All Forum Posts by: Ty Coutts

Awesome man! Sorry, it is a lot. Take your time and I am here to help!

I would just check with local zoning department to see if you need permits or to adhere to certain regulations. Definitely will take time, but it could be worth it. Just like any investment!

Hey Gavin,

It's great to have you here. It's awesome that you are taking advantage of BiggerPockets. Some other great resources I recommend as a real estate investor myself are: "Rich Dad Poor Dad" by Robert Kiyosaki, REtipster (www.retipster.com), and Rental Income Podcast with Dan Lane. I am also a loan officer so please reach out if you'd like to hit the ground running on your financing. Also, if you just have questions/want to discuss feel free to hit me up directly.

Consumer Price Index (CPI) for Shelter: According to the U.S. Bureau of Labor Statistics (BLS), the CPI for shelter increased by 3.1% over the past 12 months ending May 2024. This includes a 4.2% increase in rent costs and a 2.5% increase in homeowner's equivalent rent.

New Residential Construction Data: Housing starts increased by 3.6% in May 2024, reaching a seasonally adjusted annual rate of 1.72 million units. Building permits, a leading indicator of future construction activity, were up by 1.5% to 1.80 million units.

Rent costs rising over the past few years could finally be hitting the consumer's wallet in that they are becoming weaker and unable to afford higher rents.

Also, looking at the housing starts data, new supply may be entering the market finally, causing prices to drop as consumers have more options. 

This is a more macro view, and I am not an economist. Just my thoughts!

Hey Kevin

Don't be so hard on yourself! It seems like you have a fantastic chance to maximize the space in your existing house so that you can earn rental revenue. It can make sense to turn the garage into an additional living area if you aren't using it for what it was intended for. Giving up a bathroom at first and maybe a room later to increase this area demonstrates a calculated approach to realizing the full potential of your property.

It's important to think about a few important elements before making any selections. Assessing the renovation's financial viability should come first. Examine the projected rental income against the expense of converting the garage and possibly extra rooms. Taking into account both immediate costs and future rental revenue, this analysis will assist you in deciding whether making the renovation expenditure is in line with your financial objectives.

Second, you have choices when it comes to finance. It's simple to use your present savings for repairs, but if you need more money, you might also consider using your home's equity. However, before using your home equity as leverage, think about how it will affect your total financial condition and investigate the possibility of a higher appraised value after renovations.

Speaking of which, it's imperative that you obtain a current appraisal in light of your recent progress. It will help you see your house's potential equity and present market value more clearly. Your decision on whether to investigate other investment prospects or reinvest in your current property can be influenced by the results of this appraisal.

Hope this helps! If you want to tap into that equity please reach out as I am a loan officer. We here at Aslan have over 70 investors, so we can definitely get creative and look for programs that are applicable to your unique situation. Feel free to hit me up any time with questions or if you just want to discuss!

Hey Brandon,

First, thoroughly examine the numbers. Buddy's current $1,594.24 monthly payment consists of principle, 3.875% interest, and escrow. The monthly rental income is projected to be between $1,200 and $1,600. It is imperative that you compute your potential cash flow in light of these numbers. To calculate net operating income, deduct projected operating expenses from estimated rental income, including property taxes, insurance, maintenance, property management fees (if applicable), and any vacancy allowance.

Second, think about working with Buddy to get better terms. In order to increase cash flow, you might suggest a shorter purchase price or a longer-term financing plan because the house is ready to move into and doesn't require any modifications. The profitability of the investment may also be increased by arranging for a balloon payment, extending the repayment time, or negotiating a reduced interest rate.

Thirdly, consider the advantages of purchasing the property using seller financing in the long run. Examine the possibility of future value growth for the property as well as any tax advantages that come with owning rental property. Check to see if this fits with your wealth-building and portfolio diversification goals by taking into account your entire investing strategy and financial ambitions.

Finally, carry out a comprehensive risk analysis. Take into account variables that could affect your cash flow, such as the stability of the market, local tenant demand, and prospective changes in interest rates. Carefully go over the seller financing agreement's conditions to make sure you understand any stipulations or eventualities that might have an impact on your investment.

I am a loan officer and we have over 70 investors here at Aslan, so if your looking for creative financing please hit me up! Also, feel free to reach out directly if you have any other questions or would like to discuss anything. 

Hey Steven,

You must consider a number of variables before making a decision. First, look at comparable rental properties on websites like Rentometer or Zillow to get a sense of the average rent you can charge. This will help you research the Scottsdale rental market. Next, figure out how much the entire rehab will cost and contrast it with the possible rental income. Make sure the renovation significantly increases value in order to support a higher rent. Subtract all costs (mortgage, property taxes, insurance, maintenance, property management fees, and HOA fees) from rental income to determine the estimated monthly cash flow. It takes positive cash flow to make a BRRRR investment profitable. Examine the post-rehab value (ARV) of the property to determine whether you can refinance and extract most or all of your original investment. Speak with lenders to learn about the conditions and criteria of refinancing. Examine the terms of financing. for keeping a rental property as opposed to selling, and take long-term investing objectives into account. For information about Scottsdale rental properties, check the HOA and municipal laws. Finally, in the event that the rental market underperforms, have a clear exit strategy in place, such as selling the property.

Hope this helps! Please feel free to reach out to me directly if you have any other questions or if you just want to discuss. 

P.S. I am a loan officer if you need assistance with any of the financing things I mentioned above!

Hello Carlos

It's fantastic that you can get help with your search from a local in New Orleans (NOLA). Properties in New Orleans often remain on the market for more than thirty to sixty days for a variety of reasons, some of which make the market distinct. Seasonal changes frequently impact the activity of both buyers and sellers, which causes variances in the speed at which properties sell. Demand in the local market and the state of the economy both have a big impact on how quickly transactions get through. Furthermore, sellers may price their houses higher than what the market will bear, which causes them to remain on the market for longer. Properties' length of time on the market may also be impacted by their condition, especially older or dilapidated properties that are typical in historic districts.

New Orleans presents a challenge when it comes to insurance rates because of its susceptibility to hurricanes and flooding. These hazards have the potential to dramatically raise insurance premiums, which could negatively impact rental properties' cash flow. Duplex or triplex insurance premiums can differ significantly depending on a number of variables, including building condition, coverage levels, and location. It's possible to anticipate paying between $1,500 and $3,000 annually for each unit, but to fully grasp the range of expenses, it's critical to obtain estimates from several insurance providers.

If you intend to keep one unit unoccupied for guests, a triplex could be a more practical and affordable choice. It will be essential to have precise estimates for prospective rental income and insurance expenses when determining whether or not your investment is feasible. I wish you luck in your hunt, and it will surely help to have a reliable local acquaintance act as your eyes and ears on the ground.

Feel free to reach out directly if you have any other questions/just want to discuss!

Hey Corey,

Here are some pros and cons of your options

Seller Financing + Separate Renovation Loan
Pros:
Low Down Payment & Interest Rate: This could significantly reduce your initial cash outlay and make monthly payments more manageable.
Cons:
Financing Rehab: You might consider a personal loan or a home equity line of credit (HELOC), though these often come with higher interest rates. Alternatively, look into renovation-specific loans like the Fannie Mae HomeStyle Renovation or FHA 203K loans as standalone products for rehab costs.

FHA 203K Loan
Pros:
Low Down Payment & Bundled Costs: This loan simplifies the process by combining the purchase and rehab costs into one mortgage.
Cons:
Interest Rate & Refinance Requirement: Higher interest rates and the need for refinancing could reduce your overall return on investment.

Fannie Mae HomeStyle Renovation Loan
Pros:
Bundled Costs: Like the FHA 203K, this loan combines purchase and renovation costs, simplifying the process.
Cons:
Interest Rate & Refinance Requirement: Similar to the FHA 203K loan, the need for refinancing to extract equity and convert to an investment property might add to your costs.

I am a loan officer so I have some expertise in this area. Let me know if you have any other questions, and please feel free to reach out to me directly. If you'd like to set up a call to discuss your options just let me know!

Hey Akash,

I am a loan officer in Co licensed in Colorado, Arizona, Arkansas, California, Florida, Kansas, North Carolina, Tennessee, Texas and Wyoming. I could give you some recommendations if you like and help with your financing. Reach out to me directly if that interests you at all!