All Forum Posts by: Christopher Blanco

I am in Ohio, my CPA is in NY. They are real estate saavy, and the partner I ultimately work up through is an investor. Its worked well so far.

Can you assume the mortgage? But even if you buy the house how are you going to rehab it? 

You might be able to find HML to lend 60-70% ARV but its not going to be easy.

Why don't you pick some areas and invest out of state for a while and see what sticks? 

@Robert Gilstrap Never said my system or any system is fail proof. Garbage In, Garbage Out applies to any system. My plan is simply to implement a system where my PM's are motivated to keep costs down AND keep tenants happy. Why shouldn't a PM system be implemented where you make money when I make money? Obviously if I do not provide a quality property with quality tenants then my system doesn't work, nor would any system. If my system doesn't work, no one makes money and I will have trouble recruiting and retaining PMs. I am motivated to find a great property to attract great tenants and my PMs are motivated to keep costs down and keep my tenants happy as they do not make money on turnover. Its a win-win and that is what REI is all about.

I have worked with and talked to enough REIs to know that MOST (I do not know you so I will not lump you into this, obviously) PM's are not motivated because they make money REGARDLESS and in some cases in spite of the REI making money. PMs do a great thing and good ones do pay for themselves, but I think the system is broken and one sided. My system is just attempting to correct that balance.

I use several estimating methods. I use Realeflow's estimation tool and I also use the House Flipping Spreadsheet. I am continually updating and adding prices as I get bids. The more bids you get the better you will get. 

How far away are you from Cleveland? I went through a great program here called Freedom Source. It was 30hrs of real estate investment training and has been a  HUGE benefit to me. They are in Independence, OH which is about 15 miles south of Cleveland. It was a fraction of what the "gurus" programs cost, its also supported by and partnered with the local chapter of the National Real Estate Investor's Association. 

Freedom Source Website

@Nicole Heasley Beitenman I use an online CPA called Eco-Tax. They are VERY knowledgeable in REI and have a great rate and good support.

If you are doing a low end flip you can also put in 2cm granite.

Why not start off managing it yourself? My plan is to start managing myself. As I grow I plan on hiring and training my own property managers and tie their pay in large to my profits. I want a PM who is interested in me succeeding, because in a typical property management scenario, the worse I am, the worse the tenant, the worse the unit the better they do. I know that't not how PMs operate, but when you look at the business model, they make money when there is high turnover and high maintenance. 

By paying internal PMs on NOI rather than gross rent you are encouraging them to take BETTER care of the property because they make more money the less turnover there is and the less maintenance there is. In turn, in my rental model I ensure my units are as maintenance proof as possible. Its a win-win for everyone.

I would contact a good CPA and a good real estate atty to assess your individual situation, especially if you plan on making this a business and not just a hobby. LLC's offer WAY more than just asset protection...