All Forum Posts by: Manuel A.

Will Barnard Craps!? Everyone know's it's all about Texas Hold'em ;)

I'm 21 and if a person text's me, I call them. Unless it's a yes or no response. I don't really like texting, only if necessary. Same goes for people with Facebook, I couldn't bare messaging someone on there instead of calling them. Which is why I don't even have one.

But I may be the exception to the rule.

James Smith Moore Here are some links that you can sift through for ideas on safety:

http://www.biggerpockets.com/forums/67/topics/69716-ac-and-copper-theft-issues
http://www.biggerpockets.com/forums/67/topics/56514-rehabbing-property-vacancy-robbed

Good luck!

This is just some friendly critique :D

1. Are you sure there is such a thing as a "safe" neighborhood where house prices are $1-5k?

2. I think you'd have to worry more about damage to your property and perhaps stuff getting stolen from your rehab sites than tenants not paying.

3. I have no clue what it's like in Detroit, but if their ghetto is like my ghetto in Albuquerque, I'd assume the above thoughts.

Example: My sis moved into the ghetto because it was cheap! 2nd day there, she moved back out and back home to my moms, while her boyfriend stayed there. Unluckily for him, there happened to be a home invasion that night, only 48 hours after moving in, and he had a bad night to say the least...

4. Test the market by setting up a fake craigslist post saying roughly, "Rent to Own terms to tenant for $20,000 with $2,500 down and payments of $486 per month for 36 months." I did it before just to see how it is for mobile homes in my area as I was curious and to my surprise, I got like 5 inquires in 2 days! I still get inquires and my post is probably 25+ days old! Definitely good for your due diligence :D

Either way, best of luck!

I thought of partnering with family, but then thought of how much it would eat into my profit. I'd rather them be invested in me (ie, just give me capital and get a return on it) than them have the title of partner, which would make them feel more obligated to more money.

If you guys plan on each getting 1/3rd of the profit, look at it like this, if you decide to do it with no partners, you will triple your profits!

Sure, more work, but triple profits sounds better, maybe? I'm not in your shoes, so maybe it doesn't sound good to you, but still... I'm just throwing it out there :D

Or how about you employ your 2 other friends to do the construction if you trust them so you can have them involved, but just hold out on giving them the title of, "partner". Just let them be invested in you.

Curious though, do you plan on doing all the work yourself? Just wondering because whenever I'd see someone mention in the past something along the lines of, "I'll do the work myself" as opposed to just hiring others; I'm pretty sure it ended up with others saying it wasn't a good idea... That it was better to hire others.

I'm no pro though! Good luck either way!

Manuel

Jon Klaus Congrats on reaching 4,000 posts!

Sorry about the non-productive comment :D

Rodney Reis Why not HML for fix and flip until you have enough to fix and rent?

The way I see it, even if an HML is more expensive, you can either:

a. Get the HML and start getting experience (which is priceless in itself) and some profit as well.

b. Not get one, and just keep saving up till you can afford a traditional loan or cash, which for me would take years.

And this is just a thought, but I think the buy and hold strategy is for more financially established investors and fix and flip is the more obtainable goal with low cash reserves.

But I'm personally curious as to why you don't want an HML as that's the route I'm going down for my first and probably second and third flip...

But maybe there is another way, let's see. :)

I am on financial aid and for me, even with my high GPA (which I get more money for) I get about $2,000 every four months. So $6,000 a year and keep in mind that it's only IF I go to school full time. Less than full time, I get less money.

But who knows, maybe he gets a lot from scholarships. BUT when I applied for financial aid, they told me if I get a scholarship, I will NOT get financial aid. So that may be something you want to investigate.

Will Barnard

Good thing you pointed it out! I subtracted $5 instead of $5,000. My bad, thanks.

Jermon Clayborn See, that's one reason to get second opinions! :)

Good luck!

Manuel

You still need some key figures:

1. Rehab cost. What does, "very little" cost?
2. You need "real" comps from a Realtor/MLS. Unless those are "real" comps, my bad. Throw out the tax records value and come up with your own. If those are good comps, I'd go with around <=$105,000.
3. How much do you want to profit?

If rehab is $12k and you want $5k profit then around

(.70*ARV - $12k - $5k =) $61495 is a good offer, I'd think.

Make sure to get other's opinions!

-Manuel