All Forum Posts by: Andrew Reyes

Hi Oyin - Congratulations on the NE portfolio and I look forward to following your success in development. It seems that you are contemplating built and sell. What do you think about build-to-rent? If your all-in cost to build for below market value and you are able to place quality tenants, then you should be able to leverage the completed project in a way that allows you to pull out some of your initial investment tax deferred to fund future investments while keeping the rental income and future appreciation.

I am a CPA by day and advise many developers on tax strategies. This is not tax advice and you should speak with your tax advisors. Developers have been using this strategy for decades to defer taxes. Often the developers will raise LP capital to fund the project and the developer will share in the profits (i.e., 80% LP and 20% GP). This structure supper charges the tax deferral for the developer.

Hi Russell - I would use $3,500 as market rent. There is a comp on the block at $4,500 per BP rent estimator but it is larger with 4 bed and 3.5 bath.

I am looking for advice on the best way to keep a property in Montclair NJ. What would you do if you were me?

The property is currently being used as a primary residence (looking to move to CA) and was purchased in 2021 for $650k with a 30-year fixed rate mortgage and PITI is just over $4k per month today. The property is worth approx. $900k, which would be almost $350k in equity today with $250k all-in for down payment/closing/rehab. Rehab consisted of complete gut renovation of kitchen/dining area, new hardwood floors and refreshed bathrooms (new vanity and paint).

I am bullish about the long-term appreciation prospects of the property and have trouble envisioning the hold strategy over the next 10-15 years. The property has walking access to local parks with playground as well as nature walks. Under 10 min drive to Montclair State University, Upper Montclair NJ Transit station and close to route 3/garden state parkway intersection in a great kid-friendly neighborhood.

With 4 bed and 1.5 bath the current layout is ideal for a family. I am concerned that the local market will not support long-term rentals as I do not see any listed that are comparable size and bed/bath count. I think of Joe Asamoah with the Section 8 strategy deployed in Washington DC and keeping tenants for many years (even decades), but maximum reimbursement appears to be $3,740 for 4 bedrooms and market rate family tenants will likely turnover every year or two as they would likely be looking to own in the area.

I think rent by the room (students or university professionals) would be the best way to cash flow the property while paying off the mortgage. I was able to comp single bedrooms at $1k per month with shared bath and $1,800 per month with separate bath. This property has 4 bedrooms and only 1.5 bath, which I worry is not ideal for this type of living situation.

The house is a split ranch with one car garage and 2 car driveway. The ground floor has a family room with access to attached garage, 1 bedroom, .5 bath, laundry and access to modest backyard. Basement is partially finished with access form the ground floor only. 1st level is open concept kitchen/dining room with reading nook and oversized windows with great natural light. The second floor has 3 bedrooms and 1 bath.

My plan would be to convert the garage and living area on the ground floor into additional bedrooms to make 6 rentable rooms ($6k per month total revenue) with shared kitchen. The bathroom count is too small for this number of bedrooms so I would plan to convert the ground floor half bath to a 3/4 by adding a shower and adding an additional full bathroom upstairs attached to the main bedroom, which could connect to the pipes. etc. for the existing bathroom.

Hi All - I am in the process of analyzing a deal in the Town of Islip that the numbers work as a house-hack, but is it allowed? The property is zoned for single-family residential but the listing agent said it could be rented by paying a $250 - $500 fee to the town and getting a fire inspection. Does anyone have experience with this? Any resources I should check out?

Rental Occupancy Permit Application

Town of Islip Code

Any thoughts on what neighborhoods are B/C locations?

@David Ribardo Great information here, any update to the Cap and vacancy assumptions? We have been analyzing and offering on MLS deals and 10 cap in Allentown seems way too high for listed properties.@Justin Black

Starting a BRRRR business what name should we use? These are variations of our initials. Thanks!

J&A Properties

R&B Properties

I am considering the Lehigh Valley market and live about 2.5 hrs away. Any recommendations for rockstar team members? Realtor, Contractor, Property Management, Lender. Thanks!

I am considering a market about 2.5 hrs from where I live. No immediate connection but I have distant family there so I am somewhat familiar with the area (visited a handful of times in my life). I found a realtor who invests while running a property management business and offering her realtor/PM clients access to her own construction crew.

I am concerned that this is putting too many eggs in one basket. I would prefer to have an unrelated party for each step of the process so that there are checks and balances throughout. This individual was referred to me by a mortgage broker that I have no prior relationship with.

Thoughts?

Any updates? Interested in this market.