All Forum Posts by: Chris West

Hi Everyone, 

I have my first (hopefully) BRRRR under contract. The property is a 3/2 in a C+ neighborhood, which I like, however, the big issue I'm having with the property is that it sits on 1.2 acres. Although it's a lot of acreage, I can see from google maps that most the acreage is covered by woods, however, there still is a large yard to maintain. From the walkthrough (I'm out-of-state), the lot was described as a medium sized lot. As far as a rental goes, should I be concerned that the lot size will be a deterrent to finding tenants? Would this be a good reason to back out of the deal?

I'm trying not to overthink on my first deal...really appreciate any insight! Thanks. 

It is an interesting question if it is true that there hasn't been a spike in wages (which it seems across the country that inflation has also hit wages as companies have to pay more to hire/retain employees) and not a massive influx of jobs, you would think that just because there is higher demand due to no inventory doesn't mean a tenant has more money in their pocket to pay the rent. 

I guess you could argue that if someone can't find a house to buy, they have the down payment money (if they were to put 20% down) to pay for rent, but without an increase in wages/jobs, and inflation currently eating away at that money, that well would run dry at some point. Irregardless of supply/demand, don't tenants need higher wages from a better job/working more to pay a higher rent. So who knows haha, it's a good question!

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My partner and I are out of state investors and are planning to buy our first SFH in Memphis, TN this fall in cash utilizing the BRRRR method. Our goal, unsurprisingly, is to get our cash back ASAP to reinvest into our next deal. We've spoken with a handful of lenders in the Memphis area and have had a difficult time finding a lender with no seasoning period, LTV 75%+ and terms of at least 20 years.

Can anyone recommend a lender that offers little to no seasoning period, 75% LTV (or higher) and at least 20+ year terms?

Am I searching for a purple unicorn?

@Brandy Fujii Sounds awesome! As a new investor, I am also looking to BRRRR in Memphis.

Was curious, are you out-of-state or in-state? 

Also, what zip are you in if you don't mind me asking? 

Interested to see how it all turns out! 

Thanks! 

@Jaideep Balekar Very inspiring! I am hoping to go down a similar path! 

You mentioned that the rehab on our first deal which we anticipated to be $120k actually ended up being a $200k. What made up the $80k difference? Where did the extra costs come from (i.e., was your estimate off, unforeseen issues, etc.)? 

As an investor who is aiming to acquire my first property by the end of the year, I am currently performing analysis to select an out-of-state market. Based on my research, every area that I'm looking to invest in appears to be "red-hot". There appears to be a lot of factors that are currently (and have been) contributing to the high demand for houses and the lack of inventory, such as rock bottom interest rates, the pandemic encouraging people to move from the cities and purchase homes, etc. With all that said, I personally believe that some of the factors that have led to the high demand will start to not be as favorable, as interest rates (and mortgage rates) have already begun to rise (and I think they will continue to rise) and the rollout of the covid-19 vaccine could potentially at least decrease the amount of teleworking as people return to the office. Keeping in mind that every market is different and there are creative ways to buy properties for below market value, I was curious what the seasoned investor thinks about the current macro picture and how/if that is influencing your buying decisions currently? 

Although I'm anxious to buy my first property, it seems like a good time to continue educate myself, and maybe it's not a bad thing to educate and really learn a market until the winter, when (and if) the market cools off a bit. Appreciate any thoughts on this. Thanks! 

@Darius Ogloza I think I'm following your point. I was using this method as a starting point to hone in on what city to actually select. You're suggesting that I'd be better off picking a city (maybe by going with my gut and maybe an area I am most familiar with/have connections there, etc.), and grow my knowledge about that market (neighborhoods, local economy, etc.) rather than looking at statistics. What I am trying to avoid at this point is pouring time and money into travelling to a location that doesn't make sense on paper. Thank you for the feedback! 

@Lee Ripma Will check it out! thanks. 

@Mike Sola I am about halfway through "Long-Distance Real Estate Investing". The book has some really good insight into how to put together an OOS team.  Will look into BP forums once a location is narrowed down. Thanks!

@Chase Macherzak Very good points. Thanks for all the insight! That's a good point on the turnkey to generate some ideas.