All Forum Posts by: Becca Summers

@Aaron Ormiston For flips and driving for dollars your best bet is going to be homes that are in the right life cycle to be renovated and flipped for a profit. That would be homes built in the 1970-1980 (but not split entries) the reason for this is every home has a ten year life cycles the first ten years the home was built the first owner who built it loves it and takes great care of it, then they sell to the next home owner who in like takes good care of it, then the home hits the 20 year mark where the home goes down hill and needs the most repairs (roof, furnace, swamp cooler converted to AC, cosmetic updates)  most of the time who ever owns the home at this life cycle doesn't have the skill or ability to keep up with all repairs then you as an investor buys it after that ten year life cycle and repair it and start the cycles all over. This cycle isn't true all over the valley but it gives you a good idea about where to start. So an easy place to start is neighborhoods built in 1970 and a run down home, of course there are neighborhoods where the numbers don't make since in resale but that is where you want to get to know the market better or get a great agent to help you. 

Would you be using the flip money to buy multifamily properties?

@Ryan Perkins, Welcome to the group! Perkins is my maiden name. I doubt we are related but it's always fun to see. It sounds like you have a great game plan.

I've done house hacking for my first two investments, where we bought the home with low or no money down lived there for a few years then moved out and rented it. I've enjoyed it so far, my second one was more successful as we bought a bank owned put in $20k worth of work and have about $45k in equity. We debate refinancing it and taking equity out but I like the cash flow and reserves built into the home if anything where to change in the market and we had to get out of the home. My advice is do tons of research and move slow and really decide what type of rental you want. It's much easier to quickly analyse a deal at first when you  are focused on one type of property in a certain area. It helps because you know the rent rates, who the renter is, vacancy ect. Then once you've mastered that you can move out to other areas. I hope that helps.

@Tyler Raso Welcome BP really is a great community. I love being able to come read up on what other landlords are doing to make sure they are getting the best tenants.

I try as much as possible to give the best though out answers for other investors especially local market knowledge. Our fix and flip market is hot most of the deals I'm finding are from wholesalers and properties before they are listed on the MLS. MLS deals are few and far between.

What about finding a lender who can do a lower down payment and you prepay your mortgage insurance. I know a lender who has a 10% down investor loan locally you might be able to go that route. Check out your credit unions.

1. Most of my applicants are married duel income earning families with 1-3 kids. There is a mix of needing a rental for job relocation and newly married. (Those are my favorite) Then there are a lot of long term renters with bad credit but good jobs trying to get out of condos and town homes.

2. American Fork is a little diverse a lot of the original families who've been there forever are still there 77% of homes are owned by the home owner with the rental market making up only %19 and the rest are vacant. Which I love because the competition is lower. The houses range from 1900-1990 there is some new builds but not a ton. It is mainly a blue collar community.

Saratoga Spring was incorporated in December 1997 so most of the homes are new and when they where built the land was cheap so the builders mainly built large single family homes 5-6 bedroom style. This area tends to be a single income earner with a stay at home parent and lots of kids. The schools out there are over populated and the school district is working hard to catch up. It's a mix of blue collar and lower income white collar. I find the rent rates are a bit lower because of the distance from the freeway. 

3. Most of the tech renters I know of are going into Lehi for a few reasons, when they move here for work they know Lehi is the same city their work is in making the research easier. There have been a lot of corporate investors coming in and building nice rental communities as well. I have seen some of the employees come in and want to be in the south part of Salt Lake County. With how our freeways are limited the access to I15 is a huge selling point to most renters. 

4. Apple to apples your looking at a $50-$75 increase for Lehi over American Fork. The big jump is from 2 bedrooms $900 to 3 bedrooms $1375 but that also has a lot to do with the age and condition of the home as well. 

Lehi is great that is where all of the tech companies are moving to. Most of the homes are relativity new so you'll find lower repair costs. Saratoga Springs is good if you stay under $300,000 as the homes will be smaller, you'll get less on your rental overall than Lehi. Orem is an older city that has a different demographic of renter more of the blue collar workers, newly weds and college kids unless you go to Vineyard which is a "newer" part of Orem that has a ton of new development going on you'd be hard pressed to find anything in Vineyard under $300,000 as most homes are new and have a lot of square footage. Provo is the most diverse of the cities you've mentioned, it has million dollar homes and $80,000 dollar conds similar rentals like Orem. The one city I would ad to your list is American Fork it's South of Lehi and North of Orem. I'd skip out on Ceder Hills they have never homes but it's a little far away from the freeway making it less desirable to renters.

I personally have my single family rentals in American Fork and Lehi I get tons of applicants, higher than average rental rates and I've had zero vacancy in the last four years. Let me know if you have any questions.

I'm sure I'm biased but Utah has been named #1 by wallethub for our economy. The demand for rentals is out of control, the last few turn over I've had I made money because there was no vacancy and one would move out a few weeks early and still have paid a full month's rent. I've seen a lot of California investors moving into Utah for the stable economy, job growth and demand for housing.

What type of properties are you looking for? Single family, multi or apartment?

I just took a class in this so it's fresh in my mind. In Utah an uncontested probate can be filed in a few days. Then the home can be sold while still in probate. What you are referring to is part of probate which is publicity notifying all creditors that the owner has passed. I'm not sure if it translates to each state but here the creditors have 3 months to fial claim if there is public notice or a year if there is no notice. Also probate must happen within 3 years of the death of the home owner. 

Short answer 3 months to a year but the home can be sold off during this time in Utah.

Would you sell a non preforming property and build a acessory apartment in current home?

Back story, the first property we bought was an accidental landlord situation. I'd never buy a property at full retail again. We've paid the loan down and have 19 years left. We could sell it now at the prime with the home being 10 years old and net $42,000. That isn't enough to do much with but a thought I keep having is building an acessory apartment in my basement of my current home with the profit. That should cash flow $600 a month.

I'm open to other ideas.

There are deals but they are few and far between. I got one from a wholesaler today but it required cash or hard money. As a first time investor I wouldn't recommend you go that route. It's pretty hard right now to cash flow on a MFR when your in one of the units because purchase prices have sky rocketed.

203k loans are a pain in the butt in a hot market. Three reasons.

1-It's and FHA loan and most sellers are worried about them because they don't want to do any repairs and you have to explain that it's a 203k not a traditional one. Some sellers get it others don't.

2-You have to use a contractors who are approved by the bank or lender do the repairs meaning you'll spend more money on the repairs. You can't do them yourself.

3-The under contract time is much longer than usual because of all the bids you have to get.

I'm not a fan, but I am willing to have someone tell me I'm wrong if they have had a better experience. 

Your best bet is to buy a property from HUD or a Bank during their owner occupant time and not compete with investors who have deep pockets. I haven't seen one in recent months though. I think the MFR is out of control.