All Forum Posts by: David Casas

Wow, thanks everyone for your input. I'll stay away until the selling agent is open to showing the property.

Thanks again!

David

I found a property that meets the 1% rule for renting, and I wanted to take a look at the inside to estimate how much rehab needs to be done. The problem is that this is what it says in the listing:

SHORT SALE!! tenants are present!!, (ONLY.SIGHT UN-SEEN) DRIVE BY ONLY. DO NOT GO ON PROPERTY, IT WILL BE TRESPASSING!

I spoke with my real estate agent who said that they are not allowing any showings, and it may be a sensitive subject.

I was wondering, have any of you faced this kind of situation before? Is there any way to tour the property before putting in an offer? It is a dream BRRR situation in a good neighborhood, so I don't want to let this slip away. Do the owners have to allow showings inevitably and I just need to wait until it gets to that point? Will the short sale go to auction and I can then bid there? Or should I figure out a way to contact the owners and ask if I can walk the property and see if we can come to an agreement? What is the process of a short sale?

What are my options in this scenario?

Thanks!

David

Hey everyone,

I'm working with my Agent to narrow my search on fix and flip properties, and I'm trying to optimize my search to minimize vacancy time when the project begins.

Does anyone have experience with what types of single family homes are typically more popular In NJ? Particularly north-eastern NJ. If you have experience in other parts of NJ as well, please feel free to post your advice; more data is always better!

I was analyzing a Cape Cod style home, but didn't think it would be popular for resale since it is a 1 floor home. If I were purchasing a home, I'd want 2 floors, but maybe that is just my own biased opinion, and the general sales trends of real estate in the area may be different.

So, which types of single family homes are most popular to sell in a fix and flip project? Cape Cod? Ranch? Colonial? Does the style matter much, or should I be thinking more in line with number of bedrooms/bathrooms (3 bedrooms, 2 bathrooms seem to be the trend).

Thanks for all your support!

David

@Rob Gillespie - That would be great, thanks so much! Even a template for a craigslist ad would help. Please feel free to PM me an example, and I'll study it

unfortunately I don't have access to the MLS, but I might know someone who knows someone who does. What type of information should I be asking from from the MLS listing?

As for active listings, the only things I have to go off of at the moment are the Student housing prices per semester at the University, and one luxury apartment complex that has a 2 bed 2 bath asking for about $3,160 (includes 24 hour fitness center, monthly catered Resident Receptions, health and wellness programs, and a resort-style pool. So again, not really comparable.

If I go by the Student Housing, it's roughly $5k per semester, totaling $10k for 2 semesters (aka for the year) PER STUDENT without a meal plan, so if I have 4 bedrooms, I can charge a maximum of about $834 per room per month, totaling in a rent of about $3,336/month, so I could charge about $3.2k/month, but I'm not sure it will rent because there isn't any true comps in the area.

@Kevin Hill I'll look in to the Section 8 Fair Market Value for 4 bedroom houses and get back to this forum post if it is a publicly available figure. Thank you. The Zillow rent estimator estimated at around $1.5k rent, but that's because no one is renting, so there are no true values. What specifically should I ask someone with access to the MLS? Is there other information other than the price, location, taxes, and utilities estimations?

Thanks for all the help already guys,

David

@Michael Lee

I am looking at a beautiful 4 bedroom 2 bathroom home with finished basement near a University I would like to rent out for Student housing. 2 miles from a train station, 5 blocks from the University entrance. The problem is that there are no comparable rentals in the area where I can gauge the market to see how much I would rent out this property to see if it's a worthwhile investment. How would you determine the pricing for rent in this scenario? I can find a 2 bedroom 2 bath in a very fancy apartment building right next to the train station, but that isn't necessarily the same. Help! :)

@Steve Kontos How did you get started with out of state investing? How did you find a trustworthy "boots-on-the-ground" team?

@Tania Patch That is what I'm currently doing (somewhat). Banking on appreciation of my 2 bed 2 bath condo unit by "house-hacking" it for a few years until I can rent it out and get past the first 5 years' mortgage payments and decide on whether to hold it for another few years and rent it out or sell it if the market value exceeds the price I paid for it.

The rent increase on your first property sounds pretty great. Did you buy a property prior to the area gaining popularity, or was it just pure rental increase in line with the rest of the market? If it was the former, how did you spot an up-and-coming neighborhood to capitalize on such appreciation increases?

Thanks,

David

@Dave Cali What do you recommend looking for in this market? Also, what do you mean by a holistic approach after budgeting with formulas?

Thanks for all the input everyone

Hey everyone,

So I've been analyzing 1-2 deals per day, driving for dollars, attending RE Auctions, looking in to foreclosures, and looking for great Real Estate agents in my quest to find my first great deal in my area.

The problem I am having is that none of the deals that I have been researching tend to meet up to the (what I now see as) high expectations of 7% minimum Cash on cash ROI, $100-per-door monthly net profit/cashflow expectations that many of the big name BP users/founders swear by. This is leading me to weed out almost every deal I find in my area as a bad deal. It's leading me to believe that maybe those expectations are not realistic in our market in Northern NJ.

I started wanting to house-hack a 2-4 unit multi-family, and am now thinking that due to the low positive cashflow and even lower ROI that I've been coming across in my analyses, that house-flipping might be a better place to start to take advantage of hard-money lenders and make smaller profits on house flips until the market sinks back down to see better rental property profits.

I'm starting to think twice about all my numbers that I use as a basis of estimation. Is 9% vacancy estimate too high? $10k closing cost too high? $6k repairs minimum (For some light modernization and cleanup on the property once purchased) too high? Is everyone in my market investing for mostly property appreciation gain as opposed to cashflow or ROI? Is it common to "break even" in rent in this market, or are you just finding very good deals that allow you to have positive cashflow amidst the high property taxes and higher purchase prices?

Are my calculations wrong? Are my expectations too high? Am I getting too impatient or too unrealistic in my expectations? What can be considered a good deal in the Northern NJ market?

I'd love to hear other people in my market that have found a winning strategy to stay afloat and thrive in this pricey market. Any and all strategies, analysis assumptions, contract contingencies, and sheer local real estate knowledge on expected returns on projects are welcome.

Thanks again to this great community,

David