All Forum Posts by: Oliver Trojahn

Don, very well put. I still plan on purchasing apartments in the future as well. Mainly to diversify in different aspects of real estate.

1) move into a new personal residence and buy it at an extreme discount. Rent out my current Primary Residence.
2) Close on three SFR rentals.
3) Start buying Multi/Apartments in low income areas strictly for cash flow and hand them off to a property management company so i do not have to deal with those type of tenants. Also, form an LLC to carry these loans from my portfolio lender. Do all this while not telling my partner I am doing it.
4) Post more on Bigger Pockets.

You know it is funny. The more and more I think about SFR vs Apartments I keep feeling SFR is a better investment. I agree completely. The argument for Apartments is that they produce more cashlow. I personally think SFR produce more cash flow per unit with all the other upsides described above. I feel like every house I buy could be purchased one day by a tenant for twice what I paid within 5 years. However, I will never sell.

Wanted to update everyone on this sale of this town home. Deal completely fell through due the new fannie mae condo guidelines. Buyer then backed out due to this rule (really aggrevating). He then came back 2 weeks later and said he would pay cash. Sold it for cash 10k less than previous sales price. Closed last Friday. Still made good money with the lower offer and extremely happy to get rid of that place.

Everyone should think twice before purchasing and/or selling a condo until these rules are removed.

For single family homes i think three bedrooms is a must. However, condo's and apartments may be a different story. I know three bedrooms will bring more rent. I think there is definitely a market for three bedrooms anywhere. It is all about families. 3 bedroom could bring better tenants IMO.

Side note: If you plan on buying a condo look in to fannie mae's new condo guidelines. It will be difficult for you to buy and/or sell a condo in this market using conventional financing. Long story short, had a sale fall through 12 hours before closing on a townhome due to someone in the complex owning 10% or more of the units. Lowered the price by 10 grand and the guy then had to buy with cash. So excited when I got rid of that place even at 10k less. I feel bad for the people in that complex who will never be able to sell their townhomes until this Fannie Mae rule is removed. Imagine not being able to sell a place to anyone. Very scary thought.

I typically save zero dollars for repairs. This is because once I save up enough for my next down payment for conventional financing I dump my entire account to cover this and closing costs (reinvesting profits at all times). Now, with that said, I invest in single family homes and currently have only three. One months rent brings me roughly 1,500 cash flow (not including repairs). So once I clear my account after one month I have enough to cover any repair really. It is ongoing but I will clear my account for another downpayment any day of the week. I am very comfortable doing this.

I do my own management and own repairs if that helps. Also, worst case I can use my own day job money to cover repairs during the purchase of a new property (never been tapped).

As a note: I dont think you can directly pay yourself through paypal but you can simply make another account with a new email address and pay from one to the other.

I have done this numerous times for both down payment and reserve help when trying to use conventional financing. The most easiest way to perform this is to pay yourself through Paypal. You will pay 3% or so up front to complete this transaction. But as you said it is 0 percent interest so the three percent up front seems like a pretty good deal to me.

With that said, I would never recommend investing from out of state.

I live and invest in Kansas City, MO. There is ample opportunity for great cash flow here. However, since I manage my own properties i stick to the well known suburbs of Lee's Summit and Blue Springs. I buy SFR currently in these areas for rentals. Stats are typically 60k purchase price with 1,000 rents. I get appreciation and great tenants.

There are plenty of war zones in Kansas City, however, there are also some decent areas with the deals you are talking about. I have been toying with the idea of starting to purchase Multi-Family units in these C and D areas as they are so cheap and handing them off to a management company simply not to deal with that class of tenants. in fact, I just made my decision, i am doing it!!

Kansas City is an amazing place for rental properties.