All Forum Posts by: Bryce Renicker

@Paul De Luca it’s a 2 unit with 2Bed/1bath each. Rehabbed in 2016 with fairly nice finishes and appliances. Parking in back yard with gate, I would be interested in adding a garage at some point! 

@Jonathan Klemm thanks so much for your reply! Yes I feel like I’m in a similar situation where I don’t see anything cash flowing anytime soon but I have a good and stable income that I could pretty easily cover the negative cash flow so it’s just tempting to jump in, but don’t want to sink myself down the road. I laid out my analysis in the above comment if you would care to take a peak at my numbers! Thanks Jonathan. PS - hope to be at one of your meetups with A/N mortgage soon! 

@Paul De Luca thanks so much for the reply. I want so badly to jump into a deal to get my feet wet but that voice is telling me that negative cash flow is a deal breaker. Here’s a deal I’m looking at now in Bridgeport

Purchase price: 340000
PIMI + Tax: 2125
Water: 200
Common electric: 150
Property manager: 290 (10%)
Vacancy: 145 (5%)
Maintenance: 2O0 (7%)
Rent: 2900 (year one) 

Negative cash flow = $210

I can eliminate property manager fee and self manage for the next few years and be positive $80 cash flow but it feels like a squeeze. 

Thanks so much for your perspective 

Hello BP community. I'm looking to get into my first ever property as a live in duplex with a 3.5% down FHA here in Chicago (McKinley Park, Bridgeport, or Pilsen) The problem I am running into is that any properties I analyze on the MLS will not cash flow even after I am moved out and the property is fully rented. I feel that this is due to higher mortgage payment and mortgage insurance with my 3.5% down (a lot of them would cash flow fairly well with 20% down and no mortgage insurance.)

My question would be, would it ever be wise to take a deal with negative cash flow that I could cover with my personal finances as a trade off for not having the capital now to put down 20%? Or better off to wait and continue building a better down payment / look for off market deals? To be fair, I have not put effort into finding an off market deal at this point. 

@Brie Schmidt thanks for your reply! I am so happy you mentioned that, I have been mostly looking in McKinley Park now since my first experience with with the deal in Pilsen. It seems their is a lot more inventory in McKinley Park and at more affordable prices. 

@Account Closed thanks for your reply Tim! I think I will be going into my next inspection with a better sense of what I can and cannot handle on my own. A valuable lesson learned!

@Jonathan Klemm thank you so much for your reply and positive words! I will definitely consider the 203K option in the future. I love the pivot mindset.. I realized I was running out of time on my contract and had no contractor contacts to bring in for estimates on repairs which is what made me so unsure and killed the deal. Going into my next deal I will definitely have that lined up ahead of time. It looks like you are a contractor here in Chicago, if you are open to it I would love to reach out to you around this if I do come up with a rehab need in the future! 

@Frank S. thanks for the reply and for your perspective. I have heard that cash flow is getting harder to find and this process really opened my eyes to that! Even with this property that needed a ton of work I would barely cash flow with it fully rented in its current as is condition, let alone after doing substantial repairs. I’m hoping to build a little more cash and try again in a less expensive neighborhood like McKinley park 

@Paul De Luca thanks so much for your reply. I agree inventory seems really low in Pilsen as well. I have been looking more in McKinley Park at this point!

@Joe Splitrock thanks a lot for the reply! Your point about increased material and labor cost is really great, I hadn't considered that. I will keep looking, probably need to get a little more creative to find something other than just scanning Zillow