All Forum Posts by: David Mo

Let's go @Lisa-Marie Franco-Garcia! I love West Allis for investment properties :) 

@Andy T.

I would have that discussion with your realtor or I'd be happy to have that discussion with you. The fact that the foundation and roof were recently redone is very reassuring. 

So it sounds like your main concern is that most of your cash is currently tied up in this property and you would like to pull it out and pay back your HELOC asap. Figure out your ARV, the work and costs to get there and use that info to guide your next steps. You're holding a CF positive asset even with a HELOC payment under it...that sounds like a great position to me. Even if your CF is lower now, once your HELOC is paid off and you refinance at a lower rate you're gonna be really happy with it. Just sitting on it the way it is and waiting to build up more cash from your W2/other source of income to do the repairs isn't a bad option either if the ARV isn't there.

First time investors always make some type of mistake...thanks for sharing yours for others to learn from and thank God it's not a very costly mistake! 

Hi @Andy T.! 

I'm also an investor and realtor in the Milwaukee area. At that price point in 53207 I'm assuming it's in Bay View? If that's the case at least you're in a great area that continues to see steady growth. 

Some immediate questions I have about this situation: 

1. What's the projected ARV of this property? Did you have this discussion with your realtor ahead of time? If not, it's very important you have a target ARV in mind before going into a deal...especially if you're planning to BRRRR.

2. What work needs to be done to bring the property to that target ARV and what does that work look like? From personal experience just replacing appliances isn't going to add much value to the property. Cosmetic remodels like paint, new flooring, new kitchen/bath will add more value and ideally the units are a bit outdated so it makes sense to do these updates. It seems like your 1500 unit is already in pretty good condition while your 1350 unit has some room for updates.

3. What's your monthly cashflow going to be with the additional HELOC payment?

If the property is in great condition and you have no major capex coming up soon and you're financially comfortable and able to support this mortgage and HELOC until you pay the HELOC off, I would hold onto it. At -200 cashflow per month, that's "only" $2400 per year. Your mortgage has still been paid down more than that and while I don't have a crystal ball and you should not bank on appreciation to make a deal make sense, Bay View is in high demand. Rates are on the decline too. Does your bank offer a free refinance after 6 months? Play around with how refinancing later in this year might affect your monthly payment.

Hi @Rolando DeLeon! 

For insurance I use Zach Culbertson with Country Financial. He insures all of my properties and takes great care of all of my investor clients too! Let me know if you'd like his information and I'll shoot it your way :) 

Cheers! 

Hi @Michael Olson! 

You should 100% work with a buyer's agent who is an investor themselves. If you can find one with a similar investing strategy to yours, then even better. For example, an investor who primarily flips or has a short term outlook will ask very different questions vs an agent who has a long term outlook. Working with a buyer's agent means working with someone who cares about your interests and is legally obligated to represent your best interests. It would be like if you were to enter a legal case with a lawyer on your side or not. 

As for your price range, sub 100k now a days is going to put you in a rough spot with a lot of issues, and honestly it'll be hard to find a good agent who's willing to work in that range in those areas. 80% or lower of real value is very unrealistic. 

Hi @Uriya Nadav! 

I'm a realtor and investor in Milwaukee County. $100k for a single family home is going to land you in a C class area with a higher crime rate, and I would not be surprised if there were a list of delayed maintenance items that would need to be addressed. With that being said, there are definitely neighborhoods in that class that are better than others. Harambee, Silver Springs, Hampton Heights, and parts of Roosevelt Grove come to my mind. Again though, you're going to be dealing with a higher crime rate at that price point! 

Hi @Spencer Krautkramer! 

House hacking is a great first step in your investing career, and Wauwatosa is a fantastic location! 

I will say that Wauwatosa is more known for the appreciation than the cashflow. Areas close to Mayfair Mall and downtown Wauwatosa come to mind for what you're looking for tenant and people wise, but inventory is low and prices are on the higher end. Happy to connect and discuss further! 

Hi @Irvin Nguyen! 

Investor from Milwaukee, WI here. There are a number of tertiary markets in Milwaukee County that I would classify as C+ to B- that offer a good mix of cashflow and appreciation, and our real estate market here is still looking healthy. Prices for duplexes in those areas are going between 180-260k with 4 units going up to 400k (albeit overpriced IMO)...happy to connect and discuss further! 

@Timir Shah What made you decide to look outside of the Milwaukee market? Do the numbers here no longer fit what you're looking for, or are you just looking to diversify into other markets? 

Hey @Trevor DeSimone! I use @Joe Latson with Backflip Capital! 1 year durations, and I got an 8% on interest mid May.