All Forum Posts by: Benjamin Aaker

Repair of $5k on the fourth unit probably means similar on the other three when tenants move out. I agree with @Craig Anderson and @Rob Lee. The neighborhood sounds risky. Collecting rent will be a headache. Filling units with quality tenants will be as well. You might find yourself compromising to get tenants in. Unless you have experience investing in this area, I'd give it a pass. Or maybe find a partner who does have this kind of experience. 

Hi @Dan Moe I am going through this very issue right now, looking for a vacation rental in Florida. I've talked with about 10 bankers and everybody is excited to hear from the investor until you start talking about a commercial loan. Then it becomes very difficult. If the sale property of your 1031 was in your name then you should be able to get a residential loan if you plan to use the vacation rental for yourself part of the time. If it was in a corporation, you'll need to get a commercial loan.

I talked with 2 bankers, each eager to get my information. Both thought I didn't understand the difference between a residential and commercial loan when I clearly said "I need a commercial loan." They proceeded to get all my info and happily quote low rates for a residential loan. When I connected them with my 1031 exchange suddenly it was "We don't do those kind of loans." Hope my story saves you some time. 

I recommend Quickbooks. It's a pain to learn and too big for what you have right now, but you're planning to scale, right? Learn it now so you don't have to migrate later. I used spreadsheeting for three years and it was madness to switch to Quickbooks. Better yet, consider hiring a bookkeeper.

To add to @Cole Simpson, it's very difficult to find a municipality that will allow a new mobile home park any more. You are talking about developing bare land so you need to do a lot of research to find out the cost of developing in your area. It might not be much to build a duplex but getting utilities out to the site can get astronomical. If you do the research and can wait a while for the payoff, developing can be very profitable. 

Hi Issac and welcome. I wish I would have done more research on the cost of rehab. My first flip I lost $8,000. I just kept discovering repairs I hadn't budgeted for. Glad to see you are reading. I wish I had done more before that first flip. It's been nothing but awesome after though so keep going.

Hi Michelle and Floridians, I've been looking at Pinellas County for a while. I'm just looking for commercial loans and that is difficult. Since you are house hacking it'll be a lot easier. I love the location and am looking forward to my first purchase down there as well. Good luck!

I like to evaluate the area and then it's Yellow Letters. Just make sure the area is a good one before you start spending the money on finding leads.

@Brandon Pace I recommend getting into medium and large multifamily. These are the 5-plus units and require a commercial loan. They take more work and experience to get but they scale so much better than the smaller properties. Keep on investing and go big when you can.

If this is an REO then you're dealing with a bank and they are looking at the money. $5k over asking price on your initial offer was already pretty good. I agree with @Brandon Sturgill that the earnest money is unlikely to be a huge factor here. If your top dollar is higher than your initial offer, I recommend to increase and resubmit, but don't let the fear of losing the deal make you go higher than your analysis allows.