All Forum Posts by: Tchaka Owen

This is a common mindset and it's also the wrong one. We all want to save money and the first place people want to trim is the commission and in a sellers market, most neophytes will come out with the, "oh, anyone can sell this house" routine. 

NO. The question you should ask yourself is which agent will do the best job to net you the most. The agent who charged you 5% total and sold your home for $200k didn't perform as well as the one who charged you 6% and sold it for $203k. Chances are the agent who knows his/her worth will actually sell it for $205k, maybe more. For the record, I'm a licensed practicing agent as well as an investor and in the instances I've hired other agents, I've never paid less than 3% to one (that means 6% total). I don't negotiate commission, though I often ask for the purpose of hearing an agent's response.

@Ryan Kawash - no it isn't impossible to find homes to flip in those areas however you do want to stay out of Miami for at least 2 reasons:

1. that's one of the higher cost areas of FL and there are many investors there with deep pockets.

2. South Florida is the fraud capital of the US and what little money you have will soon be parted.

Find lower cost, less competitive and less unethical areas. Tampa is not bad, though you might want to look at Jacksonville, maybe Fort Myers. Perhaps some success in the Panhandle, but you did say Florida....

@Alfred Costanzo - that's typical South Florida, don't be surprised. An extreme case is Hialeah, which my real estate license instructor referred to as "one large code violation". Two things to keep in mind:

1. Some cities grandfather unpermitted work that was done years ago. If you find a home you really like, do your due-diligence on that.

2. Sometimes it's as simple as pulling a permit. One of my best flips was in Wilton Manors in late 2012. We ended up pulling 6 permits and one or two were for work done prior. We went to the city, spoke with someone and they said to pull permits and they'd inspect. As long as it was done properly, we'd be fine. Spent about $100 and got the approvals.

Point being, don't be afraid..........especially if you're going to invest in S. Florida.

Not necessarily; it depends on where the homes are located.

Back in 2014 I replaced one in my home in Hollywood, FL. All in was around $600. A few months later I had to replace the one in my home in the DC area; picked up the same model from Home Depot and it cost just under $1000 to put it in. Different area, different method of making it work. 

That said, OP needs to go see the homes stat!

@Sean October - keep in mind that from Fort Pierce to the border of Brevard is at least an hour drive. To the top end of Brevard, you can add another 45 mins. 

Think of it this way.....you get a few good properties under your belt and in a few years, you move back to the 'launch viewing area'. :-D

As for Port St. John, my recommendation is that you hold if you can particularly if rent > monthly expenses. Not only will renters pay down your mortgage, any positive cashflow goes towards paying off your debts. Even if it's a mere $100-200/mo, that helps. Chances are the cashflow + increase in equity (loan being paid down plus appreciation) per year is greater than the interest on your debts. Good luck!   

@Joshua Wilson - you're in Palm Bay, keep your eyes at home and take advantage of your area. It is one of the best bangs for the buck. Also, equity building at the expense of cashflow should not be an objective of yours if you're new. The cashflow often protects you in down markets when equity is given back. Once you have a number of homes under your belt, then venture to Indialantic for a duplex by the beach.

@John Doss - I can't say I like either deal.

My biggest problem with #1 is that you'd put in $50k of updating for an ARV increase of $75k. That's not enough (for me); I like to double input, so $50k in means an ARV of $310k when finished.

Deal #2 looks like a nice home and it's great that you have considerably less work, however the rents don't seem to justify the price. You haven't added MI (to either) and your Cap Rate is already under 5%. 

Questions:

1. How much do home prices drop if you venture away from UNCG?
2. If you're planning on house-hacking, what's the reason you have management fees? Wouldn't you manage?

Absolutely! And thanks for chiming in - your input and experience is valuable (to me as well).  

I won't speak for Fountain Square, what I will say is that in Indy, it is unlikely that I would pay $110k for a duplex that's generating $950/month gross. Emphasis on "unlikely". 

There's no one way to invest or single rule, but it's safe to say that a $110k duplex should gross in the $1200-1400 range (and easily could be higher). Again, that's Indy. Each city is different.