All Forum Posts by: Satyam Mistry

@Matt Byrne Great points made above already by @Corey Hawkinson and I would also add try to get information from the county assessor site as well so you can verify recent sales if there are any previous ones for that property and get a sense of how the property has trended. See how long that current investor has held the property and try to find out what value they have added to the property if any. Also, research some of the other neighboring properties and get a feel for what they are selling/renting for. 

If it is a property that is being flipped it is good to have a plumber and or contractor walk the property with you so can get a sense of some of the things that could be hidden beyond what meets the eye. Educate yourself and be conservative on the numbers and don't underestimate the value of having reserves in place. Best wishes.

@Greg McIntosh This does not appear to be a good deal based on the report. The cash on cash return is very low and the numbers for maintenance and capex are still low as mentioned above. Even if doing replacement of some big ticket items upfront I would still budget a minimum of 5% for each of them especially on a higher end property such as this that requires good upkeep. 4 of the main benefits of a buy and hold property are below and just because you are not getting all of them in the same property does not mean that particular property is a bad deal, but for a property of this value it is too expensive for the relative returns provided.

- Cash Flow
- Appreciation
- Principle Pay Down
- Tax Benefits

@Braeden Henry Lot of great ideas in above posts, but I would strongly recommend not using all that money to put into 1 property as just a down payment as mentioned you will need reserves! FHA or "house hacking" is a great way to put low money down and get great experience learning about real estate & managing a property. Start connecting with local agents & talk to banks to see what price point you would get pre approval up to for a property. If you are in Columbus, Ohio there should be properties that come up around that 100k range in decent areas just depends exactly which strategy you take. If you want to do conventional financing save up some more so you have about 6 months of reserve expenses handy in addition to your 20% down payment.

@Rena Barron Hello Rena, have they requested a receipt? I had thought receipts would be requested when I first started managing my properties, but have never had a tenant request a receipt many times because they are already paying through ACH or cashiers check so the receipt can be their bank statement and the lease which they have access to online. If you would like a more formal document you can just create a Google document with the address/tenant information and update it every month the tenant makes a payment and share it with them.

@Charlie Anne Lot's of great replies here so will not mention many of things already said, but another point to consider is what your plans for the property are. If it is a long term buy & hold it is important to also think about items that can last a long time without constant maintenance & replacement. Trying to get your rental to be as tenant proof as you can while still being a desirable property that will attract a pool of qualified applicants is key! 

@Nathan Gesner As a landlord having pride in their properties initial thought when someone makes claims that we know to be untrue is what nonsense is this & we feel like replying, but as in nearly all situations better to sit on it & come back with a clear mind. On a personal FB post I would not reply, nothing that you are going to say is going to change the mind of most of the people that are reading or commenting on her post. If it was a review left on Google or a more public review I would post a brief reply to it. If you do reply to it on her FB she will likely delete it anyways. Things like this make me think back to tenant screening. Thinking did I place this tenant knowing they had red flags & was it my mistake accepting them in the first place. For landlords with properties that appeal to a wider pool of people don't compromise on your screening, it will come back to haunt you! Thank you Nathan for sharing & all your contributions to the BP community.

@Account Closed Certainly would not go for a grace period where no rent would be owed, but rather come up with a plan if the tenant reaches out to you about payment issues. Watch the video Brandon Turner has posted regarding rent collection during this pandemic as it offers great insight to the steps that you can take without panicking. For new tenants that are moving into vacant properties if their credit is not excellent I have collected rent for first month, last month, and security deposit which provides some additional security.

@Andrew G Montoya Agree with the above, this looks like the opposite of a great deal. Also is this an out of state investment that you are considering? If I am investing OOS I would like my margins to be slightly higher than if it was my local market. Also consider the costs of property management. On the outside it does not look like this will be a strong appreciation play either as it is a 2 bedroom 1 bath which limits the market pool to resell to due to size constraints. Your cash on cash return is very low, you are not close to the 1% rule, and the appreciation does not look great from the outside. I would stay away from this deal.

@Louis Lim Hello Louis, this is certainly an option to consider. Budget out your remodel in detail with contractors, have an estimated time frame, and calculate your numbers diligently on the added value to your home. Also, talk to the bank that you are applying for your LOC with about your plans and see what terms you receive from them for getting your new mortgage as well as I assume you will need to pay back the LOC to be able to put the down payment on your new home.

@Terry Louwerse Congratulations on taking action to acquire your first property. I have purchased all current properties in my local Omaha market, but have began to explore St. Louis as I went to college there and it is still in the midwest area not far from me. As a private investor I feel more comfortable currently investing in areas that are not too far from me. Finding an agent that you are comfortable with is a huge aspect in being able to take the step to invest out of state. I would recommend connecting with agents & investors who are active on BP in your desired market. Once you find an agent you are comfortable with you can reach out to them for property management & contractor referrals as well then start building out your plan for managing the property. 

Educating yourself and connecting with other investors in the market you are looking at will get you more comfortable in taking actions. Have a strategy and also an exit plan as it does not hurt to prepare for the worst. Best wishes.