All Forum Posts by: Christian Beyer

@Elliot Vann

Hey Elliot working on that now- in the meantime a friend and I are making offers on multi families in the 55-65K per unit range but it is very competitive. Our last 3 full price offers have been out bid. We know we are fishing in the right pond- just a matter of making good offers and getting a little bit lucky.

I’ll post another follow up soon!

Alright guys- here's the final follow up. 

Property purchased in August, and we have tenants April 1st meaning I had to carry the $927 mortgage and $113 insurance for 7 months (ouch). We ended up increasing our original rent total from $2,400 to $2,750 based on demand from the original posting which will help us recoup some of the losses. 

In total the repairs, maintenance, and carrying costs will come in around $53,000. With a purchase price of $175,000 we are in this thing for $228,000. The good news is that a good comp only 5 blocks away sold for $310,000 in February (when most comps were in the $230-$260K range), which means our value when fully rented should come in somewhere in the $250,000-$260,000 range. 

This is by no means a home run, but starting in April we will be cash flowing ~$370/mo after all expenses, vacancy, capex, etc. I certainly have learned a ton and paid for my education. The best thing you can do for yourself is find a good property manager like @Ronald Bowser and his team because they have made an intolerable situation tolerable and an impossible situation possible. 

Good luck out there guys during the next few months it is certainly an interesting time!

CB

Hey @Kevin Salamea 

I've been investing in the eastern side of PA (greater Philly and Lehigh Valley) for a few years and I've lived in central/western PA about 10 years ago. In my opinion what you are looking for is not only a difficult find but can be a risky investment. The good markets with population growth and stable jobs have very few (if any) multi-family units in that price range and if they are listed in that range they will likely require a lot of work to become rent ready, or even habitable. You can find multi family for 100K in rural areas but the quality of tenant and hassle of locale will likely not make the investment worthwhile. The quality of tenant for single family in that price range may increase, but cash flow will suffer.

Instead- I would up your price range to the 150K-200K range and you will find that there are still some deals out there in the major markets that don't require heavy duty marketing or a PM who has insider knowledge. These deals can be found with a little hustle and a with a good team (like you mentioned) can be done from a distance. In fact, you may want to begin vetting property management companies in the area where you are looking and then ask them what types of properties they like to manage in your price range. This can help to ensure that when you do close on a deal that you have everyone's buy in and the project has a higher likelihood of success. 

Best of luck!

Hey guys- so I wanted to post a follow up to my post above since it received some attention. I think one of the best things about this site is that people can feel free to post about their success stories, but also about their losers.

So this purchase seemed like a real winner (and it may be one day) but things got much more complicated after we tried to get our certificate of occupancy from the city. Apparently the previous owner had pulled a bunch of permits for work to be done and ran into some major hurdles (including the need to install a new fire escape, install a new floor joist, and move an interior staircase). The work likely totaled so much that he just decided to sell instead, which is where I got involved. 

None of the needed work was disclosed in the selling process, and we did not know about the 50K of needed repair until we got involved with the city and tried to get a certificate of occupancy. We are now in the process of 1) asking politely for the previous owner to pay for repairs ahead of a potential lawsuit and 2) getting quotes to do the work. We are hopeful that we can complete the project for 30K, which would still leave us with a decent amount of value in the property. 

It is 5 months later and we still don't have any tenants- but this is where having a great property manager makes a huge difference. My PM used her own lawyer to contact the seller, and is covering the mortgage until we get some tenants placed! I'll try to remember to post a follow up once the work is complete and the place is fully rented. 

Hey Travis,

Currently my brother and I are actually looking to raise money for a potential syndication in Phoenixville, we have the project and the refinance secure but we need to raise a chunk of change to fund the build. Our summer intern has a few weeks left before he leaves for the fall- do you have a 10 hours a week to dedicate to the project? Would be a great way to get in with some seasoned guys, and provide value with some hustle and tenacity. Send me a message if you are interested. 

Christian

Jordon- welcome to BP. I've been looking for more activity from people in the State College area, but I haven't seen much traffic. I added 'State College' to my keyword alerts, so I'd recommend doing that just so you can keep in touch with anyone else in the area who is on BP.

I wanted to add myself to this thread because as an Alum I've always been interested in the idea of having a rental in State College where my friends and family could go back to for game weekends. My best case scenario would be something like a duplex in the surrounding area with one long term rental and one AirBnB rental that we can reserve for the times we want to come back. My preferred RE search engine Redfin isn't even in State College yet!

If you ever want to chat or just keep me posted on your project I'd love to hear about it. Good luck, WE ARE!

@Jhon Restrepo

Hey John- Pennsylvania is a diverse state with major metros, secondary markets, suburban, and rural regions. They key for me is to find one area- a few square miles but no more- and get to know everything in that sector. When you look at an entire state it can be confusing and difficult, so narrow the search.

After spending weeks and months looking at the same few blocks the deals will jump off the page when you see them. Run one property through the BP rental property calculator every day, this will add to your education. Then start to build out the team. You’ll need an agent, preferably a broker, and it’s a bonus if they have in house title. Then you’ll need a lender, preferably one that is familiar with investors and their requirements. Lastly you’ll need property management, I was fortunate enough to find a firm that has agent/broker/title/PM under one roof and it made everything clear from the beginning.

Hope this helps!

@Kristin Caras

Hey Kristin- I just started investing in the Lehigh Valley after a few years investing in suburban Philadelphia about an hour south, and there are definitely deals around. When I was in town, I wanted to focus my search on the developing area surrounding the PPL center in Allentown as a potential for future growth in rents and value.

I picked up a renovated but vacant triplex for $175K at 4th and and W Turner that needed $10K of work and is now listed for rent. I can recommend some people in the area as I’m pleased with the team I have in place now.

Good luck!

Christian

@Jeff Carpenter thanks Jeff.

For anyone searching for BCM Credit Fund I found their practices to be rather deceptive, as they will provide no references or background on them or their company. They seek out projects on BP where hard money isn’t a good fit and charge 3 points plus a 1% transaction fee (which is on top of the 12% rate). If we had proceeded with them I would not have been surprised to see them charge the fees up front and the fall off the face of the earth.

Please do your homework and always get references.