All Forum Posts by: Alexander Felice

As many have stated, syndications that run a 506(b) deal can include non-accredited investors as long as there is an established personal relationship. These types of deals aren't allowed to advertise or solicit. 

This is why you don't see them advertising or soliciting ;) 

for single family rentals it doesn't command a price premium from the renter but does cost a significant price premium to install. Makes for a net loss to the investor, which is sort of the opposite of the point to investing. 

It makes much more sense on properties where owners pays utilities and plans to hold for a long time, but even then it's not yet an obvious choice. It's also very market specific, far more appealing in the southwest. 

Over time costs will come down and it'll become more and more viable, not sure we are there yet. 

More important than the numbers is the area and the ground team.

A great deal on paper in an area that a property manager won't go near is no deal at all, and it happens quite often. If it's such a great deal why have all the locals passed on it? Who exactly is going to manage it and what is that going to cost you? Do they think it'll generate the rents you are predicting? What kind of tenants does this place attract? What is the total rehab and has that been confirmed by a local contractor? Will that contractor actually show up to do the work for the agreed upon price? 

Might be a great deal, but these are questions that would have to be answered before anyone can tell if it's a good deal. 

OOS investing is a great opportunity to make money but comes with a myriad of pitfalls, the numbers are the easiest part, it's the data that people don't have or consider that sinks them. 

The only workaround I know is the delayed finance exemption, but it only works if you use arms reach funds (no HML) and you have to pay for purchase and rehab all up front at the initial closing. This allows you to skip the seasoning, but it's not applicable in this case.

second best way is to find a 30 year commercial loan product 

 You don't truly win an argument until they attack your person 

<3 

Get enough properties and you'll have crime problems to deal with, regardless of asset type. 

Less likely on A-class properties but statistically coming across this type of thing as a real estate investor is inevitable with enough time and scale. 

I personally think the low supply narrative is a bit overstated, and I think the runway for further appreciation is low. 

However, as Bill stated, people buy on payment and rate hikes will increase payments but slowly and in small amounts. I find it unlikely that this will reduce home prices but it could very well reduce volume of transactions, which could lead to further increased prices. 

trying to time the market is the first mistake every investor makes. Wwhat if it goes up another 50%? then you're still kicking yourself

If you're just trying to capitalize on the mania, that's also timing the market, because what if it goes down 50%? then you're kicking yourself 

The key is to design an investing strategy that suits your end goals and is matched with your personal level of risk and resources, then just have reserves and hedges so you can weather any downturns. Do not worry about where the market is going in the short run, worry about how to succeed through the inevitable 5-8 major downturns you'll see in your life. 

Cap rates are given a heavy over-importance on BP

For starters, as stated above it's irrelevant for smaller properties

secondly, If the place is low occupied or in need of repair then the walk-in cap rate isn't at all useful

thirdly, pro-forma cap rates are very often built on LIES and the most generous accounting to show a property in it's best light. When you get the property you find out the actuals are far different from proforma, and the cap rate along with it. 

Cap rate is important sorta like how the purchase price is important. You have to know it and you'll make decisions based off of it, but it's not solely how you make decisions.

 Zero need to speculate, go ask some banks what kind of loans they will do.

All banks are different, asking the internet what your local banks will do in a specific scenario like this won't produce much useful information.