All Forum Posts by: Tom Cooper

I concur with @Andrew Taylor, especially on the rehab costs.  I had already sent you a PM to that effect.  Based on "it needs a lot of work" this could be much higher.  Also, with these older dwellings, there is big potential for major work that is hidden behind the walls, and as Andrew mentioned, bringing items up to current Code.

@Barbara Ferrer,

As for oil price patterns, I am not smart enough to figure out what the Saudi Arabia leadership will do, much less when.  They, and other big producers, determine the oil price.   Nobody predicted the decline from $100+ down to $30.  When it was at $30, most of the reports were saying it could go to $15-20, some as low as $10.  Then it popped quickly back to $50 instead.  If I were you, I would not put much stock in the oil price predictions.  FWIW, while certain pockets of real estate in Houston were hit fairly hard by the initial drop, the rental market and houses in that price range/neighborhoods dropped very little, in some cases, not at all.  

Personally, I am taking a longer term view of Houston rental real estate and will keep buying at prices I like.  We still have a very business-favorable economy and tax situation, top Medical center, #2 port in the country, getting more diversified all the time, and people are still moving here every week.

@Andrew K.,

I both know the author @Joshua Andrews personally and had the pleasure to get to read a draft copy of this book.  While I have not seen the final copy, I have absolutely no doubt that Paper Profits is a worthwhile read and will get you off to a good start in understanding the note investing business.

@Bryan Pham, Being a local Houston investor, I have to say that deal sounds a bit on the "too good to be true" side if it was on the MLS. I've had several agents scouring MLS for months and haven't seen anything like that. If it was completely off the market, certainly realistic, but since you mentioned an agent found it, I would encourage you to re-check or have someone verify, especially the ARV and the rehab numbers. 10K doesn't buy you much in rehab - paint, flooring, maybe some fixtures, but depends on the size of house as well.

@Cody L.,  I'm in agreement with you.  But just to clarify the original poster did not write "Houston rentals are doing bad" as a generalization, but that she has a "couple in Houston that aren't".  Individual situation.

@Hannah Wilkinson, Very few people buying houses directly from motivated sellers pay "cash". You do, however, need access to fast funding, so many use hard money lenders (HML for short) who can typically fund anywhere from 24 hours to 10 days - depending on lender, the deal, and your relationship with them. They lend based primarily on the value of the property and will lend on uninhabitable homes that a conventional lender will not lend on until rehabbed. Attend a local REI meetup or group and find out what firms other investors are using.

As to finding your list to mail to, there are a myriad of sources.  Which ones are available in which areas you will have to look into.  Several of the larger firms that offer numerous markets include Listsource, Rebo Gateway, Realist.  Some of the direct mail providers offer to source your lists as well, but I believe most are using one of the primary list providers. You may have other local providers as well.  Much of their data will come from the local tax assessor data.  Phone numbers and emails are harder to come by typically - skip tracers, but that can get expensive.

Great job, @Dejahn Renrick!!   I am curious with all that open space now, did you have an engineer evaluate if you could get rid of all those walls.  it sure looks like a long span with no support?  But hopefully you had that taken care of.  That is an incredible transformation on the house and super profit.

Insurance costs Varies A LOT based on locale, neighborhood, etc.  Along with size, deductible, etc.  Find an insurance broker that specializes in investment real estate and they can give you rules of thumb for YOUR market.  We have companies in the Houston market that offer a single blanket policy, so once you are set up with them, you can just go online, input the info and add a property or even take it off (as in a flip) or change status (vacant to occupied).  All without talking to an agent or filling our paperwork.

Simple supply and demand.  There have been just relatively few duplex, triplex, and quads built in Houston in the more popular areas.  It is my guess that at the time these areas were built out, the demand was primarily for Single family homes.  That is still the case today if you look at what is being built.

@Brian Gibbons,  There are fortunes to be made in what you shared, if one would just apply it!   Thank you! One of my favorites is:

"Don't let the opinions of the average man sway you. Dream, and he thinks you're crazy. Succeed, and he thinks you're lucky. Acquire wealth, and he thinks you're greedy. Pay no attention. He simply doesn't understand."