All Forum Posts by: Tchaka Owen

@Eli Ettinger - thanks for the Houston breakdown. If a similar sold for $120k, that's much different than $90k...makes your deal more palatable. Your monthly is much too high at $700+ for a $120k property. As others have mentioned, you may be paying too much for insurance. HOA fee almost always includes insurance; for clarification it's all insurance outside of the walls of your unit. You are responsible for an HO-6 policy (often referred to as "walls-in"). That should run you $60-80/month. To me, you're paying around $150/mo more than you should be.

If a unit recently sold for $120k, it might be worth it to sell and move the small gains elsewhere. 

@Lee Carter - I'm not sure about #2 (the 2nd one). If the property isn't commercial (ie, residential with more than 4 units), not sure you can obtain commercial financing. That said, instead of looking at houses, why not look at duplexes, triplexes and quads? The returns could potentially be better. Good luck!

@Eli Ettinger - Like Kerry said, you'll get all sorts of opinions. For starters, you're buying and that's a good thing. Do you have a strategy on what you want to accomplish? A roadmap will help you towards your success. Two comments:

1. I'm not fond of your Houston purchase because you didn't gain much value after spending over $25k. IMO, if $25k+ might only have it at $90k ARV, I wouldn't have spent more than $45k on it. And how do you owe $708/mo? That wrecks your cash flow.

2. If Brooklyn is worth $300k, seriously consider taking a loan on the home. If you took $150k out, you'd have most of your money back (for more investing) and the rent would more than cover it....and you get the write off too. 

Good luck!

@Terry Lao - I moved out of South Florida a few months ago, though I still keep tabs. I don't agree with Miami at #2 (might not even be top 20). There are parts that are hot, they're underdeveloped and with lots of money in Miami, investors are buying up quickly. Then there are other areas that aren't as hot. For example, about a month ago I read a piece that showed South Beach with around a 19 month supply. That might qualify as top 10 slow markets. The Lakeland prediction could be accurate, that area is doing well from what I hear.

@Frank Greco - Florida doesn't have income tax, which is nice. And creating an LLC here is extremely easy, you can do it online. To the best of my knowledge, Florida LLCs are quite solid. The question really boils down to what you're trying to do and what level of asset protection you seek. There are some BP threads that address this. NV and DE are among the strongest, however TX and one other place round out the top four. Hope this helps a bit.

FYI, I've purchased in either land trusts or FL LLCs, no probs so far.

@Eric James - if your brokerage is in a very high traffic area and you don't mind doing floor, cool. Otherwise it's pretty much a waste of time. As others have mentioned, the trend is towards internet not walking into firms. My last brokerage is one of the few (in my mind) that would be worth doing floor time. It's located on Las Olas Blvd where tons of people go for dinner, drinks, come off cruise ships, etc, etc. On occasion agents would get deals. Other than that, learn how to prospect and forget floor. My new brokerage is over 200 miles away from me, I've never been to it, never met my broker face to face (nor anyone else in my firm) yet am happy because floor was never my thing. Figure out if it's your thing, you might find yourself more productive away from floor. Good luck!

@Corby Goade might be on to something because your offer (IMO) isn't terribly low, however it could be how you present it. Assuming that your numbers are accurate, I wouldn't pay more than maybe $74k. So your offer isn't that far behind, yet how sweet you approach the seller can make all the difference in the world. Read the seller and mirror his/her person type. 

@Christopher Lane - hard money rates differ based on area. It could be as low as 10% and as high as 15%; points likely range between 2 and 4. That said, I wouldn't sweat rates so much because this deal will stand on its own. Priority is to get it under contract NOW. Think about it.....let's say you end up getting them for $110k, you're pulling in $2200/mo. Even if you're covering water, trash, etc.....you're going to cashflow plenty. Once it's running, you'll find a non-QM lender who will refinance in the 6-7% range and enjoy life. Good luck!

ps- contact your local REIA, they'll have some hard money lenders. I believe here on BP you can find some too.

@James R. - you responded, which means you took the time to think. That's where it starts.

@Account Closed - you can't reliably use 5 miles except when dealing with farmland or extreme rural. Wooster is a city. That's like comping a home in Osu by using one in Legon - it doesn't work. As an FYI, I rarely go more than 1/2 mile for comps. If I must, I'll go a mile. It's better to make adjustments to a home 1/4 mile away than to find a similar one 4 miles away. 

And if you're ever in doubt, better to be conservative and go a sliver lower. Good luck!