All Forum Posts by: Ken Holifield

WoW, what a response! That was above and beyond, thanks a lot mwarden for that explanation!

To a newbie like myself, this number ($2,300) seems very high. I realize that different markets warrant different amounts and so on and so forth but it doesn't seem possible to get this much in TN. I was thinking that the above-mentioned fictitious property would rent for a max of about $1,500 (and I guess this is why I’m on the sideline and not making deals).

This was a real eye opener for me!

What is the general consensus on what is easier to start out in, flipping or rentals?

Thanks again!

At the risk of sounding like a complete rock, here is my question...

What is the formula for figuring out if rental property is worth it? I realize this will vary for different areas, mine is TN if that helps. I've seen many different answers on here that never really explained it all the way out for a newbie. Let's just say I buy a $100,000 sfh and my mortgage payment (piti) is $1,000 a month. Considering everything, what do I need to get in rent per month to make this a positive cash flow property and also what would I need to get to make this a VERY GOOD positive cash flow property? And, how did you arrive at those figures?

My situation (condensed version):

I have already secured financing and have been looking for houses to fix and flip. I've been looking for about a month with no real luck. This is partially due to the fact that I am being overly cautious because this would be my first deal. Just in the past few days I started thinking that maybe I should be looking for rental property and if I happened to find one to fix and flip then ok. I thought it might be a little easier to find a property to rent and this would get me in the "game" and give me some experience. Is this a naive view? Any and all thoughts, ideas, wisdom or criticism is appreciated?

Thanks

That brings up another question. Do most agents have a problem submitting low offers? So far, that's what it seems like. An agent told my partner a couple of days ago that our offer was to low and that she would not submit it. Is this even legal?

Very true!

Any other advice?

Thanks!

Let me start by saying that I don't have ANY experience with REI clubs. I looked up the local club (there's only one) in Knoxville and it only has about 15 members. How valuable of a resource could this be with so few members (real question, not being a smartass)? Thanks for any and all input!

Yes, primarily I have been looking at the MLS. I have also been scouring the internet for foreclosures and REO's. What would you suggest?

All,

First of all, love the site, thanks to everyone on here!

A little info about my situation:
I'm a newbie with many questions. I MIGHT know a little more than a normal newbie because I did have a real estate license a few years ago and I have continued to educate myself on the subject. I am interested in rehabs, REO's and foreclosures (or any other good deals) in the Knoxville area. My plan is to fix and flip as quick as possible. Financing is already in place and is not an issue. Just within the last week, I have looked at about 100 properties with no real luck.

My questions are:
1. I'm hearing that Knoxville is an extremely competitive area for a flipper. Is this true about Knoxville? Is this true about most places?

2. The formula that I have seen many times for buying investment property is ARV (after repair value) x 70% - repair costs = max bid. Is this truly the formula for success? What would be the highest % that an investor could go up to, i.e. 75%, 80%?

3. Any suggestions on what I should focus on, or not focus on?

4. Should I get my license again? Is there a significant benefit to having a license and flipping even though I wouldn't be a normal everyday agent?

That's all for now, but I'm sure I'll come up with more questions soon.
Any guidance would be appreciated. Thanks in advance for your help!

Flipster (wannabe, for now)