All Forum Posts by: Nick Mcgowan

Thanks @John Casmon.

Thanks everyone for the great feedback so far. It goes without saying how valuable this site has proven to be.

@Josh Mitchell, that's certainly an option I might consider if my FIL is up for it. I have about $30k in liquid cash and, as you can see, I don't want to tie half of it up if there are more creative ways to cashflow. 

@Marcus Johnson, the $100/month was what I factored I could conservatively cashflow after all the overhead (Capex, utilities, taxes, misc) was paid- which also includes a little extra each month for my FIL/partner who successfully manages all his current properties on his own.
@Eddie T.

@Eddie T., a MFR is my next goal which is why I don't want to tie up all of my cash. But this deal is on the table at the moment. I am most certainly committed to investing but just doing it judiciously since it's my first real deal. Tying up half of my cash when it would take over a decade to recoup doesn't seem to make much sense to me if there are other means to do so. Ideally, I'd like to structure the deal to where I can just collect the, albeit small, monthly portion of $100 without ever really having to do much more (aside from the necessary requirements of an out-of-state landlord). If I can find a way to finance my portion of the deal and still cashflow, that's one heck of a COC return right?

@Jacob Pereira, you are right in that the education/experience is what I stand to gain the most here. Heck, I'm already learning a ton on just going over the hypothetical with you all which is really exciting for me! Are there HELOCs available for LTVs of say 85%? 

Thanks Jason. I will certainly look in to that. 

Thanks Jay. I've done all 3 and then some. Currently half way through 'investing in RE with little and No money down.' Also reading Millionaire Real estate Investor by Gary Keller (per recommendation from an online interview of my newfound hero @AaronMazzrillo). I've actually got about 10 different books in my Kindle including the ones from BP that I've read and still reading. 

My credit score is 804 (last I checked). I've got maybe $40k in equity in my home so not sure the LTV is sufficient for a HELOC but I haven't really confirmed that yet. Which is why I'm here.

First off- I'm new(er) to BP but have been obsessing about REI for a few months now. I listen to podcasts everyday on my way to work and have been steadily analyzing deals for a week now. I'm still green to this and aside from owning my own home now for 13+ years, I'm ready to put some skin in the game. That being said, here's where I'm at:

Father-in-law owns several (maybe 4 or 5) C+ properties in Cincinnati that he rents for around $600/month. He acquires them slowly and pays all cash averaging $20k a piece. He has developed his own strategy and niche over the years and if you know people from the west side of Cincinnati, you know you can't question nor offer to change or broaden their way of thinking. I won't go further into it just incase he finally does decide to become a BP member someday and stumbles across this post. So here's the nitty gritty:

There's a property in his farm (where he owns 3 houses on the same street) that the absentee owner has offered to sell him for $20k. Looking at the numbers, it needs roughly $5-8k in repairs where he would then be able to rent out for approx. $600/month. Using the analyzer on BP, I estimate it can cashflow around $275 to $300/month. My father-in-law and I are discussing a JV where we each come up with $12 to $15k a piece. He would pay all cash for his half. I have the cash but don't want to tie it all up just to earn what I estimate would be $100 or so a month in cashflow (after overhead/capex/vacancy and paying my partner a little to manage the property since I'm out of state). I would rather finance my end of the deal to keep my cash in pocket and still create some positive cashflow. My question is HOW/Should/COULD I do this?

Go easy on me now. I'm new to this and I'm open to all of the education I can get! Thanks all. 

Welcome John. I lived in Cincinnati for awhile but am a SoCal native. There is no doubt a higher entry point in this market compared to Cincy. My father-in-law lives on the West Side and owns a handful of SFRs in the Price Hill area. The margins are much nicer there where he buys them for about $20k and fetches about $600/month on rent. I'm hoping to duplicate a similar model here in SoCal but need to calibrate to the higher entry. Good luck!

Nick

Joshhal, I think @Aaron Mazzrillo was referring to the snow. Us SoCal dudes aren't too familiar with that stuff or any other wet substance that supposedly falls from the sky. My guess is a good hair dryer or blow torch ought to do the trick in removing it?

Jokes aside though, speaking of killz, I read that an ozone generator is pretty effective in getting rid of the smoke smell in a house... what do you think?

Welcome Richard!

Welcom Michael. You've come to the right place to network and learn more about REI. I can't get enough of this site. I listen to podcasts daily now on my way to work and, like you, I'm getting ready to pull the trigger on my new found addiction to REI. Happy hunting!

Nick