All Forum Posts by: Curtis Rouse Jr

@Edwin Martinez

To piggy off what @Ray Johnson mentioned is that there is a reason why it's boarded up most of the time meaning that this is a very distressed property. I don't know this area by any means, but if you aren't experienced or know someone who could help you partner on this deal I would steer clear because there is much more risk and time involved getting a non performing asset profitable. This could potentially be a wholesale deal if you have the network and wanted to go that route. If you are seeing population/job growth along with new development in the market, it might be something so look into. Me personally I look for value add deals that are already performing that will allow me to increase the valuation so the property will trade at a higher multiple on the exit. This strategy will help mitigate your risk on the front end. Best of Luck and I hope this helps. God bless!

@Sue Zikria

To achieve your $40k passive income with your starting point of roughly $100k to invest, I would definitely start looking into larger syndication deals on LP side that would give you more scale. While networking and looking for these experienced operators, on the short term I would look at some flips/wholesale deals to get some additional funds coming in to invest in these larger deals that will ultimately help you build wealth, preserve capital and act as a tax shelter over this 20 year period you are targeting. I hope this helps and Best of Luck. God Bless!

@Tyler D.

As others have mentioned, MFR presents far more benefits than your traditional SFR from the Cashflow, Appreciation, Leverage, Amortization that gives you the better probability of accumulating generational wealth to pass down to your kids.

I would also mention to start taking action and analyzing deals deals so you can get a good feel of the your "market specific" returns. The BP calculators is a great resource to get started. Feel free to message me for any additional questions

@Joseph Garner

I told them my business plan on an ideal property I was looking at, how I was going to manage/exit the deal and where my downpayment was coming from which was via private money. Then most would tell me no and I finally got a yes from a lender. He told me to let him know when I found a deal and I was off to the races from there :). Anybody can do it might take some time initially, but well worth it in the long run. 

Oh I forgot to mention you can also partner with a seasoned investor and give them part of the deal to leverage their knowledge base.

@Joseph Garner

I know this isn't the sexiest answer, but when I first got started looking for commercial lenders, I basically googled all the credit unions/banks in my state and called each and went down the list until I found one who first would lend on the type of real estate I was buying, second offered competitive terms/rates and finally I had an initial good vibe with for a long term relationship. I eventually found one a couple months later, but I enjoyed the process because I learned a lot of bank requirements and what was needed on my end to make their job easier.

Another great idea would be to go to your local REIA and ask around to see who other investors in the MFR space are using on their deals.

I hope this helps and Best of Luck! God bless

@Amanda Scully

So correct me if I'm wrong, but it seems like what you are trying to determine is the value of a MFR once you renovate some of the units and get them rented out. In this case if I'm understanding your question is you are right, it's based on the NOI, but some appraisers for MFRs will also use comps, rebuild cost or a gross rent multiple (market specific). I always buy off the current valuation that yields a specific return where I can do some value add and get what you are calling the ARV or new NOI that will increase the value based on a specific cap rate that appraisers might be using. It's always important to understand their valuation, but also explaining to them the upgrades and how you have increased the bottom line so your new valuation will come in as expected. This is why underwriting a deal is so important so you can forecast your exit and that's why it's important on the commercial side to look at the IRR as well for dispositioning purposes. I hope that answers your questions. Best of Luck and feel free to message me at any time if you have any other questions! God bless

@Daniel Osifo

Welcome to BP! So to answer your question about becoming an agent, it all depends on your personal and specific goals as to what you are trying to achieve. Me for instance, I'm currently investing in commericial real estate while tranisitioning from my day job to being a  full time RE investor so I leverage the brokers/agents and just factor their costs into my underwriting. I don't want to sell real estate, I want to build a portfolio as an investor and receive the monthly cashflow. On the other hand for you, it might be very beneficial so you can understand the markets and how this business works, while supplementing your income with your commission checks. 

Common pitfalls I see is to know your market(s) and also as you start investing is to focus on the financials by making sure you aren't making emotional decisions just to get into real estate. Also the dispositioning of the asset 3, 5, 10 years down the road is very important that both new and seasoned investors tend to not account for.

Best of Luck and please feel free to  message me at anytime for any help! God bless

@Kat Hughes

Congratulations! I love mfr and advise everyone at some point to jump in :)

@Steven W.

The others have provided great information about getting into MFR so I'm not going to elaborate on what they already said. I would like to offer help if you need a second eye on your underwriting on any smaller/larger multi family deals. I've built a financial model/software that I use personally and help other investors all the time as well free of charge. So far I have underwritten around $565mm and counting as I'm looking for a 50 - 125 unit building to purchase with my investors. Feel free to message me at any time and Best of Luck on your search!

@Kishanchandra Golla

Congrats on this 144 unit deal in Memphis! I'm also looking in the area for a 50 - 125 units as there are a lot of value add deals in the maket. 

Quick question, what was your purchase price and what are you expecting the appraisal to come back on an income based approach?