BiggerPockets Podcast 312: Conquering Nightmare Rehabs While Working Full-Time with BRRRR Investor James Masotti

by | BiggerPockets.com

Excited about real estate investing and looking for a blueprint to follow? Well, you’re in luck!

Today’s guest James Masotti is a well-rounded investor who’s piling up properties while working a full-time job.

James shares how he consistently finds deals in a competitive market (it’s not through the MLS), how he funds these deals (it’s not with his money), and how he handles the common complications every investor faces.

He also gives some great advice for acquiring properties already occupied by tenants, and explains how he keeps his partner and lenders happy even when things don’t go according to plan. He offers tips on planning for CapEx and dealing with the dark side of real estate investing, too. 

Plus, you won’t want to miss his advice when it comes to building funnels to find deals, as well as just what to look for when interviewing real estate agents.

James has a straightforward, no-nonsense approaching to succeeding in today’s market and provides tons of good content for how you can do the same! Download this episode today!

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In This Episode We Cover:

  • Jame’s entrance into real estate investing while having a professional career
  • Cash reserves and how he plans for CapEx
  • How he finds and funds deals
  • Dealing with tenant evictions
  • Finding the lender you need
  • What a debt cover ratio is
  • Why he continuously builds funnels
  • How to handle when things go wrong
  • Analyzing and overcoming the dark side of real estate investing!
  • And SO much more!

Links from the Show

Books Mentioned in this Show

Fire Round Questions

Tweetable Topics:

  • “Real estate is very forgiving.” (Tweet This!)
  • “When you’re looking to scale, you want to have reserves available.” (Tweet This!)
  • “Don’t chase something that you’re not comfortable with because that’s when you get in trouble.” (Tweet This!)

Connect with James

About Author

Thanks for checking out the BiggerPockets Real Estate Investing & Wealth Building Podcast. Hosts Joshua Dorkin & Brandon Turner strive to bring top-notch educational content and interviews to our listeners — without the non-stop pitch prevalent around the industry.

With over 180,000 listeners per show, the BiggerPockets Podcast has become the biggest real estate podcast in the world. But don’t take our word for it. We’re the top-rated and reviewed real estate show on iTunes — check it out, read the reviews on iTunes, and get busy listening and learning!

7 Comments

  1. Jason McVey

    Overthinking can get in your way! In the episode they talked about finding a bank that would do the refi immediately after completing the project to successfully BRRRR the property. I have had a few of the banks that I typically do business with tell me I need to wait 6 – 12 months but keep hearing investors on here talk about how they find a bank that will do it.

    This afternoon I just decided to go to google and typed “Arizona banks” and the first one that popped up I called. They gave me both the option to rate and term refi(immediately) and to cash out(6months).

  2. csilla veress

    James –
    I just wanted to shout a thank you for being vulnerable and honest with your story. I am having a similar situation happen with my 8 plex in MO. With deferred maintenance / unexpected massive exodus of tenants (lol).
    So I hear you and feel the pain.

    Similar strategy I was thinking about was to increase vacancy % when analyzing, now that my eyes have been opened to something I didnt plan for with standard vacancy %. Also, the time of the year when buying is something I am really paying attention to. I feel like the higher % for vacancy is possibly more needed at the end of the cycle – fall and winter. I do wonder if we bought in the spring to summer there wouldnt have been as much of an issues finidng tenants to move in.

    Also, loved your point about no money down and having reserves. I think Ryan Murdoc also said something similar in one of the podcasts and its such an important point. Im adding in buffers for that as well. I love the challenge and the education of the mistakes, but I also dont want too much pain.

    Thank you again. It’s motivating to know you arent alone in some of the struggles especially in a sea of perceived successes.

    Good luck in your endeavors.
    Csilla

    • James Masotti

      Csilla – It is an interesting predicament. If I had analyzed the deals knowing what my actuals are now I never would have purchased them. I think the more interesting approach as I’ve been getting feedback is to maybe reconsider is making different assumptions on the performance of the asset for the first 1-2 years if purchasing it with a tenant in place. My properties that I have done the BRRRR on (with the exception of the Money Pit) have gone well. I think I also need to more due diligence on tenants in general whether ones we’re inheriting or ones we are placing into properties, in order to figure out what the risk associated with it is. 2019 will be a big year for stabilizing with hopefully a few smaller acquisitions, I promised my wife a new primary residence before any more rental acquisitions. Depending on what the market does, I’m expecting 2020 to be a year of more aggressive growth.

      • csilla veress

        Its a good point. We have been losing money in the last month or two due to vacancy even with an 8 plex. To reconfigure with different scenerios to see what loses and gains would look like would be a good exercise and also highlights potential sinkers.
        good for you for stabilizing in 2019. I think that really important to regroup and plan. good luck on the primary residence. and thanks again!!!

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