you bank at a big bank, credit union, or community bank?

Start with your bank, but switch banks if it is a big one.
How much do you owe, and how much is it worth?  

Most banks don't like to be in second position unless you have a lot of equity.  

Here is what I look for.   So yes, obesity matters.  Obese people are generally much more likely not to be successful because of health issues.  Whether it is genetic or a lack of discipline.  Either way, they don't grow old and Rich.  They die younger, statistically. 

Isolated State College Towns or Resort towns tend to be more liberal in a Red State.  Liberals make lovely places, but red states help them not turn into tax hells or places that are anti-landlord—no big cities. The school systems are terrible, and they all have awful crime rates.  They have turned into crap holes.  Chicago, NY, Seattle, SF, and the rest.  Places you leave your keys in the car.  

It has to have some growth barrier, for example, a giant mountain or lake that makes it impossible to grow that footprint of the town.  The mountain or lake leads to other qualifications.   Ideally, there would be a mountain on one side and a lake on the other.  

Beautiful places with skiing, mountain biking, rivers, lakes, and vast wilderness are nearby.  So great outdoor experiences. 

Great Weather and natural disasters.  The weather is not too hot in the summer and cold in winter.  No natural disasters.  I don't like floods, tornados, droughts, or tsunamis.

Water - Long-term water sources.  Fox example aquifers. 

No large industries because if they close, you get Detroit and lots of vacancy.   High level of white colar workers and college educated people.  

Walkability, bikeability, healthy culture, art, music, and Good food.  Liberal towns are generally better at this.  

I invest in places where wealthier people want to live or where they will want to live.  When I say rich, I am not talking about Aspen Rich.  Think about retired professions or the millionaire next door.   First, in the 90s to mid-2000s in Boulder, CO and from 2008 to the present in Idaho.  I am not sure if anywhere is better than Idaho right now.  

Quote from @Jimmy Lieu:

Quote from @Matthew Becker:

My advice is don't invest in OHIO.  The obesity rate is almost 40%.  People are poor—no way to make money.  Most of the state is a crap hole.  You could do worse and invest in Michigan.  Good college football is about all they have to offer and staying warm by the river as it burns. The only thing better is a tire fire in Springfield, where the Simpsons are from. 

People keep talking about fundamentals in OH.  It is a declining population.  Of course, you can get a deal on a property there.  No one would live there unless they had to.  

Sell your property for a loss and invest in a nice place where people who make more than $ 8 an hour working at Poppies want to live. 

Sorry, Ohio, it seems this forum is dominated by people making poor investments in OH. 

You look at the obesity rate when deciding which market to invest in? First time hearing that.

With that being said, Matthew is wrong here - Columbus Ohio is one one of the fastest growing cities and hottest markets in the US. If you're looking at Toledo, Akron, Dayton, and smaller Ohio cities, yes, most of them aren't growing. Columbus is growing fast in population growth, job growth, and companies moving and developing here (Intel, Amazon, FB, Google, Honda, Microsoft, LG, Anduril, etc. just to name a few). Look at the macroeconomic charts and census data as well. Additionally, you can find the 1% rule and positive cash flow here and get amazing appreciation. I have had clients who have done amazing investment deals (one of them who has recently bought their 4th rental with me in less than 12 months). They purchased a $185k single family house, put $25k into rehab, and their ARV is $264k and they're executing a clean cash out refinance as we speak! Happy to connect and answer any questions!

He is correct; I was wrong about that data after looking at Columbus. Columbus is growing over a 1% rate, which is excellent.   Not sure what the ratios of rent to value are.  Jimmy?  I would still focus on South and West but not all locations that have overall state population growth.  College towns are great, and Columbus has a big one.  The price point of $265K is pretty low, and the rehab cost is the same no matter where you are.   You can find cheap deals in any market.  I prefer to do a value ad in a place that houses sell on an average for $500k plus because you can make way more money.  Here is the difference between OH or most of midwest and ID or the west.  This is the last deal I just finished.  I bought a 3BR 1BA house for $250K,  remodeled the kitchen and bath, and added another bathroom.  Floor and paint: $45K.  All in $295K.  It is an oversized lot zoned for a duplex.  Add a garage between and another house attached.  $300K =  Holding Cost $20k
Total $615K - New value 1M.  The liquidation cost is on the high end at 10%, which is just what I estimated, so I now have plenty of margin, making math easy.  Profit $285K.  I will just rent and hold and refinance it at 75% LTV.  Taking out $100K tax-free in 6 months plus cash flow and Cost segregation for a $200K deduction to offset gains for other income.  You can't do stuff like that in the Midwest.  People don't have the money to buy million-dollar duplexes, and the rents don't support the values.  But Jimmy is completely right about Columbus, and it might be a good place to just buy cheap places to rent to students.  I am not sure you will ever get a ton of appreciation.  Jimmy, thanks for correcting me. 

Quote from @John Morgan:

I self manage 29 SFR and it's easy. I have a full time W2 and find managing rentals doesn't take up much of my time. Maybe 2 hours a month at the most? And 10 houses are out of state. If something breaks, they text me. I text someone to go fixes it and cash app them the $. Done. My rentals are under market rent so people stay with me for many years saving me a ton of $ on turnovers. I list them on Zillow for free and usually find new tenants within 48 hours.

I agree with John 20 to 30 units is pretty straightforward.  If you build to 50 at some point, you can hire a part-time or later full-time person to manage as you grow. The right person can fix, manage, and pay bills; It can be a great part-time or full-time job for someone.  You don't need an office.  Get a good app to do the paperwork if you have 30 units at $2K monthly.  $60K x 8% management $4800.  You can pay someone part-time for $30HR, and they will be ecstatic to get that kind of money.  Before I grew past it, I had a single mom working part-time, doing everything and making more money than she had. I have slowly built up a team of people from this model into a company that manages my properties. We collect $150K a month in rent.  That will increase by $100K in the next 18 Months.  A construction company that builds out $10M a year.  If I had a management company, I would spend 20K a month for someone to do a lousy job.  Instead, my one office person makes double what local PMs make: $8K monthly as a PM working out of a garage/office.  We take a college kid for the summer to help with leasing and turns.  This is quite an easy business to scale.   Keep it small; keep it all.