All Forum Posts by: Chad Kastel

Absolutely not on ever going cashflow negative. That means you're making an appreciation strategic play. That takes foresight and expertise. If you aren't finding cash-flowing deals you either need to spend more time learning underwriting/creative financing. Or you need to expand your search parameters. I know that may take your edge away b/c the further you go from your team the harder it is. If you only want to stay in your area in may just not be the time to buy. You may just need to wait for the market to catch up to the interest rates.

This is going to be a personal preference. What the CCROI? How much time are you putting in? Are you self managing? What kind of property (A class or C-class?) This is a question of risk and value of your time.

All BRRR really means is adding value. There aren't BRRR teams and anyone who tells you something is that cut and dry is either ignorant or looking to make money off of you. Hard money lending is a function of risk. The more experienced you are the better terms you will get. Go to local meet-ups and see if you can get connected to some local HML. If not, go national. Seller financing is literally any terms you want them to be. My suggestion is to put an offer in writing, especially if there is a RE agent. If you put it in writing they have to present it. In your cover letter make sure the agent knows they will get their commissions upon closing. The general rule of them is the better price you give the seller the better the terms for you are.

Broadly speaking it's always correct to pull permits. If you're going to evade that you better understand what you're doing, the risks, the local market etc. How much is the total renovation without pulling permits? What's your ARV post-pulling permits? How do you think you'll sleep at night taking on that potential liability?

The easy answer is referrals. The hard answer is you need to dig in and spend time getting to know your local vendors. You're of course looking for a rock-star realtor. The problem is they generally know they are great and it will be hard to get their attention. However, if you can get a rockstar team member it will be easier to find other rock stars.

Buy and hold is simply that. BRRRR is a way to create value. They aren't at odds but they aren't necessarily the same thing.

A buy-and-hold investor should be looking at 5-15 year horizons to see if they want to own a place. What does the economy look like? Is there population growth? Who is my tenant base? Is their employment (or way of paying rent) stable? Is this property new or old? The older it is the more I’d assign it to maintenance or cap ex for underwriting.

The interest rates will have an effect on the price of the building. The bigger the MF the more the interest rates will affect this. Banks loan on DSCR which is directly linked to the NOI of the building.

As for your tenant base and whether the rents will go up and down. Are you buying A-class units in a tech-heavy district? I’d be more concerned with my residents being able to pay rent compared to a B class full of nurses.

There are tons of information on what makes a market great (rising pop, landlord friendly, economic diversity). If you’re not familiar you probably should learn that as you dive in.

If you invest close to you it gives you an advantage of finding vendors and possibly knowing the lay of the land.

Your investment in multi-family should have a goal in mind. Are you investing in cash flow? Appreciation. They’re not directly at odds but a lot of the time great appreciation plays aren’t necessarily great cash flow plays.

In the last 6 months, I've recently become aware of NACA and had a friend go through the program. Use it, it's phenomenal and worth the additional obligations to obtain a loan.

Other programs are FHA and FHA 203k loans. Great for getting started with less money down. 203K loan will give you money for rehab.

#1. Get on to the website http://biggerpockets.com. Listen and learn the lingo and concepts. Lots and lots of fascinating strategies. Great for beginners. Be careful though, everyone makes it look like they have their sh** together and it's easy. It's incredibly hard. Started with original episodes from the beginning. There’s a ton of value and less structure in a good way.

#2. Go to local meet-ups. You're the sum of the 5 people you spend the most amount of time around. If you want to be a real estate investor then spend time around other real estate investors. If you're starting out I know it can be scary but we all started from zero at one point and time.

Warning: Don't go to a sales meet-up. It should be networking (or educational only). There shouldn't be a hard sales pitch at the beginning or end.

#3 There are so many asset classes. Single Family Homes, STR, Multi-Family, Assisted Living, MHP, and the list goes on. All have justifiable reasons to get involved. Don't fall prey to the shiny coin syndrome. Pick one and learn everything about it.

#4. Deal Analysis: Once you pick an asset class. Start underwriting. Watch videos to learn and start underwriting lots of deals. If you've networked at your local meetups you'll likely be able to find an experienced investor to help check your work. If not turn to Twitter.

#5. Conferences are bigger meet-ups. Multi-Day events with lots of education and networking. I've been to Joe Fairless in Denver and Jake and Gino's in Orlando which were great. Met great people that are still part of my network. I've also been to a terrible conference. Networking was garbage and lots of upselling

#6. Once you have the knowledge and confidence it's time to put offers in on properties or invest with other investors as a limited partner. If you invest yourself you will likely reap more rewards but you're also going to take on the pain of your mistakes If you invest as a limited partner you're essentially going to get paid to learn with less upside

#7. 7. After you've figured out your weaknesses or where you can improve, continue to educate yourself. I paid for coaching to help teach me how to run a property management business I interviewed 3 major players in the multi-family coaching space and interviewed their students.