All Forum Posts by: Adam Hughes

@Rick Gibson

Thanks Rick, I like this feedback. Hopefully we get a chance run across each other soon.

I’m in Troy, IL.

Thanks!

Hello,

While my description says I’m from St. Louis in all reality I live 20 minutes from downtown on the Illinois side of he river. I’ve grown up here and know this side of the river very well. The book I just started reading “Crushing It” made a point about home field advantage. I live in a town of about 10k and am surrounded by towns of 1k-30k.

In addition it seems that the old guards of multi family are starting to shift and I’ve watched new buyers enter the market. That said there are quite a few deals right now in these communities that are offering conservative returns. That said I’m yet to make an offer and this purchase will be my first multi family unit and only second unit in total. I’m considering buying between 1-3 duplex to 4plex.

My question, am I selling myself short by not looking in St Louis city or is the home field advantage a good strategy starting out?

Thanks

@Ben Lilley

While I respect what others are saying here, there is no actual “cap” standard or regulation. Banks may set their individual cap to mitigate risk of their portfolio to one individual. Does your lender work directly for a bank or is your lender a broker? I work with a broker and he will do my kind all day, then sell them to BoA, Wells, etc. and off to the next one. If he works for a small bank then at some point the loan committee may step in and say enough is enough and if he/she works for a large bank there likely is a cap on the amount they will hold. That said they too could sell a portion of your loans.

One piece of advise I’d give you is diversify your connections. Go find another lender and give them a try on the next one until you find at least a second lender you like working with.

Hope that is helpful.

@Patti Robertson

Newbie! It’s updated now.

@Patti Robertson

I agree with you for sure. Thanks for the boost of confidence. The largest hurdle is overcome now as I finally got my wife’s buy in. Finding the property is the next goal.

Thanks again!

I’ve sat on the couch for the past 10 years and read book after book on real estate, spent 10 years in banking watching everyone from developers to section 8 land lords make deals, and am ready to do something about it.

I currently own a single family but it was only because we didn't want to try and sell 6 years ago. I've been fortunate in that the same family has been in that property for the entire time. Now I'm looking at it as an investment. I've created my spreadsheet to calculate NOI and cash on cash. So far all the deals I've looked at (other than my single family) are around an 8-10 cash on cash with some fairly conservative estimates on expenses. I've included 5% of revenue for maintenance and 5% of revenue for vacancy. In addition I'm only looking at top school districts.

What am I missing?

What other advice might some of you have?

Thanks in advance.

Adam Hughes