All Forum Posts by: Pat Lulewicz

To the previous point, guests will let you know if they track water into the home with their shoes...you don't think you'll get a message with each rain/snow storm? Not to mention, your utilities bill must be getting heavy if they're leaking that much external into the house. Although you might be fine putting a hoodie on and dealing with the lower temp, your guests will crank your HVAC. Not only does this blow up your utility bill but will put continued effort on your HVAC unit to need to be replaced sooner.

If you have a good product at the right price, it will sell. Inventory for good homes is still tight. From a renting perspective, STR/MTRS in cary generally have good rental fundamentals but its of course case-by-case and property-by-property.

Looking at your property, I'd say that the zillow/redfin estimate for both ARV and rent are directionally accurate. Won't have much, if any, capital gain to shelter so don't let the 2 year market be a big driver for you in your current situation.

The other factor to consider is the immediate cash need of higher points. You pay those at closing, so if you are trying to limit your cash invested, you can spread the interest out over (in this person's cash) 3 months while also having cash outlay of renovations, so you IRR is better even if all costs are equal.

Hi @Ambica Pilli- @Nate Benton and I host a monthly investor meet-up at the Brier Creek Carolina Ale House called Pints & Properties. We will post the event on here each time. Here is the link to March's meet-up later this week if you have availability to make it.

https://www.biggerpockets.com/forums/521/topics/1233568-pint...

You can distribute funds out of the business in creative ways to decrease your overall tax burden. You're effectively trying to move money within a family to the lowest tax bracket, or distribute it as (example) a dividend (taxed lower) instead of 1099/self employment income (tax highest)

BP may have deleted your attached/links, so I don't see the specific listing however overall thoughts knowing the location. 4.4 cap on self storage isn't that wild:
1) Land price and availability to accomplish the build. In general commercial land is VERY expensive around here and could cost you $900k just to find somewhere that you could build...that location could also be less advantageous to self storage demand. Could require rezoning. Dont forget infrastructure...lot clearing/grading, roads, electricity, fences/gates, security, etc. etc.

2) Is payroll the owner paying themselves or family? Easy way to move $ around for tax or other purposes. This is very common with small businesses.

3) Put yourself in the seller's shoes...you have an asset that's hot and people are willing to pay you 20 years worth of NOI RIGHT NOW. List prices are not sold prices...a lot of newer investors forget that.

Alternatively - to @Patrick Knapp point, Build, Rent, Refi and Repeat...I am the co-host of the monthly Pints & Properties networking event here in the Triangle. Thursday, March 20 @ 6:30p this month, our topic is exactly this: New Build Investment Property v Rehabbing a home as an investment property. Here is the link if you'd like to come out and see this presentation. I'd love to chat in person on my above response of Live-In BRRR-STRs or anything else you'd like to spitball.

https://www.biggerpockets.com/forums/521/topics/1233568-pint...

Hi @Nandini Abburi- I have done a form of this through live-in BRRRs (think BRRR but combine it with a live-in "flip" that I keep and rent out). In the Triangle, I've converted these to AirBnbs....this acronym would get crazy: "Live-in BrrrStr"?), Obviously that's a tremendous life sacrifice to live in construction zones, so not for everyone however the concept of a BRRR-STR still holds. Its rare you'll find something on market that will be a "successful" (everyone's metrics are different for successful) BRRRR; all of my purchases have been off-market through wholesalers.

To @Patrick Knapp point, LTR cash flow is not there. If you BRRR and try and refi all of the equity out you'll just have a high mortgage that makes it tough to cash flow. If you self-manage, you may break even if no repairs are needed. So 2 ways to think about it:
1) Don't pull all your money out (70% LTV for example) for a lower mortgage and likely lower rate...more cash flow...then its an ROI goal metric convo
2) Pull out all the equity you can to max your cash-out refi...deal with "negative cash flow" realizing that your cash-out and W-2 are the emergency fund to cover your L while you appreciate, rent increases, tax benefits and equity paydown your way to growth.
(Extra credit) - you could consider an interest-only ARM loan to decrease your monthly cash flow OUT because you aren't paying the equity portion. The just artificially increases your cash flow but can leave breathing room. ONLY do this if you know the property will hold value so that you don't find yourself underwater when you have to re-up the loan in 3-5 years when the ARM adjusts or balloons.

Either LVP or Laminate will do. No reason to go crazy with the quality as well especially given that its a basement. I'd go with a lighter color brown or so because dark spaces with low ceilings need to feel lighter to be home-y-er. A darker LVP with low ceilings can make it feel dungeon-y. WIth the box - could you add 2-3 shelves so people can use it as shelving?

 If you are available and open to making the drive over to Raleigh, we would love to have you! Our event is located at the Brier Creek Carolina Ale House. Address above for reference.