All Forum Posts by: Ellie T.

@Charles Morgan Insurance guy just confirmed he will insure for $1200 a year. I'm inclined to go ahead with the deal. The ROI is awesome. Still waiting for someone on here to give me a reason to not do that!

@Charles Morgan I am trying to find out if the house can be insured.  At least I want liability coverage.  I am not sure it makes sense to pay over $1000 a year to insure a 55K property.  Thoughts on that?

Thank you @Jeff Copeland.  I suspect this was part an attempt to get insurance to upgrade the house.  There is no visible damage to the house in the past 6 years and the inspector didn't find anything wrong at all.  

Hi All,

I need some advice. I was about to close on a buy and hold property and I had a hunch that something was too good to be true. There was nothing to worry about disclosed on the MLS, nor were there any permits that showed any reason for concern. Still, the hunch was there so I asked my realtor to dig. He came up with an investigative report from 2010 that showed that house has settled and it is suspected that this is due to sinkhole activity.

Based on this finding, I approached the sellers agent and he immediately agreed to drop the price of the home to 55K (originally it was priced at 80K).  As I said, not permit was ever pulled, and no damage to the property was found in the inspection.

I am buying it cash, and for long term cash flow.  I can rent it for at least $1000/month.  Yearly taxes are $900 and I am unsure if I can insure it due to the sinkhole.  I will be using a PM.

Would you go ahead with the purchase? closing is today so I don't have much time and would love to hear some pros/cons and any past experience.  What would you do?

@Colin G Murphy I received amazing service from @Jared Townsend.  He has responded to my emails well after regular working hours, and has provided policies for tenanted homes for me in Pasco.  Best of luck.

So there's a general message given out by realtors and others that buying properties off of MLS is a bad idea, and FSBO or wholesale deals are usually hiding something.

Would love input on this, and what extra steps if any do you take to mitigate the risk when buying off market?

@Account Closed  Since it was my first time in the area, yes, a lot of them I vetted just driving by because I didn't like the neighborhood or the condition of the house on the outside.  

Thank you everybody.  To answer your questions @Flavio Zanetti , @Jonathan Z. and @Agi Anderson I bought a SFH in Florida.

In short the process was:

1.  Identify the county/area I want to invest in.  This includes lots of reading, calculating, and deciding what type of properties to buy in each area.  Also made sure rental market was solid.  Wanted to make sure it meets the 1% rule and I can afford to buy a house there (which I can't where I live- the boston market is insane and Incouldnt find a property that met the 1% rule with only minor rehab within an hour away).

2.  Build a team (have a property manager I trust was crucial- they make or break your profitability).  I had to go back to 1 because initially I could not find recommended property managers in some areas I considered.  Also made sure to find an attorney, tax consultant, insurance guy etc and have them ready to help analyze options.

3.  Figure out how I will finance the purchases.  Since the market was hot I figured I would have to pay cash so I had to make sure I have enough cash for the first deal on hand.

4. Find the properties- being out state made it near impossible to buy off market. I also wasn't comfortable w that as a newbie. So I started going through the MLS religiously.

5.  Flew down to Florida For a 3 day weekend (took Fri off of work).  Booked in advance so I had dirt cheap flights, booked a cheap motel and viewed 70 (!!!) properties in 3 days.  Spent every evening running numbers.  Then submitted offers on 5.

6.  One closed :) that's it- waiting on inspection now.  Keeping my fingers crossed that inspector doesn't find anything so I won't have to walk away.  Paying cash, rehabbing, refinancing and renting it out.

Lessons learned- do a ton of homework (on BP and off), know what you want, come prepared and stay true to yourself.  I felt more comfortable investing in FL because I fly there on family vacations (now I can write them off as work trips since I will visit my properties. I also felt more comfortable starting with sfh maybe cause I bought the one I live in :). I also decided I would take a lower cap rate for a PM I trust than a higher one in an area without one.

Sorry my answer was so long- I should probably write a blog about this journey :)

Happy investing!

Ellie