All Forum Posts by: John Public

After looking back at my post I realized that the word "turnkey" isn't exactly what I mean as that seems to suggest no work at all, but I think you get my drift from reading the post. I am basically asking how feasible it is to have as hands off approach as possible to rehabbing if I have a good team. And exactly how hands off is it?

I generally run under the assumption that most investors here (those that do rehabs)... either do the rehab entirely or partly themselves to save on cost, or do the deal finding themselves, so as to save on wholesalers assignment fee and thus allow themselves room for profit. But has anyone here done (or currently do) this before:

Bought a house from a wholesaler.
Paid a general contractor to deal with the rehab for you.
Sold it for an "acceptable" profit.

I am interested to know how viable this seemingly turnkey "hands off" strategy would be for someone who has a full-time job with no immediate plans to quit that job in the foreseeable future. And of course the idea of an "acceptable" profit would differ from person to person. And also just how turnkey and hands off this really is.

I'm sure as in everything in life there are hidden hassles with this, some of which the end profit (if there is any) would make worthwhile, and some that make it too much work for too little gain. I'm interested to know others thoughts and especially experiences with trying this or something similar out. Also what kind of profits are you seeing and how long does it take to realize those profits. After all profit isn't just a function of how much but how quickly you achieve it.

I don't know, but this property analyzer should be able to help you.

http://www.biggerpockets.com/recritic.html

Maximum profit is directly related to maximum down payment your willing to make (among other things). Right now with 10% down your going to have a hard time finding something that has positive cash flow right off the bat unless your willing to buy from a wholesaler and fix it up first, or can short sale from a bank. At least thats what I'm seeing.

I have no way of knowing that because I don't have any experience with properties that large. But I would ask to see the previous owners rent rolls to see what kinda vacancy rates he has at that place (which would make a BIG difference as to whether or not it's a good investment). Also ask yourself if there are that many people willing to pay $650 a month to have a 2.5 hour commute to Downtown Miami or Doral everyday for work (the two biggest working districts in Dade county that I can think of).

I personally would never rent in Homestead for $650 if I could easily find that somewhere else in Dade county. There are still quite a few safe neighborhoods in Miami that rent at or close to that price, and are a far closer commute to any job I'm interested in than Homestead is. But that's just me, who knows it might be a great deal... you gotta ask other landlords in that area and make a decision for yourself. Also what kinda down payment can you afford to put down on that place? That makes a difference too in it being a deal or not.

Does anyone know any good real estate investing podcasts?

I have been listening to one called "Get Real" lately and I really like it. However after listening to about a show a day now for about 4 weeks I'm quickly catching up and will very soon have to start waiting for an episode each week like everyone else.
Well that just won't do for this podcast junky, I need my fix. :goofy: So are there any other good podcasts anyone else out there knows about and advises where I can get my daily dose of real estate investing tips and tricks?

Well if your going to get a condo on the beach, that condo building will probably have a pool and you will likely pay a condo fee for its maintenance. But hey, if you can find a good deal on a foreclosure there then go for it. And some of those condo buildings DO have a parking garage (indoor parking is a plus in South Florida) for their units.

In my not so professional opinion... renting them out is a great idea if you have them already. Paying today's prices and expecting positive cash flow is like... well... investing in 'buy and hold' properties in So Cal. There's a reason why all them Cali investors are learning the benefits of investing out of state ya know. ;)

Keep in mind that on some of the oceanfront property the rent would have to be so high to get positive cash flow (like $2500+ a mo for 1 unit). And some of those places have the demand that will support that. But many times, people who have that much money to dispose of a month will put it into their own mortgage payment where at least their getting equity out of it. And if the unit goes vacant, you'll be out that much more money a month while still having to pay your mortgage.

If you are going to buy something south of 23rd St. (South Beach) try to get something that has a parking spot for your tenants if possible. That will be a BIG benefit that will attract them, as parking on South Beach can be anything from annoying to a nightmare.

Ah yes much clearer now,

And I guess it makes sense that Tax + Insurance is calculated into the NOI where as Principal and Mortgage isn't. Because someday the P & I will be paid off where as the T & I is a continual expense for as long as you own the property.

You seem very experienced with cash flow analysis, thanks for your insight.

Really? I had heard it stated somewhere else that PITI was not included in the expenses when figuring out the NOI. I was told something like Gross Income - Operating Exp = NOI - (Taxes + Insurance + Mortgage) = Pre tax cash flow.
Perhaps I am wrong then. Man wheres a big complicated cash flow statement when you need one. :wink:

Oh yes thats right... I had forgotten about only being able to deduct the interest portion of the payment, thanks for the reminder.