OPTION 1: OPTION 2: When Seller Uses RE Agent & You're Using Property For a Rental When Buying Subject To & Selling to Tenant Buyer Pro: Doesn't require specialized knowledge Pro: Little competition "Adequate" cash flow - Nothing Exciting Can be little $ down You get appreciation if property goes up Can do Unlimited number Can Get Started Much Sooner Get down payment (Cash $$) back immediately Great Cash Flow No Bank Approval Needed No Maintenance or Repairs Con: Have To Have $45,000 Cash for Down Payment Con: Have To Have $15,000 Cash For Reserves (just in Case) Have To Have $15,000 Cash for Closing & Carrying Costs Due on Sale Clause Have to Get Bank Approval Must learn the technique Can only do 4 -10 properties depending on bank Competing with everyone else Requires 20% Down & other requirements If AC breaks - you fix it If roof needs replacing - you pay for it If toilet clogs - it's on you If house gets trashed - you un-trash it You take loss if property goes down in Value Tenant Can Trash The House When Seller Uses RE Agent & Using Property For a Rental When Buying Subject To & Selling to Tenant Buyer Asking Price MLS $225,000 $225,000 Balanced Owed $223,969 $223,969 RE Agent 6% $13,500 $0 No Agent Involved Seller Brings to Closing ($12,469) $0 So No fees Asking Above ARV $0 $0 Seller Walking Money $0 $0 Sometimes Walking Money If I Use ConventionalFinancing If I UseSubject To Asking Price MLS $225,000 $225,000 Amount Down - 20% $45,000 $100 (I Give $100 Down) New Loan Amount $180,000 $223,969 I Take Over Loan Title Report $600 $600 Closing Costs $1,250 $1,250 Monthly Payment $1,151 $1,225 I Take Over Existing Payment When you are new, looking for lenders & considering Fix & Flip, BRRRR, or rental, as a buyer, I’d ask the owner/seller to be one of my private lenders with creative financing.

You paid extra for less cash flow, even if the long-term CapEx benefits were obvious.But when new construction trades at a discount — and comes with a 10-year roof, new mechanicals, energy efficiency, and a builder warranty — the math changes.Lower maintenance, lower vacancy, and predictable CapEx are now being offered at resale pricing or better.That is a different equation than anything we saw in 2015–2023.What I’m seeing in Reno, NV• In 2021, new builds typically sold 12–15% above resales• Today, builders are offering $15K–$40K in incentives plus below-market financing• Several new homes now underwrite better than 1980s resales, even before factoring depreciationIf you only pull comps from the MLS, you won’t see these concessions because they aren’t reflected in list prices.

E.g. what is the RUL (remaining useful life) left on the roof, HVAC, water heaters, etc...In general, I use 3% for maintenance and 3-5% for capEx.

That's like asking for credit because the roof might need replacing in a few years, or the furnace is beyond it's useful life but still working.

A roof used to be 4-5k for a brick ranch.

Roof was in shambles, we had it replaced.

, things to look for in a medium term (2-5yr) rental (no carpet lol, furnace, roof, and windows all intact), typical grading of neighborhoods you want to invest in.

New roof.

One roof, one tenant, one payment—it feels simple and predictable.

Builders often will put on cheap 3 tab roofs, vs a 30-40 year architectural shingle roof.Also way too many of the newer neighborhoods have HOAs and rental restrictions that prohibit or severly restrict rentals.