All Forum Posts by: Ehab Shoukry

Buy it at 70% ARV minus repairs and use a hard money loan to acquire the property. If you are buying right then you will need little to no money out of pocket. After the rehab is complete, refinance into a long term note. I've done this multiple times.

This post is worth my vote. All great points made. 

Thanks!

Ehab

@Pete Storseth I don't have issues with seasoning. You have to make sure you are working with the right lenders. For example, for the hard money lender I'm currently using, their program allows you to convert the hard money loan into a 20 year loan as soon as the rehab is complete. I just finished the renovation on a condo that took me two weeks--I'm getting very efficient with my rehabs. So as you can see I'm not paying a lot in interest because I'm not keeping the loan that long and I don't have a seasoning issue. Make sure to work with the right HML and small banks because they offer a lot of flexibility.

Thanks.

@Brandon Brador I know there are a lot of people who would love to quit their jobs and live life on their terms.  First and most importantly, I quit my job in October 2019 and I can 100% tell you IT IS AMAZING!  It was like a 300 lb weight was lifted off my shoulders.  And most importantly my new "job" (real estate investing) is something I really love to do--looking at properties, managing rehabs, guiding contractors through my vision, working with interior designers, etc.  Just to be clear I am still working but now it's doing something I love to do.

Last bit of advice is that I didn't really have a plan four years ago when I started. I tried different things to see what I would like and adjusted along the way. The key is to consistently invest time in growing your real estate business every single day. It won't happen if you are not disciplined and consistently looking at deals, MLS, marketing, managing a rehab, etc.

Take action every day even if it's networking with lenders or attending a REIA or shadowing a rehabber. Take a lot of action and these small steps will lead to big results!

@Tony SanFilippo It takes me less than 7 hours a week to manage.  Most of the repetitive things I have automated including: cleaning, restocking supplies, laundry, guest messages, dynamic pricing, etc.  My remaining responsibilities are:

1. Respond to one-off guest questions (takes 1 to 2 minutes to do but cumulatively may add up to a few hours)

2. Review next 30 day occupancy and adjust my base price on my listings (takes 5 minutes a week)

Thanks.

@Bhaskar Rao My mentor was a guy named Nate Lewis but I have started to mentor people myself, particularly those interested in short term rentals.  Most of my properties that I am acquiring now are near downtown either in Third Ward, Museum District or Eado/East End area.

@Tony SanFilippo I do manage myself. The draw is near Texas medical center, sports arenas, downtown, etc. 

@Tony SanFilippo I purchased the six plex for $235k and spent $300k on the rehab plus $50k furnishing and make ready for Airbnb. The purchase and rehab I financed with a small bank that required 15% down. I’ve been with them awhile so slowly my down payment percentage has been decreasing. 

As far as numbers, I make anywhere from $15k to $20k a month in gross Income. Subtract from that monthly:

Mortgage PITI $4700

Cleaners $2000

Utilities $1000

Supplies $300

So it costs me around $8k a month to run the place. I have very little maintenance because everything is new. 

On the flip side had I rented this as a long term rental comps are around $1400 a unit or $8400 a month. You can see the profit is much higher with Airbnb. 

Thanks. 
Ehab

@Magesh R. I believe just Texas but definitely double check. Also there are HML everywhere.

@Nicholas L. for the two multi family deals I did with my friend he put up all the cash and I managed the entire project. He lives in another state and just by me talking so much about my passion he wanted to invest with me. 
I switched to HML last year. Prior to that I didn't want to use them because they are expensive and I had a good chunk of money in the bank but I realized how easily it is to blow through your investment capital with 20% down payments here and there.
So far strategy is working great.