All Forum Posts by: Christopher Fougere

I can say that TK can be great for cash flow - IF you buy the right deal from the right vendor. Example I just bought one in Independence MO in a top end school system for 92k that was listed as a 3/2 but had 2 extra "bedrooms" in the basement. This rents for 1200, and my COC on this deal is 23%. Zillow estimate for this property was 100k.

However that was a lucky stroke - pretty much every TK company I have run across are selling properties that are not exactly my preferred type of investment.  Not only are they at top of market with no built in equity but they also typically are in rougher areas where they can buy houses cheaper, so that after the rehab they can still make a profit. 

Now I have money to spend and want to buy 2-3 properties before school starts up in Sept - and every day I get emails about several TK opportunities but I am passing on all of them. Instead I am reaching out to realtors, with whom hopefully I can build some trust in areas I like where perhaps I can find a better deal. My plan is slow since I am investing out of state. I had some success from 2015 - present, I was able to buy 7 SFR all with COC of 18-25%, and I'm picky about where and what I buy, but now it's a real struggle to find anything worth buying.

I have never been - I am always meaning to go, but life gets in the way.  The areas I am interested in now are very difficult to find deals.  There are TK vendors offering properties but the areas they can make money in don't appeal to me.  I have been working with @William Robison for the past few years and he has kept me in safer investments.

I'm an investor from VT, but have been investing out of state (mainly in MO, most recently in OH) the past few years.  We've grown our portfolio (my wife and I) much faster than we originally planned - seems that is not unusual, but we are possibly looking at opportunities in SW FL.

I will be in the Largo beaches area Apr 21 - 26 and am looking for a potential partner in the area to help find deals. What I am looking for is a Realtor and/or PM or combination of both that has an excellent track record in SW FL who can steer me away from trash properties. My strategy is a boring but lower risk one - safe areas with good schools SFR 3BR 1+ bath. I don't consider multi-family at this time. Thanks!

I just locked 2 in last week for 4.875 on a 30 yr fixed

@Ginny Nelson - you could probably get in under a TN visa before Trump kills NAFTA.  That's how I first got in 16 years ago :-)

Money is cheap now.  It won't always be.

I'm one of the lucky ones who likes his job and wants to continue working, so I will likely continue to buy leveraged properties as soon as capital frees up, the more properties added the faster this happens.

1 on the remote thing.  I haven't worked in an office in years, and have opportunities in the field weekly.  Top talent likely won't relocate, so you'll need a fresh graduate and hope they work out. I'm not interested per se, I just see where the industry is going

I asked a similar question to my FA...

1. We are closing 2 more rentals next month. Does it make sense to use extra funds to finance more houses or pay down mortgages for cashflow at 55? With interest rates (still), at near all-time lows, I’ll strongly advise against paying down your mortgages. Think of it like this, if your capital earns a 5 or 6% cash flow, why would you use it to pay down a loan that has a net cost of below 3%? Again, this is a complex issue, and it’s the one I find people struggle with the most. We’ll talk more about this one too.

Do you have children?

I could quit my job I suppose, but I enjoy the mental challenge of being an engineer also, and the large salary that comes with it.  I'm going to see my kids thru their undergrads which is another 10 years for us.  By then I will definitely be able to retire, but I likely won't.  If someone is going to pay me a high salary for my brain and I can still grow my RE business that's a no brainer for me.  I'll likely scale back and just consult or something once the kids are thru their undergrads, but I can't imagine leaving the workforce entirely.

Jan 2015 my wife and I decided to commit some savings and use the equity in our home to acquire a rental property (SFH) in the KC area. Since we are in Vermont we found a broker we could trust and in the past 2 years have managed to purchase 5 properties.

We are at the point now where we are trying to figure out what our next step should be?  The rentals are cashflowing - we had some bumps along the way, but the choice to go with lower risk investments so far has been a good one.

I'm looking at purchasing a duplex and while the numbers look great, the cost to play does not. I'm looking at needing to bring 40k to close which is over twice what I usually have to bring (25% and 2 doors I get it) My question is how do people get past this hurdle? Buy and flip for cash? Sell an asset? Partner? Other? Does it make sense to skip this expensive purchase and go with another SFH, and then another in a few months? A 40k cash to close will stretch what I am willing to spend. I can swing it, and will enjoy solid returns but it will leave me less comfortable than I enjoy being, and is that worth it?

This is not a full time gig for us, we are both professionals with solid incomes, perhaps I should not be rushing things, however I'd like to grow sooner rather than later while I can take advantage of the market and cheap money.

What do you think?