All Forum Posts by: Drew C Grossman

Providers have different coverage options and costs in different areas and you always want to talk to couple different people since it’s a localized conversation. You may also be able to learn some things and verify information by doing so.

I have a few insurance recommendation that I use for Florida. Feel free to PM me.

0 Votes

Savannah, Georgia

Quote from @Thripura Vemireddy:

Is there any website like bigger pockets for commercial real estate

Reddy

Thanks

What information are you looking for?

0 Votes

Atlanta, Georgia

Quote from @Chris John:

@Cheng Zhou

Have you considered out of state? For 600k, you can get a decent multifamily in Florida that will generate 6k a month in rent. I'd be surprised if you could get more than 3 or 4k in rent a month with that in California. Just a thought.

Good luck!

My thoughts exactly!

0 Votes

San Jose, California

Quote from @Jason Medina:

Just received a call from my insurance broker that my current insurance company is no longer covering hurricane insurance. They recommended another insurance company who is charging 3x my current rate... you know it's bad when your broker yells out JC's name in the middle of a comparison.

Hey @Jason Medina - What is going on in Florida is super interesting. You have major insurance companies “pulling out” of Florida…don’t be scared they haven’t left everywhere but definitely certain locations as we have seen.

You have places like Orlando, which have increased 2-3x in some cases like you noted. Few reasons why..

#1 Insurance fraud…Florida holds the highest percentage of the country’s residential insurance claims at 80%…mind blowing when you really think about it. A lot of this has to do with roofing claims

#2 Recent hurricanes have added a ton of rain to the water table and lakes that certain parts of Orlando that were high and dry ….flooded. This is causing insurance companies to re map certain areas driving the price of insurance up.

#3 Most of Orlando is older and the homes are older with that…causing insurance to be more expensive.

New construction is the only place I have seen decent quotes. My new construction rentals in Ocala are around $450-$600 yearly…3-4x more expensive in other areas like Tampa, Jax, South Fl ect..

3 Votes

Orlando, Florida

Quote from @Randall Alan:

Quote from @Nic Hill:

Afternoon all,

I have a property I'm looking at in Florida and the numbers make sense (somewhat) Low purchase price, with high rent values. However, the land is leased at $576 per month, which apparently includes the property taxes for the year and increases 2-4% each year. Given the numbers below, would this still be considered an ideal investment? I know your COC return should be much higher, but ive also heard in BP podcast that if its a buy and hold for cash flow sometimes you will have to wait a couple years to break even due natural market appreciation. This would be my first investment. If anyone is willing to help me analyze this and what i may be missing i would much appreciate it. Definitely want to make sure im not making a bad investment, especially my first one.

Total cash needed is less than 50k

Passes 1% rule

Fails 50% rule

Cash flow is less than $150 and comes in at $137

ROI and Equity is -24% until year 3

Cap Rate - 7.4%

COC - 3.4%

So it’s a mobile home? While I’m sure money can be made, your “home” is a depreciating asset; whereas “real” real estate is an appreciating asset.

My personal suggestion is to stick to owning brick and mortar homes - which is to say one where you own the land and the house.

Not being in control of the land brings all sorts of potential headaches… lot rent increases outside of your control; what if the seller decides to sell the land? You are out of luck! You’ll likely be moving your home

But the biggest argument is financial. Mobile homes do not appreciate over time like real estate does. That alone should be enough. Banks also don’t recognize them the same way, so will not lend the same way on them. For them it’s more like buying a car… another depreciating asset.

all the best

Randy

Agreed, well said Randy

0 Votes

San Luis Obispo, California

Hi @Chloe Darst welcome to the BP community!

Some of my partners invest in Tennessee and I hear it’s a great market. I think it’s awesome that you are wanting to start small with a single family, as it’s typically the most achievable way to get your feet wet!

I started with a single family a few years ago at the same age and you can definitely get creative with your approach! Don’t take no for an answer!

Best of luck with your goal to find a property!

1 Vote

Knoxville, Tennessee

Quote from @Nathan Gesner:

Welcome to the BiggerPockets forums!

It sounds like you're over-analyzing it and you've paralyzed yourself with fear.

What happens if you save up $50,000 to invest in a single-family home, it turns out the entire transaction was a scam, and you lose the $50,000? Do you die? Does someone take your kids, freeze your bank accounts, fire you from your job, or throw you in prison? Of course not! You lose the $50,000 but your life goes on and you'll be more wary of scams in the future.

Real estate is a very forgiving investment vehicle. People from the 70's and 80's didn't have BiggerPockets, hundreds of books on investing, calculators with graphs and charts, or any of the fancy tools we have today. They saved up money, bought a nice house in a nice neighborhood, and they rented it out for a couple decades. They made mistakes, learned along the way, and held on to the investment knowing it would produce a profit. 30 years later, they're millionaires without any formal education or hundreds of pages of notes.

Have you ever jumped off a tall bridge or cliff? I used to spend my summers jumping off cliffs and bridges in Oregon with heights of 30-70 feet. When a new person shows up to try jumping for the first time, they are often paralyzed. They stare at the water forever, hoping their fear will go away or someone will give them a secret that guarantees they will be successful and safe. The truth is they just need to jump! Once they jump in from a 20- or 30-footer, they'll realize it's not going to kill them and they can enjoy themselves. Same concept.

There's nothing wrong with educating yourself and making better choices from the start, but you're taking notes as if some magic formula will suddenly appear and make real estate investing a simple, fool-proof process. The truth is, you need enough information to understand the general concepts, you need some money saved up, and then you need to jump in! You'll get through the first deal and realize you've been wasting time looking for the answer when action was what you needed. You'll refine your education and ability from there.

If you can't get off the pot, look for an investor group and find someone willing to let you shadow them. You'll find most investors are not sophisticated people with secret formulas hidden from the public. We save money, find a solid property in a market we believe in, buy it, then do our best to manage it well. Hold on long enough and time will erase your mistakes.

Well said, Nathan!

1 Vote

Ottawa, Ontario

@Account Closed - good to see your involvement and great questions! This is my perspective on the situation.

Have you purchased/owned real estate or will this be the first deal? Regardless, you should start small and learn as much as possible with least amount of risk. And the only way you can learn is to physically do it like you touched on! I have been in real estate for years, owning many single family and commercial buildings and have just started dabbling in the past year into small multi family. New construction Duplexes / Tri / Quad ect

You nailed it, book knowledge will only get you so far. The problem with this is it’s ESSENTIAL to know what’s realistic in each market..I cannot stress this enough! You need to know what type of opportunities money can buy out there and what the probability is you will get that deal..how will you find it ect? What are the trade offs? This is fundamental and how you will develop a framework to analyze what deals are good and what deals are bad. This unfortunately just takes time and you can’t speed it up, just need to analyze deals like you’re deciding to put money on the table or not. Overtime you will get better.

Why do you want a 16 Unit c class deal? What are you going to do with it..wholesale, buy yourself, syndicate? Where do these deals even exist? What markets? How much are you expecting to pay

The smaller more focused your goal the easier. Certainly don’t want to discourage you of thinking bigger but just realize there will be a lot more things to figure out and being newer just adds a lot of risk. If I were in your position, (assuming this is your first exposure to real estate) since you mentioned you are high income earner, I would start by buying your first single family or duplex. figured out what your requirement are, how you want to finance it and then work backwards.

Go find your market based off this! Best of luck and happy hunting

2 Votes

Ottawa, Ontario

Hi @Phyo Ko - I understand you have some decisions to make on this Duplex deal and it may feel overwhelming! Lets tackle this with data and you can logically assess what the best route is..for you!

What is best case? What is worst case? If worst case is selling to break even or even lose some money....you can use this as a valuable learning lesson (as long as you dont lose your shirt).

The fact that rent does not even cover the mortgage tells me that this might of been a deal to avoid from the start and may want to cut your losses..always need multiple exit strategies Rule #1. Where is this Duplex, price point, what was the strategy, what is the dynamics of the market?

Feel free to PM me and we can chat off the forum if you to go in more detail

3 Votes

All Forum Posts by: Drew C Grossman

Drew C Grossman has started 5 posts and replied 128 times.

Post: Looking for a lender

Post: Acquiring Home Owners Insurance

Post: Commercial real estate forum?

Post: Buy rental property in Oakland or Sacramento

Post: Florida Insurance 3x!

Post: Florida Real Estate Deal

Post: Newbie to BiggerPockets and Real Estate!!

Post: Looking to get into multi fam investing - Need experience!

Post: Looking to get into multi fam investing - Need experience!

Post: First investment back against the wall. Need advice!