All Forum Posts by: Brandon Penn

Facebook market tends not to be the best place to advertise as it gets you a lot of unqualified people. I might modify the add to be sure to include that you require a rental application to be filled out. That tends to deter people who know they have bad rental/criminal history. From that point I would say show anyone who is interested after talking with them through the message system. I would first ask them if they had ever been evicted, if they have any criminal history, any pets, and any special needs you should know about. If you feel they would be worth your time to show, then set up the showing. I tend to group people together for showings in more of an open house type setting. This saves me time, and creates competition between the different renters.

At a glance without knowing too much information I would recommend the following.

1. have your tax return amended. It will be a small fee, but would be better in the long run.

2. form an LLC that you could purchase the property in. As an investor you should have an LLC anyway for any investment properties that you won't be living in.

3. talk with a mortgage broker that deals with commercial/business loans. A lot of times banks have to fit you into this small little box and only deal with loans/deals they have already done in the past. There are many commercial loans out there that will base the income off the property especially if you have the 25% down and good credit. Feel free to message me if you you would like any more info.

Good tenants will own good dogs and take care of them. Bad tenants won't. I rent to pets in almost all of my apartments. I see it time and time again. The animal is the reflection of the owner. I have some super loving and loyal pitts, and I have seen some really aggressive ones. It all comes back to what type of person the owner is.

That's awesome man! I just recently reached my goal of over 100 units, and while I am still working a day job it is such an amazing feeling to know that I don't have to. Controlling my own financial future is the main reason I got into REI and I'm glad to see other people such as you becoming successful with it as well! If in your trips your by Erie, PA let me know and we can grab a drink or lunch

Not necessarily. There are a couple ways around it. The first would be if you are a w2 employee of the owner. The second would be if you are part owner. A good way to do this would be to have whoever wants you to manage their property add you as a 1% limited liability partner. This would allow you to manage the property as you would have ownership, and also gives you right of first refusal if the owner ever wants to sell it.

Wow, I'm completely humbled by the amount of replies I have received on this post! Thank you everyone for your very kinds words. I don't know how to tag people individually so I will just try to answer everyone's questions with this reply. If I miss anything or anyone just want to talk more feel free to send me an inbox message!

1. How did I get the deal? 

-This 70 unit deal I actually aquired from my employer. A couple years ago I took a 15-20k pay cut to leave car sales and go be a property manager for a local investor that I greatly respected and had 350 units. through the last couple of years I have helped him to grow first to 500, then 700, and now he is getting close to 1,000. As he is expanding into the larger complexes he does not have the interest or time for the smaller multi-units. He sold me this 70 unit deal on a land contract. I actually didn't have to come in with any money down, but I look at it as the 40k that I gave up from my other job over the last 2 years was my down payment on this deal.

 2. How much was it per door?

-This particular deal was 22k per door. Honestly it was a little pricey for the conidtion and area that they are in, but it was 100% financed by the owner which makes it a phenomenal deal for me. 

3. What is the return?

-My cap rate is about 16%. My net operating income is about 262k after accounting for vacancy, utilities, maintenance etc. My annual debt service is 183k leaving me with a proffit of around 79k per year. It will be paid off in 15 years and at that time i will see a huge increase in the cashflow. 

4. Was multifamily always my goal?

-I had always wanted to get a 2-4 unit to live in and then move into the next one, rinse and repeat. My wife at the time did not like that Idea so we just went with a single family house. I had never planned to be an investor with a bunch of multifamily though until about 5 years or so ago. I just wanted to own my houses, and rent them out when I went to my next one to build a retirement fund. 

5. My thought on a podcast?

-I would love to do a podcast. I started listending to bp about 6 months ago and love all the information I have learned. I truly thought I knew most of what there was to know about real estate investing. While I do know most of what the podcasts have touched on, there is still a ton of information that I had no idea about. Also different points of view about different sides of investing that I had not thought about before. You truly don't know what you don't know.

6. What's my next goal?

-At the moment I am just trying to stabilize the 70 units I bought. about 20 of them were vacant with a lot of work needed and we are almost done with all the repairs. My short term goal is to be fully rented by the end of June. The next project I would like to work towards is converting a school into a community hub. Erie has experienced a lot of economic hardships, especially with the school system. This has caused many of the schools to close. I am currently talking with a few different people about converting one of these school into a central community center. We will have communal living spaces, supportive services such as work ready and daycare, along with activities for children and youth.

7. What is my background?

-Well it is a much longer story so we will cut it down to I was first a real estate agent. I kind of fell into a niche working with investors and realy loved all the mechanics of real estate investing. I then went to sell cars because I wasn't making any money and was going through a divorce. From there I became a property manager and have been doing that for the past 2.5 years.

8. Where do I buy?

-I stick with my home town of Erie, Pennsylvania. There is a ton of opportunity with buy and hold investing in this town. I would like to look at other areas in the future, but for now Erie is where I buy everything.

9. Do I have an LLC?

-YES! I actually have 3. I do believe it is essential especially where I live to work from an LLC. I have a couple different partners, and have different LLCs set up with each of them.

Again, thank you so much to everyone, and if you want to talk more feel free to send me a message!

@Brian Allanbrook thanks a lot! These were actually 70 units that I had managed for someone else. He is moving into bigger complexes and selling off his smaller duplexes and 4 units. I took about a 15-20k pay cut to come work for him a few years ago, but the knowledge and opportunities that it provided were worth way more.

Thank you!

Haha just 10x it brother! Honestly it is whatever you're comfortable with. I work with a guy that is about to reach 1,000 and I don't believe I would want to get that big. Nothing works for everyone.

That's awesome! Just have to keep pushing through until you make it.