All Forum Posts by: Chad Kastel

@Bo Goebel     @Trevor Schuler @Daniel Reyes  @Caleb Heimsoth

I Wanted to reach out and thank you all for your input. Remember this is only for this deal, If I'm making a mistake, then it won't be that big of a mistake. What we decided on was an 80/20 split in Jeff's favor. Dan doesn't get any of the 20% until he actually puts in work to earn that percentage. Jeff can always buy him out by paying what Dan has paid in to the business. I'm going to be putting offers in starting tomorrow. Today Dan brought be a BRRRRR deal that has the potential to be bought for 70% ARV, so I'm getting more and more confidant in his abilities.

For non biased responses I changed my name to Jeff in this question.  I was very much concerned with getting the best opinions and not what I wanted to hear.

At some point in the future I will update with how the partnership went.

Chad

@Trevor Schuler

Jeff is kind of in the middle of all these ideas.    0% is too little and 50% is probably too much.  The goal is for the partnership to progress to 50/50 on every deal.  It's really a perfect partnership on paper, Jeff and Dan fill each other's gaps very well.  They are both thinking about the big picture.   Jeff's not particularly worried about Dan screwing him, so it's more as if they're both able to do their jobs effectively.   

And just to clarify.   The way Dan will be gaining equity is after he does something.  So if he goes and does $1000 worth of labor, instead of paying him cash, Dan will now own whatever percentage of the property $1,000 is worth.  

The theory is Dan will take better care of the property if he has a piece it in.  Dan doesn't make any money unless the property makes money.   So unless the deal is a bad one (which is Jeff's responsibility to analyze,) why would Dan leave?

In addition, if Dan doesn't do the work he says he is going to do, then Jeff can just move on and replace him if necessary.

Hey Daniel,

Thanks for getting back to me.

1.  Two Partners.

2.  Jeff's is Providing 100% of the capital.  He is reading all the books, listening to the podcasts, dealing with the real estate agent, analyzing all the deals, and making ALL the decisions on whether to actually purchase each property or not.    He will taking care of the book keeping.  He lives 1,000 miles away from the location.

Dan is physically going to the properties, inspecting them, determining how much work needs to be done.  He will do construction work (split the costs) if it's needed.  He will manage the property and do all the repairs.  He will be consulted on the local area since he grew up there.

3. The deals we are looking at are mostly duplex's or very large SFH in college towns that have 8+ rooms (so more like a triplex)

I've formed a partnership for purchasing a property. My partner and I are trying to assign value and equity to each partner.  It's our first time working a deal with a partner and both want to be fair without being taken advantage of?

Jeff:  - Providing 100% of  the capital. 

                        -  Doing all the research and making the analytical decisions

                       - Does not live in the area planning on purchasing in

Dan:    - Grew up in the area and has intimate knowledge of the streets and connections

                          - Can do ALL construction and repairs

                          - Qualified Inspector

                          -  Will manage the property.

Jeff could just hire a construction worker, property manager, repairman,  inspector (and anyone else necessary) and pay them per diam.  But decided that based on Dan's skill-set he would rather give Dan sweat equity.  Jeff feels Dan will work harder and take care of the property even better if he owns a piece of the property.

The question is what is Dan worth to Jeff?   How much equity should Dan be able to work up to?  How does it scale?   If Dan was going to earn $500 per month for all his service, does that $500 get applied every month to his equity?  Or do we do it quarterly,bi-yearly, or annually to make tracking easier?

Thanks for all you help.

Chad

I've read the books, I've listened to the podcasts. I'm in the process of looking at potential properties, I'm days away from making my first offer. I feel confident that I'm in the right direction.

My question is how do I keep all these properties organized. I've been sent 20+ properties from a realtor, I've put all her emails in her own folder. I use the bigger pockets calculator to determine CCROI for rental properties. But I need a better way to keep all this information organized. I need a lists of places to go see, notes on the properties, notes on information I need from emails, a section for properties that I will revisit for future price decreases, And whatever else I'm missing. Any suggestions/help will be great.

Chad

Chad Kastel

I've read the books, I've listened to the podcasts. I'm in the process of looking at potential properties, I'm days away from making my first offer.  I feel confident that I'm in the right direction.   

My question is how do I keep all these properties organized.   I've been sent 20+ properties from a realtor, I've put all her emails in her own folder.  I use the bigger pockets calculator to determine CCROI for rental properties.  But I need a better way to keep all this information organized. I need a lists of places to go see, notes on the properties, notes on information I need from emails,  a section for properties that I will revisit for future price decreases, And whatever else I'm missing.  Any suggestions/help will be great.

Chad

View report

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

This Is a deal I'm looking at.   I've been looking for a duplex,tri, or quadplex for my first full rental property but I'm not able to find one that has a cash on cash Roi that is meeting my 11% requirement.    This area is an A area and every unit I've looked at has these type of numbers.    How many properties should I look at in the duplex-quadplex rental space should I look at before I determine this isn't a good market for those property types at the moment and move on to something else: i.e. SFH or flips etc..  I haven't found one that is even close to making an offer.

Hey Guys,

I'm new to real estate I've hit the ground running. I found bigger pockets about a month ago. I Have listened to about 45 podcasts since and am currently finishing both "Rich Dad, Poor Dad" and "The Book on Rental Property Investing" by Brandon Turner. I have many more books lined up and plan to be ready to purchase a property in the next 4 weeks. Below I have attached a screen shot of a spread sheet of actual properties. I want to make sure my math and variables are correct. I haven't included a mortgage because I think I will be buying in cash. I haven't included what the ROI will look like if I sell in the future because I'm still waiting on information from the realtor. I also have two additional questions. One, how should I calculate vacancy percentage if I'm buying a place with tenants that have a year lease? What if they have a two year lease? The second question is how much should I be spending on things like Inspections, checking the roof, A.C., and Sewer System? Is this a percentage based on the property? Any help will be appreciated.