All Forum Posts by: Zambricki Li

I think it can be a great idea. Just run the numbers as you would on any property. I suggest not starting with negative cashflow on any property. Appreciation is a bonus, not a plan.

Depends what you mean by "decent pool of capital". It would be nice if you could leave at least two moves on the board and get started with something to learn on and go from there. You don't want to be out of the game before you give yourself a shot. Analysis Paralysis slows a lot of people down, so just start. Merely fill every moment you used to do other things- with RE machinations and you will crush it! You obviously understand business so you will be fine. 

In response to your direct questions

• We don't really have a network of people (friends and family are all in different states)

-You and your awesome wife are already a network. You can build a team you don't need it to be a party atmosphere day 1, just knock a couple out, and you'll meet plenty of people.

• We aren't Real Estate agents

-Great, interview five agents and pick the who understands your goals. Make them earn your business and anyone who may condescend about your level of experience, show them the door. 

• I don't have any handy-man/rehab skills

-You don't need to be a handyman, just pick someone in your family to be the "yelp master" and go forth! I would suggest think about starting with a renovation/ value add/creative expansion and wait for a big "flip". I've seen flips fail, I've bought failed flips.  It can be a money pit and the housing market is so hot the margins may not work for you in your area as they are described from peoples experiences 2-5 years ago. 

All the best!

Your inspection report is your "house manual as well as your opportunity to "kick the tires" and maybe even get the seller to do repairs or give money back so you can do repairs.  Do not skimp on this step.

My inspection days are a flurry of activity where I also bring in some contracts and specialists for estimates on work I may do in the future, so I can see how much I will really be putting into the house. I surprisingly get more from these estimators sometimes than I do from inspectors. Inspectors by law are only required to report on "what they see". Some lazy ones will purposely not look very hard. I follow them around and ask questions like an annoying boy scout who wants to learn how to get a complicated Merit badge. I exhibit genuine curiosity and respect for their profession. I always bring is systems specialists as well as General Inspection.

I bring my plumber for sewer line camera inspection-extra $100

My roof guy for his opinion- usually free or I pay him $100 just to be cool and he appreciates it. These guys are giving free estimates all day long its not really a big deal

I bring in HVAC guys because gen inspectors just turn them on and are not required to analyze the real health of the system

There are some gen inspectors who offer some of these services though I personally prefer to have a range of trusted specialists opinions.

My goal is to find 10k in repairs. It keeps me motivated to hunt for issues. I have found up to 20k and had the sellers cover it. I've also had houses have zero issues and happily walk away and complete the transaction. Most owners defer maintenance however I want to know these issues before me or my client buys the house. If the owner wants to use their people to fix the issues, I am cool with that. You have a little bit of leverage here as most sellers do not want to fall out of contract over some deferred maintenance. I have told seller, "listen If I was a contractor I would buy it and fix it myself though I cannot walk into a situation where I am immediately fixing this property, as I am a realtor and investor- not a handyman."  Most sellers warm up when it is framed this way.  

Inspection day is the 3rd most important day when buying a property. Go big and don't be afraid to ask questions and get opinions. Some agents don't want you to find issues and walk. I would prefer we walk from the deal than you go underwater on an issue that could have been discovered with extra effort. I know someone who bought a place without realizing that every year it floods 4 ft in the basement. Someone messed up in inspection. That person is them. Sellers usually say no repairs though once you are in contract that dynamic shifts.

I do not think you should ever lose money on an investment on the onset. I also think, contrary to a popular belief on BP, that a paltry 200 monthly cashflow is not worth the risk, stress, liability, and time. I crush in CA, you just need to be creative and understand the markets and how to cashflow. Make sure to calculate property tax into your monthly payment. Happy to help if you want to work with an agent who is also an investor. If you have an agent already, make them crunch the numbers and find you a deal, that is their job.

Z

Beware of splits you usually need one compressor(sorry if that is not the right word for it) per unit, in CA they won't let you share compressors between multiple units(at least in my regions). I just put a bunch of splits in, ran me 7k per unit.

Use billback, put it in the lease, sounds like the construction costs will not justify the separation. Meter for all water or don't bother trying to just meter for hot. Not worth it IMO

Consider an umbrella policy. I know LLC is the thing people always do though if you are covered, you are covered, doesn't matter how you get there. If something really comes up they can probably pierce the veil of your LLC and get to you. You need coverage. Yep Florida is expensive though also cheaper in numerous other ways- so use the benefits avail, and good luck!

*You can easily change to LLC after closing with a quit claim deed, very easy -ask your agent. They can ask their broker if they don't know off hand.

Z

I have come across this. In my case it was to limit one person from owning too much of a complex. If one person owns 50% of a condo building some banks won't loan out on it to new people. The deck is stacked and the majority owner holds too much power to tank the property if they go under.  I would rent it, see what happens. You probably are fine. Good Luck!

You can make a round and say hi, if they seem friendly ask on a case-by-case basis. Asking here won't help -you need local people. I run str's in Lake Tahoe and LA. In Tahoe I've even helped neighbors head in the right direction to get their permit. I want to help people get started in a business I feel passionate about. Now I have neighbors who call me if they see issues at my property, rather than the sheriff. Anyone successful should be helpful IMO. Its a small world and life is too short to be a jerk. All respect to jerks!

@Josh Fisher would love to chat and offer my experience. I have str’s and ltr’s in SoCal. Dm me if you like. I’ll send my Airbnb profile as well in the DM so you can have a look.