All Forum Posts by: Ryan Evans

I've invested in both and have had all kinds of experiences. The biggest frustration I've faced and heard from almost every single investor is the ability to find and keep decent contractors. Second to that is a severe lack of good PM's. That said, out of state investors often have far too high expectations of PMs. You're simply not going to get top-notch management service on your two $35k D class properties. It's just not going to happen. 

Don't spend too much time trying to meet and build relationships with contractors while you're here. West coast investors are a dime a dozen and most never buy anything, which is something all of us on the ground know well. Once you buy something the conversation gets a lot easier because like @Brian Garlington said, you've got to prove that you're serious! 

Hey @Armando J Daniels II, welcome to the site! 

I was just in Columbus over the weekend for the first time and it seems like a great place to be. As your getting started, don't confuse wholesaling with investing. They're completely different things and if you want to get into investing, then you've got to find a way to invest. Wholesaling can be a great way to build up contacts and partners, but it's a tough gig. Good luck to you! 

At least you know that it needs complete rehab. I get properties like this on a daily basis from wholesalers and most of them claim to need 10-20k rehab, but the reality is they often need 40K+ and are worth maybe half of what needs to go into them. 

I imagine the only money to be made in the deal you've described is the wholesale fee brought in by the out-of-state investor who didn't know any better. And when you call them wondering why you're losing all your money, I bet your wholesaler contact won't be so keen to pick up the phone. 

Glenville properties sell for maybe 20k a unit in decent shape. If you get the property for free you might be able to break even with a full rehab, but I doubt that's why you're here. I don't mean to sound like a downer, but you'll be better off starting in a more stable area like James said. 

Congrats on getting the first one going! 

Up in CLE most duplexes only have one water meter. As the owner, you'll ultimately be responsible for water/sewer/garbage, even if you can bill it back to the tenants one way or another. Those utilities are often difficult, expensive, or impractical to submeter. But in your case, you should have two tanks and furnaces that are metered to the tenants respective gas/electricity bills which they will have in their name. 

Some landlords charge a flat per person monthly rate for water/sewer in these situations. 

Go rich dad poor dad on it and buy yourself a house that cash flows $250/month and use that for your car payment/lease. It's easy enough to do in this market! 

The buyer gets to choose the title company, but some sellers are just set on a certain company because they have a good contact or get a break on fees. I've gone with seller title companies just to keep things moving along on a couple of my personal deals and those of my clients. It can also make a slightly stronger offer by going with "sellers choice" of title company. 

I don't think you should be all that concerned with your immediate cash flow when you're living in the place. If you're living for free, that's your cash flow. If your monthly living expenses go to zero, that's not much different than making 800 in cash flow and renting. Of course, there are other factors influencing those numbers, but that's the simple version. 

If you can break even year one then when it comes time to move your numbers will look really good. Sure, some expenses might go up like your utility bills, maintenance (if you're doing it yourself while you live there), etc., but you might be cash flowing $500 which is good no matter how you look at it. 

If you're planning on refinancing to something more conventional you're most likely going to need 20-25% equity. Which means you're going to need to do a significant value add or come up with a chunk of cash. 

If you can find a fourplex, that would be ideal but everyone wants them so you won't be very competitive with a VA loan as you'll likely be competing with cash offers. That said, if you can find a nice double in Edgewater, Lakewood, etc., and get it for free, then you're off to a great start!

Since you won't be out of pocket much you could find a double where you could add a couple of bedrooms on the third floor. That can give you a nice little value add and a rent raise for the upper unit. 

Nobody is ever ready to get started investing. You just have to start anyway, so good on you for doing just that. You're already ahead of most people! 

And as James said, you don't have to take on big rehabs to be successful. You're in one of the best cash flow markets, so you can keep getting to know the market and just buy right.