All Forum Posts by: Frank Maratta

@Greg Dickerson

Lots of good info in there. Thanks for taking the time, Greg.

And yes I was looking at vinyl siding, vinyl windows, pretty basic housing with 1-2 bedrooms each unit. Just to make sure I understood your paragraph correctly, for something like this, you think $100/ sq foot is a good estimate to build? Does this include the engineering/architectural, utility hook up fees ect? Basically all costs other than the land itself.

How would you suggest is the best way to start my search for a contractor? All of my rehabs I have done in the past I have been the GC. But these are just two and three family rehabs. I could not handle GCing a 12-24 unit building while keeping my full time corporate job.

Anyone out there ever built an apartment building from the ground up? Can you shed some light on price/sq foot it cost you to build (not including the cost of the land). What type of cash on cash return can I expect from new construction? A few years ago, the small multis I have in my portfolio cash flow around 20-25% cash on cash return. I understand cash flow on new construction probably won’t be anywhere near as high, but it’s something I’m trying to learn more about as all the deals in my area have been non-existent and I have not purchased anything for the past year. How does the loan from the bank work, approval process from the town ect? I’m completely new to new construction, the only expierance I have with the town are simply pulling permits on a few rehabs I have done. What is the best number of units to build per building to be profitable? 12? 16? 20? I only have about $250k in cash available right now.

@Jake Engle

Haven't taken the time to read the whole thread but my last BRRR I had it appraised when it was vacant. I really think it makes the building show better. Also the appraiser asked what my rents were going to be. I gave him an estimate, and in the end I actually ended up getting less for rent then I estimated. I'll be honest, I kind of knew this. But the appraiser took my verbal "estimate" and used it for the income approach to valuating the property. Not sure if this helped with the final value they landed on for my property. Anyways, it turned out well.

Hi all. I am an investor of small multifamily buildings in new Britain ct. all of my 6 properties are located in new Britain CT. Any other CT investors feel free to give me a shout. I’m looking for more rehab projects!

@Leah Slaughter

I have no experience with vinyl plank. I don’t mean to hijack this thread, but would love some clarification on the durability and water resistance of vinyl planking. My understanding is that vinyl plank is made with a layer of wood at the base- the same type of wood that you see at the base of hardwood laminate. I’ve had spills on laminate and the cheap wood underneath expanded and bubbled up the laminate layer. I would assume the same thing would happen with vinyl planking if water made its way through the cracks in the interlocking pieces. Am I right? Obviously the top layer of the actual vinyl would stay intact, but I wonder if the wood below would expand. Im a fan of VCT, I’ve found it to be the most tenant-proof flooring next to real hardwood. But I’m not crazy on the appearance as it has that “commercial” look to it. I’m wondering if they make glue down VCT in “plank” form.

@Dominick Austria

PAL = pass activity loss ?

@Craig Jeppesen

Agreed. I know a very successful businessman/investor that believes the same thing - all “toys” including your personal home, vacation home, Ect should not have any financing on them.

Not all of us are fortunate enough to have that possible - I have a car loan and a small mortgage on my personal residence. But i am working my way to having those type of things paid off.

@Connor Ryan

I would strongly encourage you to house hack. I wish I had done it. You don't have a lot of capital so an FHA loan with 3% down or whatever the minimum requirement is, is a great way to get great cash on cash returns. Also I am strongly against investing out of state for your first rental. I self manage and need to be close to my properties. All my properties are in the same town, 15 minutes from my home and 15 minutes from my day job. I think out of state investing is for those who have more expierance and have a relationship with a good property manager.

Just a side note, I looked at a six unit the other week that was managed by a property management company. The owner knew nothing about the building, including where the boilers were located in the mess of stuff piled in the basement. He also did not even realize they were oil fired when he told me they were all natural gas. One unit did not even have heat - just space heaters. The entire building was just a disaster of deferred maintenance. It’s scary to think you pay someone 10% of your rents to manage the place and this is what you end up with.

@Jordan Woolf

I’ve had two multifamilies with asbestos siding. One of them I just sided right over it. Keep in mind pieces will fall off and break when installing nails for the new siding (and windows I did as well). There was broken asbestos siding everywhere, but I did not get charged with a contaminated dumpster. My other building with asbestos siding is actually in good shape. So I just painted right over it. Asbestos siding is literally all over the place in my area. I would jump on that deal.

@Kyle Root

Why do you want to start a partnership? Is it just because you want to feed off of someone else’s network and experience? Not Ment to be rude by the way. But Those can go terribly wrong and usually have a bad ending. I wouldn’t recommend. I do think it makes sense sometimes - for instance a handyman partnering with a lawyer. Your best bet is to find a mentor who expects nothing in return. Rather than a partnership that may have unclear boundaries.

Are you trying to form a partnership because you don’t have enough capital? Most likely the other partner is going to want a return on his investment equal to the split of capital you each put in. If you have $50k in the bank and put it towards a $100k downpayment, and your partner does the same, you both end up with a return on a $50k investment - in other words you could have bought a smaller property with the $50k, get the same rate of return, and have it all to yourself and have no headaches worrying about a partner and him not pulling his fair share of putting in the work.

Partnership can make sense, but at a more advanced level. At a beginners level it is just a fancy term for hand holding and usually results in disaster.