All Forum Posts by: Andrew W.

Some similar threads: 

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

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

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

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

Invest in what way? For long term rentals, I would recommend connecting with Gold Medal Property Management. They will give you good advice on good and bad areas for rentals, what true market rents are, etc.  

Hi @Jocelyn Mo, I posted on this other thread about how to connect with wholesalers to purchase off market properties that need work and what that process looks like. Check it out and feel free to PM me and I can recommend some specific people to reach out to.  

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

Check out this thread on Austin rentals https://www.biggerpockets.com/...

LLC has been discussed a thousand times on these forums. This is my favorite article on that topic https://www.themoneycommando.c... 

Any recommended real estate investor friendly local lenders where I might not have to deal with such a transfer concern?

• Not if you are using conventional financing. 
• If you want to buy with the LLC at a higher interest rate you can do that from a commercial lender or hard money lender.

Sounds good, I would just be very cautious of any high cash flow numbers that you see on Class C and D properties in Killeen. It may not play out like that in reality if you have evictions, damage, etc. Solid property management is super important up there, I recommend Gold Medal Property Management for Killeen/Temple/etc. They will steer you to realistic expectations and neighborhoods that will work. 

It's not easy, but off market deals in the Austin suburbs can still break even or cash flow a little especially if you don't mind self managing. I shared some examples in this thread. 

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

I've invested in Killeen some but I would only do that when it's an excellent deal, be very careful on neighborhood, and I would assume no appreciation above the rate of inflation. 

I would keep it, mainly for the learning experience of being a landlord. 

I would not bother refinancing, especially if you only plan to hold it for 5 years. 3.75% is excellent. 

If you are looking to get experience in this business you can take pictures and list the rental yourself using Zillow Rental Manager. You can accept applications on there as well. You can of course use an agent to lease it, or hire a management company to lease it and manage it if you prefer. 

I'm not an agent and I self manage a few similar properties and find it pretty straightforward. I also use property management for other locations and a Class C property.  

Don't forget to update your insurance policy and ensure it has good liability coverage. 

@Jonathan Rivette congrats on doing your research. I think your numbers are about right. 

My tax rate has been 2.3% to 2.4% in Cedar Park / Leander and I am getting loans at 75% LTV, not 80%.

Example numbers from my deals: 

Purchase $185k, 0 rehab, rent $1525, ARV ~$190k - Cedar Park

Purchase $183k, $20k rehab, rent $1600, ARV ~$230k - Cedar Park

Purchase $175k, $5k rehab, rent $1650, ARV ~$210k - Leander

I am buying in the suburbs to make the deals at least break even or slightly cash flow positive, and holding for appreciation. I find that self managing single family homes at this price point is pretty easy as long as you properly screen to get good stable tenants. After a few deals I am now buying off market from wholesalers so I am picking up some equity at time of purchase. This typically requires using cash or hard money to close in 1-2 weeks. I have found that Hard Money lenders will lend up to 70% of ARV which can be 85-90% of the purchase price if you find a good enough deal, so your cash to close can be ~$30k instead of the normal ~$50 to buy one of these the normal way.

If you have never done any deals I would recommend you start with househacking a 2-4 unit property or a house and renting the bedrooms. I would also recommend joining the Facebook group "Investor Underground" where wholesalers post tons of off market deals every day. You can start connecting with both wholesalers and hard money lenders, though I'm not sure they would work with you until you have done at least 1-2 deals. 

Househacking is a combination of investing and lifestyle choice. Yes, you should evaluate it as an investment, but I would argue that it is more important to compare it to your next best housing option. 

For example, I used to rent a 2/2 and pay $1650/mo.  Then I bought a duplex for about $400k when when its market rents were only about $2500. So for an investor that is a bad deal. However, as a househacker its pretty good. It reduced my housing costs to about $1300 for a 3/2 with a yard and a garage. The area is just slightly less desirable than the apartment but also very close to my office so it saved a lot of time and commuting costs. 

Over the years rents have gone up and I've refinanced to lower rates so the math just gets better over time. My low housing costs have allowed me to accelerate savings and buy more investment properties. 

That was my first deal, I learned a ton from it and every successive deal I have bought with better and better price to rent ratios and/or discount from retail price. Good luck Evan! 

Thanks so much for the helpful response Brenden. You are right, it is not really a MHP but just a piece of land with a few random homes on it. 

I was able to connect with quite a few MHP investors this week. The conclusion was that this deal could be done, but because city sewer is not available, the opportunity is limited. From what I understand, you need more land (more like 35 acres plus) to make it worth it to build a small sewage treatment system, and using septic you can only place 1 home per acre in this area. 

For now I will focus on existing parks.