All Forum Posts by: Andrew Syrios

Check out John T. Reed's guru rankings: http://www.johntreed.com/Reedgururating.html

You might try mixing it up with some various types of letters and styles of writing. Postcards can be effective because they don't even have to open them, also manila envelopes almost always get opened.

As far as the content, try one letter that's very formal and looks like a professional company. With another, either hire someone to handwrite the addresses on the envelopes and brief notes like "Hi my name is Andrew and I would like to buy your house, please call me at ___" or look for a company that writes letters or addresses so they look handwritten. I can't think of one off the top of my head, but I've used them before and they look pretty good.

Some good websites:

CLRSearch.com - you can find all sorts of demographic and crime information including vacancy rates

HomeFair.com - More of the same

City-Data.com - Search by zip code and you can see if that area is growing or declining. There is also a shaded map feature that can help you analyze areas by all sorts of different factors

RentoMeter.com - Good quick glance at rent prices

Craigslist.com - Use the map feature to comp out rents

Hotpads.com - Can also use for comps

Padmapper.com - more comps

RentRange.com - You have to pay after a few free one's, but provides detailed information about the area and rent comps

Finally, just drive the neighborhood, count the for rent signs. If there are a lot, it could mean the area is struggling. Call some for rent signs and talk to a few people to also get an idea of what things are renting for and what the demand is.

I would call the dumpster company and ask for an explanation and then price shop it.

Definitely tight for a flip, it's certainly better for a buy and hold cash on cash wise, but I still like to have a sizable equity margin in buy and holds too. Here you have a little, but the question is could you do better elsewhere? I guess that part is really up to you.

One more I should mention is the debt service ratio, which banks are usually the most interested in.

Net Operating Income / Debt Service

e.g. net income is $6000 and debt service is $4000, $6000/4000 = 1.5

Banks usually want at least 1.2 and sometimes higher

In general, you want your holds to be as good of deals as your flips, so you should still have that equity margin in it. My three favorite formulas for holds are these:

Rent to Cost: Monthly Rent / All in Price

e.g. It rents for $900 and you are into for $60,000 = $900/$60,000 = 1.5% rent/cost

(the national average is about 0.8%, depending on the area you want to be 1 to 2.5%)

Cap Rate: Annual Net Income (not including debt service) / All in Price

e.g. that annual income is $10,000, expenses are $4000, so net is $6000. All in price is $60,000, so $6000/$60,000 = 10 Cap

(Unless you're in a really nice area, aim to beat 10 cap)

Cash on Cash: Cash Flow / Cash into deal

e.g. You buy a house for $80,000 and put down $20,000. After expenses and debt service you clear $4000, then $4000 / $20,000 = 20% cash on cash

This one can vary a lot on your debt levels, but you definitely want to be 10% at least.

In real general terms, managing yourself out of state is really hard. It would all come down to whether or not you can find a really good and trustworthy property management company (easier said than done, make sure to vet them very carefully). The one thing I would say in favor of keeping it is, in my opinion, the road to long term wealth is not flipping, but holding real estate.

Yeah, just my opinion, but it seems a little tight to me. When you take into account that rehab usually goes over budget and sales prices are often a little less than hoped, there just isn't very much margin for error here.

Raytown and most parts of Independence are certainly better than Ruskin, which is pretty rough, especially the middle of it. Is there any rehab with this property or is it basically move in ready?