All Forum Posts by: Stephen E.

I've been buying cash flowing B & C properties in Mississippi. 2 singles and a double so far. I also closed on a property i had in the works prior to Covid, a commercial building in New Orleans.

Great, interesting discussion. @Jim K. this is why I followed  you, haha! You need to publish a small self-help book.

There are a lot of expenses, clearly, with backing out of this sale. Would all those expenses be less than fixing even the worst case scenario here? It does strike me that your home inspector was not very good, but still...?

Curious to see how this turns out. I would make a spreadsheet that included all these expenses from a worst case perspective, how much rent am I collecting, how much rent am I saving (which I would just count as if it was someone else paying rent), taxes, insurance, with a monthly set aside for maintenance and improvement, etc. The spreadsheet should tell you pretty clearly if it makes sense to stay or go.

I mean actually, in this whole story, we don't have the numbers, we don't know how good the deal is, but great deals don't come along every day. If this place rents for more than 2% of the purchase price then while it's true that you might not make what you want to make right off the bat, as long as you have the financial run room to fix what needs to be fixed it's going to make the most sense to fix it.

The most important thing, it sounds like, is you'll have to build your team. You need good trustworthy people who will fix things the right way, or you need to learn how to do a lot of it. I've actually chosen the former. I was making better margins doing my own work but I'm happier making smaller margins and letting other, good people do the work for me. But you have to factor that in to your spreadsheet, and adjust your expectations accordingly.

My 2 cents, for what it's worth.

Hi @Daniel Mullins how is the search going. I'm actually looking at a place in Clinton, MS right now. Not usually the kind of property I go for, but the price might be right. Curious about your experience.

You say they have good jobs  and money, why wouldn't you sue them?

Have  you considered filing a small claims lawsuit? The lawsuit and the cash for keys might help. It gives you one more thing to offer. I don't know the type of tenant but having an eviction on their record, as well as losing a lawsuit, would destroy their credit and make it very difficult for them to get another apartment. Explaining, politely, that you would end the eviction process (though absolutely get it started ASAP) and drop the lawsuit, plus some cash if they agree to leave might be enough to entice them. 

If they disagree then definitely go through with the lawsuit. A small claims filing isn't difficult. Collecting is difficult but the judgement against them will be there forever and they won't be able to get a loan until they pay it off, meaning one day in the future you might get an unexpected check.

I just think with the eviction and the lawsuit it might be enough to make the tenant decide it isn't worth it and they should accept the cash for keys. I'm definitely not suggesting you do anything illegal or harassing.

Though again, that's just my impression on limited experience. I've bought 3 TK properties OOS and it's worked out exactly as I hoped. No appreciation and strong cashflow and while I lose some money to the property manager I basically don't have to think about those properties at all, and money just comes in every month. I intend to keep purchasing properties this way.

I only have limited experience with this but it seems the benefit of OOS investing is turnkey. It's not so hard to purchase a place in other areas that has much better cashflow than California. You might pay a small premium for not being familiar with the area and even still the investment will make sense, as long as you find a good property manager (always the magic bullet).

But BRRRR and fix and flip seems to really be for areas you know and with the advantage of contractors you've built relationships with. That's where the margins are.

Hi! How recently did you sell your New Orleans home? What was your reasoning? 

I have three homes in New Orleans, two of them are STRs. One is a double that I live in and the other is a commercial unit with a store underneath. I've been considering selling the commercial property but I was hoping to get a year of good STR returns post Covid so I could show just how valuable to property is to a prospective buyer before putting it on the market. It's very close to the Quarter and it's the largest legal STR in the area.

Anyway, curious about your experience and why you chose to build a new STR somewhere else.

Thanks!

My friend's dad needs to sell some land in Palm Coast Florida. What's the best way to find a realtor to deal with it remotely? Should she use a realtor or... 

Ugh, that doesn't sound great to me at all. I was hoping to look forward to more than that when I do my cashout. How much cash flow is being generated by the property? What's your credit rating? I bought my most recent  property, a commercially zoned building, using a commercial loan at 4%, so I've been figuring I will be able to refi my investment properties at 4%. I also don't have W-2 income, but I have good cash flow and I'm reasonably liquid.