All Forum Posts by: Trent Honea

Hi Cindy,

Each month there's a meeting, usually somewhere in the mid-cities area, on the last Wednesday of the month.  The group has a website at:  http://dfwreinetwork.com/

Just about everyone involved is active here on BP.  I've been to one of the meets and it was pretty good.  Wish my schedule would allow me to attend more!

Cheers and Happy Investing!

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Yes, definitely, that's one of my focus areas.  I currently own one rental in that area, 3-2-2 around 1200 sf.  Recently, rents have been running about $1/sf and RETAIL pricing is listing about $100/sf for a CLEAN, ready to move-in property.  Those numbers assume property size between 1000 and 2000 sf.  Many of those homes are 15-20 years old and need some maintenance or upgrades, so keep that in mind.  Also most homes in that area have been hit heavy by recent storms and need roofs.

My rental is about 1200 sf, built in '01.  It needed paint, cabinets, plumbing fixtures, flooring, appliances, new fence and pet smell removal. Rent is 1195/month.  Remodel ended-up being more extensive than I estimated which cuts into my overall profit, but it's still going to be a good cash flow property for me.  I did not "lose" money but it's not as good a return as estimated.  I'll rent it out, let it appreciate a few years, then ReFi to take my investment out and roll it into another property.

I'm looking for additional properties in that area so if you know of any, even your own, please let me know.  I'm NOT a retail buyer - I want some discount - but I do close on good deals. If you put together a good deal ( not just provide a listing - I can search MLS too) I'd pay a referral fee.

Duplexes I have seen in that area are pretty rough, so if you want to house-hack be very careful of the area.  It actually seems to vary by street.  There have been a few duplexes available just south of I-30, between Spur 580 and I-30 in the triangle behind Churches Chicken, Sonic, etc., but the area declines slightly when you go south of I-30.

Good Luck on your wealth building!  Most important thing is to get started!

I usually charge slightly more than one months rent to help make it clear it's not a payment for the last month of rental.  For example, if rent is 1400/month, I might ask 1500 deposit.  If it's 1200, 1250 deposit.  It could go lower too, but I don't want the impression to be for the tenant to skip the last month rent and think the deposit covers it.

I personally would try to pay off the student loans completely first, then focus on investing.  My reasoning is that you need to be able to handle the unexpected.  Just a down payment may not be enough to see you through difficult times like having to pay your mortgage and court costs to evict a non-paying tenant, major system failure such as HVAC replacement, etc.  You need some contingency funds to see you through, and having to make payments on the student loan is just another drag on your funds. 

In addition to your down payment, try to build up a reserve of 6-months of payments (PITI - Principle, Interest, Taxes and Insurance) to handle any down-turns.

That's just my 2-cents worth, and I'm sure others will have their own opinions.  I tend to be on the conservative side with such things, but I've been through a few layoffs and one really bad tenant eviction experience.

Congrats on the diploma and on wanting to take action!  It sounds like you are on your way!

There is a group that meets the last Wednesday of the month in the mid-cities area.  I went to my first meet-and-greet Wednesday night and it was great!  They usually post on BP that there's an event coming up so keep an eye out.

Sorry but I don't know of anything available tomorrow.  Maybe someone else will.

Good luck!

Go to the HomePath,com website and read under the Investors menu.  They spell it out for you pretty well.  IF a house does not sell to someone who wants to live in it, they make it available to investors.  (I think there's a 60 day period for live-in only but am not 100% certain.)

They have structured sales and auction sales.  Contact them or get with a Realtor who is familiar with the process.  It's a reasonable path to take, although I have not found any in my area that interest me.  (I check their inventory from time-to-time looking for a deal.  There just has not been one in my market that interested me so far.)

Good luck and happy investing!

EDUCATE YOURSELF!

You are on the right track here by reading everything you can on BP.  I suggest you sign up for some of the free webinars and listen to some of the podcasts.  There's TONS of great information here at BP and most of it is free!

You don't necessarily need money, either.  Read Brandon Turner's book about investing with little or no money down available Here and the Ultimate Beginner's Guide as well.  These are GREAT sources of information.

I'd recommend getting a property or two before you dive too deeply into things like business structure or insurance beyond a "Landlord's Policy", and that requires a property first. Once you get your feet wet, get a CPA and a Lawyer to discuss these things. Build your team, but get that first property first. (In my opinion. Some will tell you build a LLC and invest there, but that's not how I'd suggest. In the end, it's up to what's right for YOU.)

EVALUATE PROPERTIES

You don't have to be ready to buy to start analyzing deals.  If numbers aren't your thing, you can still use the calculators under the Tools menu.  I've been doing this a few years and I still use them.  They really help to quickly see if a property is worth investigating further.  The more deals you look at, the better you will get at spotting the good ones.

SET GOALS

If you don't know where you want to go, how will you know when you get there? Don't set a vague goal like "I want to be rich".

Instead use something along the lines of "I want to increase my wealth through buying and holding SFH Rentals. I will buy one house per year for 5 years until I have built up a cash flow of $1000 per month. Then I will focus on paying these off so my cash flow is near 100% after allowing for expenses like taxes, insurance and cap ex." This is just an example of how to be specific. DON'T USE THIS GOAL! It's just an example of a place to start. Use a goal that fits YOUR life, YOUR wealth plan, and YOUR comfort level. You might do better with fix and flip, or tax liens, or whatever but make specific goals.

If you reach your goal, set a new one. Constantly re-assess your goals to see if you are on track or need to adjust. They are not set in stone.

TAKE ACTION

Find a property, run it through the calculators, see if it makes sense.  If the numbers don't tell you no, find a way to get to YES.  Make an offer that makes sense based on the numbers.  Negotiate.  Try to get that first property.  Don't try to buy a bad deal, but even if it ends up not being perfect, you will learn more from your first property than from years of studying the business.  Once you buy one, you will get better at each phase.  Each time you buy, you learn.  Just keep repeating until you reach your goals.

FIND A MENTOR

Find someone who's done what you want to do and learn from them.  You may just study their methods or you might get to be friends with them and actually discuss deals.  But make sure you bring something to the table, and don't be a fake friend.  If all you want is to pick someone's brain, you will become tiresome and eventually it will backfire.

LET TIME WORK FOR YOU

RE is not a get rich plan, despite what some "gurus" will try to sell you.  RE is get rich SLOWLY.  Your equity grows with time as you pay down the mortgage.  Your property appreciates with time as inflation and demand play their part.  Find a path that works for you and persevere, but be patient. 

HAVE FUN!

This may be the most important of all. If you don't enjoy working with real estate, find something you do enjoy and put your efforts into that. RE is not for everyone. If you dread getting up and going to work, find different work. Life is too short to trade your hours doing something you hate. There are many ways to make a living and to build wealth and RE is just one of those.

Build a plan, build a team, and build your wealth.  And Welcome to the BP community!

My understanding is that you can only use Realtor forms if a Realtor is representing one of the parties.  You can go to many sites, though, like Rocket Lawyer, Zillow, and many state websites to download templates and examples.  There's nothing wrong with taking a template and modifying it to more closely match the "standard" one, but in fact there is no such thing as a standard contract.  Just make sure to use one that's OK in your state.  Many office supply stores have inexpensive forms and some books do too.  Or you might need to get a lawyer.  You don't want to get in trouble to save a few dollars.

I personally use a Realtor to represent me most of the time, but I haven't been buying FSBOs either.  You can hire a buyer's agent, but you have to pay the commission or negotiate a flat fee up front.  That way you get access to their experience as well.

If you talk to a licensed agent and tell them you just want them to help with the paperwork (for a fee), they will probably work with you.  Especially in a slow market and if there's a chance of future business.  My agent is an investor himself, and his experience is priceless when I have questions.

My last property took me just over 2 months to rehab, mainly because I ordered cabinets and had to wait on them, it was the Holiday season, etc.  I did all the work nights and weekends with a little help from family members, and I paid my niece's boyfriend to do some of the heavy lifting, rip out carpet, clean, etc.  This was a rental I purchased occupied from another investor, not listed.  Once the lease was up, I knew it would need rehab and it was figured into my purchase price.

I now have a very nice property, new tenant at market rent, and a good rehab story to tell. :)

I DID hire the painting out - it's messy and time-consuming and well worth having it done.  I got as much ready as I could and gave them the house without any other contractors for a week.  I got a referral from a retired painter I know - they did a pretty good job at a decent price.  

My biggest pain point was pet smell.  Dogs from prior tenants had peed on all the baseboards near the doors in the living room and kitchen.  I had to rip it all out and replace it to get rid of the smell.  The  boards were completely saturated!

Best of luck!