All Forum Posts by: David Shapiro

@Account Closed

 Welcome to Austin! I look forward to meeting you at one of the events mentioned above.

I used that strategy on a Fannie Mae foreclosure. It may not have been a 203k loan, it might have been a HomePath specific program, but it allowed me to wrap the repairs into the loan. The downside was that as an investor I had to put down 25%. It allowed me to do the deal with a little less out of pocket compared to purchasing with a conventional loan then using cash to rehab. The downside was the bank required that all draws be paid to a GC that I had identified and contracted prior to closing. The GC cost me a couple thousand dollars.

When it was all done the house appraised for $20k higher than my all-in-cost and it cash flows nicely every month - which is partly because I put down 25% :/  
Unless it's a killer deal I would avoid such large down payments, hurts cash-on-cash return.

@Juan Maldonado I hope all is well. I've used a 203k loan. I'd be happy to refer my lender who helped me through the process. Shoot me an email.

Thanks everybody for the replies and tips!

@Andrew Cordle Good to know, I'll check out the HD app.

@David Epstein Thanks for the tips. I'll look into the volume pricing. Do you get 5% off in addition to the volume discount when using your HD commercial credit card?

@Shawn Thom  Buying coupons online, good idea!

@Bill Coleman Is that Lowe's equivalent to the volume pricing/bid room that David was referring to?

I've been playing around with MyLowe's which tracks your purchases at Lowe's. You can go back and see what items you've purchased. I make purchases at Lowe's for several different properties. As an investor I'm trying to accomplish two things 1) It makes it easier to assign costs to the appropriate property at the end of the month 2) Keep an inventory of what I've purchased. An example of how I see it being helpful: If after move out I see a tenant damaged a section of the floor, I can see exactly which flooring I bought last time and order more.

I'm curious if anybody has come up with a system to use this for multiple properties?

Two things I noticed. It looks like you can order multiple unique MyLowe's cards (not store credit cards). You could label one for each property.

You can set up a "Home Profile" and add different spaces. You could create a space and rename it for each property.

@Brandon Hall Interesting idea about forming your own property management company to interact with tenants. When I've had property managers, as the owner, I've still signed the leases with the tenants. Would it be possible to have the LLC be on the lease?

Now that you would be running a property management business, do you have to get a business insurance policy?
Does it really provide any protection because of the blurred line of whether you are acting as the owner, or the property manager?

@Shawn Holsapple Out of curiosity, is your limit $500k in property value or equity?

@Curtis W. Sutherland I like it!
17x in 23 years is pretty phenomenal. Are you expecting the same types of returns in Austin over the next 23 years? 

I just looked at your profile and see that you plan to develop it, so it looks like you're doubling down. Very cool. I just happened to drive by there on my way home today. It looks like re-development of that section of Congress is already beginning, so sounds like timing will be right.

@Jon McCarron   I'm in Austin and I agree with @Ali Boone  that rent-to-purchase ratios are not good in the core. It's definitely a hot market and that has driven prices up and cap rates lower. Yes, you can go to the outskirts and probably get some better cash flow (I prefer to keep all of my properties within 20 minutes of downtown for convenience, curious to hear Ali's take on why she prefers out-of-state). I've refined my criteria for purchasing rental properties over the years, and I have high standards. I live here and decided 2 years ago to pursue other avenues rather than buy and hold because the time commitment wasn't worth the return. Any good deal on the market will go to multiple offers. There are many others looking for off-market deals, including me (any wholesalers feel free to reach out to me :) 
I'm curious, have you looked for cash flow properties within driving distance of you?
I own an out-of-state rental and it's been great, but it would be even better if it were within 20 minutes of where I live :)

@Brandon Laughridge Would KC be your first time listing a vacation rental property?
I was in a similar position, considering buying a property solely as a vacation rental. I decided to try renting my primary residence as a trial to see how I like it and what kind of interest I would receive. Since I live there and anything I bring in is extra it allows a pressure free testing environment. I've found a lot of the same things that others have posted about... keeping prices low initially, a couple positive reviews really help, getting verified, etc. Hope that helps, if you're interested in speaking more feel free to dm me.