All Forum Posts by: Daniel Wolcott

Hey BP Fam, I have a deal that I would greatly appreciate your advice and insight on. We have a 3/1 SFR, 900 SqFt with a purchase price of $170K, Rehab cost of $40K and an ARV of ~$315K. I am trying to decide if it is best to Flip or BRRRR. We are partnering on this deal (50/50) so if we were to BRRRR we would have to buy out our partner which would be roughly $45K (estimated profit from flip after expenses) bringing our all in investment to be around $255K. Rental rates are around $1600/Mo. When I calculated this on my own spreadsheet I was getting roughly a 6.7% Cap Rate and a $270/mo profit (incl 5% vacancy rate and 5% repairs, we will be replacing all of the appliances, water heater, etc) but when using the BRRRR Calc on BP it was giving me a much smaller cap rate and negative monthly/annual returns. I am not sure what it is considering that I don't have in my spreadsheet.

I am ultimately a strong believer in Flipping will make you rich and Rentals will make you wealthy so I would prefer to hold on to it as it real property is an excellent hedge against the impending inflation we will experience. My only plug for Flipping is that we are in a very hot market right now that might flatten out in the near future so taking as much profits as possible now. What are your thoughts and/or is there other things I should be considering. Thanks in advance. 

Hey all, I have been struggling to find a worthwhile investment here in Colorado Springs so I have been thinking about purchasing a new personal residence with Air BnB potential and either selling my current residence or renting it out and having a hard time decide which route to go. Current rent I could receive is $2000 and my PITI is $1300/mo, making $700/mo before expenses I currently have $0 down and roughly $125K in equity after owning for 6 years. With my ROI more or less being infinite on the rental with no cash down or the potential of making $125K by selling I am having a hard time making the decision. I'd greatly appreciate someone else's perspective to help make a decision. Thanks you all in advance.

Thank you all for the great responses. All of your inputs have definitely given me a task/way forward, I have asked my realtor to broaden the search and actually increase the amount of units to see if there is a market here for that. I have also begun researching some marketing strategies to direct my interest to sellers I have started to look up how to get recent eviction notices as well plan on doing a simple mail out to multi-family homes in my areas of interest.

As for still pursuing out of state I have narrowed the search to Dayton, Cleveland, Cincinnati as I have family there and a friend that is currently buying single family homes. I am also looking in Tampa, Jacksonville and Cape Coral as I grew up there and still have ties. I'd greatly appreciate any input on these cities and or any other recommendations.

Lastly, for the questions on financing, I currently plan on going with cash and conventional for now until I need to enter the commercial realm. I really want something under my belt and a little bit of a track record before pursuing private money.

Once again thank you all for the replies.

After spending the last year trying to find a multi-family home in Colorado Springs and submitting a few offers I have convinced myself that Colorado Springs and possibly Colorado is overpriced. We have been under contract on a few 4-plexes, but after digging deeper either the numbers didn't make sense or the seller's were not willing to make necessary repairs/provide concessions that would make the purchase worthwhile. I have come to terms with looking out of city/state but get overwhelmed with trying to narrow down a city to concentrate my efforts. I understand looking for cities that are seeing population/job growth, landlord friendly and ultimately rental rates that allow cashflow and decent ROI. What cities are you finding that offer great potential and/or how did you find/choose these cities? I am looking for the property to meet the 1% rule and to achieve a 10-12% cash on cash return (I don't believe this is overly restrictive).

How are people finding multi-family deals in Colorado Springs. I know it may not be the best method but I have been using a realtor and the MLS and everything I analyze seems extremely overpriced. Very low cap-rates (<5%)and NOI, High GRM, nothing gets close to the 1% rule (maybe .5%) and some are running at a cash negative yet they seem to be flying off the market. Am I missing something or is the new norm. Are people just buying hoping they can juristically increase rents or hoping that the market will continue to go up in this town? Any insight or advice is greatly appreciated.

Thank you all for the forum response all your messages were very welcoming and informative. I look forward to connecting and possibly working with many of you. 

Hey everyone, my name is Daniel Wolcott and currently enlisted in the Air Force stationed in Colorado Springs. I received my degree in finance and accounting from the University of South Florida prior to enlisting.  I have been intrigued by real estate for many years but I am slightly ashamed to say I have never had the courage to start investing.  I guess I am enlisting to Abe Lincoln's motto of "Give me 6 hours to chop down a tree and I will spend the first 4 sharpening the axe." I have spent many years reading investing books, taking real estate classes and enrolling in real estate seminars but yet no I have not taken the most important step of taking action.  I even convinced my wife to start a career in real estate so I could live vicariously through her.  She has achieved great success as a realtor in Colorado Springs and has re-inspired my ambitions of investing in real estate. 

I now have the financial security/confidence to take action and I am looking to start investing in income properties, preferably multi-family homes.  My goal is to have one income property by the end of the year and start finding at least 4 properties per year in the following years. 

I also have interest but limited knowledge in flipping houses and investing in notes.