All Forum Posts by: James Campbell

@Austin Bright No problem! So the HELOC would be taken out of my primary residence. I built up equity when I move it and fixed it up 2 years ago. I settled for a condo as a first property because I was in the same situation as you and I couldn't afford a duplex. I set up my 401k (through work) and an IRA on the side about 3 years ago and I've been contributing as much as I can since then. Now I'm trying to figure out ways to access that retirement money to invest in real estate. To answer your question I would say at this point be patient and save as much as you can until we see what a post-coronavirus economy looks like. You definitely don't want to over leverage yourself and buy your first property while property prices are falling. You may be able to get into a duplex cheaper if you wait a bit and the housing market takes a hit. Some other things you could do is look for an off market duplex that needs some work and try to buy it for a discount. Also you could look for a partner and split the duplex and its costs in half.

Hey @Austin Bright I'm in the same situation, looking to get started investing in real estate as soon as we can get back out there and look at properties. In the meantime I have been working on my LLC which I just started on April 4th. I used incfile.com and they basically did everything for free (it only cost $150 to file in my state). Then used Fiverr.com to hire a freelancer to create a logo which you can see here in my signature. Then to create my website I used website.com, you may not need one but I wanted to establish some credibility to potential lenders/investors. You can look at mine if you want to get some ideas (link in signature). All this cost me less than $300! Other than that I've been working on a business plan, I bought a lead list using listsource.com, driving for dollars using the Deal Machine app, applied for a HELOC, opened a small business bank account and now I'm looking to rollover my retirement accounts into self directed ones to buy RE with. Educating and networking are a given and we should all be doing this every day as real estate investors. Good luck with everything let me know if you use any of those platforms I suggested and if you have any questions!

@Howard Eyre I happen to be in a similar situation as you. I had the same idea a few months back, that I would get my RE license and that it would introduce me to all people and aspects of the real estate industry so that I could start investing myself. I started interviewing brokers to sign with and that's when everything started getting shut down so I had to put that on hold for now. Since you're a new agent and your step-brother is your broker (and also an investor) you may need to lean on his experience a bit when presenting to potential clients. Does he have some sort of "credibility packet" you can take with you when meeting with people that shows you're backed by an experienced broker? Another thing I've been doing to invest in real estate since I can't meet with brokers at the moment is work on my LLC. I've been doing a lot of legwork like organizing the LLC, setting up funding, bank accounts, etc. so that when I can start looking at properties again I will be prepared to make an offer. Anyway, I'm a newbie too but that's what I've been working on, I hope it helps. Best of luck!

I agree with @Krishnan T. on his last point about inflation being far more complex than just printing money to pay off debt. It's too complicated for me to explain but I think J Scott does a good job explaining how it works in the episode that @Annchen Knodt linked.

@Jerrel Almeida I'm a brand new investor (0 deals) and so far I'm trying to make the most out of the situation. I just passed my real estate exam in February and I was in the process of interviewing brokers to sign with but I had to put that on hold for now. One positive is that I finally have time to do a lot of the leg work that I've been putting off like organizing an LLC, opening up a bank account, getting pre-approved, etc. Things that don't require meeting anyone in person so that when things get back to at least semi-normal I'll be ready to capitalize on some of the opportunities that I think are coming.

@Steven Le Thanks for the input! You're right $2,500 was way too low but the $4,000 in repairs per unit is more of a budget for small repairs like holes in the wall, painting a room, or cleaning a unit.. things that wouldn't necessarily increase the value of the property. 

@Tchaka Owen Thanks for the expert analysis!! To your points...

1. I based the income on all 4 units rented because I like to see the future (or market) value but maybe that's a mistake since it clearly inflates the numbers. Also you're absolutely right, the likelihood of me buying this property and moving in is basically 0%! lol, but I watched a BP webinar and made a goal to analyze a property a day and since I' m really interested in Florida RE and my mom lives in Riviera Beach I figured I would start there. (I like the COVID-19 analogy lol)

2. You're right $2,500 was way too low, beginner mistake.

3. I did not know that about FL taxes so thank you, I will keep this in mind for analyzing future properties. 

4. Okay I'll raise them to 7% just to be safe.

5. Another good point when investing in FL, I should be paying close attention to potential flood zones.

6. I got the $1,200 from rent-o-meter but since you're a licensed agent I trust your opinion and I'll change it.

After making all your recommended changes I ran the numbers again based on me not living there and I learned a lot. I would need about $84K to close and ROI drops to 15.37% but cash flow remains high at just over $300+ per unit.. I can see the advantage to finding distressed multis and fixing them up yourself. I attached a link to the new analysis in case you want to take a look.

https://www.biggerpockets.com/...

Thanks again for the in-depth analysis of my analysis! I'll use your advice when analyzing FL rentals going forward!!

Hey guys, I just started analyzing deals in Florida but the numbers seem too good to be true.. especially cash flow on this one. Can anyone spot an error in my analysis? The numbers are based on $10k off asking price, 3.5% down FHA live-in 4-plex, and $1,200/mo rent for each unit. Also the property is turn-key so I figured $1k repair costs per unit.

Thanks!

View report

*This link comes directly from our calculators, based on information input by the member who posted.

@Joshua T.undefined

@Nancy DeSocio Okay thanks again Nancy! I'm looking to at least get locked into a low rate for the first year so that's excellent news.

@Anthony Thompson Thanks for the great advice Anthony! I'll be sure to keep good records and read those forums ASAP.

@Nancy DeSocio Thanks for the advice! The money is to buy rental property although I don't have anything lined up at the moment. I'm thinking establishing a line of credit now, while value is high and interest rates are low is a good idea so that when something comes up I'll be ready.. Is that typically how a heloc works or will the lender need specific details on what I plan to do with the line of credit? Thanks!

@Anthony Thompson Thanks for the response! I'm not worried about closing quickly, just trying to take advantage of high market value and low interest rates. Those other terms are important too, I'll make sure to look into them as well.. I didn't realize some helocs have the ability to convert to a fixed rate so thank you!

@Larry Sanni Thanks for the input Larry! I'm finding online and here that PCU is probably the best option.

@Sam Albert Thanks Sam, everyone else has said to go with PCU as well so that is probably what I'll do and stay away from the online lenders. Also that's really good advice to establish a relationship with a local bank so thank you!