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All Forum Posts by: Alexander Yates

Alexander Yates has started 2 posts and replied 49 times.

Post: New investor and new to the community

Alexander YatesPosted
  • Investor
  • Reno, NV
  • Posts 53
  • Votes 44

Welcome, Chris! 

I'm in Reno too. Congrats on your first purchases! Were those local or distance properties?

Cheers,
Alex

Post: Free and Clear Multifamily partnership advice

Alexander YatesPosted
  • Investor
  • Reno, NV
  • Posts 53
  • Votes 44

@Jordan Naeem,

Nathan and Jay make solid points above... is there potential for you to invest $50k and take a 10% equity position while reserving the additional $50k for another deal of your own or another partnership? Obviously that means your two partners in the deal you mentioned may have to increase their cash by $25k each.

I would also be weary of the expectations of your partners in regards to property management. Make sure you have all of your responsibilities and expectations (as well as your compensation!) clearly outlined in your operating agreement. I have been in a somewhat similar RE venture in Reno, NV where my partner brought the money and I did all of the hands-on work. If you aren't properly compensated for the boots-on-the-ground duties, it can start to feel unfair very quickly. Perhaps in addition to your hourly rate, you could negotiate an additional 5% equity stake for your effort? Or maybe you set yourself up more like a professional property manager, where you earn extra money for placing a tenant and/or a percentage of the rent each month rather than just an hourly rate when you have to jump into action. 

If you go the route of reduced equity upfront, that free $50k could go a long way in your market. I invest in the Cleveland/NE OH market as well, so I see a lot of deals there. I also understand the difficulties associated with getting your spouse on board. Once your new partnership is up and running, you should clearly outline the investment for her (in simple terms) and talk to her in a way that expresses 1) you understand what you're doing and how to be successful at it and 2) you can replicate this success and it makes sense to acquire more properties. It's important to address her fears and hesitations, which often include things like getting phone calls in the middle of the night from tenants, having all of your spare time taken up, what happens if a house burns down, etc. etc. etc. Then follow those concerns with solutions, such as having a system in place for tenants to make maintenance requests (including in emergencies), why all of your spare time won't be consumed by these investments, being properly insured against hazards, etc.

Your wife doesn't have to be passionate about real estate like you are but if you address the concerns upfront, it's much easier to get the ball rolling in the right direction. Then your $50k could get you a duplex in a decent area with a good lender and a little in reserves for repairs and upfront costs.

Hope this helps! Feel free to connect and let us know how this plays out!

Alex

Post: New Mutli family investor

Alexander YatesPosted
  • Investor
  • Reno, NV
  • Posts 53
  • Votes 44

Hi @Jimmy Alfaro,

I invest in commercial multifamily (5+ units) in the Cleveland, OH area. It's more of a cashflow play than appreciation but there are definitely deals to be had. Entry price points are much more affordable than anything decent on the west coast. For example, my partner and I acquired a 6-unit for $190k; currently undergoing a $150k rehab and should be worth $410k+ after all is said and done. Cashflow will be around $20k/yr (>30% cash on cash return). 

Not sure if you're looking to invest locally or where the numbers make more sense but feel free to reach out if you'd like to connect.

Regardless, keep us posted on your journey!

Cheers,
Alex

Post: Seeking Recommendations for Remote Property Assistance

Alexander YatesPosted
  • Investor
  • Reno, NV
  • Posts 53
  • Votes 44

Hi @Mo Nueman,

Depending on what exactly you're doing/looking for, there are a few options. The easiest one is to find an investor-friendly agent (which you can do here on BP), as Michael mentioned above. This is typically the method for on-market/MLS properties, as I'm sure you know, but you could also offer a commission to your agent if they help you with an off-market property. Agents are a great resource for the neighborhood insights you're looking for and are typically more than happy to take photos and videos of properties you're considering. Agents will have inspectors they know/have worked with in the past as well if you need recommendations and have a network they can lean on if you need more specific inspections (e.g., sewer line, septic, pest, mold, etc.).
Another great service that can help with all of these things comes from property managers. Even if you don't have a property to manage, you can start the conversation with them, explain what you're looking to do in their area, and they will be able to advise you on neighborhood insights, inspectors, and, once you have a property for them, have them go out for photos and videos.

Regarding photos and videos, another option I've used is a 3rd party platform such as TaskRabbit. The key is to be very specific about what you're looking for in regards to quality of photos, whether you want full walk-through videos or have them broken up by area, etc. When I hired this type of work out, I put together a full job description as if I were hiring a photographer/videographer. It's best to set expectations upfront and ensure they're going to cover all of the areas that you need to see.

For inspections, while it depends on what your main goals are (e.g., price vs. quality & comprehensiveness), you can usually find plenty online. I recommend starting with a certifying association such as InterNACHI, ASHI, NAHI, etc. (searching "home inspectors association" will give you all of these as top results), and then searching for a home inspector based on location. From there, narrow your results by checking out their services, costs, and many even provide report examples of actual inspections they've completed so you can know what to expect as a final product. There are typically local inspection companies that provide investor-focused inspections that are a bit more basic (e.g., testing main components, general mechanicals condition, basic roof condition, any major red flags, etc.) for a lower cost. These are the type of inspections you usually find wholesalers using because they're around half the price of a full home inspection (e.g., $200 vs $400, depending on your market and their services). Many home inspectors will also offer add-on services for the more specific inspections I mentioned above. I recommend putting a spreadsheet together as you're doing this research so that you only have to do it once. Choose your top ~3 inspection companies, contact info, etc. and then when you're ready to start due diligence on a property, start with your top choice and then utilize your backups if needed for availability, coverage area, or whatever other reason. Use this same spreadsheet and build it out anytime you're looking for new professionals in all of the trades. That's how you start an introductory vendor/contractor list. Then the next time you need to hire a plumber, you just go to your list instead of starting over with a Google search.

Finally, regarding neighborhood insights, if you're not using an agent, and don't find another boots-on-the-ground type person in your area, networking is the way to go. You can do that here on BP, for example. Use the search function to search the forums and blog posts first for information on the market(s) you're interested in. Chances are, there is a thread or 20 that already contain(s) discussion on what you're looking for. If not, start a new thread and/or connect with people that you see are active in the market(s). You can also search for real estate associations in the area, utilize websites such as neighborhoodscout (there are several others like this, which I'm sure you will also find in forums/blog posts), and sometimes even local entities such as title companies will put out information on their local market that has great info on demographics, price points, growth areas, etc.

Long story short - there are ways to get all the information you're looking for but in some cases it may take some extra effort if you're not working with an agent or property manager.

In any case, wish you the best of luck! Keep us posted on how your journey goes. And if you're looking at the Northern Nevada or Northeast Ohio markets (I live in Reno, NV and invest from a distance in the Cleveland, OH area), feel free to connect and message me for more specific referrals.

Cheers,
Alex

@Josh Thomas, are you utilizing a local property manager for this duplex? I think your questions would be better posed to them or a lawyer if you have one in the Cleveland area. Some lawyers will do a free intake call if you do not currently have one. I can provide some recommendations if you want to connect. 

That said, I have had some luck responding to code violations by reaching out directly to the city agent that is listed on the report they send to you. If nothing else, they may be able to at least answer the question of what to do regarding panel access for your upper unit. Permits are also relatively inexpensive in the area. You can find that info here: https://www.clevelandohio.gov/city-hall/departments/building... under "Electrical Permit Fee Schedule." The late penalty is $200+25% of permit cost and the permit itself may only be $50.
Regardless, now that you are on your radar, you should really consider trying to get everything up to code. But I would personally start by utilizing your right to a hearing regarding these violations.

Let us know how it goes!
Alex 

Post: Fix and Flippers In Cleveland

Alexander YatesPosted
  • Investor
  • Reno, NV
  • Posts 53
  • Votes 44

Hi @Syed Ahmed,

Is there a certain price point and area(s) that you have in mind? I am getting ready to start a flip and will be looking for more. Would be happy to start a conversation about starting with a known buyer in mind. Feel free to connect to directly discuss as well.

Cheers!
Alex

Post: New Investor ready to invest out of state

Alexander YatesPosted
  • Investor
  • Reno, NV
  • Posts 53
  • Votes 44
Quote from @Shawndra Brown:

Hi @Bradley Buxton. I didn’t think about Reno but Nevada is definitely a location I will like to tap into. It’s a lot closer than GA. Let me know how we can connect.


 Hi Shawndra, I sent you a connection request to discuss both NV & long-distance investing. Cheers!

Hi @Sainath Muntha,

Congrats on starting your investing journey! A lot of what people would recommend is going to be based on your strategy. What are you going to focus on? Traditional single family long-term rentals, small-large multifamily, short- or mid-term rentals...? Happy to share knowledge and resources depending on what you're looking to do. I encourage you to get very specific with your strategy and share it here so that others can contribute. Feel free to connect directly as well if you prefer to talk privately.

Regardless, keep us posted on your progress and good luck!

Post: Basic Duplex in Old Brooklyn - Cleveland, OH

Alexander YatesPosted
  • Investor
  • Reno, NV
  • Posts 53
  • Votes 44

Investment Info:

Small multi-family (2-4 units) buy & hold investment.

Purchase price: $86,200
Cash invested: $37,500
Sale price: $125,000

Duplex in the Old Brooklyn neighborhood of Cleveland (44109). Partnered with a local investor & Realtor who we connected with through BP. Acquired as a long-term rental, renovated to raise rents, and eventually sold around break-even because the timing made sense.

Learned several lessons about working with and managing contractors from a distance, utilizing local resources, listing/renting headaches and tenant screening.

What made you interested in investing in this type of deal?

This was my first long-distance real estate investment as well as small multifamily deal. Investing in the Cleveland, OH area reduces financial barriers but comes with its own set of challenges. My primary partner and I were looking to scale up (i.e., from single family to multifamily) and this seemed like a solid "base hit" to do so.

How did you find this deal and how did you negotiate it?

Local investor and Realtor connection through BP helped find the deal and acted as agent for the purchase. We agreed on a small equity stake in the deal for local support as well. Offered slightly below list price based on analysis and later negotiated a $3k price reduction based on inspection findings. Other than that, it was a straightforward on-market deal.

How did you finance this deal?

Attempted to fund this with one local (Cleveland) lender who was not very responsive and almost killed the deal. Found another broker connection through our agent/partner who was able to help us close this deal with conventional financing. Nothing fancy; 25% down, 30-year fixed market rate mortgage.

How did you add value to the deal?

By renovating the units and bringing rents up to market rates, we were able to add value in the form of both cashflow and equity.

What was the outcome?

Sold this property in December 2022 when the market was still pretty hot. The timing made sense while my primary investment partner and I were looking to scale up into commercial multifamily (5+ units) and our local partner on the ground was neck-deep in another business venture. Basically broke even when all was said and done but learned a lot.

Lessons learned? Challenges?

Always trust your gut!
- One of the contractors we worked with had done some other work for our agent partner but his communication was lacking as was (we learned later) his attention to detail.
- A tenant we approved in our first renovated unit looked great on paper but our agent partner who also helped manage the property felt like something may have been off with them, though he couldn't put his finger on it. We ended up approving the placement anyway and ended up having a lot of issues.

Post: Hi there, new here and looking to learn/connect

Alexander YatesPosted
  • Investor
  • Reno, NV
  • Posts 53
  • Votes 44

Hiya, Ry,

Congrats and welcome! I recently started moving into the commercial multifamily/apartment space (5+ units). There are a significant number of opportunities in the area. If you're interested in growing into larger deals like this, feel free to send me a connection. I could use another set of boots on the ground to check out off-market deals, including taking pictures & videos, and would be happy to share my knowledge and processes with someone like you looking to add value there.

Regardless, wish you the best of luck! Keep us posted on your journey.