All Forum Posts by: Michael Gilman

Just stumbling upon this thread.Please add me. We love the VT market and have been active in southern VT and NH for the last 5 years. Currently around 60 units in that region and always looking to grow.

Question 1: A real estate option is one good way I can think of. 

Question 2: We do 60day DD period now with option to extend another month.  1% earnest money deposit. We are able to usually get this for off-market deals during covid. Also with  Covid now its best to always pin the request for maximum time on the lenders and everythign being backed up etc. For marketed deals its very tough, they well bid and you may be competing with cash buyers who can shorten to a 30 days closing window or less.  From understanding your situation, I think your best best bet would be an offmarket deal where you partner with a cosponsor who can backstop your capital raise so you dont end up in a situation where you forfeit the security deposit

There is no way to answer this  question without an understanding of someones full financial picture. There are myriad considerations including  your active vs passive income. Ultimately, it is a question of if pass through tax treatment is the tax optimized structure for your situation.  

Unfortunately I will not be able to make it. Would you consider a video meetup in the future?  Generally from my surveys it seems weekdays evenings have been a favorite time for these.

Anyway, I was intending to speak about my experience investing outside of the immediate region and if there are similar opportunities in CT. We really like southern VT and NH but the buildings are on the smaller end, I am on the lookout for any areas with similar market dynamics in CT but larger buildings-  more rural  buyer markets, 8%+ cap rate with value add opportunity.

Northern Weschester county here.  I would be interested in a meetup, but am out of state focused.

Vermont is a great place to invest. We have a 50 unit Multifamily portfolio in southern VT and always on the lookout for more. Everyone skips over rural markets like VT so there is a lack of investors and ample deals! Only issue is if you want to go larger size buildings there is not much.

It will depend on the prevailing cap rate in the location you are investing in. If you are focused on cash flow andlooking for lowest price per unit then look for high cap rate markets. There are many such market sin the MIdwest and  probably some in North Carolina in the smaller towns outside of Raleigh where you are. Its typically always a trade off between cash flow and appreciation. 

If by commercial you mean multifamily/apartment complexes one readily available off-market resource is apartments.com. This site can give you an idea of every apartment complex in the area and then some sleuthing would be necessary to identify owner and outreach. There are a few things you can do to increase your conversion rate such as filtering out recent purchases (look at hold periods greater than 5 years) and looking for properties where it looks like the owner is asleep at the wheal (unkept grounds, low occupancy, poor reviews etc..).  If you  do this  for 100 properties odds are you will find at least one owner willing to sell. 

I suspect the issue is you have a multi member LLC versus single member because I have seen single member LLCs utilize conventional financing. As others have mentioned you may get better rates with conventional SFH financing but commercial loans are much quicker and straightforward process without nearly the brain damage that comes with the conventional financing process of verifying all income, expenses and loans with respect to yourself and your properties. The issue you may have on the commercial side is most bank lenders won't do a commercial loan for a single SFH. Typically you would need l aggregate a number of SFH (say 10) to bump up the loan amount and put it within range of the commercial programs. A hard money lender would be able to finance this scenario but cost of capital is more expensive.

If the conventional loan is what your after you should exhaust your list of local and regional banks and if nobody is financing then consider changing your ownership structure to get it financed via conventional.