All Forum Posts by: Adam Beckstetdt

I could pay cash but that would reduce my leveraging amount in the end. Maybe thats just what nicer duplex units go for. I would think I could just build some for that if I wanted to spend that much.

I definitely dont plan to buy one just to buy one. If it doesnt make sense I'll just invest in stocks until the right deal comes around however if I wait too long I know I will lose this tenant.

I have been researching some nicer Duplex deals and the ones I come across are listing for 160k+ when the rent is only bringing in $1500/month. There just doesnt seem to be enough meat on the bone in deals like this but it that typical for nicer duplex units? Does it have to do with the fact they are nicer units and dont require so much repairs.

I usually do pre numbers by the 50% rule. That leaves me $750 for my loan and cashflow and thats with a good size downpayment. Any experience would help. Maybe they are just not good deals and I need to wait. All of the other duplex units I am running into are in very questionable neighborhoods. I have a tenant that wants to rent from me but want it to be in a decent neighborhood. Thanks in advance.

My skin is crawling. Bust out the hazmat suits.

@Phillip Smith I havent started looking into property yet. I am currently doing my research to build my team and determining my purchase criteria. You are the first person I have read that a 7-10% is a standard amount. That may be true once I start looking at property. I will continue my research to see what is reasonable for my area.

Reading others posts they tend to have criteria along the lines of a 20% return. One poster I read yesterday stated they use a general rule of thumb that 60 months of income should pay for the property. 1000/month = 60k purchase price. 12k down. 50% for expenses. Leaving $500 for mortgage and cash flow. 30 year roughly $260/month leaving $240 cashflow. 240/12000 = 20%

This was one example that I read. Reality may be different.

Thanks for the reply Phillip. I'm not sure I am reading your reply right thought. I am planning on a 20%+ CoC. The 20% down is not mandatory however it seems to be close to in line with what I have been researching. Your deal listed above would only be a 7% return. Correct me if I'm wrong. Thanks

My wife and I have started our journey into buy and hold and are wondering how others have found the right team members and at what time. Looking for the right accountant, lawyer, broker, etc... can be daunting and we are hoping for some guidance. While I already deal with a good team for my job I dont feel they are going to be the right people for this section of our life.

Is there a good resource on what we should be asking them. When I used to do flips I never really found a team and I think thats why I was not as successful. I remember reading somewhere that you should ask if they invest in real estate too as a good lead. I do think that some people could be good resources without investing in real estate as long as they have experience.

Thanks for your time and thoughts.

I initially set my goals and honestly I think I am selling myself short. These were my initial goals.

This year - $1k/month in cash flow

2nd year - $3k/month in cash flow

3rd year - $7k/month in cash flow

I am starting with roughly $400k and I want to leverage this amount to maximize the amount of properties and cash flow. I will be working a full time job with alot of flexibility on time required. This will give me the steady income alongside deal flexibility. I want to create a very high but achievable goal with what I am starting with. I have experience with flipping but I plan on almost a strict buy and hold philosophy. I may run into deals that offer a good flip at some point and wont completely shun the idea. 

I'd appreciate everyone's perspective on what they feel is achievable. If I was able to close on a deal every 2 months and get $500/month cash flow that would put me at $3k/month at the end of the year with 6 deals. Obviously each deal has its own potential. I am going to stick to multi family housing idealy 4+ but I may do some duplexs as well. If I stick to deals where I will achieve a 20% ROI I will be putting out roughly 25k per deal and spend only 150k of my initial capital. Assuming the same return of 20% caps me at 12 deals and still leaving me with 100k for cash reserves. After those 12 deals I will exhaust a few lending options but proving I can be successful will open up other options for financing and one being my parents which could finance quite a few deals for me. Especially since they have a large capital just sitting in the bank.

Considering some of these point I want to reevaluate my goals. Id like to here from a few of the BP members with more experience before setting my goal amounts. I appreciate your time reading my post and especially since its probably all over the place.

I agree on the car loan. You can't get money that cheap very often. 

I have no issue with cc debt as long as I am using the money or other money to offset it. Let's say you have 20k in cc debt and 20k in the bank. Logic says to get rid of the cc debt but if you had a secure place to invest it and make a much larger return that what you are paying on your cc while still allowing you to slowly pay it down. This makes much more sense to me assuming it doesnt put a strain somewhere else. 

Now the DTI issue arises and also you want to make sure you are not maxing your cc out because that will affect your credit score greatly. I recommend 50% of the max or less.

I know I can get multiple different answers to this question but how fast is too fast in buying into  buy and hold investing? Obviously in your own experience.

I am thinking of putting between 250-400k in properties using leverage and as many low down deals as I can find that are good deals. I will most likely stick to 4+ multi family homes.