All Forum Posts by: Michael Schaper

Hello Everyone,

I'm happy to be here on BP. This is first ever post so I hope it leaves a good impression. My name is Michael, I'm 25, married with 1 little baby girl, and I'm out of Phoenix AZ. I'm currently in sales in the another sector and make a decent income. I've been able to save up about 50k separate from my stock portfolio, I own the home I live in and have a little over $100k in equity in my home. Over the past year I have basically only invested into my stock portfolio by maxing out my Roth IRA and investing another 30k or so in other regular accounts. I've thought about investing in real estate for a long time, done some research from time to time, watched YT, read some articles on BP etc. but I never took the plunge. After seeing the crazy amount my home has appreciated over the past year, I decided I need to stop putting it off and just jump into it.

With that being said, I'm trying to figure out where to start. I'm looking to buy long term rentals, I don't ever plan on selling them unless its to buy a bigger better property. A few of the things that weigh heavy on my mind 1. What market should I invest in? (Thats a loaded question, but what are some good markets I should look into, I'm not opposed to OOS, although that does make it trickier cuz I'm clueless about the market in my backyard, let alone OOS) 2. Should I focus on wealth building over cash flow? (Buying properties based on assumed appreciation vs buying based on cash flow alone) 3. Is now the best time to buy? Does that even matter if I don't plan on selling(There are lots of talks of an upcoming correction, so it would be easier to buy more property with less capital if that did happen, but I also understand opportunity cost) 4. I'm currently taking a course to become a real estate salesperson (mostly just for my own investing, but also because I want to learn a lot more about Real Estate and network with important people and build my own team as I start to work with a brokerage) 5. For my first property, would I be making a mistake by buying a fixer-upper rather than a turnkey property since I have no team of contractors or other connections that people seem to have when doing fixer-uppers? 

My motivation for real estate is to build passive wealth, with which I can reinvest to continue on my path to financial freedom. I'm not a short term thinker, I'm thinking about generational wealth and leaving behind a legacy for my family. With that being said, I am more than willing to learn the ins and outs of the industry even if that means being on the sidelines for a bit to make sure I get it right. I definitely plan on having a Property Manager as I spend most of my time working or with family. I don't mind giving up a bit of the cash flow as long as I'm still seeing positive cash flow and its scaleable. Any support, opinions, or recommendations are more than appreciated! :)

Thanks!

@Alexander Ritchie Dude way to take initiative and get on BP. There is so much valuable info, I'm new as well, but feel free to ask me any questions you may have as I've been studying a lot the past couple weeks and have a good idea of the general questions and answers. As far as market-specific questions, feel free to post as many times as you'd like. Others will learn from your questions! 

What market are you in?

I think both options are good for you. To be honest, I'd keep living with your dad. There are ways to get conventional loans with low down payments too, get in touch with some lenders in your area. That way you can save more money to invest. Then you can buy a duplex, and instead of house-hacking, you can rent both doors. Either way is a good start though!

Good luck!

I’m from Arizona and I’d like to invest in properties here, although from what I’ve read on BP, it seems like the best place to invest your money is the Midwest, specifically Texas. I am new and I have only spent the last few days analyzing properties although I don’t plan on purchasing anything until next year. All the properties I have seemed to analyze have been from Nextdoor and even when I price them at 20-30% less than the asking price they still don’t seem to even pass the 1% test, and CoC is very low. Now there are two things that could be the problem, either I’m looking at the wrong properties and analyzing them incorrectly, or most places in PHX just aren’t very good investments(too expensive for the rent) I’ve also calculated homes based on their mortgages and what the homeowner’s are renting them for and there is no way they aren’t losing money ($230-260k properties being rented for 1300-1400/ month) So my next thought was “where would be a better place to invest my money? I started reading and everyone raves about Texas. So I guess my question is, Would I be better off just waiting for an amazing deal in PHX(which would most likely be a BRRR sort of property, or investing somewhere like Texas where renting makes much more sense by the numbers. Or are there any PHX investors here that could tell me that there are real deals here in AZ and that I just haven’t taken enough time to know the market?

Hey Seth how is it going? I'm new to the REI game but I grew up in Mesa, I'm looking to start investing in a few properties next year. How much do you think the property is worth now that you completely rehabbed the apartment? How much did that rehab cost, close to 10k I would presume? It seems like the CAP rate on this investment is a little low, would you mind sharing your thoughts on why you feel that it penciled out well? Why did you choose a 15 year loan over a 30 year loan?

Sorry for all the questions, I'm just in learning mode right now!

@Doug McVinua I just posted about how I'm unsure if I will be able to be approved for an FHA loan, but we would like to go that route if possible. My wife does work... but it is uhhh off the books... lol, she cleans houses and nanny's for a few different families. So unfortunately we can't use her income as proof of income.

Maybe you're right, owner financing may not be the best solution. Maybe a hard-money lender... Worst case scenario we just wait another 5-6 months so I have 2 years of income that I can show, I just promised my wife this would be our last apartment and our lease is up in August of next year.

We plan to purchase the property in either Mesa Gilbert, or Chandler area as we both grew up in Mesa.

Okay so here is the deal. My wife and I are 22 and are looking to purchase our first home. We want it to be a rental after a few years so its doesn't have to be nice by any means. We have just under 50k saved up and we should have another 50-60k saved by the time we go to purchase(totaling around 100k) so we should be okay to put even 20-40% down on a property. 

Here is my problem, I started a commission job in April of this year. It is the first commission job I've ever taken and I know for most conventional loans they require at least 2 years of proof of working for the same company and income statements. Yes the money is flowing consistently and yes I am doing well, but it has only been 8 months, and when we got to buy it will have only been about 20 months. My question is, will we be able to get pre-approved for a loan? Will I need to go through a hard-money lender? What is the best way to do this? I'm not in love with just stacking my bank account, lol I want to invest it in real estate.

Any tips will be appreciated!

@Justin Johnson Sort of, we came to an agreement to buy a home thats meant to be a rental in the long term meaning purchasing it at 80% of market value, fixing it up a bit, then living in it for a year, and then turning it into a rental. That way we can do the fha loan and only put 3.5% down... although we plenty enough for a 20% down... What do you guys think, is it better to put 20% down if you can afford it, or use the extra cash to invest in other properties?

@Aaron K. Yeah, we are kind of looking at our options as we go, our lease isn't up until August of next year. Also, getting pre-approved will be tricky because I have only been in a commissioned based job for a little over 8 months. We are thinking of maybe going with a Owner financed loan if we can't figure out a way to get pre-approved. But yes, by the time we go ahead and make our purchase we should have close to around 70k saved up.

@Gerry Harris Dude that's awesome! Good luck!

Good Evening Everyone!

My name is Michael and I am new here to BiggerPockets, REI has become a dream of mine. I started working in sales for a solar company in Arizona in April this year and I finally have a size-able amount of savings that I'm ready to invest (It's only around 30k, I know, not a lot). I'm eager to learn from some of your REI masters out there. I really want to get into the buy and hold part of REI to build long term wealth for my Wife and I. Let me introduce myself. I'm 22 years old and I have a lot of passions, but what I love to do most is travel and play sports. I am an absolute beginner when it comes to Real Estate but I am studying diligently to get started in 2019. My wife and I plan on buying 2 properties, our personal home and an investment property. My wife insists that our home come first as she is sick of Apartments lol. (Any thoughts on that by the way?) I love reading self help books especially books that actually teach you how to apply practices instead of just motivational books that make you be the best you(Except I still love those actually lol). I heard about BiggerPockets from the Audiobook on Rental Property Investing by Brandon Turner so I figured I should check it out. Are any of you investors here in PHX by chance? Anyways, I hope to make the most of this website as it seems to attract the right kind of people I want to meet.

Thanks,

Michael