All Forum Posts by: Jonathan Stone

@Rohin Dhar

Yes.  I love the idea as I mentioned.  What is the draw to Taos?  It's not a lake city, beach city, or super close to skiing from what I know.  Maybe I am way off.

@Mel Volland

Awesome story. Thanks for sharing your experience as I think it is valuable!

https://www.biggerpockets.com/... 

This thread contains the link to the Earthship I was mentioning.  I don't think Taos is a destination city.

I can't think of any reasons not to let them know. Just make sure you have cash reserves beyond just the funds for repairs. Are you planning to live in this place? Is this an investment property only? Are you doing the work yourself or hiring contractors? Do you have the cash to do the repairs through the escrow as part of the HUD? Did you consider a 203k loan that would include the repair costs if you don't have the cash on hand?

I know I dumped a bunch of questions but you didn't provide a lot of context. If you are planning to BRRRR and this is your first deal and you have limited capital/income, check out the thread below.

https://www.biggerpockets.com/...

@Michael O'Hanlon

The only example I’ve seen was here on BP and was an earthship. The draw could be to those who want to buy or build one or evaluate the sustainability. As to the management I have no idea how they do that. I believe the thread I read it in was about investing in Angel Fire NM.

@Paul Sandhu

You looking for partners in OK?

@Matthew Irish-Jones

It seems to me that most of the concern has to do with HML and under capitalization. I certainly have heard all the talk of BRRRR but looked at it from my background of commercial construction and know that you need reserves + contingency dollars. They can't be the same funds. So if you need 6 months reserves and 15k for your rehab you add them. You can't do fuzzy math and use the same 15k for both. That and the due diligence of actually learning to price out a rehab, getting multiple bids understanding the processes and work required seem to be the main gripe in this thread.

To sum up my understanding of this post BRRRR isn't a beginner strategy and construction implies risk so learn more than just the basics before planning to be a construction manager.

I was not in the market in 07-08 as I had sold my only property prior. However several people close to me were, people who owned cash flowing real estate generally did fine. People who were in the middle of flipping 2-5 properties got really hurt, some I know of let places go or attempted to sell for small percentages of their estimated ARV. The reason most seasoned investors don't see this as 07-08 again is the fundamentals in lending have not slipped back to where they were in the early 2000's. Money is cheap and prices are up but it's still unlikely that rents dip more than a few percent across the US, in my opinion.

@Sunny S.

Not sure how well you know the market you’re investing in or the agent your working with. If you have strong belief in your agent and they know the market maybe you just had a tough appraisal. But I’d recommend looking at the appraisal and the comps in the area. I know you pointed out the cashflow but what if you could buy the house next door or down the street for 15k less and bring in similar rent? Also is this rent normal in this market? Will it be possible to replace the tenant for similar rent or would you have to reduce your rent to get new applicants. I think it’s a sign to do more research and I don’t know the market you are in but from afar. That’s my advice.

@Char Dickinson

Both @Don Spafford and @Tony Clark have given great responses. You mentioned wanting to house-hack or BRRRR but didn't mention if you are geographically tied to your current Idaho location for work. Also is that where you plan to stay for 2-3 or more years.

I know you can invest long distance but I was looking for more feedback about if your desire was to move somewhere else to house hack or to look for a market to long distance BRRRR. And although I know that strategy is very popular for building a portfolio quickly as often discussed here and in the BP podcast realize that in many market contractors are booked out 4-6 months and material prices are continuing to rise. I wouldn't advocate against it just realize that the amount of cash needed to BRRRR right now and the time to rehab could be difficult on a newer investor.