All Forum Posts by: Frank Klarich

@Rahul R.    I see that you will have an inspection done.  However, based on initial assessment do you expect to have any upfront rehab costs (I saw a line item in your spreadsheet, but no data)?  Is it currently rented?  If so, what are current rents it's receiving?

https://komonews.com/news/coronavirus/under-covid-some-landlords-of-limited-means-worse-off-than-their-tenants

The article above got me to thinking about whether or not we need to re-think what an adequate amount of reserves in this post-COVID world should be.  Traditionally, the advice has been 6 months, however with eviction moratoriums, etc., perhaps that should be re-visited?  In the example above, these folks "may" have had reserves that were traditionally adequate but bad tenants + COVID has forced them into a terrible situation - including homelessness, while tenants still have a place to live.  I assume this is not limited to Washington state, as eviction moratoriums are in place all over the country.

Thoughts on what the right approach should be going forward?

This is an incredibly personal decision.  How often do you think about that debt?  If it were me, it would drive me crazy...however, you may be comfortable with it.  Perhaps there's also a middle ground?  Pay off half or 3/4ths?  You may want to talk with an advisor or someone who can give you a holistic response based on your "comprehensive" personal situation.

@Todd Powell, in looking through the thread of posts from past several months, it sounded like you had a lot of "college exposure."  Is that accurate?  How has/is COVID impacting you from that standpoint?

On a side note, I am a PNW native but now live in TX...much, much better here.  LOL

@Randy Bloch, I am of the same mindset. When rolling over funds into the SDIRA, I did not have to move everything. Instead, I could choose whatever amount to move from my IRA (rollover,) to my SDIRA. Thus, maybe the learning is to move your 401k over into a Rollover IRA first and then move over whatever amount to the SDIRA you are comfortable with. I agree with you in that I am also targeting a 50/50 asset allocation between stocks and RE. Personally, sitting on a large % of cash, and waiting for deals to pop...not comfortable putting another dime (outside of current 401k new contributions/investments) into the stock market.

I rolled over some of my IRA over into an Equity Trust SDIRA. So far, I have used it to invest in a couple of apartment LPs. The service has been good. The website is good. They are responsive and quick. You can reach them via email or phone pretty efficiently. With what I've used them for, they are good...however, I cannot speak to any other services (metals, etc.) though I would not hesitate exploring it. Only thing I don't like is that I feel they're a bit pricey (fees.) Also, what I learned was that it always paid to spend a little more and expedite the process when given the option. When I did so, they were all over it and got things done for me fast. Hope that helps.

@Bruce Lynn and @John Morgan, I must be doing something wrong, because the VAST majority of deals I've seen lately, (MLS, wholesaler-provided, etc.) do not typically meet the 1% threshold, especially when building in closing, rehab and holding (hard money costs.) I have been looking at deals every single day (literally) in the most of those markets, (I live in DFW too,) and getting a deal to cash flow is dang near impossible. Anecdotally, even wholesale deals are getting bid up and most are going highest/best now as a result. It's frustrated me to the point where I am considering trying to source my own leads. I would greatly appreciate any insights/advice...been ready to buy for quite some time now.

Good feedback...I am doing the limited partner route on MF here in DFW...just got into my first deal (closes at month-end).  Have you had much luck in the SFR space up in OK, while being located down here in DFW?  I had been kicking around doing something up in OKC, but the distance has me spooked.  Feel free to private message me a reply if you'd prefer.

@Daniel Mendoza, what is your ultimate objective, SFR, Multi-family, etc.? Very difficult question to answer without knowing some more details on what you're trying to accomplish. For example, if your goal is to own 10 SFRs within 5 years, then the advice you get may be quite different than if you say that you are all about Multi-family. What I would do may differ greatly from what you would do.

@Ben Leybovich

Good stuff...thx for sharing. What ballpark cash-on-cash, IRR and hold period are you currently estimating?