All Forum Posts by: Adam Widder

@Patrick James thats a good summary. thats exactly what we ended up doing with this property, closing soon!

@Andrew Morem Currently, I do not invest in MSP, we're moving there next summer and we'll begin investing there. That being said, @Jordan Moorhead, above, is a RE Agent who specializes in working with investors, he's set up MLS search for my criteria and has helped me gain knowledge while I'm currently out of state. He's an investor himself.

My 2 cents on convincing your wife or for the women on the site, your husband, or SO... My wife was getting lost in the numbers and didn't care about that and she's an engineer.  What she cared about was the other life values and what the 3rd form of income would mean for our family 10 years down the road or early retirement.  See what emotionally or intrinsically motivates her and show her how real estate will make that come true. There's many successful women investors on the site and threads on this I'm sure, but that worked for me, now she wants to dig into the numbers with me.

@Andrew Morem Welcome to BP! great questions. I don't have knowledge of the greater MN market. I can tell you there are quite a few properties in MSP that cash flow well, that are on the MLS. Talk to an investor friendly agent and they can help you. A fast way to get started would be to house hack a property in Plymouth or neighboring town or closer to where you and the wife work. That would increase your savings rate!

If you are going to manage it yourself, me personally, I would not want to drive 2 hours to a property.  I feel that would get tedious. Say you have a toilet problem or a simple fix. you would have to drive 4 hours total to maybe fix a 15 minute job. Again, personally, if i was self managing I would want it to be local to me, that way I can swing by that day when I run an errand or on the way home from work, or if there's a crisis I'm 30 minutes away and it doesn't ruin a whole Saturday.

@Jason C. So generally, put down whatever you want to, 3.5 FHA, VA, 5% conventional if SF or 15% conventional if MFR.  You will most likely use one of those products if you're living in the residence, which you said you were.  Essentially yes it's a BRRRR through your own financing and not not using anybody else's, but since you're living in the property you are BRRRR the property to yourself in financing terms if that makes sense.  There's no outside financing, just what you are providing.  

Example: you put 3.5% FHA down, occupy, renovate, live in for a period of time, refinance, then rent.

Yes, you will want to check the numbers, it will need to be in a place where you can get equity, so in disrepair, or purchased will below ARV in order for you to get the equity to count on the refi.

@Michael Plaks great thanks, we'll definitely be talking with a CPA.

@Ashish Acharya @Michael Plaks if we know we're moving because we're leaving AD military, that would then not allow partial exemption because it was planned? Am I saying that correctly?

@Ashish Acharya thanks for the clarification!

@Chad Clinton for an agent for investment properties, @Jordan Moorhead comes highly recommended from many in the MSP market. 

@Tim Swierczek is a standout option for a lender

IMHO some areas are already to hot or exploded, like NE Minneapolis, Uptown, South of 94 in Saint Paul. There's still a great bunch of small cities neighboring the TC's that are highly desirable. Most in TC investors focus on cashflow versus appreciation, unless some macroeconomics happen, appreciation will take years, (Most the time, always exceptions) you'll find most deals cashflow, when I open the MLS and run numbers most properties cashflow and have a good neighborhood.

BP,

We're looking at buying a SF for us to live in for the short term verse rent for the next year before we move approximately fall 2019. We'd like to make some money as the house we're looking at has good bones, but looks like the 70s walking in. Here's the numbers:

Purchase: 136k, 5% down = $6800 + closing costs and prepaid insurance will be roughly 10k down

ARV: 175-180k, have to see how the neighborhood does in the next year, my realtor firmly believes 180.

Rehab: 15-20k, all done by us.

So after putting 20k into the property, that leaves roughly 24k of capital gains tax.  If I sell it fall 2019, because we're moving, would partial exclusion allow us to keep most the 24k in profit?

Or, is there another strategy you think would work for us? We'l only live in it for a year maybe 18 months depending on how long my wife stays, but I'm definitely leaving fall 2019.

@Ashish Acharya what do you "wipe out?" mean, no profit? Because wouldn't the partial exclusion allow me to avoid some capital gains and keep most the profit?