All Forum Posts by: Frank Avallone II

Hey @Jared Lundy I come across similar situations sometimes my self. Ideally you would always want to see some indication for appreciation over time. However, depending on your financial situation and investment portfolio it could still make sense. Have you been looking with out finding anything for a while? Do you have other investment properties? Does this amount of cash exposure put you in an uncomfortable place? If you can really see 700-100 cash flow on a property that you can pick up for 125k, it seems like a great return on investment.

One other factor is just how bad are these water issues. I've looked at hundreds of houses in the last few years and water always seems to be the issue. You just have to be careful because water infiltration commonly means mold. 

Is the property in a condition that you can see more problems arising as time goes on? If this is the case then it might not be worth the headache.

 I think because it is still pending. 

@Randall Justus Glad things seemed to work out. Usually doesn't hurt to ask!

Investment Info:

Small multi-family (2-4 units) buy & hold investment.

Purchase price: $579,313
Sale price: $625,000

First Investment Property that I purchased with 2 other partners. Turned out to be a really great learning experience. Since then have had a slightly different outlook on how to invest better into real estate.

Lessons learned:
-Make sure you do your due diligence on current market value rent.
-Properly screen tenants thoroughly
-Buy in renter friendly areas.
-Consider neighboring houses.
-Research all potential value adds prior to buying property.

What made you interested in investing in this type of deal?

First rental experience. It was a turn key scenario which I personally would avoid in the future. I believe it is better to buy properties with potential value add for BRRR method.

How did you find this deal and how did you negotiate it?

Realtor

What was the outcome?

Learned a ton about investing in real estate. Made some mistakes but untimely still made it worth it. Wound up selling the property to reposition that money into a better investment opportunity luckily in a higher market then when we had bought it.

Investment Info:

Small multi-family (2-4 units) buy & hold investment.

Purchase price: $505,672

Purchased this rental property in 2019. Great property that came with 2 rentable separate garage spaces as well.

What made you interested in investing in this type of deal?

Great Investment

How did you find this deal and how did you negotiate it?

Realtor

Lessons learned? Challenges?

Always screen tenants thoroughly.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

Yes, Chris Coranato.

@Lance Bean I should be able to help you out with this.

Congratulations! This is awesome!

Hey Leslie, Happy to hear you are looking to take advantage of house hacking! As @Natalie Schanne mentioned I would suggest trying to shoot for a 3 or family home as well if your financials can allow this. First, this will make it easier to cash flow while still living there. Second, if one of the units has a vacancy then the other unit or two can help carry the bills. Lastly, and most importantly from a lending perspective it could be a little more difficult to go from an owner occupied 2 family to an owner occupied 4 family. As far as location I also invest in new jersey. I would suggest staying along the train lines and also looking for rental friendly areas. I like the dover NJ area a lot for investing. Also look for emerging markets or areas that are seeming to grow. Hope this helps!

 Well said @Reed Vennel. I would take the same approach. Doing this could bring a lot more clarity to the situation. As long as you talk about it with the potential renter and then the employer you should be able to figure out the likelihood of him keeping his job if he does lose his license. Was there any other criminal activity in the background check? Is there a co-renter?

and these are all in West Virginia? I would speak to the lender about the entire plan.