All Forum Posts by: Tim Czarkowski

For the people I know it is. If you figure their several million dollars each, you can make pretty good living off just that. I know the one closing the agent in my office had, she got a $200,000 commission check. I'd certainly be happy with one of those a year and two would really be great. They also do some leasing, but I'm talking about actual sales. I would like to get into some commercial sales but others from this board should know better than me. My experience in commercial is fairly low, I focus almost entirely on residential and on my own deals.

Richard Evans I just wanted to say it's amazing that you were able to save that kind of money, very impressive. Have you started on your rehab? How did the comps look from you realtor?

Good luck, it sounds like you are on the right path. Being able to live on less then you make is almost a requirement to get into business and most people simply can't do it.

Chris Clothier I hope you didn't take my post the wrong way. I was just pointing out that there is also a good way to execute this strategy. I understand you didn't mean that people were doing anything wrong but that they could get themselves into trouble. I completely agree with you that "cash out" shouldn't be the magic words to do a deal. That's a terrible strategy if they can't support the debt load. As long as you are conservative, as with anything else you a much less likely to get yourself in trouble. I personally only purchase properties that will leave me with a lot of free cash flow even if leveraged up to 75%. If they don't, it's not a good rental. It may be a good flip but not a good rental. In that case it should just be sold.

I wouldn't think too many banks are being aggressive on their values these days. They certainly were before the crash but it seems they have done a complete 180. I've had the opposite problem in several deals recently. In one appraiser was comparing a trashed out bank foreclosure to a property that just recently had a full rehab like it was an apple to apple comparison. I eventually got him to come up to the sales price by sending him a few decent comps.

The properties I am looking to pull money out of fit this scenario perfectly. The one was purchased a year ago and the other several months ago. We paid cash, rehabbed them, and rented them out. They are both 2 units, provide great cash flow, and with purchase+rehab are still below 70% of market price.

Everyone makes mistakes, I certainly have. lol Anyone with a business the size of yours certainly has and it sounds like you have an absolutely amazing business. You just can't be successful without making some mistakes. You have to try to learn from others mistakes and when you can't, make sure they are not career ending mistakes. Once again I completely agree with you that you could get into trouble if your focused on the wrong thing and that is true of many strategies. There are good ways to implement them and bad ways also.

Part of my decision to move to Jacksonville a 3 years ago was because the market is more affordable here than in Savannah while still being close to family. There are also many more small multiunit buildings available in decent areas. Which is what I wanted to focus on. Overall it has worked out great and plan to keep it rolling.

The commercial agents I know generally only do a deal or two a year and they work at it nearly full-time. Granted they are nice paydays when they close. The broker I know already had a lot of business connections before she started and that drew her in. I would estimate at least 6 months and probably more like a year. Obviously it depends on your contacts and how hard you work at networking.

I do residential real estate and it was about a year before I closed my first outside deal but I was in no way looking for business. Most of my sales are for my own account.

Sounds impressive. If it works, even if it is one of the ten ugliest buildings, it will revolutionize skyscraper construction. If those costs are accurate it's all the more impressive. Being able to build towers that quickly and cheaply will likely lead to a building boom. Possibly even causing rents to decrease in areas such as New York.

Chris Clothier I would think that as long as you are conservative with your estimates and have strong cashflow you would be just fine. It shouldn't be much different from getting a normal conforming loan to purchase a property. Obviously if your buying marginal properties your likely to get yourself into trouble no matter what. It seems like people these days are much more focused on cashflow then during the boom. Rapid expansion can cause troubles too but being forced to wait 6-12 months should minimize that. With the 10 property cap on conforming loans that also should help keep people from getting themselves into trouble.

David Beard What is the delayed cash out financing rule? I have considered using this strategy in the past but didn't realize they don't do cash out refinancing on 5-10. That would certainly put a damper on the plan. I have only one conforming loan right now and two free and clear properties I was thinking about pulling money out of.

James Vermillion What I like about rentals is they are so steady. Once you purchase it you can expect a pretty steady return. You don't have to always be chasing the next deal. With having enough rental income if the market changes or something happens I can still pay my bills. It makes me feel much more comfortable. It helps keep my wife off my back in-between deals also, lol.

Personally I was dying to go full-time but I was also planning on staying at my job longer than I did. They were making cuts so I just left, but it has worked out great. I did much better this year than any year with a regular job. My father has his own business and told me more times than I can remember that I needed to live on less than I make and get my own business. With the economy the way it was it took me longer than I hoped for to get my business but it has worked out better that way. I actually tried to buy a local restaurant but I am glad I couldn't find financing then, it was 2009. Real estate is much better than the restaurant business although I did enjoy managing them in the past. I would say when you feel you don't have the time necessary to continue to grow your business it's time to go full-time. I couldn't imagine handling flipping while also working full-time. I am much happier now that I am on my own.

Andy Bankston The key for me being able to invest full time is having someone decent work for me that can handle all maintenance work. If it's something he can't handle he has HVAC, electrical, plumbing contacts, etc. He also had been able to help me minimize costs by doing things like refinishing counter tops or painting a refrigerator and buying scratch and dent appliances. It's nice to have someone who can show apartments and handle getting the units ready for rent because turnover is the most time consuming part of managing rentals, for me at least. If I was attempting to do the maintenance, I can't because I'm not all that handy, I wouldn't have time for anything else.

I think the auctions are a great place to buy. If your the high bidder it yours, there is no 45 days to close or negations or inspections or anything like that. That is part of what makes it challenging though. Just make sure you do your research and be prepared as you can for the unexpected. The competition for listed properties here makes it almost impossible to get a property you can flip and even many of the properties at auction are overbid in my opinion. It's like anything else if you stay on top of it and know your values you can get deals.