Embrace transparency and communication with builders to avoid surprises.

Even if you don’t buy right away, it’ll help you spot a good deal when it shows up.Real estate is a team sport, so focus on relationships early, you’ll be surprised how many doors that opens.

I was also surprised how much of my own capital starting out you need between closing costs and floating the repairs until you get the work done and get the money back from hard money lender. 

They’ll not only save you from bad surprises but also often bring you off-market leads.

Just be sure you’re comfortable with the opportunity cost.On paper, a $3,837 monthly net looks solid, but reality often runs tighter with occupancy swings and surprise expenses.

Hey Robert, I would like to recommend something that I have found helpful.Very simple- go to a mortgage calculator online (a free one that does not require you to input any information about yourself)- take the amount of $100,000 as your purchase price, and play with the variables- hold everything constant, but vary your down payment amount (5%, 10%, 20%, etc) and see what that does to the mortgage amount- then hold everything constant and do the same for interest rate (4.5, 5, 5.5, 6, 6.5, etc)By doing this on a simple amount of $100,000, you can begin to see the magnitude of changes to down payment and interest rateDepending on the situation, this may end up surprising you.

I am surprised to hear Reno.

That way, we avoid surprises down the line.

Spend time running conservative numbers on rehab costs, rents, and refinance values so there are no surprises later.

Emphasize that it’s a deferral (recapture comes later), but often by then you’re doing a 1031, refinancing, or they’ve rolled into a new deal.Offsetting K-1 Surprises: Depreciation helps smooth out years where operations are tight.