All Forum Posts by: Salvatore Lentini

@Mike Bloom - something I've come to learn after building my rental portfolio into triple digits...Having a cushion when closing on new properties makes a huge difference. The saying "it takes money to make money" applies. While you certainly can into this business with little to no money, which is what I did, having a little extra capital goes a long way in helping increase cash flow. Repainting the exterior, landscaping, replacing or adding lighting, new flooring in common areas etc. Stuff that doesn't cost a ton of money but when you do it it increases the ceiling on your rents. Stuff you'd probably have to wait to do if you had zero dollars left over after closing. But, if you do it right away you get the immediate rent bumps, you fill units faster and you get better tenants. And the money doesn't even have to come from you. Instead of focusing on getting the cheapest price for a property, you can pay asking but ask for a seller credit at closing. Or if you find the right lender, you can get an interest only period of say 6 months, which will save you thousands which you can put toward improvements. Makes you more money and is good for the bank too because you're improving the asset and increasing the NOI.

@Nick Furukawa - 100% equity also comes with 100% risk.  If you don't have money or experience, you may want to partner with someone that has one or both.  Not saying you can't do it but if things go south you won't survive the hit and then your real estate career will be "game over".  Better to partner and get 50% of a deal and be able to weather a storm than 100% and get crushed.  And I don't even mean you lose 10's of thousands but if you have no money and your 19, even if the property gets a couple vacancies and you're in the red $500 a month... that is probably not sustainable very long for you.  Or maybe take a smaller swing than a 4-8 unit.

Anyone know of a good management company in Dayton OH?  I have 14 doors and am not happy with my current property management company and am considering switching to a new company or selling.  I have a much larger portfolio here in PA where I manage most of it myself and the other part is managed by a company.  So I know what's needed to successfully manage properties and I know what it's like to work with a good management company.  I haven't had 100% occupancy with these properties in the 17 months I've been with this company.  Scratch that.  I've never been above 83%.  There was bad timing on my part when I started with them.  I didn't realize it until a few months after getting on board that they had just acquired another management company and they were woefully unprepared and understaffed to handle the influx of properties.  But I didn't know that prior.... oh well.

So I gave them time to deal with their growing pains.  A lot of time.  And a lot of conversations.  And every time it seems like we have a good conversation about moving forward, they slip right back into their ways (lack of communication, not doing what they say they're going to do, not getting properties leased up etc).  I don't want to put their name out their just yet as I'm giving them one last chance.  But will be glad to warn others in the future if and when I do end up leaving them.

@Account Closed - Depends on how long you plan on holding and whether this mountain is conducive or has a plan in place for year round activities (mountain biking, alpine slides etc) . Google "the future of ski resorts".  With weather getting warmer and the number of days below the temp needed to make snow, ski seasons will become shorter and shorter.  But it's all about the numbers.  I would just make sure you plan for that contingency.

You either need to find off market properties or look for properties

that are getting passed over for one reason or another. The more

difficult a property seems it would be to rehab or turn around the less

competition there will be. If you're a beginner this is a risky gamble

though. Partner with someone that has experience. Offer to work for

free to learn the ropes. Cold calling, mailing, door hangers, meeting

with contractors, picking up materials, arranging a dumpster drop off

etc. Doing is the best way of learning and having experience is the best way to have continued success in real estate.

Hi @Devin Fakner - You just need to get the right lender. Message me and I can put you in touch with investor friendly lenders that not only are willing to finance properties in the name of an LLC but require it. No tax returns or W2s either. I've used these lenders to build my entire portfolio of 161 rentals. Happy to share.

Hi @Stephanie P. - how much would you be able to pull out? What could you buy with that money? How much additional cash flow would it create? Obviously it would need to be well above $250 because that's what you'd be losing on your current rental. You could also do a LOC (Line of Credit) on your current rental. That way you're only pulling the exact amount that you need as down payment and then you're only paying interest on that amount. You can pay it back faster if that reduces your stress. There's the math and the ROI (Return on Investment) and then there's reality and how well you can sleep at night. Some people get stressed by high amounts of debt, even if it's good debt that's earning you extra money. And some people get stressed about long term debt. Just because something's right mathematically doesn't mean it's right for you mentally.

@Ben Mosh - Would you buy the property now at $520K if you could get $2800/month rent?  I wouldn't.  You should be getting at least double that amount per month.  That tells you your money could be better invested somewhere else.  Why don't you just start looking at what $520K could get you in terms of rent if you used it as a down payment (or $520K-$100K).  So $420K plus closing costs so maybe about $400K.  What could you get with $400K down money?  What kind of rent would you get with that?  I think if you start looking at what that untapped money could buy you your eyes will open wide, your jaw will drop and you won't be able to sell the condo fast enough :)

@Guy Idan - Loopnet is a decent place to find brokers.  Unfortunately you'll have a hard time finding any that will take you seriously if you don't have any experience.  Early on I used to email and call brokers all the time and no one called me back.  Now brokers are calling me because of my deal history.  Bottom line - they gravitate toward those that they have a higher chance of turning into a commission.  I don't blame them as there are only so many hours in a day.  You would benefit to start a little smaller.  Get a couple 2-4 units and they'll be more likely to respond to your outreach.  Or if you're dead set on starting out with a 16 unit, consider partnering with someone that's already done it.  I partnered with someone that had some singles and duplexes and wanted to make the leap.  We just bought a $3M+ property a few months ago and now we're looking for another together.  Btw - we met on BP.

Hi @Kenneth Pratt - Sure thing.  Message me and I can put you in touch with investor friendly lenders that don't require W2s.