All Forum Posts by: Collin Garbarino

I second @Jeff Richardson's concern that the MLS is overheated. We've bought two properties in the Houston area in the last year. Both cashflow. Both have excellent prospects for appreciation. We found both just by mentioning to people we were looking for real estate. Sometimes people just say, "Do you want to buy my house?"

Another thing to consider, almost every property will cashflow if your downpayment is big enough. A 40% downpayment might not fit into a savvy investment strategy, but you'll start cash flowing on just about everything in Houston.

"The Millionaire Next Door" book cautions people against practicing parental largess. 

You should think carefully about whether this sale will set your daughter up for success or will it continue to enable her so that she always depends on her parents to get by.

I closed on my second rental property yesterday. I bought the first property 10 months ago, and thanks to the education I've received on BiggerPockets I was able to use some of the equity on the first deal to buy the second.

The first deal was a grand slam. This second one is just a single, but that's okay. Every day I learn a little more. I listen to podcasts. I read posts and books. And I learn by doing. The learning-by-doing makes the biggest difference, but I wouldn't have had the confidence to do anything if it weren't for the great content that this community provides.

Thanks to everyone in the community for being part of that education.

I saw a crazy deal yesterday.

A house went on the MLS Friday afternoon for $115K. No pictures, and the listing agent wasn't going to schedule any showings until Sunday. I contacted my agent on Friday afternoon to set up an appointment to walk the property Sunday afternoon. By Sunday afternoon, the property was under contract, sight unseen.

That's pretty typical around here—not the crazy part of the story.

The crazy part is that something jogged my memory Sunday afternoon when my agent told me that we'd missed the opportunity. I had her look up the history. The same property had gone on the market for $70K just a couple of weeks before. I'd wanted to buy it then, but got beat out by a few hours! The guy who bought relisted it as soon has he closed and just hauled away the trash that was laying around. I missed out on the same property twice in less than a month!

So right now in Houston, there's no time to walk a property. I've just about decided that I need to hop in the car as soon as I see something promising, drive by it, and make an offer if the thing looks okay from the outside.

AND I need to work on getting an off-market pipeline running.

I'd appreciate anyone's thoughts on this kind of situation.

I recently heard a full-time flipper say that he needs to clear 20% of the ARV in order for him to bother with a property.

I don't know about selling a house, but I'm looking to buy an investment right now. Things are going under contract within hours of hitting the market.

@Egan Lohman, you've got some great advice there.

@Wilzon Marinero, don't neglect the advice about telling everyone you know that you're looking for a property. I got my first deal because I offhandedly told a neighbor that I'd buy his house when he was ready to retire. A couple of weeks later, he told me, "I'm ready to retire. Were you serious about buying my house?" I had no idea he was contemplating a move.

There's just no telling where that deal's going to be hiding. Get everyone you know to help you look for it.

No problem. Remember, if the numbers don't work at the asking price, offer a lower number that does work. 

Also, an interest rate of 4.17% seems too low for an investment property. I'd expect something more like 4.5%, but maybe you've got a kind lender.

I looked the property up on the MLS. Taxes are a little too low. They should be more like $200 a month. I also think that you should expect about $100 a month in insurance. Don't forget to check whether it will need flood insurance.

I also see that you didn't budget for property management. I'd put at least $85 a month for management, even if you're thinking of managing it yourself. You also might want to factor in what it will cost to get it rented, i.e., paying a realtor one month's rent to get a quality renter.

Make sure you double check with your realtor about whether you can get $1300 a month for that neighborhood. I don't see any other houses currently for rent in that subdivision. That $1300 seems reasonable to me, but if you can only get $1200, your margin is getting much slimmer.