All Forum Posts by: Forrest Williams

 Hi Zach, welcome to BP! I also flip houses in the Chicago area. I'll start by saying the best way to get into house flipping is to do a house hack. You're going to have a hard time getting a hard money loan if you have no experience and have no GC. That's a route for more experienced investors.

I got my start house hacking a foreclosed property in an outer suburb where prices were cheaper. From there I fixed it up, sold it, got another, sold it for more, etc. I lived in each one as I did it. Get a couple roommates that don't mind some dust, and you'll be well on your way. Lots of projects you can do yourself by youtubing the problem e.g. faucet replacement, drywall patching, flooring installation. That can teach you a great deal about how much work and money goes into each improvement. Let me know if you want to connect.

@Naoko Potts If the tenants are on income assistance, I wouldn't consider that a red flag. While other land lords have been (rightfully) panicking about getting paid since March, the income assist checks always clear.

I bought a two flat with some pre-existing tenants. Definitely ask them a few questions. Find out if they like living there. Is there something they've been bugging the landlord about that s/he hasn't completed? When I asked my tenant about the garage, she said, "I don't like to go in there because of the rats." So we had them fix up the garage a bit as part of the contingency to help keep the rats out.

And definitely ask how much they are paying and if they have a lease. You'll probably hear different numbers from the tenant and the landlord. If they are on income assistance, call the organization they have assistance with and get info from them too.

Tenants are scared you'll kick them out, so if you aren't planning on it, make that clear to them if you buy it. It's unnecessary stress for them otherwise and you want to start on the right foot.

That depends on what you want to do and where you want to live. No one can answer that for you except you. Some factors you may consider though: 

Cost of living. Look up some numbers and get an average. 

Weather: It's snowing in Chicago today. I bet Atlanta and Austin are nicer this time of year. 

Job opportunities: If you're going to start investing, it helps to have a W2. Which of these cites offers the best opportunities for your career? 

Proximity to home: For some people, being more than an hour away from their family and friends is a deal breaker. Is it for you? (My parents are 1000 miles away in opposite directions so that's not a deal breaker for me obviously). 

Housing cost: Some areas are more expensive than others. Which spot can provide you with the most successful entry point?

I second Chicago. Thorough transit system, more affordable areas than NYC, not terrible if you own a car.

I've used Geico for several years and have been fairly happy with them.

I did a house hack in a townhome for my first place. It was a fine experience, but I wouldn't do it again because of the HOA. They were $20,000 in debt, charged $207/mo for very little work, and never did any work. Worst of all, because of their rules, they made it impossible for someone to get a FHA loan on the house I wanted to sell. As a result, I had to sell it to an investor for $15,000 less. I still made money, but now an HOA is a deal breaker for me.

I would try to land a job with a property management company to learn the ropes. It sounds like you have a solid background that can help. You can get some experience dealing with tenants, learning local and state regs, and talking to other PMs about their experiences. 

I am not currently looking for a PM, but when I eventually do, my number thing I'll be looking for is, "how hands off can I be?" I'll want someone with experience and a proven track record of running properties well. I don't want to be micromanaging them, so knowing my properties are with someone I can trust not to overspend on a clogged pipe is important.

Have you worked in property management before?

Would you be able to live there for one year, regardless of what happens to him? At that point you could call it a primary residence.