All Forum Posts by: Farakh Zaman

@John Warren thanks. That’s exactly the type of guidance I was looking for. Appreciate the inputs. I’ll reqch out to a few PMs to start my search and go from there. 

FZ

Hi,

We're starting our search for our first apartment (6-24 units). So far we have a couple SFH and a 4plex in Colorado. One of the SFH has over a 100k in equity tied up in it so the plan is to 1031 exchange that into a larger property. Also we have additional money to put into the deal.

Has anyone else done this? Where did you start?

We have a great team for buying smaller properties but I don’t have a broker for commercial properties nor do we have a lender lined up yet for commercial properties. What is he best way to set up a team for this type of endeavor?

We have two markets in mind for this purchase, the front range in Colorado and also Dayton Ohio. We are familiar with both areas and comfortable investing there.

I’m currently reading multi family millionaires to learn a bit more. Any other book recommendations are also appreciated.

Overall just looking for some guidance on how to proceed forward. 

We bought both of our cars. I am on the dave Ramsey side of things with leasing. It make no sense unless maybe it’s for a business vehicle. In our case we have a 2006 xterra and a 13 fit. Both have had minimal issues. The xterra is just now starting to show it’s age and squeak a bit that may require a 800 dollar or so repair. But I haven’t had a car payment in almost a decade. We use the money instead to buy RE. I prefer buying a few years old and paying cash. No headaches with financing and I own them free and clear. Just my 2 cents.

Hi,

We're in the process of acquiring a 4plex in Colorado Springs.  Current owner had a leased machine in the building from a company called Jetz.  Reading reviews on line, they didn't seem that great but haven't had anyone tell me about them from first hand experience. 

Two questions:

1) Should I purchase a commercial washer/dryer?

2) Should I lease instead?

Also, we don't live near the place we are buying (out of state) so was wondering how coin collection works?  I've never had one in our units before.

Finally, does anyone have any experience w/ the credit card machines?

Thanks!

Farakh

US Air Force officer here, currently just closed on my second SFH in Colorado. I'm working on forming an LLC in Colorado, but I'm looking for advice for electing a registered agent. My wife's family lives in Colorado, so one option we are considering is asking her brother to be the registered agent. He is living in Colorado longterm and already has 15 investment properties of his own. The alternative option would be electing an attorney. I found an attorney that does LLC management with a one time start up fee of about $800 and then an annual fee of $100. Not sure if it's worth the extra money or not. Any advice would be appreciated. Thanks!

FZ 

Send copies of documents to mortgage broker. Taxes, bank statements, etc. 

Hi all,

Wanted to see what everyone uses to send sensitive information.  Email is obviously the easiest and least secure way.  If you use drop box or something like that, it is a bit more secure...and then there are paid services like securesafe that I saw which encrypt & pw protect your files when you send them.  

Just wanted to see what everyone used.

Thanks.

FZ

Originally posted by @Curt Smith:

@Farakh Zaman I've quit my job recently on our growing rental holdings. I live in the hot area of Atlanta and know something about your problem. I've met a few folks in my REIA who've made 200 offers too, no deals. Then I shared my strategy and now the 200 offer guy has 3 houses that are good performers.

Go to my profile, down on the right, download the file Bullet Proof rentals.

The fix for making offers and no deals is not clear when one has blinders on.  The blinders come from "standard advice" that doesn't work in hot metro areas, following the crowd etc.  The solution lies in:  figure out what everyone is doing, then do the exact opposite.  Avoid competition.  If everyone is bidding on 1980's 3/2's then become an expert in 1960s 3/1s.   I just read in a paid for training that the successful trainers sell off their 3/2 contracts as wholesales, they keep the tiny 2/1's that cost them only $25k, brick 2/1 in ok area cap rates like crazy because you are all in for only $25k to some low number disproportionate vs the lower rent you get.  IE make lemonaid out of lemons.  What ever the market is leaving for dead, learn how to make money with that dead asset type.

Or like we did, we figured out where everyone was buying, we bought everywhere ELSE. IE we moved up and down the freeways 45 min out of town to the next small town that had good jobs, decent but cheaper houses where few folks bid on the lower priced fixers. IE a fixer won't appraise for a FHA loan so it becomes a cash only deal. PERFECT!!! So we are very glad the hedge funds came to Atlanta forcing us to get out of our lazy comfort zone and learn how to think, re-position our business, learn to be constantly (every 12 mo) jumping to a new deal type or geographic area.

I suspect your areas, like Atlanta is constantly changing.  Yet I see or hear of almost no one talking about figuring out what now does NOT work, and what is the gap in the market or new area to jump into.  My Bullet Proof paper gives some tips as to how we make those jumps, but not nearly enough.  Its not the purpose of that paper.  But a new paper is needed on how to jump to new strategies and how to tell when its time.  Definately when full price offers are getting ignored in my business model of high cap rate deals only, means I have to move on.  I actually move much much sooner, like when 85% offers get ignored and other indicators.

 Curt,

Thank you for the detailed response.  You are where my wife and I want to be by the time we leave the military in 8 years or so.  I downloaded your paper to review and will reach out via PM on any questions I come up with if that is ok with you.

FZ

Originally posted by @Will Barnard:

Giving up or quitting is NOT an option in my book. A good investor changes strategy and approach when the market conditions change. In this highly competitive market condition, buy and hold single family market is very difficult in most areas and in areas where it is not, you may not want to be there.

Building capital right now is important and creating cash flow is certainly possible with the rightvplan and in the right place.

 Will,

As you said, I will keep building up capital.  I know at some point either the market will come crashing down again or at the very least a correction will make help the market cool off a bit to be able to get some reasonable properties.  In the meanwhile I will keep looking and change up where I look.

FZ

Originally posted by @Christian Cramer:

Have you looked at properties that have ohanas and main houses that have been split up for rentals? With some creativity and a little bit of value add there's a lot of possibilities in hawaii, look at this property for example 

https://honolulu.craigslist.org/mau/reo/6029650916...

The existing rents could definitely pay the mortgage, while offering steady appreciation and opportunity for a lot more rental units 

So I just looked at this property and while you are correct that the rents pay the mortgage, once I put in the vacancy, repair, CAPEX and PM, this is what the picture starts to look like

This was using the standard numbers of 5% for vacancy/repair & 10% for CAPEX/PM. I know if I can bump the numbers lower in some cases, but not knowing more about the property this was the quick run on it...

For me these types of numbers don't work...and the problem has been that if I change my offer to a asking price that does work, then that has been rejected.  So I keep looking...