All Forum Posts by: Blake C.

@Jim Couch Welcome to BP. This place has a ton of information. You will be able to find out tons here about the general mechanics of investing in real estate. I can't really help you with understanding your local market, but you likely know more about it than you think. From my experience here in Amarillo proper, the market is slow and steady. Rents have appreciated well in the past decade and home values never really dipped hard. This has created a solid market to invest.  I don't factor in appreciation at all to my numbers just to be conservative. 

Start talking around town about your interest in looking for good real estate opportunities. One of the best thing you can do is to network locally with someone thats already been successful in your target market. You say you don't know your niche yet, but my thought is that your local area can easily become your niche. Let me know if I can be of help to you. Good luck! 

@Lance Lvovsky Have you checked into an FHA thats owner-occupied? You could rent one of the sides to yourself and get great terms... 30 year fixed at a low rate and only a little down (3.5% I think). I don't remember the specifics right now on how long you have to live there.

Or, the numbers are good enough on this that you might be able to take it to a community bank to get a commercial portfolio loan. You might need a guarantee from someone on the loan... may be this is where your parents could come in. May be they could loan you the 20% it would take to do this and sign on the loan. Dont expect this from your parents for free. Pay them a fee for doing it. Then you could be 100% owner, with no people to consult when it comes to selecting tenants, rehabs, ect. You get 100% of the appreciation and profits (even if they are smaller due to the fee you would pay them). Might be too creative, but I personally would explore it.  

@Lance Lvovsky This still looks like a solid deal to me, but I would want to factor in an 8% vacancy rate. Of course, I like to be rented more than that, but I try to run numbers conservatively, and then surprise myself with good news. 

Also, here is my 2 cents as for splitting it three ways... Why do you feel the need for partners. If you have a cash offer, or at least 33% to put down, do that and don't bring a partner into the equation.  I have a partner on some deals because I need money and financing that only he can bring. if I didn't need that, I would do the deal solo and reap 100% of the return. 

@Bill Jacobsen You make some good points. Im exploring this house as a test of the potential long term partnership. I know this deal will be profitable and we will orchestrate a buy out if it doesn't. I guess I felt like sometimes you just have to try things with a mindset of what is the worst that could happen. In this case, I work hard and only earn a little. 

My reasoning for doing this is that personally Im tapped on the capitol I have available. After having our first kid, my wife has been staying home, so we need our cashflow from our other properties to live. Therefore, Im really not creating more capitol to do a future deal. I see this as my avenue to expanding, even if it means a smaller reward. Does it make a little more sense now, or do you still see me selling myself short? 

My concerns of tile in the living room is it being cold and loud. Ive been looking into the wood tile, but it runs about $3 a foot. I dont love that. They have some at HD, but I wasnt sure of the quality. 

Other downsides I see to tile is that its expensive to remove (but should last), and will crack if there is settling on a foundation. 

Thanks for the reply and thoughts

I usually remodel older homes where I can refinish hardwoods, but I need a new vision for when I have a slab on a slightly nicer home (3/2/2 100k ARV, $995 rent). Im all over the place on what to do: Allure, Tile, Wood Tile, Wood Laminate, New Vinyl Planks.

I really can't decide because I see advantages to each. The biggest debate is what to do in the entry, living, kitchen, hallway and utility areas. I know I want to go with porcelain tile in the baths and my partner is pretty sold on cheap carpet for the bedrooms. I disagree on the bedrooms, but welcome to life with a partner :)

 You usually can only recover what is deemed as a sufficient time for you to get a new tenant... this might be 30-90 days rent, not 11 months. Every area is different though. 

@Jimmy S. I assume this is the same situation as you posted on your other thread? You might need to find out more about the Penn State laws. Either way, Im not one much to take stuff to court. Hard to make it worth my time and money even if they are the ones that owe. Id deal with them directly to see what else you can get out of them... you wont get 11 months rent, but may be you can get some extra. Unfortunately we wont make money off every tenant... but thats why we try to screen well and tenant proof properties to avoid this. When it happens, look for ways to limit the damage, you lick your wounds, try to screen better next time, and make money on the next deal. 

@Jimmy S. I would eat it. I collect those things up front for moments like this. If you try to collect, they might fight you more. Since you can probably get this rented with minimal hassle and come out ahead on rent... Id take care of business and move on. Make up the $150 else where. 

@Jeffrey Lester Im not sure where your spiritual beliefs stand, but my feeling is that whatever you need to accomplish the plans the Lord has for you, he will give you. This doesn't mean you don't have to work, but he will make the things you cant control happen in the right time. Most of the real estate connections I have made have been through church (2 Realtors, a wholesaler, two peer investors, a partner, and private money lender). Whats good is that this makes the trust bond greater and our desire to help see the other success strong.