All Forum Posts by: Kase Knochenhauer

Welcome Sarat!

There are a lot of knowledgeable investors locally that would love to help (me included)! Meet up with Charles Kao, who is a wealth of information, or join a local REI meetup. You'll gain so much insight in just a few hrs; well worth the evening out.

As a physician your time is worth a lot - leveraging other investors to find you deals is going to be the way to go.

Feel free to shoot me a message if you'd like to meet. Looking forward to connecting!

We love to use Rentometer.com (it's free!) for our rental rate estimations. After putting something under contract we go deep with our property manager as well.

I love success stories and wanted to quickly share one of ours. :)

Here's a case study for a BRRRR property in Muskegon Michigan:

Purchase price: $15,000

Renovation cost: $16,500 (new paint, new flooring, new bathroom, new roof, exterior repairs, landscaping)

Rental Rate: $800/month
Appraised Value: $50,000
Cash Out Refinance Loan: $37,500 (20 year Commercial @ 3.9% interest with local bank)

Result: infinite returns, ~$200/month+ cash flow after cap ex and all expenses, $12,500 of equity in property, $6000 cash-in-hand at refinance closing.

How we did it: we flip properties full time and have a dozen contractors that work for us exclusively. This gives us the best prices and turn time for flips and BRRRR properties. We completed this property last month.

Financing: Cash purchase and cash repairs. Commercial cash out refinance.

Time frame: 3.5 months from start to finish. 

What are some things that you did to ensure that your BRRRR was completed successfully?

Here are a few photos of our project:

Joseph - welcome to BP and the investment world. :)

There's a lot of knowledge out there to get yourself started. If you want to ramp up your forward movement start finding a way to talk to distressed sellers. Decide if you have more money or more time and create a marketing strategy that fits your budget and schedule.

Search BP for ways to get free seller leads if you lack money. If you lack time work with an established agent that can help you out.

You've got this!

24 Unit residential multi-family comprised of 3 buildings. Central location offers easy access to downtown, ample parking, and current 100% occupancy with great cash flow. Recent improvements include boilers ($31k), new air conditioning units ($10k), covered parking, coin laundry, with many units totally renovated. Low-maintenance brick exterior and updates ensure property cash flows at close.

For more info and photos visit: www.gullapts.com or call 616-405-8635

Yes! You absolutely can write an offer on a property - but make sure it's contingent on approval of HELOC. Your agent should be able to write a standard PA with a note in 'other provisions' or with an addendum that states that your cash purchase is contingent on HELOC approval.

Talk to your agent. He/she will be able to give you insight on the local market practice. Be upfront with all parties involved and you should be able to move forward with no issues.

Has anyone ever offered a very small incentive to tenants so that they actually report necessary repairs to management company before the small repair becomes a real problem? (ie. leaking toilet, leaking rook, electrical issue, etc.)

Here's the dilemma: if you make the incentive too large, the renters may vandalize the property to get the reward. However, if it could be implemented, property repairs would be reported accurately and in a timely manner.

In terms of a reward, my thought was to keep it close to the $10-$20 range. Perhaps a gift card, dessert, or something simple.

What are your thoughts? Has anyone tried this before? How did it work?

Bill, it sounds like you've been thinking plenty about it and considering it from numerous angles. Here's the decision as I see it:

Does the time flexibility and lucrative pay of being a property manager outweigh the highly illiquid nature of this  investment?

Secondly, would you purchase the complex if you couldn't manage it yourself? If not, I'd think twice about the purchase.

Jakub, it takes 10 minutes to put an offer together. Put it on paper. 

The scope of the offer varies much more than price. For all involved, reduces confusion and ensures that everyone is on the same page. 

Good luck!

Bill, it sounds like a great opportunity to buy a property management job. But when push comes to shove - at that price, with current rents, and a high interest mortgage - turning a handsome profit will be difficult when you're tired of managing and repairing the units yourself.

It's very different opportunity than your current property portfolio. Better a little caution than great regret.