All Forum Posts by: Nicholas L.

@Gina Shumway OK. No offense intended... but I think it's pretty difficult to BRRRR right now. You really need everything to break your way - you have to find a great deal, you have to have contractors ready to go, materials prices are up and it's taking longer to get everything, and then you have to refi with the higher rates that are available. I just finished one myself and I got everything right except for the appraisal - it was low and so I "left money in the deal." And I was able to refi at 6.5% which I don't think is available anymore.

So, I get nervous when people who have never done a BRRRR before are using tons of leverage, which it sounds like you are.

Just my two cents.

@Gina Shumway

I am just curious, have you ever done a BRRRR before? Or will this be your very first one?

And, I am not an expert in any of what you're asking, but a lot of it is going to depend on whether your partners want equity in the property or not.  If not, and they're just looking for a return on their money, it's going to be simpler - you pay them back when you re-finance, and they go on their way.  But, if you are all going to own the property together, it's going to be more complicated.  These are questions for an attorney and CPA.

@Angel Celis Lopez

will this be your very first flip?  do you have other team members lined up - contractor, agent, etc.?

@Ryan Beckham

awesome!  what are your questions?

@Gabrielle Reyno

OK.  Seems like you could learn together without partnering.  OOS investing is very difficult.

Just my two cents.

@Gabrielle Reyno

just curious - what's the impetus for partnering this early? 

@Account Closed

the only reason to buy in cash would be to make some kind of value add play - like buying a property in cash that is only accepting all-cash offers, fix it up, then refi to get your cash back. otherwise your cash is stuck. but having that much is a great way to make aggressive offers with no strings attached. you just need a value add and refi plan - like a BRRRR.

@Susan O. my opinion is that, if you are going to invest out of state, you really need to get to know the target market in a way that you can't just Google.  This could mean visiting, seeing properties, networking, building your Core 4, etc.

Or you can check out previous threads on BP about which specific markets and sub-markets OOS investors buy in.

@Noah Davis

I don't own any large apartment buildings, but I don't think you're thinking about this the right way.  If you're just getting started now, you're like to be in a much different, and stronger, personal and network and financial situation once you acquire a few units and are years in.  So - no offense intended - but I don't think this is the question to worry about right now.  House hacking a 3-4 unit is a fabulous way to get started - focus on that.

And, a similar question to this was just asked on one of the recent BP podcasts - how to pay back a loan if you're buying turnkey? - and David Greene gave a couple of good answers.

Hope this helps.

@Brian Kim

I think you're asking a personal question mixed with a real estate question.  Which is why you're getting the varied answers.  And most people don't refer to their primary residence as a "place to stay"  =-)

As @Russell Brazil says I think DMV real estate is a solid investment.  I lived in a one bedroom condo in Clarendon that I absolutely loved, and kept it as a rental when I moved out.  I break even on it each month, but I have great tenants and it has appreciated quite a bit.  I'm keeping it for the next 110 years.

One way to think through this is - what impact will this purchase have on your financial situation and ability to continue investing in 2 to 5 to 10 years? Is it going to crush your DTI ratio? Or be absorbable? Will rents support a break-even situation once you move out? Etc.