All Forum Posts by: Edward Rhoads

Seconding what @Brandon Battle said.  Once October hits you won't get any tenants until probably February.  I have had that happen a time or two, someone moves out early October and it stays empty until February and the only people who apply are people who just got evicted (but of course will claim on application that they have no evictions....  reject...).

Sounds like your are wanting a JV. Looking for those myself (I need funding also).

The good news is that you have already made a 25% profit on the property or 300% cash on cash return by flipping to yourself.

However since you have negative cash flow (which does not mean you are loosing money as you should be gaining about $500 in equity a month) if this were my property I would sell it and use that money to buy the next deal.  If you sell it for 90% of the appraised value for example after closing costs and paying off that loan you are about to sign you would pull in roughly $30-$40k more for a total profit on the deal of $80-90k which is pretty darn good for a 6 month investment you really did not put much of your money into.

This one may just not be a good hold...

$260k in Indy is a pretty high end property.  Not highest but pretty high so those are tough to get.

The rents though don't follow the ARV much and are probably about 1500-1800 where a 130k house gets about 1300.

If you are looking for quality rentals I would go with the 100-160k ARV homes that rent for $1000-$1400. They are still tough to get for 75% of market but can find them sometimes.

Camby is a good place for that (a small city inside of Indianapolis on Indys SW side).

Well if you buy from a wholesaler in Indy, and we have a lot of good ones, a 40k +20k rehab property will probably have an ARV of 80k. True the appraisers are killing us so they might appraise for only 70k. I definite possibility.

At this point and price point you will probably have a $800 a month property so $500 cash flow with no mortgage.

You should be able to get a 60k mortgage on it and still get $200 cash flow a month.  So, yeah that would be a good strat for sure.

Buy them from good wholesalers like Brett Snodgrass

@David Morgan If I have a Coverdell with Scottrade how do I turn it into a self directed one and can I use that for tax liens also?

Again, the biggest reason the ARV matters is because that ARV is a good thermometer for the quality of the neighborhood. Under 50k is a rough neighborhood which means tough rentals. 60k and higher is a decent neighborhood so you will get decent renters in a decent time frame.

That is one if the biggest reasons I won't touch a house with ARV under 50k.

@Brett Coombs

What I meant is $45k ARV. Any area with $45k ARV you will have a very hard time getting a good renter and those area will have rents closer to $500.

You want a $60k ARV even if you are not looking to resell.

True the appraisal may come in lower than ARV as the appraisers are appraising everything low for loans now it seems.

And yes if you are working with a good wholesaler your $30k purchase can get you a $60k ARV house. Afterall you are not paying retail...

You can get some good 60k houses for 30k+10k here in Indy and should be able to resell those.

I would avoid the $45k homes for sure no matter what the price.  Those won't move.