All Forum Posts by: Brian Valdivia

When I renovate for appraisals i target items that i think will cause the appraiser to grade the property higher on a quality scale.

Here's a few of the things I do:

1. Use tile finishes in kitchen backsplashes and bathrooms
2. Use vinyl flooring on the main floor of my properties
3. Add those puck recess lights to the main living room (gives it a 2023 feel as soon as you walk in)
4. Stone countertop (granite or quartz) over linoleum 
5. If replacing kitchen cabinets isn't in the budget, that I would paint them white and replace hardware.

Hey Jeffrey,

We use a combination of RentRedi and Buildium for rent collection.  Both of these softwares allow the tenant to save their banking info in there.  I personally don't save it to avoid the risk of even having it.  The RentRedi software is very simple and pretty inexpensive.  

I personally think Buildium is a little clunky.

Hey Taber,

One thing that I did in the beginning in order to connect with other investors was to look up local meetups that were within an hour of my target area.  This worked out really good.  I also looked for real estate agent events as well.  This has served us well because the agents can be a really good source of off market properties.  

I'm not local to you, but this worked out really well for me in the beginning. 

Hey Joseph,

I own 4 properties (5 units) in the Ocean City, Maryland market.  The issue with our market is that it's super hot from May to End of September, but pretty slow after.  Some advice I would give here is to find a market that has good rental more than where our properties are located.  Definitely a learning experience for us!

Hey Mark,

Congrats on getting into the game.  I own over 100 units in Maryland and I also own Beltway lending.  I can guide you through how I would personally do the transaction you mentioned above. 

1. Purchase in Cash
2. Renovate
3. Refinance.  Here's where our team can jump in and help out!  So we have a product that will allow you to refinance with no seasoning as long as you paid cash.  Additionally, it will qualify off of the property's income versus your personal debt to income ratio.  

I'm personally happy to jump on the phone with you at any time and field any questions, even if we're not a good fit for financing. I started years ago with not very much, and it's really worked out well for us using the BRRRR strategy.

@Jonathan Taylor  I want to grow at a faster rate than I currently am.  I am currently waiting for a seasoning period to end in order to refi cash out and growing. 

I am considering using a HELOC on my primary as a downpayment on a BRRRR property. My question is this: theoretically, at the end of the rehab/refinance I would take the cash out and pay myself back on the HELOC (likely to do it all over again). Have you seen this done in practice versus just the theoretical situation? Aside from the potential downturn in the market, are there any glaring downsides that I am missing?

@Jason Hines I'll defer on the eviction question to someone that may be able to better answer.  My gut says that if they don't move out (whether because they can't or don't want to) then you'll have to go through the process.

To the other point, I would be more likely to have a casual conversation and just explain to them.. look, market rent is near 1200.  If you would be open to signing a 2 year lease, I would hold your rent at 1000.  They've been there for 10 years, and I'm sure they are probably nervous about a new landlord coming in.  I would make it seem as though you weren't going to change a whole lot.  The longer the lease they sign, the lower the rent I would consider.

Remember that if you get that 1200, versus 1000 per month, that's 2400 extra per year.  2 months of no rental income is 2400 at market rent (I usually assume a turnover is 3 months including time to get the tenant out, reno, and time to find a new tenant).  Granted ($2,400 x years stayed) can add up quickly.  

@Jason Hines Congrats on your upcoming closing.  I'm all for raising rent a little bit, but keep in mind that there is a value in the fact that they have been there for 10 years and may stay another 10 years.  The PA market isn't something with which I'm very familiar; but in my market, an eviction is going to cost me 3 months of rent.  Given the COVID situation, evictions may also be backed up to a longer than average period (assuming they won't just move out on their own).

Also, if they've been a good tenant for 10 years, what's to say they may not stay another 10 at a lower than market rate.  Even $1,000/month could save you quite a few turnovers in that time frame.  Just things that I would heavily consider.  I do agree that $800 is way too low.  But I would be likely to keep the rent lower than market in order to keep them happy & in the property.

I am fairly well read on strategies and details, but wanted to get another opinion.

Background: We have completed a few flips to add capital. We are currently about 55% of the way through a rehab for a rental. This will fall under the BRRRR strategy. This rental will be our first hold. Our intention is to immediately refi out of hard money (expecting to occur in November) and purchase the next rental.

My question: Is there anything I can do to expedite growth?  I realize there's not much I can do on the short term to add more than 1 more rental in this calendar year.  But what would the experts do on a go-forward basis.  After 2020, I expect to have 2 cash flowing rentals.  One will be financed at 75% and the second is obviously up in the air.  How can I plan better now, for expedited growth in 2021?