All Forum Posts by: Andrew Freed

@Michael Ray - Have you considered a RELOC or a HELOC on one of your properties to create a "nest egg" in case any of the surprises you mentioned occurred. A lot of these home line of credits are interest only for the first 10 years and you can grab up to 85% of the ARV hence you can grab funds for any life emergency very quickly no questions asked. Additionally, you can access these funds to expand your real estate portfolio while maintaining a good appreciating asset in the bay area. I do not know your circumstances, but this would be an option to consider. Please keep in mind that lines of credit are only meant to be used to purchase assets and be emergency funds, and not to buy liabilities.

@Emily Lee - If you have enough for the 20% down payment, you probably have enough for a hard money loan + rehab costs. Or you can do a HELOC on your primary residence and use those funds to pay cash and do conventional later. Your plan definitely works, but getting a loan via conventional loans carries a lot of closing costs hence you need to find a really good deal to make it worth it. Like I said, I would look into a hard money lender or a HELOC and then use the refinance to pay those funds down. In addition, since you are new investors, I would connect with an investor friendly agent who can guide you through your first transaction, which can make or break your career in real estate.

@Kathryn Schauer - In my area (New England), it is a best practice to have gutters on all structures and have them lead away from the property. You always want to get as much water away from your property as possible and gutters do a fantastic job at this. They are also one of the cheaper solutions. 

@Khaled Eissa - As people mentioned, it all depends on what you are looking for. Personally, I would have liked to purchase near the Boston area, but it was too expensive for me and the cash on cash returns where minimal at best. That is why I started purchasing in the Worcester area since it was on the cheaper end, had a high stock of multi-families, and cash on cash returns were better. But at the end of the day, Boston is the heart of Mass and being close to this epicenter is the best bet for long term wealth building. The stock is low and super competitive though.

In addition, if you are in the western mass area, I know of a great real estate meet up occurring soon. Check it out, it seems like a great place to network with other investors in the Worcester area and get a lot of your questions answered. Below is a link:

https://www.biggerpockets.com/...

@Andrew Duncan - You are in a great position. All good problems to have. Given the uncertainty and the fact that you may invest now or later, a HELOC would be a great option to access the equity when you find the right property. I personally utilized a HELOC on my primary residence in Boston and used it to buy my next two real estate deals. I currently have a 3 family in Worcester and am working on closing another 3 family. In addition, if you are making so much, you should be able to pay down the HELOC very quickly if you did utilize those funds for a down payment.

Lastly, if you are in the Worcester area, I know of a great real estate meet up occurring soon. Check it out, it seems like a great place to network with other investors in the Worcester area and get a lot of your questions answered. Below is a link:

https://www.biggerpockets.com/...

@Barrington Webb - Not a bad problem to have in this market. I would recommend getting some contractor bids and seeing the extent of what it would cost to renovate the unit. If the numbers make sense from a BRRR perspective, I would prepare a slide deck and present it to some local investors or family members. If it makes more sense as a flip, you could always sell it to a wholesaler or take on the project yourself with an investor in a similar fashion. Do some research on the numbers and let us know what you find, if a great deal is there investors will come.

@Account Closed Hi Arian. Great question. I tend to work with a mortgage broker, but from my experience, I would look at small local credit unions or banks that can offer these services. I would like to mention that normally these loans are accessible to people with pre-existing relationships with banks hence it is always better to get a warm introduction from a seasoned investor to that local bank.

In addition, I do know of a real estate meet up occurring in the Worcester area soon. Check it out, it seems like a great place to network with other investors in the Worcester area and get a lot of your questions answered. Below is a link:

https://www.biggerpockets.com/...

I hope to see you there.

@Lina Chen - Have you considered running numbers on an Airbnb in a great location or a rent by the room model near a school? In these high appreciating markets, you really have to think outside the box on strategies that will cash flow. The normal rental model simply does not work in SFH for some of these up and coming markets. For instance, I was looking in Austin TX and found that a rent by the room model (they have property managers out there that do this) seemed to make way more sense than a SFH where your cash on cash return is minimal at best.

@Joshua Steven Ferrell - Super broad question. I think you need to figure out the specific area you plan on investing in, talk with other investors about what sort of returns you should expect in that area, and base your criteria on those numbers. Every area's ROI is different depending on the areas appreciation vs. cash flow potential. Once you have your criteria set, e.g. certain amount of ROI or cash on cash returns, it is just a numbers game from there on out. Just gotta run the numbers on countless properties until the right one that passes your criteria comes across your desk.

@Mindaugas Maciulis - Nice, I've personally never dealt with section 8, but I do see a lot of investors utilizing this, especially among multi-families. See if you can rent the garage for $100 or $200 a month. Add to that cash flow!