All Forum Posts by: Brad Jacobson

Hey Jason,

One trap a lot of new investors and flippers fall into is over-rehabbing.  This is extra dangerous now that the market is softening and we don't have a crazy appreciation pillow to break our fall.  

If this is a single family house, you can get away with more rehab but if it's a multifamily, big rehabs will very rarely provide a return via appraisal since appraised amounts are mostly calculated off potential rent income and that rent doesn't change too much. 

Even if the property is single family and wouldn't be considered just a rental, it's still probably wise to not over-rehab.  Appraisers look at a ton of factors including bed/bath count, square footage, acreage, neighborhood, etc. and the cosmetic condition is only one of many factors.  As long as the house looks fine cosmetically (carpet, paint, kitchen, bathrooms, etc.) you'll probably get just as high of an appraisal as an over-remodeled house would if it had all the other same factors.  

Good luck!

 Hi @Gilda L. Sauceda,

You'd be very well served to start attending local real estate meetups!  Look on BP, Meetup, and Google search to find local meetups.  Become a regular at as many as you can.

At these meetups, you'll meet the best agents in your markets.  They'll be the ones who either know how to effectively look or might even have an insider deal for you.  The first single family AND duplex I ever bought came from inside deals from people I met at local meetups.  Then I used one of the agents at the meet to help me buy the house-hack I live in currently.  

Good luck!!

Hi @Johann Martinez,

@Austin McClain's crime map is an excellent tool.  

The other tool I really like is calling local property managers and asking for their opinion.  A lot of PMs won't manage properties in certain areas and most good managers are happy to help guide your purchasing decisions to areas that they would prefer to manage.

Good luck!

Hey Deidre,

I don't know of a CPA in the STL market but I would stress that finding the right CPA is a massively important decision once you have a decent sized portfolio!  

If possible, go to a local crypto meetup and ask around there for a referral. You'll probably find that there are a few stand out CPAs in the area that only work with investors like us. Try to find one of those pros through the local REI network.

Good luck!

I'm not in the Tampa market but I can say with almost 100% certainty that the entire country-wide market is cooling off.  Just six months ago we had 3% interest rates, now we're at 6%.  Buying power is dramatically reduced with higher interest (imagine 3% of $500,000 is $15,000/yr or $1,250/month - now 6% on that same property is $30,000/yr or $2,500/month).

Here in Utah, we're watching prices start to come down to match the buying power of people.  It's not a steep drop but inventory is up and prices are definitely trickling down.  

If that's legit, take the job!  People frequently come to me asking how they can get a start in real estate investing and I always suggest two things: house hack and work in the industry!  

Working in PM will give you a tremendous amount of experience and will also put you in the right spheres of people.  Take the job, work your butt off, succeed, and learn from those who have really succeeded.

Good luck!

Hey Javaras,

Here in the Utah market, the market has seriously slowed but it feels like a breath of fresh air to me.  Properties are still moving in a 2-3 week period as opposed to the 2-3 days it was the past few years.

Lenders aren't requiring anything more than before, just the proper qualifications to have the proper DTI for 5-6% rates which definitely lowers buying power compared to the 2-3% we had prior.

Don't let the market shift scare you!  Keep finding good deals.

Good luck!

Hey Chris!

Based on what you outlined, I'd seriously consider Equity Real Estate. They have no monthly, charge $500/transaction, and are happy to take on agents that only work part time.

I was with Equity for years and loved it.  I recently switched to Real Broker and follow a similar process to Brenden who posted above.  Real also has no monthly fee, 15%/transaction, and it allows you to be compensated by bringing on additional agents.  

You'll get more support at Real and will be compensated if your friends or other agents join you at the brokerage, but if you're only doing 1-2 transactions per year, Equity will probably save you money and be a simpler pick.

Good luck!

Hey Monty,

I assume you're using Quickbooks for tax reasons.  If so, I'd recommend talking to your CPA.  My CPA encouraged me to get Quickbooks and then was gracious enough to spend 30 minutes with me to point out what she was looking for and what I needed to do for tax reasons - very basic stuff.  

We kept it simple.  Don't go overboard at first or you probably won't stick to it.

Good luck!

Hey Scott,

I usually only keep about $5,000 in reserves for each door so my opportunity cost of investing the money vs leaving it in a checking account under the LLC is minimal. I think you're fine to just keep it liquid if it's a small amount for each door.

If it's a large amount that covers the reserves for your entire portfolio, I'd consider something very liquid (48hrs max) with no tax ramifications like whole life.

Good luck!