All Forum Posts by: Andrew Slezak

Hey Nick,

let's link up. I live over in Gadsden, frequently travel Birmingham, and dying to know what you see in Birmingham. I have 2 rentals in Chattanooga that started out as house hacks, looking to start my first BRRR or Flip by the end of this year. Also come from the construction industry on the material manufacturer side.

Hey y’all,

So it’s my first time finding a tenant for the duplex I’m house backing. I posted an add on Facebook market place and have had 10 people reply so far that are interested. Here’s the issue; I need to get this thing rented, but I’m only home 1 day out of 2 weeks and it’s Sunday. So I’ve been telling them I’m having an “open house” to come in and see it, if you like it and think you qualify, then apply. I’m back on the road for work at 6am Monday morning. And it’s been vacant for a remodel/appraisal the last 3 months. So needless to say I’m ready to put some coin in my pocket.

Anybody have some guidance on how to select somebody? What if all 10 show up and apply?! A damn good problem to have but sheesh, I can only do so much.

Interesting reads and I've been following what people are posting. As somebody who works for a building materials company, the home builders who make billions of dollars a year are not slowing down due to a lack of housing demand. In fact, they're building more because there is so much demand for new housing or "like new" housing such as a flip. I'm talking Pulte, DR Horton, David Weekly, Goodall, and of course many small local contractors. When people NEED a place to live, they'll find a way to pay for it. People NEED to work and make money, they will find a way to make money. I think maybe we will see a dip in the market, but not a crash. A crash will happen if everybody dumps there houses at the same time. I know for certain in the south some cities have been ravaged by tornadoes and now hurricanes. Many families have been displaced and have FEMA/Insurance checks. They need somewhere to live and have money. My point being that this is all speculation that we're going to bottom out again, but I don't see it coming. Are prices inflated? Maybe, they might drop so make conservative offers, and stock pile cash for that rainy year fund.

@Austin Wingett

Hey man, I'm also a fellow house hacker in my 20's. I bought a duplex with zero down rather than putting any money into it. Sure, it's in a rougher area than I'd like to be in but it's only for 2 years. See if your state has a zero down FHA program. I know people say always put 20% in, but if I have a duplex, the other person is paying the majority of my mortgage, and now I have more money in my pocket for when I need it, like for a real rental property. Btw, I have zero issues making my mortgage payment even without a tenant. Mortgages are cheap now, put as little down as you can, keep saving and use the cash for a different property. That's my 2 cents

@John McCurley mannn that’s a tough call. You’re talking to a guy who works for a building supply manufacturing company and I bought a good chunk of stock back in the initial drop in March. Then sold 3 weeks later on like a 50% gain thinking it was all going to tank again and I’d lose my job. Turns out we had a record setting year and if I held my stocks I would have quadrupled my money. But now the price is getting so high the rest of the economy is going to keep up. I think we’re going to see a hard hit stop in new housing developments due to the rising cost. Then after 3-6 months we’ll see prices come back down because yards have to sell off all the lumber they committed to which is typically purchased on quarterly agreements, in my experience.

@John McCurley well. As we enter Q3 of a booming market in construction, along with the logistical strain of COVID, building materials right now are incredibly high. Southern yellow pine is up 50% in most markets. OSB was 8$/sheet back in March and now it’s up to $24/sheet. Building right now is not a good idea IMO. And the market is about to catch up and realize that.

Hey y’all,

I bought my first house hack in Chattanooga, and I'm enjoying the process so far. It's a duplex that I got for 0 down. Long story short, I originally wanted to get the FHA zero down where the state does a 2nd mortgage to give you 3.5% down at 3.5% interest. However, when it was time to pull the trigger THEN my mortgage company tells me I no longer qualified due to the income from the property. So they changed the loan to 3.5% down on $169k at 5.2% interest with a stipulation that the down payment is forgiven in 3 years if I have no late payments. Easy $6k in equity, right? But if I refinance or sell, then I owe that $6k. My mortgage is $1281 a month, and currently rent out the other unit for $900 a month. I know I overpaid, but it beats the hell out of $950 a month and another year long lease in an apartment and I NEEDED a spot quick bf my gf killed me in her studio apartment we shared for 2.5 months.

What I’m wondering is if it’ll be worth it to refinance with today’s low rates at 2.9% and lose the $6k on the equity?

It’ll help me cash flow an extra $200 a month. With that $200 I can either save it for my next property, or just pay it as extra towards my mortgage and have $6k in equity in 3 years.

@Mike Paisley

Hey Mike,

I’m 28 and was in the same boat a little while ago. I’m stoked to see you getting after it. I was living in an expensive city I didn’t care to live in and actually wanted to be in an area where I could be outdoors more. Assuming said city would be smaller and housing more affordable. I loved visiting Chattanooga, so I moved here and bought a Duplex that I could fix up. I put 0 down with a double mortgage, one that’s 5% of down payment with no payments due unless I refinance or sell in 3 years, after 3 years of no missed payments the 5% is forgiven! Other 95% is regular 5.125% interest over 30 years. With my brother living with me and the tenant in unit B, I break even on my mortgage. All that extra money goes into upgrades. I made custom closets from plywood, scraped popcorn ceiling, and plan to buy new windows soon. Also saving for my next property.

All to say, I love having the duplex and feel like my “debt snowball” is now “growth snowball”

@Shiloh Lundahl I’m going to play devils advocate- 0 down on a duplex for $167k with a tenant with great history in one unit while I live in the other. I have zero debt other than this mortgage and I can afford it even if he isn’t there. I have enough savings for most repairs and if not I have plenty of credit available. Furthermore, I just freed up $1000 I’d typically pay on rent that’s going straight to savings.

I think telling someone they shouldn’t invest unless they have x-amount will only encourage analysis paralysis. Sometimes it just takes the right deal, discipline, knowledge, and grit to make something happen. I think if you’re going in with low savings, then you need to have all other debt paid off and have financial discipline. Now, my next property I won’t buy without a solid savings.

@Tristin Sellers hey man, I’m 27 and just getting started in this so not too much to say on the real estate side, but maybe some life lessons. First, patience is a virtue. You’re so young right now, take the time to try new things, make mistakes, and learn from them. I’m not saying you’re egotistical, but always keep it in check and live beneath your means. Stay out of debt and start saving for that next opportunity. It sounds like to me you want to get into rehabbing and flipping. What’s your construction or building experience? I’d try to get in with a builder/remodeler to start learning the trade and they can tend to pay pretty well. You’ll learn skill sets that will help you cut cost in the beginning. Or, work for a building supply company; I’m biased here because I’m a manager at an 84 Lumber in Nashville. But it has been a tremendous experience in sales and management. Not only that, but I have a huge network now of contractors, and flippers that I talk to every day. So when I need to get some help on my place, now I know who to call and owes me some favors.