All Forum Posts by: Russell Brazil
Russell Brazil has started 177 posts and replied 16825 times.
Post: Solar Panels on Foreclosure
- Real Estate Agent
- Washington, D.C.
- Posts 17,652
- Votes 30,543
Quote from @Danielle DeCormis:
Working on a deal where the home has been foreclosed on by the bank but they indicate they have no knowledge of the solar panels or whether there is a lien. Has anyone dealt with this? Who owns the solar panels and what's my liability if I continue with the purchase?
Post: Buying and Understanding Profit Is Complicated - Here Is What You Need To Consider
- Real Estate Agent
- Washington, D.C.
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Quote from @Ken M.:
Quote from @Ken M.:
.
Is there an existing formula that considers acquisition costs, interest rate, inflation, appreciation, cap ex, rent and so on, in determining what an offer price should be to achieve an average 5% yearly return over 5 years at a given interest rate?
I'm looking to solve for the following
- Offer Price $xxx,xxx (To be solved for)
- Asking Price $ 438,750
- 35% Above Historical Value xx% (35%)
- Historical Value $ 325,000 (To be solved for)
- Rent $ xx,xxx (To be solved for)
- Rent Actual .005 of ARV
- Offer Purchase = $ xxx,xxx (To be solved for)
- Amount Down 20%
- Amount Down $ xxx,xxx (To be solved for)
- Closing Costs $ 3,500
- Interest Rate 7%
- Prop Taxes Yr Rate 0.005 (variable by market)
- Insurance Yr Rate 0.0064 (variable by market)
- Inflation 2.9%
- Appreciation 6.4%
- Cap Ex 10%
- Repairs 10%
- Vacancy 8.33%
- Prop Manager 10%
- Yearly Return 5%
How does one calculate at what price "off of asking", to buy if: we assume in 5 years prices will be back to historical norm If a property is currently priced at 35% above historical value (which is what an economist is saying is the current situation on the MLS)
Purchase Price with 20% down, and a 7% int rate, Inflation is at 2.9% and appreciation is at 6.4%, with 5% return on a yearly basis
The following links suggest some costs:
https://www.biggerpockets.com/forums/52/topics/588344-how-much-do-you-budget-for-capex-and-repairs-on-single-family
I have this figured out for buying SubTo, and for Wraps, But I don't have experience with using a bank to buy properties and figuring costs. since I never use them. However, it might make sense in the future to use banks. Also, I understand places like CA and TX have higher tax rates. If the tax rate is input as a variable, that covers the discrepancies. Inflation & appreciation will vary by year and by place, so, input as a variable as well. But I'm looking for a general calculation to use as I investigate various markets that I can modify as needed.
@Russell Brazil: You seem like the kind of guy that is handy with a slide rule or spreadsheet, do you know of a source that has already put together a spreadsheet to determine price to buy at, with a given interest rate to receive a predetermined rate of return on a 5 year timeline?
Not really...but the formulas for that wouldnt be too complicated to come up with.
Post: Condo nightmare HOA issue, need legal advice
- Real Estate Agent
- Washington, D.C.
- Posts 17,652
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Quote from @Paul Zofsak:
Russell, what's the advantage of filing on my insurance if the HOA is liable?
Because its literally what you are supposed to do. Your insurance carrier will decide who is liable, and if it is the other insurance carrier then they will file a Coordination of Benefits with the other carrier.
Post: Request to share cost in replacing part of adjoining fences
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If I were the neighbor, it sounds like I'd be the only one bringing money to the table so you could get something you want. I'd be a hard no in their position.
Post: Condo nightmare HOA issue, need legal advice
- Real Estate Agent
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Quote from @Paul Zofsak:
Not sure where this should go so I'm putting it here. I own a unit at a local condominium complex and am having issues with timely response from the HOA. In July of last year a roof leak developed and caused damage to the ceiling in my unit, to the point there was partial ceiling collapse. In December the roof was finally repaired, however the damage to the ceiling has not. Currently there is plastic sheeting covering the hole in the ceiling, about 4'x4'. My managment company has made more than a reasonable amount of attempts to get the HOA to have this repaired. I have reached out and spoken with the HOA management property manager myself, and just keep getting BS excuses and no sense of urgency on this matter. My management company has recommended sending in their own contractor to make repairs as the tenant has concerns about mold growth. I of course will need to be reimbursed by the HOA for these repairs. If they don't pay willingly, what are my options? If an attorney needs to get involved i currently don't have one, can anyone recommend one in the Houston area if need be?
Have you filed an insurance claim with your own carrier yet? That should have been step 1.
Post: Should I have my renters pay me personally or have them pay into LLC
- Real Estate Agent
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Who owns the house, your or the LLC? Tenants should be paying the owner.
Do you also live in the house? If you live in the house, and an LLC owns it.....there is zero liability protection created by that LLC.
Post: Hello BiggerPockets! New PRO here
- Real Estate Agent
- Washington, D.C.
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Quote from @Jeremy Baskin:
Hello BiggerPockets community! I'm Jeremy from Washington, D.C., passionate about real estate investing for several years now. I'm particularly passionate about multifamily and syndication investing.
Outside of real estate, I enjoy traveling, martial arts, and photography.
Excited to learn and connect with you all!
Welcome to BP. Lots of DC area people on here.
Post: Why BRRRR is not an effective strategy today...
- Real Estate Agent
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Quote from @Aaron Murphy:
Quote from @Account Closed:
Quote from @Aaron Murphy:
you are probably feeling like BRRR doesn't work because you are trying to turn a 600k house into a rental. It would be hard to cash flow on a 600k house that has 3600 in rent regardless of the broader economic situation going on in society.
i find that when someone says BRRR doesn't work anymore they end up meaning it doesn't work well for the specific types of real estate that they want to buy. And I've got no qualm with someone saying they aren't doing BRRR anymore but the bolder "brrr is not effective today" is in my view not very accurate.
https://eyeonhousing.org/2025/01/cost-of-constructing-a-home...
cool break down thanks for sharing! This seems to be breaking down new construction and is a national average so kind of hard to read into this what it means in general but I would not expect a 665k new construction house to be my target for a rental property.
Im a medium sized operator - 46 units- and my typical deal has an ARV from 200 to 230 when its finished. Wich goes back to my comment to the initial poster. people who want to buy homes in DC and top markets like that are the ones saying BRRR is impossible right now. Im not even sure that it is impossible in those markets but the main issue is that BRRR isnt working where they want to buy not that BRRR doesnt work.
A typical BRRRR in DC creates $200k in equity. Seems pretty good to me.
Post: Lets Connect Together
- Real Estate Agent
- Washington, D.C.
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Quote from @Kyle Carter:
Hello Bigger Pockets Community!
My name is Kyle Carter. I live in the Washington DC area, and I would love to connect with anyone willing to.
A little about myself, I graduated from North Carolina A&t with a degree in Computer Engineering. I currently work at Deloitte in Cyber Security. I have been investing in the stock market for 5 years and I am now transitioning over to real estate after doing my research on real estate for the past two years.
Would love to connect, regardless of real estate experience I know we could all be of value to one another.
Welcome to BP. Lots of DC area investors here.
Post: Boston - Has the ship sailed?
- Real Estate Agent
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Quote from @Calvin Thomas:
Quote from @Russell Brazil:
Quote from @Calvin Thomas:
Quote from @Russell Brazil:
Time in the market, beats timing the market.
Buy now. Rents will go up. Rates will at some point allow you to refinance.
Why would someone buy now and make little money for the chance that the rates will adjust later? What happens if he has a major expense? Sh!t happens, and it usually happens when one least expects it. This is a good way to get underwater real fast.
This is an unwise suggestion.
Yea, what do I know? Makes complete sense to purchase a property that breaks even or loses money. Because real estate always goes up and the maintenance fairy takes care of all repairs free of charge.
Seems like a recipe for disaster. DC properties are expensive, but they probably do not hold a candle to the crazy prices in Boston. Even a clock is right twice a day.
Boston is the 3rd most expensive market in the country, and DC is the 4th. Ive invested in the Boston & DC markets for 22 years now. So yeah, Ive got some experience in this realm.