All Forum Posts by: Craig Moore

Awesome answer. I am very opportunistic, that being said, even if I did go the duplex route the thought of having such an open opportunity to make additional capital with no real expenditures = crazy ROI. I have to make that leap...soon. I do not want to sit around thinking about what ifs. I would feel much better if I experienced it and then said ehh, maybe I won't do that. (This is in terms of experimenting not buying properties and seeing what happens). I just graduated college and I was given 1YR to be out and this was last May. The time is approaching. The kitchen won't be hot but I'd rather not linger especially if I can go one of these routes.

Hi BP,

I've come to you with a few questions about some scenarios I had in my mind. @Joel Florek helped me hone in on what exactly I need to do (thanks, Joel!). I come here in hopes of getting more opinions on if I have my head on right or not and what tweaks need to be made.

I will start by saying that I would like to be self-employed by 30 and when my first child does come in my 30s I will want (unceasingly) the desire to be a stay at home parent. I would like my portfolio to be majority buy and holds as I will need the cash flow to reach my goals. Here are some scenarios, let me know what you guys think.

Scenario 1: This is the scenario I have lulled on the longest. I do not have much capital ($15K>), but I do have a starting base that is encouraging. I am in a unique position where I have the ability to wholesale at very little cost ($200>;1k mailings). I had the idea of wholesaling up enough capital to have 5% down for a pretty decent house (3-family) in a nice neighborhood. I know of FHA but am not sure of the house quality. After speaking with Joel he thought it'd be pointless to waste time trying to wholesale when I could be using that time to build equity somewhere else (wise advice). My idea was to buy a turnkey property, one that didn't need much work at all. If any, minor or cosmetic at the most. Is this unrealistic? Should I be going the BRRRR route? What do you guys think?

Scenario 2: This is an idea that I initially had coming in. Buying a duplex and renting out the other apt, living for free and refi the next year. However, I shot that idea down because I figured (and was advised) a 3-plex would be better for my buck. But in relation to scenario 1, should I just go for a duplex, put in the time, build equity, refi next year and then get a 3-family? Thoughts on this?

Also, please let me know if I am misinterpreting something, but are refis' not as "attractive" with houses that are already in good condition? What is the difference between buying a home already in great shape vs not so great shape outside of the possibility to raise it's value? I believe I am missing a piece to this puzzle. Nonetheless, I'm confident you all can help. 

So to sum this up, I am now considering these 3 options, but #2 seems the best right now:

1) Wholesaling for about a year to build significant capital then buy a 3-family. (Reminder: my marketing costs are virtually non-existent and I could possibly mail 2x a month)

2) Buy a duplex relatively soon, rent it out, build equity, refi and then buy a 3-family. (Awesome advice, Joe!)

3) Buy a duplex and still wholesale on the side (this opportunity is almost too good to pass up). Could I then combine refi money and wholesaling capital to then buy an even better property? Thoughts?

Thanks!

@Russell Brazil Do you mind sharing what this strategy has done for you? Any particular amount of deals you see per month doing this? I'd love to hear it.

 Wise thinking. I see what you mean.

 Weekly? Do you think that would bug your farm area and be annoying to them? 

Hi BP,

I'm curious as to what you all would do if you knew you didn't have to spend a DIME on your marketing budget for wholesaling (this includes letters and postage)? Use your scenario in terms of direct mail letters only. How many letters would you send out? What would your strategy be? Would you take more risks marketing to different categories? How wide would your net be? This may be coming off as vanity but that's why I'm asking. In an ideal situation what would YOU do? 

Thanks,

 Thanks for your input! I am currently a commercial property manager so I have already been exposed to a big office building. I've seen it all from HVAC, plumbing, leaks, you name it. I never considered what a max would be for me right now though.

 Exactly. I would like to stop at 4 (haha). By the time I have them I would like to have an immovable foundation to literally watch them grow. 100+ units or more maybe. Depends. I've got 7 years, and I don't plan on messing up "because I have time to fix my mistakes" as I've heard countless older people say. Do it right the first time and I never know what that could bear..

 Hell of a response, Gino.  I know for a fact that creating passive income and being self-employed BY 30 is totally engraved in my mind. Real estate is how I would like to go about it. I like to think that multis can provide a nice income for myself, but in regards to starting a family, which I will in later years, I need to know that I have a massive/large enough portfolio to take care of my family comfortably. 

 Thanks, Chris! I agree that waiting to save up money for every deal would take forever and is not something I planned on doing. That was just an idea for my initial purchase. I am almost there in regards to MF but not quite in regards to apartment buildings. A 1031 exchange is something I will too begin to look into.