All Forum Posts by: Natalie C.

Hello!

I am an out-of-state investor, looking to move back to the Sierra foothills soon and interested in starting to invest in the Reno/Sparks, Nevada market.

Does anybody have any recommendations for good local lenders (commercial, portfolio)? Would love to start chatting with a few.

Also, what resources have you folks used to help estimate vacancy rates (looking more into northern / northeastern Sparks area)?

Thank you so much, and would love to connect with any of you guys!

Natalie

@Andrew Syrios - Thanks for the link to your article. That was actually the article I read a little while back that first introduced me to BRRRR! Well written! :)

@John Leavelle - Thanks again for the information. One more question. I think I know the answer to this question but would like to confirm.

Can the BRRRR principle be used without the rehab, but buying in a down market and refinancing as the market / house value goes up? I'm thinking that the answer is no. For example, If I bought a house during the recession for $200k, renting it out for $2k/mo, and now it is appraised for $350k (no work went into the house, we just got lucky with the market). These are the rough numbers on our rental. It would not be smart to refinance this, as you would now no longer be meeting the 1% (or whatever number) rule.

At what point then, if ever, would you refinance a house in this situation? The numbers only really work if the house was purchased at such a low price.

This is in the Bay Area.

Hi @John Leavelle

Thank you SO MUCH for the detailed response - it is immensely helpful in thinking about the analysis, I really appreciate it! Hopefully it will be helpful for others, too, who are trying to wrap their minds around this!

Natalie

Hey everyone!

I have a couple VERY basic questions about refinancing and the BRRRR strategy. I appreciate your patience and kindness here!

1. When you refinance your property via BRRRR strategy, are you factoring that new debt as an expense into the numbers on the property that was refinanced, or your next property that you will be purchasing (I'm guessing the latter is the answer)? How do you evaluate the numbers if you'll be using the money from refinance to either A. purchase one more property in full with cash OR B. use the money as a down payment on multiple other properties?

2. At what point do you refinance your property? We own one single family home that is a cash flowing rental. This home has appreciated significantly since we purchased it in 2012. We're looking to start scaling up, but may end up not making that next purchase until the market becomes less bloated where we are. Should we wait until we have a deal that we're trying to secure, or refinance now and have the money ready to go? And in the meantime, before closing that next deal, we just make those payments from the money that we pulled out through the refinance?

3. Approximately how long does it take to refinance a single family home, to the point where you have cash in your account ready for that next deal?

Thank you again for helping me understand these concepts!

Natalie

Hey everyone!

Thank you so much for the thoughts, they are super valuable, I feel like I have more discussion points to bring up to my realtor.

My realtor is experienced (30+ yr in the East Bay), has a good reputation, and has over a dozen rental properties so I do generally trust his opinions. I'll see what his opinions are on some of these points.

Thanks again everyone for taking the time to read my post and give their opinions!

Natalie

Ahh! Seller should be in the title, not 'Sellet'!! Sorry!

Hey everyone!

My family inherited a house through probate. The home was owned by a hoarder and the house is in pretty rough shape but in a good neighborhood (Rockridge in Oakland, CA). The home itself is VERY charming with architecture typical to the area.

The house will very likely need significant work on plumbing, foundation, electrical, etc., but per several agents is unlikely to be torn down. Very rough estimate is that $100-200k will need to be put into the house per our realtor. We cleaned out the house and are now working with our realtor to determine how much work we should put into the house before selling. We do not live in the area so will not be flipping it ourselves, would like our involvement to be minimal. ARV is probably approximately $1-1.2 for a flipper.

At this time we are planning to do only superficial improvements - paint, gut cabinets, refinish floors, etc. Current estimate from one contractor for this work is approximately $20k.

One question that we have is regarding inspections - getting both a general inspection but also detailed ones for plumbing, electrical, etc. This information would need to be disclosed to any potential buyer, correct?

Does anybody have strong opinions whether we should preemptively get inspections done on this fixer-upper, or let the buyer/flipper do it? What are the pros and cons?

Thank you!

Hey everyone! Newish member here (have made a couple posts).

I am originally from the SF Bay Area but am currently living in East Grand Forks, MN (husband is an AF pilot so we're stationed here for a few years).

We own one rental property in Suisun City, CA (near Travis AFB), and manage from afar (the renters are actually old roommates who stayed on and are unicorn renters!).

We will be looking to continue to invest in the general Fairfield/Sacramento area, especially once we move back there in a couple of years. Would love to connect with any of the folks out there!

Natalie

Hello everyone!

Baby investor here!

In April 2012 we bought a single family home near Fairfield, CA, about 10 minutes from Travis Air Force Base. The house was purchased for 190,000 with 0% down (VA loan) on a 30 year mortgage. Our current mortgage is $1,151/month, with an outstanding principal balance of $116,536. We house hacked - we lived in 1 room and had roommates filling the other two rooms, creating good cash flow while we lived there.

My husband is active duty Air Force, so in July 2016 we PCS'd from California to North Dakota. One of our old roommates wanted to stay in the house, so they now rent the house for $1,700/month. This is definitely below market rate (could probably rent for around $2000/month), but these are unicorn tenants and they are managing the property very well (small landscaping projects, small home improvements).

The current value of the house per Zillow is $383,000.

I am originally from the Bay Area so we plan to settle in Northern California once my husband is out of the Air Force in a couple of years. We are interested in investing in future single family or small multiplex homes, but will likely wait until there is a market downturn.

Capital gains tax exclusion sounds best, as we lived in the home from 2012-2016. With military it looks like I can suspend this by 15 years.

1. Hold onto the property and continue renting?

3. Just hold out and refinance when we're ready to start buying other properties?

4. What else????

Thank you all so much! And please comment on any tips that you may have to improve my critical thinking skills here!