All Forum Posts by: Amit Kal

Not to state the obvious but why not just asked the seller to show you the leases and proof of the rents being deposited for the last 3 to 6 months? Beyond that it is YOUR responsibility to know the local rental market and current rents being asked for units of similar size and condition. Where I am invested out of state, I have local property managers I work with closely who can give me that information so I can run my numbers before making an offer. GOOD LUCK!

I'm kind of in the same boat as you except I'm planning for college from my 8 month-old. The challenge on your side is that you have education related expenditures happening now and on top of that you want to also invest into cash flow producing properties to offset your current liabilities. I invest in lower B class properties in a strong market (Nashville) where I can cash flow (NOI even after all set-asides for PM, major repairs, etc) about $300 a month for every $170K home I purchase. Now it costs me about $40-$50k out-of-pocket to acquire that home. So using that as a rule of thumb, if you have about $150-$200k invest you can definitely see your goals met depending on the market. The only difference is that your cash flow would be continuing on well past when your son finishes school. Good luck!

Hi Lakeisha Smith. Why is your interest rate coming in so high? Sub-prime credit score? You should definitely take advantage of first time home buyer programs which will provide you with better rates and lower down payment requirements. Seeing as you are in Rochester, from my research I know there are many triplexes and quadplexes there, even in nicer neighborhoods. My personal suggestion to you would be to look at either triplex or a quadplex and which you will have as your primary residence in one unit and rent out the remaining units. How much down payment money do you have so far? If you can put down 20% to 25% that would be great because you avoid PMI and it gives you significant equity and more cash flow cushion in case you end up in any precarious situations like where a renter stops paying. Live there for 1 to 3 years so you get the hang of being a landlord which will also give you time to save for your next deal.

Jennifer Corredor first of all sorry for your family's loss. Your story sounds eerily similar to mine (dad passed, find myself going from no responsibilities to many tenants, rent regulated building, helping my mom cope, etc). There is no doubt a learning curve but it's manageable. I'm happy to help with any guidance or questions you might have. I'm also Queens based and REI is not my day job, but now it's a sideline business I actually enjoy. Feel free to shoot me a note.

Your USDA home sounds like it will be a break even proposition if you rent it out but that's not a bad thing since you put no money down on it! 

Do you have the money saved to buy a $150k home all cash to do a BRRRR? If so, then stay where you are and start your REI career by looking for your first BRRRR investment.

My personal advice would be to stay where you are, bank the extra money you are making at work and use that for down payments on future investment properties. 

Yes we all want to live in our dream home as soon as possible. but wouldn't it be better moving into your dream home knowing you have 5, 6 or even more units bringing in enough cash-flow to offset some or most of the PITI+expenses of your dream home?

Make an offer but make it contingent to (amongst other things) seller being able to provide documented evidence of rent payments going back at least three months. Request the leases as well. Your property manager should also visit the place with you and have a good handle on if the rents are in line with comps in the immediate area. YOU should be also be looking at comps in the area to get a feel for how the units compare the one you are making an offer on. This ain't just about paper analysis and pointing and clicking only.

New York and the surrounding areas are very difficult to find cash-flowing rental properties for a number of reasons. The two main reasons are 1) there are too many guys out there doing this full-time, focused and very entrenched in each local neighborhood-getting an edge to find below market deals is difficult; 2) way too much capital chasing very few deals which lowers yields to the point where break-even is even considered a deal. It is one of the reasons I moved on from investing locally. Now just recently when I saved up $20k, my partner and I pooled our $40k and bought a $130k duplex down south, rehabbed it for another $30k and rent out each unit for $1300/month. I still live in NYC and probably always will, but my attitude is "get in where you fit in." NYC investing (for rentals) is for the real big dogs with lots of capital, and long time horizons to wait for appreciation (and gentrification). But if you're determined then you just need to be creative. Someone mentioned house hacking, great idea.

Welcome @Jason Stephens! Lots of NYC based guys here you will be able to get advice from. 

I'm in your boat, FT day job and looking for passive buy and hold. I've been working 9-5's for 16 years now, bought my primary residence 11 years ago. I didn't pick up my first investment property until 5 years ago. 

In that time, I've been able to accumulate 7 units in Queens, and over the last year 7 units in Nashville which I picked up with a partner. I've never done a flip. 

All of this has has put me about half way to your magic number. I figure it will take another 4-7 years to get to $7k a month NOI passive at which I hope to FI btwn REI and stock market investments.

I do think it's worth point out that in NYC/LI, the playing field is definitely not level and things like this make it even less so: http://www.npr.org/sections/money/2016/05/27/479717380/episode-703-how-to-hide-a-million-dollars-in-plain-sight

Any questions, feel free. 

Best of luck!

Welcome to NYC. 

Best of luck in Brooklyn. Most Brooklyn guys have moved on to the Bronx after picking Brooklyn dry so keep your eyes open about that borough as well.

How did this deal turn out for you Jacqueline Pelzer ?