All Forum Posts by: David M.

Hi Peter, where would you rec starting my search? How would you go about it? Thx!

Hi, I own 18 vacation rentals across 4 cities and am looking for a creative portfolio lender. Any referrals or ideas on where to find them? 

The few that I have spoken with all want the homes to have long-term rental leases in place even though our EBITDA is covering interest between 4-8x. I'm surprised lenders are jumping on this as I think it's a potentially highly lucrative opportunity for them as the properties are extremely credit worthy and can be cross collateralized - that being said, I understand this is new territory and therefore there isn't a framework for it yet (again, opportunity!). 

Hi BP!

Let's assume $50K in capx/furniture per property (vacation rentals) for this thread (most of the $50K is furniture).

I am looking for some creative thinking on how to get additional leverage for that $50K besides doing a typical 12-18mo bridge loan.

Idea 1: Is there any way to include these estimated costs into a conventional loan on the initial purchase property? I know there are cash-out refi programs where once I've made the $50K in payments, and I can show payments/invoices to a contractor for said repairs (I'd have to fake this which I don't want to do), I can go get the home re-appraised with the capex done and apparently this process is relatively simple, costs around $3,200 per house and most of the time the homes appraise how you want it. Curious if there's a way to do this on the initial purchase - am guessing no. 

Idea 2: Create company #2 that is a furniture rental company (like Cort). We get a line of credit, buy furniture wholesale, then "lease the furniture" to company #1 which holds our rental properties. So we're getting the benefit of buying the furniture wholesale, and also getting leverage on it. 

Idea 3: I'd like to preface by saying I don't want to do this if it's illegal, but just jotting down my idea: perhaps contact seller and offer $50K above agree'd upon price in exchange for them writing $50K check to us personally outside of escrow? Is this illegal? Maybe add an extra 10% ($5,000 in this example) as incentive for seller to be willing to do this (assuming not illegal, just for the hassle).

Any other ideas?

Thanks!

Thanks guys - two Qs:

1) Any suggestions/ideas on a commission structure?

2) I have not hired before, but already have an office with some extra space so have room for a few people: how does one go about finding out the expected salary for an admin type job like this in LA? Can't find salaries posted on Glassdoor.

Edit: found it! https://www.glassdoor.com/Salaries/los-angeles-adm...

I'm planning to hire someone that does the following and I'm not sure what salary to offer. Curious to see what numbers you guys come up with as it's quite a few required qualifications. I've already been doing below for 6 years so can train here and there but ideally the hiree won't require much:

1. From a list of cities we already have lots of vacation rental data on, find competent realtors in each city and and spearhead purchases of properties (work with realtors to get videos of properties, submit offers, meet inspectors, negotiate, etc). Must have some real estate investing experience.

2. Work with local designers to furnish the places so that they are 100% ready for vacation rental guests, set up utilities, create listings, work with photographers, etc (ideally has some Airbnb hosting experience or lots of Airbnb travel).

3. We already have a team that handles all communication with guests and cleaners, so they would also have to deal with major issues e.g. plumbing, theft, bill pay, etc (this part anyone junior can be trained to do).

Thank you!

Curious to hear thoughts on investing in foreign RE given strong USD now (recently up ~40% vs AUD/NZD, ~25% vs Norway/Swedish Krona). 

Lending concerns: haven't researched too much yet, but could probably cash-buy and then finance 1-2 years down the line once I have tax returns.

Other than issues with distance, why aren't more people doing this?