All Forum Posts by: David Ribardo

Shane, there are already a few good meetups in the area. Check out the BP meetups page, @Justin Brown hosts one monthly in Allentown with a great focus on deal analysis. Meetup.com has several other active groups. If you have questions about any of them, shoot me a PM!

I've had good luck with Jay Tilton from WIN home inspections, and Dan Kostenbader from Solid Rock. There are plenty of good options out there though. I recommend you ask them for a sample of their work, and shop around for pricing. 

@Brian Bogart, my recommendation is that you focus on building a team and finding deals first. Many new investor clients spend months working on websites, LLCs, and "business systems", but none of those will ever make you money without a deal! If you haven't already, step one is finding yourself a good agent, lender, property manager, and CPA. Then, start looking for your first property. It's a hot market and that will be your first big challenge.

Once you have your first property under contract, that's when you can start putting together financing details. I do recommend you talk to a lender when you are getting started, but typically they will only talk in general terms until you have an actual property picked out. The initial conversation should be to identify your purchasing power and make sure you can qualify for the loan. There are good investor friendly lenders here that offer creative products ranging from construction loans, non-recourse loans, and commercial lines of credit. Assuming you have liquid assets to find the purchase, finding your lender will not be difficult.

You shouldn't need to get a lawyer involved here in PA for routine business. Most closings are handled by title agents, and most LLC's are set up by CPAs. I'll refer a client to an attorney only when they have questions about our standard contracts or need something non-traditional written up.

Hey Eric! I recommend you talk to @Basit Siddiqi. He's a CPA, as well as an investor in the Lehigh Valley. 

@Bradley Davis a 700 won't hold you back getting started. Typically a 730+ will get you the best rates from lenders, but there will (almost!) always be someone willing to lend you money regardless of where you fall on the score. It's just a question of how much you have to pay for it and how much work you have to put in for it.

It's a hot market here. On-market deals are getting bought up at prices that make cash flow tricky. We've had to hustle a lot to keep getting investment properties, as well as leveraging connections for off-market deals. One technique you might find productive is looking for an investor with a large portfolio looking to sell off some of their smaller units. They understand the numbers that go into your max allowable offer and many will want a quick / smooth closing, so sometimes you can get decent deals that way. Good luck! 

@Franky Aikens - there are tons of investors succeeding in the area. For any given strategy, there are people who are crushing it in the Lehigh Valley market. Flips, buy and hold rentals, hard money lending, you name it.  

I recommend you check out some of the local REI Meetups, both in your local area and when you get down here. They are a great place to listen to experienced investors share successes (and horror stories!) as well as ask questions to help you get started.

@Bradley Davis Welcome to the investing community. If you haven't, the BP ultimate beginners guide is a great once over. After that, I recommend their guide to estimating rehab costs, the 4 Hour Work Week, and the E-Myth revisited. I like Matt Faircloth's youtube channel - he is a frequent contributor here, and has some great videos that are easy to watch and very informative. There are a few investor groups, each one with their own particular audience, and you can learn a ton from them.

If you have a good credit score a FHA house hack is a great first plan. If you buy with multiple exit strategies in mind it is hard to go wrong there. You can learn a ton by self-managing, and by doing your own repairs.

@Justin Brown

$50k / unit is pretty typical for what I'm seeing things go for. With stated gross rents I'm assuming 1 bedrooms at $750 a month? I run insurance at $800 + $200 per unit, just for a conservative estimate. I agree that common electric is high, might want to figure out if a tenant is plugging something into an outdoor outlet. With good management 8% could be reasonable for 1 bedroom apartments. I use 10% for management, but have had clients pay everything from 16% (10% plus 1 months rent every lease signing) to a flat $50 / month.

The real questions - what value add opportunities are there? How motivated are the sellers?

@Justin Brown

@Daniel Akerman, if you are looking at the BRRRR strategy, your ability to make cash offers will help you get better purchase prices than investors using financing for the upfront purchase. There are plenty of single family row homes that you can buy with cash at that price range that will be rehabbed and ready to go, or you can look for some value add and do the renovations yourself. Two years ago the average duplex here was selling for $67k, but as of two months ago, the one-year rolling average for a two-unit in Allentown was $110k. The 2-4 unit segment of the market has quite a bit of competition. Now, if you use the $60k for a down payment as @Joe Colasuonno said, you could easily purchase a 4-unit and get some reasonable cash flow from it.