All Forum Posts by: Chris Watkins

Getting enough passive income to step away from a job is going to be hard to do in Oregon. We're an appreciation market, not as much of a cash flow market here, unless you're putting a large down payment or actively managing STR's.

Buying out-of-state can get you more cash flow, but the tradeoff is less appreciation (usually), and cash flow can be eaten up by maintenance and expenses. I agree on investing in the market you know.

Nice work, Barbara! Like Eric said, investing is the long game. Holding anything for 5+ years will make you look smart. Take calculated moves forward and your efforts will compound!

Sounds like a great plan! You can put an agreement together where you capture any depreciation (if your tax burden is higher than hers) rather than split 50/50. You'll get to write off any home expenses against your rental income as well. 

As a lender, I see multiple parties signing a mortgage all the time. There is a "joint and several" clause in every lien that means you are both 100% responsible for the payments, so always something to keep in mind. 

Another alternative would be to buy the property yourself, keep the mortgage in your name but have your daughter on the title. That is a common arrangement as well, that can be done after the loan has closed, too. 

Happy to answer more questions, shoot me a DM!

Ah, I've brokered with them and they were cool with adding my fee on top of theirs, but that may not fly with your client.

 Have you talked with Zach Smith at Cetan Funds? Sounds like a deal he could do.

You can buy investment properties with conventional loans under your own name. No need to add an LLC when you're just starting out. You won't qualify for an FHA loan and if you've got 25% down, you wouldn't benefit from one anyway. If you need an LLC for tax reasons later, you can move title into an LLC later for a couple hundred bucks. There's enough to learn when you're starting out, keep it simple.

I can help on the HELOC side if you want to know what you could get out of the property without selling or doing a full refi.

Think in terms of Return on Equity. This article is a good primer: 

https://www.sageregroup.com/the-secret-formula-to-getting-ri...

It depends on your long-term goals. Don't make a move thinking of the next five years, but further down the line. Re-investing that cash will buy you a lot more top-line value, but your cash flow will take a hit for a while. When it comes back, it will come back bigger (5-10 years). Just make sure that you're investing in an area that will continue to see appreciations (midwest and TX/FL may be iffy on that). 

Don't worry about giving up the rate if you're looking to grow your portfolio. You could potentially take out a HELOC rather than sell to invest as well.

SFR with room to build on the lot will be much more plentiful than duplex/triplex deals. Cost to build an ADU are high, however, so it may not pencil out in the short-term. Depending on your investment horizon that may matter or it may not. Your equity won't likely increase beyond the cost to build because there aren't a ton of ADU comps on the market yet.

Having 2-3 contractors in each field is important, as your preferred guy won't always be available. 

High rates are here for at least the medium-term (1-2 years), so deals will have to pencil in this current environment.

You may also want to consider hard money for your lending, as they can often fund your construction with far fewer restrictions than a HomeStyle loan. It's more expensive, though, so there are tradeoffs.

Happy to chat, shoot me a DM.