All Forum Posts by: Enrique Huerta

@Russell Gronsky my pleasure. It will absolutely save you those 45 minutes or more. I have two analysts and it expedited our underwriting substantially across myself and the two of them. We've almost doubled our capacity of reviewing deals...that's the goal for now! 2x as many and go from there. I think if we used the redIQ model we could easily double it but alas we use our internal model as a matter of habit and ease of pasting into our CIM for distribution.

Best of luck!

100%. There's always many routes to an end goal. Use what's worked for you in the past and if you have doubts about financial commitments then do what you can with what you have now. The next steps will naturally arise as you make progress!

@Russell Gronsky @Joe Ansley

No, the 3 I mentioned don't do it automatically. You must manually input the data.

RedIQ:

I personally use redIQ and it is worth every penny. It's the only one I know of that can be fed financials and spit out a model that is almost done (requires your own tweaks). And to clarify, if the software cannot read your statements, you don't have to manually enter them...you can if you want to (which I actually enjoy) or you can send to redIQ team for their analyst pool to process them manually overnight (beware - they are human so they make errors too!). In that case, you send them a deal for processing and you move on to the next one while you wait. Magic! Next best thing to hiring an analyst...

Overall, redIQ has improved my efficiency substantially. I don't use their model because we have our own proprietary model that works for our deal structures, but the redIQ model is editable and you can alter the template. I'm really in awe of what they've been able to accomplish.

1. Upload address and deal details

2. Upload T12 and RR in Excel or PDF

3. Export as a completed model (if you buy that option)

4. Use redIQ to dig into the T12 and RR and perform a thorough analysis of the asset trends...I use this often. Not perfect but helps with deal screening

On the flip side, if you guys are fans of Michael Blank's Syndicated Deal Analyzer, why do you prefer it over Real Data's REIA Professional?

-I have never used Real Data's REIA Professional so I cannot comment but I like the MB SDA because (1) Easy to use, (2) Good deal structure for newer investors to understand, (3) Guided videos, and (4) Cost-effective. It's hard to go wrong with that. If you're wary of inputs, this does require you to input Annualized Income & Expenses, Closing Costs, and make some tweaks but overall it's pretty helpful.

As someone mentioned, if you have poor financials, then you'll still have to do manual data entry at some point in time no matter what you use. Unfortunately, without an assistant or analyst, you can't eliminate the admin work just yet...

Let me know if you have other questions.

TLDR: redIQ takes in financial statements and delivers a full model ready to be tweaked. It's expensive but worth it.

@Joe Ansley, "best" is a relative term. Your own excel model is the best because it will incorporate your own deal structure, financing, and goals, but a strong starting point is the SDA and accompanying videos that @Charles Seaman mentioned.

If you're not interested in excel, there are a plethora of online models. I've used a few and they're a bit clunky overall but if you spend the time to learn them you might find them useful. AssessRE+, PropertyMetrics, Valuate, are a few that come to mind.

@Brian Alfaro, If I were you I would start the process the same way you tackled SFR investing. Read the books, attend the webinars and virtual meetups, and reach out to people who may have the time to take a personalized call. Watch YouTube and underwrite deals. Learn by trial and error. You have the willingness so put in the time and effort to learn. Once you have a foundational understanding of the basics...finding deals, calculating returns, etc. then you can take the next step.

When you're not doubting the financial commitment of coaching, you could consider a coach. Coaches are great but as someone mentioned they are more helpful when you have a baseline to build from. They can take you to the next level. Otherwise, you'll be learning while spending money and time rather than just time. There's enough free resources to get you going in the right direction including some core books that will shorten your learning curve. DM if you'd like the books but one that comes to mind is Frank Gallinelli's book on Cash Flow and 36 other something...google that and you'll find it. That's an AWESOME place to start. I'm also happy to jump on a call with you to share my experience. No, I won't charge you anything or pitch you any products, deals, etc. I genuinely am happy to share my experience and learn about you and what you're looking to do. We currently own over 2k units in DFW so I have some insights that may be helpful to you. 

Best of luck!

Hi @Kyle Douglass, what specific property types are you looking for? If multifamily, then the best bed is through relationships with brokers in that space. I would say that is the case for most property types to be honest. What are you looking for?

@James Orr

This is great data! Thanks for sharing. I’ll be browsing your website for more.

The Midwest is a large geographic region and each state, county, city, and even neighborhood will hold different risks and rewards.

With that said, my general observation is that many jurisdictions have very high property taxes (I’ve seen this personally in Ohio, Wisconsin, and Michigan). These taxes are highly variable and the mill rates are high. People do lose assets to unexpected high tax assessments so it is something to be aware of. Be sure to have a solid tax advisor and understand the calculations and systems in each region you’re interested in.

Also, the natural disaster risk you mentioned is very real. Tornados, hail storms, etc do happen and that translates into high insurance costs. So be sure to get a few real quotes for your deals and don’t neglect this important piece because insurance costs can also hamper a deal.

Another thing to watch for is certain markets that have no job diversity or a declining population. There are still good deals in these markets, but the risks are different.

And my last thought is related to the real estate itself: many buildings have substantial deferred maintenance so do a thorough inspection and budget accordingly.

Hope this helps!

Hi Cole, congrats to you and your wife on the decision to become real estate investors. It is always awesome to see someone willing to do whatever it takes to make a reality happen (aka moving locations). Best of luck in that regard!

1) Yes. I would make a list of the biggest questions I have. Where are the gaps in my knowledge? After reading the book, what are the topics that confused me and intrigued me? Then pick 1 and start there. I'd pick a single topic and read a handful of articles or watch a handful of videos. 

2) Yes. Marcus & Millichap Research. CBRE Research. IRR Research. Axiometrics. Google these websites and download their reports. The unfortunate reality is that a lot of these reports are out the window due to COVID-19. HOWEVER, fundamentally strong markets WILL recover and bounce back so there is value in looking through these reports. With that said, below are some metrics I would focus on:

• Population Growth
• Job Growth
• Median Household Income Growth
• Household Formation
• Job Diversity
• No New Supply Imbalances relative to current inventory

In general, the Midwest is recognized as a strong cash flow market (but it is NOT risk free) with good deals in Ohio, Indiana, Missouri, Minnesota, etc. The reality is that (as you said before) you an find good deals anywhere. If you're in Denver and not looking to immediately move, start with Northern Colorado or Colorado Springs. The Cash Flow is a lot better and the prices are lower.

Let me know if you have any other questions. I am doing a real estate video series online so any questions you have I will put together a video for you. Feel free to message me or reply here.

Talk soon!@

@Tyler Winchell, "Best place to start" is different for everyone.

Where are you starting from? What is your real estate experience level? What is your risk tolerance? What returns are you looking for? What is your timing and business plan? You don't have to disclose this data publicly but be sure to ask yourself these questions.

That will help determine where to start for you. Houses, Trailer Parks, and Marinas are different animals requiring different skills sets from start to finish. What are you good at? What do you like? How can you create value?

Sorry if this is not the short-cut answer you're looking for but there is no short-cut. If you share some of you goals, I'm happy to provide some guidance. I've been putting some videos on YouTube regarding this topic too.