All Forum Posts by: Chris Coleman

@Josh Fenton

Two things I recommend that will hopefully help you steady your emotions and move forward:

1. Solidifying your money status. That is, determine exactly how much money you have to invest. This includes both your private money, as well as any lending you will get. If you need a mortgage, then go ahead and talk to Lenders to confirm how much you can borrow, how much you will be required to put down, etc. Get the money squared away.

2. Establish your investment criteria. By this, I mean determine what types of properties you’re looking for and what types of returns you need.

You’ve determined RI as your market. What cities? Class B/C? Single-family, duplexes, etc? Are you looking to do major rehab, light renovations, or practically none at all? What is the minimum cash flow you want to achieve?

Once you’re set with these two items, then it will hopefully give you more confidence as you evaluate potential properties.

@Jeremiah Kovarik

For multifamily, or any rentals, you ideally want to invest in major markets where people want to live and can pay the rent.

That means:

1. Population is growing in the city, as shown by the last three years data

2. Employment is growing in the city

3. There is ample diversity in employment, such that a downfall in any one company or industry can not take down the entire market

If people are moving into this city and have plenty of employment opportunities, then that’s a good start.

Next you want rental vacancies to be low, and rental rates to be steadily increasing. But not drastically overheated.

@Dan Handford

Agreed.

Great operators are transparent with their investors. Great operators require great property managers and hold them accountable. And great operators care about the overall growth in value of the apartment community for everyone involved, including the investors, property managers, and residents.

@Russell Dodd

A question you need to ask yourself is do you plan on acquiring more rental properties? If so, then finding a good tax accountant who is experienced with rentals and real estate investing is a good idea.

You said the general accountant you used is unknown to you. So it’s not like your leaving a long term relationship with them or anything.

@Brett Richardson

I am in Joe Fairless’ program, and I can say for me it is great. My interaction is always directly with Joe. He only takes a certain number of students at a time, so you get his direct attention.

Also, so many other students in Joe‘s network are extremely helpful and everyone really seems to help each other. Within days of joining there were people reaching out and connecting with me to offer their help, advice, and value.

@Jef A.

You need to determine from be start whether you’re going to hire a PM or manage yourself. If hiring a PM, then you plan this into the operating expenses from the start, when you’re looking and running the numbers on potential properties to buy. And as such, you only buy properties where you can still get the cash flow you want/need while including PM.

@Dylan Thomas

Have you estimated what the actual payments will be in both scenarios? I'm guessing it's probably not a significant difference. Assuming the ARM is not Interest-only, right?

If that’s the case, then I would go with the 30-yr fixed. You’ll sleep better at night...

@Ana Bermudez

In which scenario would you realize the greatest net increase in your cash flow? I would strongly consider that one.

@Benjamin Sol Ignacio

Personally, I prefer to know my CoC using only "real" cash that I can put in the bank. So on SFR's, in years which I am holding the property and not selling or doing any cash-out Refi, then I use simple CoC. Equity is not real cash during those years if you're not using it somehow, so I don't count it in my ROI.

When the asset is sold (or cash out refinanced), then the equity is realized and so then I include it in the ROI.

However, from a business perspective, note that when you're calculating you're ROI in communicating with banks or investors, then you should include both.

@Aaron P.

It would be 8% annually, and paid out however you decide with your Investors. Could be monthly, quarterly, etc.