All Forum Posts by: Frank Granata

 @Henry Clark Thanks for the great response! Residential purchases are definitely a little slower right now due to rates but inventory has been low for a while now. The last point you make is intriguing and definitely a question I've had regarding self storage. I would like to own the business and the asset. I didn't even realize in self storage you had the option to strictly own the asset. I always assumed whoever owned the units also owned the business that is running them. 

 Thanks @Taylor L.! That's an interesting point you make. It sounds like bigger might not always be better depending on the market and how efficiently the facility is run.  

 Thanks! @Jenny Bayon - Do you have a system for analyzing cash flow to see if it's a good deal or not? I understand the current owner will provide P&L's but do you estimate the loan payment and taxes just like you would on a conventional mortgage?

As someone who has never invested in real estate, self-storage seems like a great way to break into real estate investing. What are your thoughts on this? From sourcing/analyzing deals to financing to cash flow. Is self-storage as great an opportunity as it seems or are there pitfalls to be weary of? I'd love for you to share your experiences so I can gather some real world advice. Thanks! 

Thanks Anthony! I appreciate your feedback and support. 

Anthony, incredible feedback. Thank you. It's definitely a competitive market right now. I'll have to become pretty well versed in analyzing these deals before I'm comfortable putting together a direct mail campaign. I would also love to get out and see some houses that have been flipped so I can compare them to other houses in the area. I feel like it'd just be good to get out and see the final product. It feels good just jumping on here and finally starting to talk about investing in real estate!

It all comes down to getting the house for a good price and not going over on the reno budget, right? So I feel like if I can get a good feeling for a specific market by seeing what houses are selling for I would then move on to seeing how much it's going to take to repair and kind of working backwards. Or perhaps I'll find I'm better off buying a rental.

Again, thanks so much for the feedback!

Frank

Moises, what a fantastic response. Thank you! 

1.) Are the properties that you find on auction sites in good enough condition to get a conventional loan on? Also, in regards, to searching the MLS - are you a licensed realtor or do you work closely enough with someone who is and has access to the MLS?

1a. Are you able to spot possible repairs needed to the foundation, plumbing, roofing etc.. on the initial walk-through? You mention bringing in multiple contractors after you close but I would imagine you also need them to build your budget upfront so you know whether or not it's a good deal. 

2.) I'm assuming that when you're financing the repairs that's when the 75% CLTV comes into play. My question would be does the lender also estimate the ARV?

My hope is to be able to really narrow my focus to 1 zip code, find a property that only needs cosmetic repairs, finance with 5% down and then cover the repairs with cash or perhaps a small bank loan to supplement if I don't have enough cash to cover all repairs. Home values in Pittsburgh can be pretty low so I'd like to dive into the market and really see what my options are around here. 

Thanks again for your response! 

Frank

I work in the mortgage business and I've seen what it takes to get a mortgage done. I want to learn how much work goes into flipping a house. From finding the deal, building a budget, securing the financing (if it's not a conventional loan), to working with the sellers, agents, and contractors.