All Forum Posts by: Christian Sabatini

Hello! Is anyone familiar with investing internationally? I want to buy a STR overseas and was hoping for some pointers - what to look for, how to analyze the market(s), etc. Also, what are the legalities - if any - from a legal perspective? Do you need to buy under a business entity? Can you buy under your own name? Etc.

Thank you so much!

Hi Gilda,

The feedback and replies you have gotten are incredible and worth pursuing. The advice I’d give you - that I haven’t seen - is to get good at running numbers. Of course, as a first-time investor there is no way of knowing everything, and having someone to guide you who is knowledgeable is vital, but you have to get comfortable running numbers.

Use the calculators provided by BiggerPockets and run numbers. You’ll see that (1) you’ll learn a lot about your market and the different areas and what you can expect; (2) your search criteria will tighten up and you’ll have a better grasp for what you want/need; and (3) you will understand the numbers much better and what deals will/won’t work.

Hope that helps, happy investing!

Quote from @Joshua Janus:

Quote from @Christian Sabatini:

I have ran across an amazing opportunity in a 3bd/3ba townhome that ran some great numbers, but it has been bought. I want to call the owner and see if he would be willing to sell any other property of that kind, but I have no experience cold calling. What are some ways that you guys approach these calls and move the prospect into potentially selling another townhome?

Get as much information from them on the first call as you can. Here is what I try to gather:

notes on owner / owner motivation

units / beds / baths

price range

Save email / phone #

price?

Lease price, structure, length and longevity of the current tenants

Condition of the capex items including the roof, structure, water tank, furnace, ac, appliances etc.

Keep engaging with them and create consistent touches. Maybe try to meet the owner, that helps as well. 

That is extremely helpful information! Thank you!

I have ran across an amazing opportunity in a 3bd/3ba townhome that ran some great numbers, but it has been bought. I want to call the owner and see if he would be willing to sell any other property of that kind, but I have no experience cold calling. What are some ways that you guys approach these calls and move the prospect into potentially selling another townhome?

Quote from @Victor Steffen:

@Christian Sabatini Interesting Question! curious to hear what you think as well? 

IMO: higher rates are just another line item in your pro forma. If the cashflow margin is adequate with the higher rates go ahead and proceed with the traditional 20-25% down payment. 

More equity in a deal does not limit our exposure- cashflow and liquidity does.

In a nutshell- I suggest my clients increase their reserves rather than put that cash toward a larger downpayment if the property will hit our cashflow target. Always good to have some dry powder especially in the changing market environment!

I love the point you make! If a deal is fundamentally strong, including higher rates in your numbers, then it’s a deal that should work regardless of environment (accounting for the fact that you’re in a growing area with jobs, etc.)

Considering I am still in the process of buying my first investment, I would note that I am not speaking from personal experience - instead from my limited knowledge of macroeconomics and real estate investing.

Personally, I do agree that having higher reserves and having a fundamentally strong deal is the key to prospering in a market like this. Inversely, I do think that as rates go up, margin for error contracts (following much of what you say with cashflow and liquidity), and that may leave a lot of aspiring investors - usually the ones with less capital to deploy and/or in reserves - facing a harder battle.

Quote from @Victor Steffen:

You should, absolutely, 100%, continue to invest. If you're following sound fundamentals (buying 20% below market value, cashflow positive real estate in areas with growing populations) it would take a true black swan to derail your growth and leave you worse off than not investing. 

How do you feel about leverage in regard to higher rates? Would you warn against being over leveraged? Do you think investors should try to put more money down to lower LTV? …

Having listened to both the BP Real Estate Podcast and On The Market in the last month or so, I find that there is much more uncertainty present as to what direction we're moving in and the best way to handle a possible recession. 

With rising interest rates and inflation, a changing market, and different dynamics in our investing world, what are some of your own personal ideas in regard to investing in today's market? Would like to open a conversation as I think there are valid points on both sides.

Quote from @Will Barnard:

Most common question on BP. Review this thread, specifically my post which goes into great detail.

https://www.biggerpockets.com/...

Great! I will check that out. Thank you so much!

Quote from @Sarah Isabella:

Hi Christian, 

 I use a "cheat sheet" that has interior and exterior price points to help me calculate the repair cost.  Additionally, if I'm able to I bring a contractor with me to the property to analyze the deal it's very helpful. 

Thank you so much for the input, Sarah! Additionally, where would I be able to access a “cheat sheet” myself?

While looking for potential investments, I've tended to steer away from analyzing deals that require heavy rehab simply because I am not sure how to estimate rehab costs. I've watched the BiggerPockets video going over how to estimate ARV (based on comps of your post-rehab property, etc.), but how do I know how much I actually would need to put into a property?

Any feedback is greatly appreciated!