All Forum Posts by: Milton Chamberlain

That region will require some risk mitigation, and would be better suited for a local flipper specializing in those types of properties vs buy and hold OOS IMO. 

I generally look for those regions between A/B and C/D markets. I.E. if you look a few blocks South you hit Marlborough (D market). Directly West of that is Waldo. In BETWEEN Waldo an Marlborough there are currently two quads listed on Campbell. I am going to go check them out for an OOS investor this weekend.

This specific area is primarily large apartment complexes and small multis, with B class SFR subdivisions directly North of that. Waldo Heights Apartments is adjacent to these currently listed quads. It is owned by Landmark Realty, a large San Fran based owner that owns ~6,000 units. This gives additional reassurance that this specific 'fringe' region between Waldo and Marlborough is a sound area to invest IMO. particularly in the long term.

Main issue with the Quads is price: they started at $550 asking in September of last year. They dropped the price 25k 3 times, with it sitting at $475k since January (4 months ago).

Ideally, these 'fringe' regions allow investors to acquire properties at C class prices, but with A/B class tenants/rent values. These regions are where I typically suggest looking if investors main goals are maximizing Cash flow/Cap rate/ COC return

Hi Eilon, Happy to talk about your investing goals. Ample opportunities here in the metro

Hi Marcelo! I am a local KC investor and realtor. I successfully assist many local and OOS investors. Happy to discuss your goals and how they line up with what KC has to offer. 

Welcome! What type of properties do you primarily invest in?

The agent should want to sit down with them for a consultation, where they ask probing questions to clarify what the buyer is looking for. The agent should also fill them in on the current market conditions and a brief history recap of the market.

Then guide them through the buyers process and explain any docs/contracts the buyer will be using.

Big popular teams are fine.They will typically have you work with newbie agents they use for buyers. However, they typically have great training programs and a strong support system.

I can refer her to my Home services of America network if she is interested. They must maintain a high level of service and quality of work to be in the network. They have always done a great job helping buyers I send their way. 

Let me know if she would be interested in connecting with one of my HSA agents

Having an existing HELOC is always a great resource (if you are planning on repaying the HELOC through the sale of said property, assuming equity would cover the loan payoff. That way you can bypass a bridge loan.

I have borrowed $50k from my father to float some of the purchase of a Dental practice my wife owns...we simply pay into an account that we use to periodically pay him back lumps sums. Your terms would depend on the person, obviously.

When did you buy/rehab property?

I am not familiar with San Diego, but I would believe market value and rental income are appreciating at a steady clip? That 2.7% rate is pretty special...If I were in your shoes, it would depend on what I could leverage that 200k into out of state.

There is ample opportunity here in KC (my market...I work as a Realtor here and own 3 SFR as investments). If you would like to learn what you could do with your 200k here, let me know

This is a great deal. I thought I would share with BP community. It just came on the Heartland MLS yesterday (Kansas City Metro), and is listed at $255k. I imagine there will be competition at this Price Point in this A market area. (Roeland Park is a high price point area, Which turns into Million dollar homes as you head South into Mission and Fairway.As you head NW, it turns into a C market area. Directly North is still A market-Shawnee)

It looks good with straight investor metrics using Fannie Mae conforming loans (25% down, 7.1% rate with a few points) and easy ARV monthly rent of $1700/unit ( I get this number based on the exact same floor plan in Raytown with complete rehab placing a tenant at $1500, and Raytown gets lower rents than Roeland Park KS.) Keep in mind I have 20% held in reserves and expenses for Mgmt/repairs/cap ex.

COC: 6.7%.            Cash flow:  $960.         Cap rate pro forma 7.26%...better if you can get that $75k rehab budget down

For house hackers, it appears putting 10% down (if you could swing it) would be best. Using income assumption of $3400, so after buyer fulfilled one year obligation as owner occupant. Keep in mind I removed 10% mgmt fee, but kept 10% reserves for Capex and repairs:

Cash Flow : $960   Pro forma cap rate of 8.42% (obvs better if you could get my high estimate of $75k rehab down)

COC return:  9.6%

If any OOS or local KC investors  are interested in having detailed analysis and information sent your way, contact me.

We have plenty of sexy properties like that in Kansas City. TONS of SFR listings in the Troost corridor heading up to the river and then curving East along independence Ave.

But they present many challenges; vacancies  (due to below C market tenant pool), increased maintenance and repair costs (due to below C market), and increased cap ex due to homes in this particular region being older (many century homes).

Then, even if at the end of the year it does well from a financial analysis standpoint, you may struggle to find the necessary and diligent and high performing property mgmt necessary to manage said property…so then if you self manage OOS, you will need a strong ‘boots on the ground’ team.

many challenges come with these ‘$ sexy’ properties. If it sounds too good to be true…

Personally, I have one SFR investment in a rougher area. To illustrate the challenges I have faced in the last three years; robberies, vandalism, assaults, evictions and vacancies. You might get lucky and dodge these issues, but I would expect these challenges investing in below C category markets

All that being said, it’s still a solid producer financially. But my property manager hates it. And I’m pretty sure the only reason he still manages it for me is bc I’ve given him a lot of business on the construction side of his business.

I own 3 SFR as investments in Columbia MO, along with my 4th primary SFR in KCMO. two of the 3 investments have been gutted and rehabbed. I Bought a dental practice with my wife 2 years ago, so once we are no longer poor from that, plan is to convert 3rd property into a STR. Then plan is to merge some City lots I own in Columbia MO and build new construction triplex.

Then my plan is to begin investing in my local market of KCMO. For now though, I just assist local and OOS investors underwrite deals, and act as boots on the ground for my OOS investors. I am well versed in laws pertaining to STR regulations, which are extensive in my market.