All Forum Posts by: Rick Novotny

I have 11 units in KC. I own a single family, 3 duplexes, and a 4-plex near Kansas City. They have been great investments so far. I am looking to purchase a 20-30 unit probably around September of this year in KC. Hopefully a deal comes up around that time.

Welcome to BP!

I grew up in Kansas City, so I've built my business there remotely from Denver. Great rental market with incredible returns on the deals I've done. I actually just got a 4-plex under contract this weekend!

@Logan Freeman, I would love to do a deal that large, but I have no idea how to come up with that kind of down-payment capital. I'm buying only a few units at a time right now.

I agree, I have absolutely no interest in a direct mail or other marketing campaign. Maybe if it wasn't my own time. I've found all my deals through the MLS so far. Plus my 9-5 eats my soul. I lived in Overland Park most of my life, so I visit the area at least once per year. I'm more familiar with Overland Park, Leawood, Olathe and Lenxa over the cities I've been buying in.

Voepel Property Management

https://www.voepelproperties.com/

They handle everything for me and make it easy to own property long distance.

Hello BP!

I'm looking for multi-family properties in KC. I currently own 7 units in that area. Nothing on the market at the moment is any good or way overpriced to make a profit. How do I find off market properties? Should I wait or start reviewing single family properties as well?

The cities I like to buy in are:

Raytown, MO

Independence, MO

Grandview, MO

Belton, MO

Raymore, MO

I would like to keep my next couple deals somewhat nearby so I can use the same management company, but I will take other areas into consideration.

Investment Info:

Small multi-family (2-4 units) buy & hold investment in Independence.

Purchase price: $360,000

Cash invested: $110,000

3 duplexes purchased all at once for $120,000 each from the same seller. Long distance, without seeing them in person, while working a full time job. The process of buying these properties took more of my time than managing them for an entire year. My management company handles everything.

When purchased:
1 vacant unit, 4 units rented at $625/mo, 1 unit rented at $575/mo

Current:
All 6 units renovated and rented at $825/mo

All units have 3 bed/2bath and 1 car attached garage.

These duplexes are likely worth more now, but I haven't had them appraised.

How did you find this deal and how did you negotiate it?

I found these properties on the MLS.

How did you finance this deal?

Traditional financing. 25% down.

How did you add value to the deal?

Cosmetic renovations

What was the outcome?

Over 20% cash on cash returns.

Lessons learned? Challenges?

I've learned the power of multi-family investing. I hope to scale my business so I can buy bigger properties in the future. Down-payment capital seems to be my most difficult area. I do save about 70% of my income, but it still seems to be the limiting factor.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

https://www.facebook.com/KniselyTeam

Investment Info:

Single-family residence other investment in Northglenn.

Purchase price: $298,000

Cash invested: $17,000

Single-family townhouse.
3bed/2.5 bath
2 car attached garage
1575 sq ft.
Built in 2007

Purchased in May 2016 to live in with an FHA. I lived in this property for 2 years with roommates to pay most of the mortgage. At this point I've given all the tenants 30 day notices and will be putting it up for sale shortly. I should be able to sell this property for $350,000 once it's on the market, when looking at comps in the area. If you know anyone interested, let me know!

What made you interested in investing in this type of deal?

After reading and listening to podcasts about real estate.

How did you find this deal and how did you negotiate it?

I found this property on the MLS.

How did you finance this deal?

FHA

How did you add value to the deal?

I didn't, I got lucky with Denver appreciation.

What was the outcome?

I should walk away with about $50,000 cash to invest back into my rental business. I will buy more multi-family properties near Kansas City.

Lessons learned? Challenges?

I've learned that I am terrible at managing tenants (or maybe that I just hate it). So I'm glad for property management with my other properties, but it doesn't make sense to use property management with this one financially. It's time to move the equity into more zero maintenance cash flowing properties.

My challenges in buying this property included very little credit history, in result, a low score, and I had just moved to Denver 2 months prior for a new job. Now my credit score is in the 760's, about 3 years later.

Investment Info:

Single-family residence buy & hold investment in Raytown, MO.

Purchase price: $91,000

Cash invested: $22,200

This property was my first rental and it was purchased for a long term hold in 2016 for $91,000 and it is now worth about $120,000. It is rented at $1,000 per month currently. 3bed/2bath, 1500 sq ft, .26 acre lot.

I bought this long distance without personally seeing it and I use property management. I spend maybe an hour per year on this property, which might include a couple emails and gathering the tax documents.

How did you find this deal and how did you negotiate it?

I found the property on the MLS.

How did you finance this deal?

Traditional financing.

How did you add value to the deal?

I think I can easily create an extra bedroom out of the "bonus room". I haven't figured out if this makes sense yet.

What was the outcome?

I still own this property and I do not have any plans to sell it as of now. The cashflow seems to work, I love real estate!

Lessons learned? Challenges?

Buying long distance without seeing the property for my first investment was interesting. It was a lot easier than I expected.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

If you're looking to buy your new home in the KC area, or your next rental, I work with a wonderful team that I can recommend.

https://www.facebook.com/KniselyTeam
@KniselyTeam

Hi local BP friends!

I’m looking for a CPA in Denver to help with my taxes. In 2017 I owned two single family properties so my taxes weren’t too complicated. I used H&R Block, but he had a rough time because I was house-hacking a townhouse. I purchased 3 more duplexes in 2018 and did renovations. I think need to start using a CPA to grow with my business every year. 

Does anyone have a trusted CPA who will be familiar with real estate write offs?

Thanks,

Rick