All Forum Posts by: Michael J.

First off, welcome to BP. It's a great place to get into the nitty-gritty of real estate, and you're asking a solid question. Let's break it down.

Interest rates, while they're a part of the equation, aren't the end-all-be-all. Yes, they've been on the rise, but the real question is: how are you planning to structure your investment?

Here's the deal with FHA loans: if you're going with one of these, it's got to be your primary residence for at least 12 months. The exception? If you're diving into multifamily and you're gonna live in one unit while renting out the other. That's a smart move, by the way, especially if you're starting out.

Now, onto your 20% down vs FHA question. The thing is, if you drop 20%, you're definitely going to reduce your monthly payment because you're borrowing less. No rocket science there. But here's what you gotta consider: FHA loans often have smaller down payments, which means you can potentially get into the game with less cash upfront. That's a quick way to leverage, but it comes with its own set of strings - like PMI, higher interest, and the primary residence thing we talked about.

It's not a black and white answer. Sometimes, freeing up that cash for other investments or to have as a safety net can outweigh the benefits of a lower monthly payment. But if you're stretching yourself thin with a lower down payment and higher monthly commitments, that can get risky real fast.

I get what that podcast is saying about long-term success rates curing all. Over time, real estate generally appreciates. But that's a generalization. You gotta do your due diligence, understand your market, and know the property. Real estate ain’t a set-it-and-forget-it game. You gotta be on top of it. And if the numbers work in the long run, sometimes it's worth paying a bit more on interest to get started sooner.

House by house, case by case – that's how you need to approach it. Your strategy needs to fit your goals and your current financial situation. So, take a step back, look at the bigger picture, and then decide on the details. Good luck out there!

First off, props for taking the initiative and looking into the real estate game. It's a space where serious moves can be made if you play your cards right. Now, onto manufactured homes...

1. Ownership of Land: You hit the nail on the head with this one. A lot of times, with manufactured homes, you own the structure, but you're leasing the land it sits on. This can introduce some risks. You might face rent hikes on the land or other restrictions that could dent your ROI. If the land lease expires, and isn't renewed, you could end up with a home and nowhere to put it. Big factor to consider!
2. Depreciation: Unlike traditional homes, manufactured homes can depreciate in value over time, kind of like how cars do. That might eat into your long-term gains.
3. Financing and Insurance: It can be a little more challenging to get traditional financing for manufactured homes. Lenders see them as higher risk than stick-built homes. Insurance might also be pricier.
4. Quality and Longevity: Don't be fooled by the "recently renovated" tag. Check the build quality. Some of these homes might not age as well as traditional homes. That might mean more maintenance costs in the future.
5. Resell Potential: The market for reselling manufactured homes isn't as vibrant as for traditional homes. Just something to think about for your exit strategy.

Look, the 1.5% rent to price ratio is enticing, and I won't lie, there's money to be made here if you're smart about it. But you've gotta weigh the short-term gains against potential long-term pitfalls. Get clear on your goals, do your due diligence, and crunch those numbers.

Stay sharp, play smart, and keep hunting for those opportunities! Remember, it's all about spotting gaps in the market and making them work for you.

First and foremost, kudos to you for thinking outside the box and having the hustle mindset. But let’s break this down step-by-step and make sure you're setting yourself up for success and not just chasing a shiny object.

1. Getting Your Name on the Deed: Sure, if your dad is down for it, go ahead. But remember, this comes with responsibilities too. Ensure you both understand the ramifications.
2. Using Land as Collateral: Before even thinking about putting that land up as collateral, dive deep into understanding the real value of that land. Research the market, see what similar lands are going for, and always, ALWAYS be conservative in your estimates. Consult a financial advisor or a real estate expert in the region.
3. Hiring a Tiny Home Builder: Solid move, but ensure you're getting a quality builder. Cheaping out can lead to more expenses down the road. And think about what folks really want in a rental. Is it just a place to sleep or an experience?
4. Setting Up with a Theme: Love it! Unique experiences drive bookings. However, be sure the theme is broad enough to appeal to a wider audience, but specific enough to stand out. Don't make it so niche that only 3 people in the world would be interested.
5. Listing on Airbnb: Understand the game. Look at other listings in the area. What’s the competition? What are they charging? How often are they booked? And more than that, be ready to be a host. It's not just about listing; it's about customer service, maintenance, marketing.

Now, the long-term investment angle is smart. Especially when you think about how many people are moving towards experiences and minimalism. But always have a plan B and C.

If you end up living there, that's cool, but don’t let that be a crutch or an easy out. Stay resilient, pivot if needed, but keep pushing forward. The game is about adapting, learning, and grinding it out.

Finally, surround yourself with people who have been in the game. Network with Airbnb hosts, real estate investors, and others who can provide insights. Knowledge is power, but applied knowledge is where the magic happens. Stay relentless!

How long did the run the ozone machine for?  It needs to go for several days and move it throughout the rooms.  Probably going to need to replace the carpet and pad to really get rid of the smell, & I'd run the ozone machine after the carpet and pad are removed before putting new flooring down.

Quote from @Dave Rav:

@Michael J. I was just considering doing the same thing.  

Came across a lot with an older, small MH.  I was going to sell the old MH, replacing it with a larger MH.  Then try to sell the land-home package.

If not MLS, then I was thinking of approaching MH dealers to help sell the deal (some will funnel deals to their client list). I'm happy to pay them a commission or referral fee.

Thoughts?

 I'm definitely wanting to explore this option some more and see if it makes sense numbers wise.

Is anyone buying lots and putting new mobile homes on them and then selling them on the MLS?

Is there any upside to this?

Quote from @Matt Hall:

I'm currently living in LA and hoping to get started with my first investment property in the next few months with BRRRR in mind. I've narrowed my target area down to the Greenville/Spartanburg area with more emphasis on Spartanburg since the price tag in Greenville seems to be on the high side for my budget. Looking in the $60k-$120k range. Happy to hear any insights on this area!

Thanks in advance!

Matt
  

Hey Matt! I am a realtor and investor/flipper here in the Upstate.  Just went under contract on a duplex in Spartanburg this morning for one of my clients.   Would love to connect and see if I can help you out.

Quote from @William Broxson:

Quote from @Michael J.:

Using Google Local Services ads for high intent leads that want to list now.   Have a system in place to qualify the leads and you convert the appointment.

 Ive tried google ads in the past with mixed results. Trying to keep lead cost down right now as im getting waxed from realtorDOTcom and there lead service.

 Local services ads are better than google PPC ads.

Hey there! Welcome to the world of real estate investing. I'm stoked you're jumping in and getting educated.

Let's break this down:

1. Starting With Cash: You're in an enviable position, my friend. Having $100k ready to go is a strong start. Your plan to buy a house at $75k and invest $25k for rehab is solid, especially if you're sure you can rent it for $1,200/month. This offers a great return on investment (ROI). Just make sure you account for all costs: property taxes, insurance, potential property management, and unexpected repairs.
2. Credit Building: Since you're working on building credit, try getting a secured credit card and keep utilizing it responsibly. This can expedite the credit-building process.
3. Private Loan vs. Cash: This is a classic debate. Using a private loan can certainly leverage your position. Borrowing can keep cash on hand for any emergencies or unforeseen rehab costs. But remember, with loans come interest payments. You’ll have to weigh the potential returns against the cost of the loan. If you have solid connections or know of private lenders offering good terms, it might be worth considering.
4. Speeding Up The Plan: Real estate is often a game of patience, but there are ways to speed things up. Consider looking for multi-family properties. By getting a duplex or a triplex, you can earn multiple rents with one purchase. This can provide you with more cash flow to save and invest in your next property sooner.
5. Potential Concerns:
   • Market Research: Ensure you're buying in a good location where people want to rent.
   • Underestimating Costs: It's common for rehab costs to be higher than expected. Always add a buffer.
   • Property Management: Consider how you'll manage the property. Will you do it yourself, or hire someone? Both options have their pros and cons.
6. Consider Different Strategies: Yes, always! Look into 'BRRRR' (Buy, Rehab, Rent, Refinance, Repeat). This strategy allows you to recycle your capital and grow your portfolio quickly.
7. What I'd Do:
   • Begin with one property. Learn the ropes. Make mistakes on a smaller scale.
   • Engage with local real estate meetups or groups to learn more and network.
   • If comfortable, consider a private loan to maintain liquidity but always prioritize terms that are favorable to you.
   • Once you have a handle on things, refine and scale your strategy.

Lastly, you’re not in this alone. Lean on this community and other resources. Keep learning, stay hungry, and hustle hard. Best of luck in your real estate journey! 🏡❤️

First, I'm sorry to hear about your aunt. Let's honor her memory by making smart moves. Moving in with the family's blessing is a gift, and you've got a potential goldmine of an opportunity. But we've got to navigate this like pros.

1. Owner Financing: This is one route a lot of folks overlook. Approach your cousins with the idea of them acting as the bank. Propose a deal where you buy the house from them for $450,000. Pay them a reasonable interest rate, spread over a longer term. This way, they still get their money (and some interest), you get the house, and everyone is happy.
2. Lease Option: You can lease the house with an option to buy it later. This gives you the flexibility to buy it at a predetermined price after a set period, say in 5 years. This gives you time to build capital and maybe the property value aligns more with your price by then.
3. Joint Venture: Maybe there's a way to partner up. What if you took out a smaller loan for the difference, say $215,000, and created a deal where they retain some equity in the house? This way, you're putting up less cash, and they retain a stake in the home they're emotionally attached to.
4. Creative Terms: Consider structuring the payment in a way that benefits both parties. For instance, a large down payment followed by smaller monthly installments. This minimizes the loan amount you’d need from a bank.
5. Consult Professionals: This isn't just some deal off the streets. This is family. Make sure you're getting tax pros and lawyers in the loop. They'll help navigate any murky waters when it comes to familial transactions, ensuring you're not stepping into a tax trap.

As for investing in rental properties, remember one thing: Cash flow is king. If you can make this home work for you, without straining your finances, it could be a springboard for future investments.

Lastly, always trust your gut. If the numbers and terms don't feel right, don't force it. There's always another deal, but you've only got one shot at making smart choices with family. Make it count.