All Forum Posts by: Brenden Mitchum

Hey @Andrew Martinez, welcome to the BP community!

Plenty of areas around the major metros here in GA to find success. Some are good for certain strategies, some better for others. It depends what you're looking for and what your investment goals are. Assuming you are investing from out of state, the most important part will be the team you build. A knowledgeable, investor-focused agent in any market can help you find a deal. Just make sure their knowledge and success aligns with your goals. 

My advice would be to partner with a few and interview them well to determine if their clients have found success recently. As long as their clients have recently found success similar to what you're looking for, you should be able to snag a deal with one of them. 

Do your research on the market(s) & on the agent(s) and you'll do just fine! And feel free to reach out anytime if you have other questions or just want to chat!

Hey @Lee Williams, welcome to the BP community!

Honestly, I wouldn't touch it or recommend any of my clients do so for one big reason: It's in Cobb County. They have real strict occupancy laws there (no more than 2 unrelated adults). Now, I know plenty who have gotten away with ignoring that law but when a county is restricting number of cars in a driveway (yep, they do), that's not a place I want to be house hacking. 

I'm not sure about the numbers though - not really enough info here to determine if it's a good deal. Are the comps based on current layout or include a finished basement addition? Keep in mind, a full reno plus finishing the basement could be $70k+ so you'll really only land a house hack buyer if the purchase + reno is near ARV. And, with shaky times come shaky 6-month estimated values so many house hackers would likely still avoid, except maybe those who are quite handy and in no rush to refinance.

Unfortunately, this is a tough one on multiple fronts, but location is the deal killer for me.

Hope this helps a bit though and please, feel free to reach out anytime if you have other questions or just want to chat!

Hey @Dajana Topic, welcome to the BP community!

I would recommend first looking in your own backyard to start investing. The learning curve is much shorter this way. However, if your market is not very friendly towards investing/flipping, there are plenty of solid markets throughout NC, several in SC and a few in GA too. Pretty much any market right now is going to seem overpriced when you look at price to rent ratios and it's a rocky time to start flipping with rates doubling in a couple months. Really hot markets like Atlanta might still have some runway left before prices flatline or drop a bit but I would be careful of flipping in less hot markets right now. It's a great time to do some research and select a market that you feel will be strong not just for investing now but for the near future. Hopefully your flexibility will allow you to move to the market you select to give you that boots on the ground advantage. 

BTW, there are plenty of areas here in Atlanta that are still seeing high demand and appreciation, despite rates and inflation. We're still putting offers on homes and see double digits in competing offers. 

Regardless of what market you select, you would be wise to put some resources into building your off-market deal funnel. The larger your deal funnel, the less likely you are to struggle finding a deal in these tough markets.

Hope this helps a bit! Please, feel free to reach out anytime if you have other questions or just want to chat! 

Hey @Anthony Parello, welcome to the BP community!

This is a great book to get you thinking on creative strategies. However, keep in mind when the book is written. The market was very different then. Fantastic book for motivation and encouragement but definitely lacks some current real world application. Not Brandon Turner's fault, necessarily, the book was just written in a different point in the market cycle. 

This isn't to say these strategies don't work now but it will definitely take some real world experience and capital to best utilize them. And, much more time & energy than the book implies. 

Disclaimer: I have not read the newer edition so hopefully that one is a little more applicable to current market realities! It's also been two years since I read the original and we all know how reliable memory is..

Like any book, take everything with a grain of salt & nothing as gospel, and you will garner plenty of value from it! And feel free to reach out anytime if you have questions or just want to chat!

Hey @Josue Lopez, welcome to the BP Community!

Wow, all caps?? Guess you're pretty excited. I would be too if I had a triplex with some equity in it! 

Your best bet here is to start working with a loan professional to plan out the best strategy for you. Hopefully, you already have someone. If not, ask around to friends and investors in your area. 

As far as I know, HELOCs are reserved for primary residences so you would have to move back into the triplex first. Not sure if there are exceptions to this but, again, leverage your loan pro's knowledge!

Shouldn't be any issue getting that HELOC and pre-approval at the same time from the same lender. In fact, this would be the smart move since you'll get your credit pulled for each. Doing them together avoids a double hit to your score.

And that's about the extent of my knowledge on the subject but figured something was better than the nothing you've gotten so far. Hope it helps a bit! Reach out anytime if you have other questions or just want to chat.

Hey @Rodrigo Santano, welcome to the BP community!

You should be able to get by with any typical residential calculator. I'm not familiar with BP's calculator but you shouldn't be including appreciation in your calculations anyways. Unless you have a crystal ball that tells you exactly what the appreciation will be.. But you are right that MH typically don't appreciate like SF (there are always exceptions). This is due to MH being personal property (like a car or RV) not real property (like a stick-build home and the land around it).

There are plenty more nuances to MH though that should be taken into account during your calculations and due diligence. Most of these center around the physical properties of these types of homes and the maintenance required. This will largely depend on the age and condition, but generally speaking, maintenance is higher than in typical stick-built (single-family) homes. You might be able to get away with doubling the number you typically use but better to determine a likely percentage increase based on each MH that you're analyzing. A brand new one might have pretty similar repairs/maintenance expenses while one that is 30 years old could be triple what you'd expect from a SFH.

Also, keep in mind that how you plan to structure your lease can have a significant impact on maintenance as well. If you just want a straight rental and are responsible for the maintenance, costs will be higher because tenants often won't keep the home nice. They may even trash it and strip it of anything valuable when they leave. Instead, you might want to consider some kind of rent to own agreement that makes them more responsible for the home. This can put all maintenance costs on the tenant (future owner) and allow you higher cash flow. The downside is that eventually you will lose ownership of the home.  

You also want to consider whether the home is in a park and you'll be responsible for lot rent or if it's on private land. This will have a major impact on your calculations. 

Lastly, there are numerous differences in construction between an MH and SFH so best to get acquainted with all of these. You really should treat this as a separate asset class and give it the time and attention it deserves, just like I'm sure you did when starting to research residential real estate investing.

Hope this helps a bit. Please, feel free to reach out anytime if you have other questions or just want to chat!

Hey @Account Closed, welcome to the BP Community!

Congrats on getting your license! I'm not sure if this will be your first time being licensed. Assuming it isn't, you likely already know it can be tough to find a brokerage that has low fees/charges by transactions AND is cool taking on a low volume agent that only does personal deals. Brokerages simply don't make any money in that situation so while you may find it at a boutique brokerage, it can be tough to find one that will let you stay on long-term. Your best bet will be to network within your specific market's REIA or even post here again but mention the city/market (so folks with key word alerts will see). This will help you get recommendations for local, boutique brokerages in that market.

Two nationwide options you may want to take a look at are Virtual Properties and EXP. I believe Virtual has really low cost options but little to no agent support. EXP is $85/mo and offers tons of support. In my opinion, if you take advantage of all the courses and material included as an EXP member, that desk fee gets pretty close to paying for itself. Either way, you make your money back if you're closing at least 2 or 3 personal deals every year. 

Hope this helps a bit! Please, feel free to reach out anytime if you have other questions or just want to chat!

Hey @Keita R. Eaddie, welcome to the BP community!

Like others have mentioned here, it really just comes down to the numbers (and your goals). Make this as scientific as possible. 

STR:

$500/mo cash flow. What is your capital investment in this property (downpayment, closing costs, capex since buying)? Use that to calculate CoC.

Sell:

What is the ROI on paying off your debt? In other words, what is the interest rate? Is this better than the CoC you see from STR? How much do you have left over after paying off debt? What could you do with that? Remember Atlanta is pretty expensive now and a very tough market, especially for new investors. How much time and effort will it take to find something that produces a better return than the STR strategy above? "Flip the money later in other real estate properties" is not a solid enough plan to choose the sell route. That is not scientific at all and just you guessing/hoping.

Refi/HELOC:

Have you thought about this route? Since it's still your primary residence, you can refi at favorable rates and are still able to pull out a line of credit with a HELOC. This may allow you to pull out enough to pay off your debt and still allow a small amount of cash flow. Again, it's all about the numbers. If that HELOC has a higher interest rate than your debt, this wouldn't make sense. If the new mortgage has payments that put your cash flow in the red, this also wouldn't make sense.

Personally, I would take cash flow now, rather than cash. With inflation through the roof, having money in cash flowing assets with low rate debt would make me much more comfortable than having a pile of cash. But others would say take the cash because opportunity is on the horizon with a likely downturn coming. Only you can really decide what's best for you and your RE goals. 

Hope this helps a bit thought. Please, feel free to reach out anytime if you have other questions or just want to chat!

Hey @Pamela Winslow, welcome to the BP community!

BP does a lot of things really well. The calculators are not among those. Check out dealcheck.io for a much more robust and customizable option. It's also free as long as you delete properties after you max out the 10 limit. 

Hope this helps!

Hey @Anand Acharya, welcome to the BP community!

Very clever to look at the total return, rather than separate them by property. However, maybe a bit too clever? Personally, I would never want a property that is losing money, even if it helps me purchase something that cash flows. This property will always be a liability unless I am able to raise rents enough to cash flow. Maybe this is an option for you? Are you below market now? Are there some low cost updates you could do to justify a rent increase? Maybe you could decrease the equity you pull out, which would lower your payment so that you can still cash flow? This is what I would look into first. The alternatives, in my mind, are to sell or hold but definitely not refi into the red. 

Let's say you do this assuming your total return will be net positive over current. What if you have a hard time finding that cash-flowing duplex or quad? At what point is it a bad total return vs. a good one? Rates will likely continue to climb for a while so this could make it tough to cash flow on the new property (assuming you're leveraging that equity you pulled out of the other). Just things to keep in mind if you decide to analyze based on total return. 

Hope this helps a bit. Please, feel free to reach out anytime if you have other questions or just want to chat!