All Forum Posts by: Adam Scheetz

@Quincy Lockett the low vacancy is a point of pride that they tout over the last 10 years. I don't know how'd I'd independently verify that number without seeing all their tenant records.

@Heather Schmidtknecht Where are you located? Does that mean that you break even or slightly above that every month? I'd love to know more. Thanks!

@Syed H. I am 100% on board with flipping and holding a property myself, even partnering, Refi'ing, and paying out if there's enough meat. Problem being, as I mentioned initially is that the process of putting together an out of state team is doable, just not quickly. And in the interest of experiential value and soliciting financial partners, a couple cash flowing properties and a couple of local flips looks better than a bunch of analysis charts and inaction. I am a full time military officer and will be for the next 10 years. My target is actually as you said 9-12% @ 20% down. I typically do 8% CapX, 5% Mx, 10% PM, and 6% Vacancy. The reason why I went lower on some of those is because of the nature of the Turnkey property and the level of rehab and updating that- to me- allows for a reduction in those areas. Could I be mistaken by doing that, maybe...likely...but that's where my thought process was. Additionally, I never bank on appreciation unless I build it into the deal. As in, a foreclosure + Rehab that puts my ARV at or above market so I have a nice cushion of equity built in. Forced appreciation is the only appreciation I think you can trust with some certainty.

Much Appreciated,

Adam

@Michael P.

I've said it's Memphis. It's @James Wachob and his team at Memphis Investment Properties. He has a lot of free content and knowledge on the web. He's been timely and professional every time we speak. He's forth coming with his criteria for property selection and has answerd in detail every question I've had. Additionally you find a lot of reviews online and BP about how he does business.

@Dennis M. The 1% rule part does bother me because that's one of those general rules I look at. But that's what prompted the origination of this post.

@Caleb Heimsoth the articles were 2018

@Jay Hinrichs I've read enough "oops Stories" where people have done just that. Assumed that the Median Price would be their price on a discounted property only to find their ARV was on the lower end of the spectrum. The bad news is that researching and due diligence seems to be very time consuming, the good news is I can learn a lot by looking at all different facets of market to see what makes a deal sustainable and what doesn't. I enjoy the education aspect of all this but fear the analysis paralysis will get me if I ONLY analyze. I really appreciate your insight.

@Jay Hinrichs I'm not sure where $625/mth came from? This is a SF @ $1250/mth. I'm sorry if I eluded to it being a duplex. If it were a duplex I would certainly expect more per door.

Are saying you have properties where you are netting $1k-1.5k per door? Where is that at? And also, i'd assume there's no financing involved? 

This provider, in addition to 3x rent as qualifying income, they also look at the budget, credit, and spending patterns of the prospect tenant and see their DTI ratio as a contributing factor. Like you mentioned, it's not just W-2 income, but what debt they have.

That being said, $3750 is the new qualifying income, minus $1250 for rent, minus $200 for utilities, minus $150 for Phones and TV, minus $1000 for two expensive vehicles. That leaves them $1150 for food, fun, and savings.  Do those numbers sound more realistic? $45,000 annual take home seems middle America to me. Let me know your thoughts! Thanks.

@Sen A. I always up the rate for a conventional loan to provide a bit of a cushion knowing I'll be sub 5%.

As I progress further I will certainly be calling references. Thanks for your feedback!

@Niels Bjørn Toppenberg

http://www.noradarealestate.com/blog/invest-in-memphis-real-estate/

https://www.fortunebuilders.com/memphis-tn-real-estate-market-trends-analysis-2018/

Norada and Fortune Builders have good articles talking about different aspects of the memphis market.

Basically, the market is appreciating around 6-8% depending on what source. Other factors include large corporations and non-profits dumping money into the local community.