All Forum Posts by: Mike Terry

looks good on paper... a couple of suggestions, bring on a money partner, way reduces risk of not being able to refinance. Will make your deal cash flow faster, yes you will be giving up cash flow for greater security and safety.  None of your money in the deal makes your returns infinite.

Kerstin,

Congrats on getting your first flip under contract.  I have had several fall back properties.  It is always a good idea to follow up with realtors after your offers are rejected.  It sounds like you are way ahead of most rookies with contracting experience, crews ready to go and material suppliers.  Best of luck and let us know how the project goes.

Hi BP Community,

I stumbled across this article this morning and I started to think about the impacts of these trends.  One of the things I really like about bigger pockets is the concentration of Younger, be it Millenial or some other generational designation. It's worth the quick read. https://www.marketwatch.com/st...

My sense is that the backlash that is starting to emerge toward landlords, entrepeneurs and anyone who has proven economically/financially successful my not be as popular here as it appears to be in the greater populations in these generations.  These forces and factors will have an impact on all aspects of the country,  Here are some I have thought off: continued backlash against landlords, moves to redistribute generational wealth through taxes, elimination of Social Security and medicare etc.  

I remember attending a Black Lives Matter March earlier this year at the urging of my mixed race daughter (for the record I am biracial) and listening to one young man shout "Eat the Rich".  Not sure how this sentiment was related to the cause I and my family were there for.  I don't think this is a pervasive view, but I do think a generation that has been left behind in many ways economically will soon have the numbers to impact the direction of our nation. I just thought this topic might spark some interesting conversation.

I struggle with what you are thinking about right now also.  I think decisions like this always go back to your goals and your timeline.  For people in my boat that are trying to build a cashflowing portfolio to help me retire earlier and maintain my standard of living.  So I think a moderately levered portfolio is wise and safest.  60 to 65% loan to value should acheive my goals.  Just some thoughts.  I hope this is helpful.

I am putting a vacation rental property on the market because I have a lot of equity in it. The Short Term rental returns are not satisfactory (approx 2.5% return, cash flow 400/month).  I am trying to make a decision on optimizing the proceeds.  I am leaning toward a 1031 exchange into a small multifamily or roll the money into a flipping fund to start completing some flips in cash rather than current hard money.  In my market we are averaging 13% cash on cash returns on hard money financed flips and 19% on cash deals.  Any assistance in helping me frame this decision would be helpful.  I am 51 years old and eyeing financial freedom and moving toward real estate full time.  I think the tax implicatons of flipping vs multifamily are obvious.  In addiditon I am in Southwest Florida and multifamily properties are hard to come by and very expensive.  I would consider a more affordable wouth eastern US market.  Any and all input is welcomed.

@Paul DeSilva building materials are mostly steady, but shortage of appliances and lack of selection is increasing the quality were using and cost of course.

Just closed on a flip on Monday.  We have 4 underway at the moment.  Prices continue to rise here in Florida, listings are getting gobbled up as soon as they go on the market.  There is an end to this, but if you can predict it you have no need to invest in houses.  Good luck to everyone.

Yeah sorry can't help you there, my partner is a contractor and he is contemplating some new builds at the moment, but I have not considered it.  Multifamily is hard to come by I may be interested in building some tri's and quads.  The current cost to build and exisiting inventory is pretty divergent ( existing ins very expensive and is all less than 1% rule in my market.  I would never use a builder that wouldn't let you pick your materials or at least designate, budget, mid grade or high end.   Builder grade is what it is.  I would think with some research you could find a builder with plans.  I like working with small companies, more control and communication.

Build in a x flood zone or elevate your home significantly about established elevation.  REgular HO policy should be 1600 to 1800 for a asphalt shingled, new build 2500 to 2000 squarefoot home.

I flip in Port Charlotte.  Things to be aware of.  This is mostly a rural to literally sub urban area.  Most homes are on septic and well.  Some have city water and remain on septic.  We have flipped 2 homes there and both needed new septic tanks and drain field.  Area is appreciting fast because there is a severe housing shortage here and people are coming to all of Florida from high tax states (New York, Connecticut, New Jersey, Massachusets, Illinois).  I don't see that abating.  The country's population continues to age and many are financially underprepared for retirmentment.  Covid 19 has accelerated this trend.  If you are a 58 year old and you have been laid off due to the virus driven recession.  Your job is probably not coming back.  Many of these people have most of their wealth in their home in high priced markets.  So they are choosing to sell and take advantage of buying a home in affordable Florida markets.  So I think the demand for housing in Florida will be steady.  I don't think building is a bad idea in that market.  Growth will come and both areas are among the cheapest in coastal Florida. The reason I don't build...exposure to an extending time frame, building permits are causing delays in both counties right now as local governments deal with a backlog after being shutdwon in April through June. Spec building is inhently riskier than redevelopment.  Land is cheap, but preping a lot, clearing, and septic are expensive.  We can turn flips in 45 to 60 days.  We are buying at a or below 70 percent rule in a rapidly appreciating market, hard to beat with new builds.  Just some things to think about for you.