All Forum Posts by: Garrett Christensen

I do know agents that have great success with the platform, however more often than not I hear about experiences like yours. For that reason I haven't tried it out yet. I've explored similar programs with other sites and had the same experience.

What Cherie said is spot on. Make sure your lender know what your plan is if they don’t already. As far as finding a property goes, it’s possible, but difficult. There are actually more multi units available than last year because people are taking advantage of the high prices and seller their investments.

If I were you I’d be analyzing every duplex that pops up so you get good and fast at it. I’ve got a spreadsheet I can send your way if you’d like, or use the BP calculators. 

There’s also a lot of strategies to find off market deals if you and your agent are willing to put in the work.

@Tucker Cummings Hahaha you quote wins, and that's a good point. The risk is much less when you can cash flow, I just think appreciation, at least in a market like mine, is super powerful for scalability.

@Jon Kelly Ok this is a bit embarrassing, I forgot to add that into the calculations for this example, yes that is true. And to you second point, yes that is the threshold I was referring to earlier, just explained in a much better way. Thank you! 

@Dan Portka Thanks, yeah taking into account all the benefits of Real Estate is the key. It is an interesting scenario though, I found that there is a threshold where a higher appreciation yields a higher ROI, and this deal is sitting just below it.

@Tucker Cummings I feel that a lot of the time the industry focuses primarily on cash flow and it is key like you said. As far as scalability goes though, which do you think wins, cash flow or appreciation?

There are a lot of levels of a BRRRR deal. A "Full" BRRRR is usually referred to when the entire initial cash investment is pulled out at the refinance stage. In my deal's case we are pulling out almost, but not all of the initial investment and it's messing with my numbers. The other thing that makes this interesting is that I am in a high appreciation market and thus the cash flow isn't great.

Here's the simplified summary: 328k purchase price, 40k rehab, 75% LTV, 410k ARV, $400 yearly cash flow (I understand this is low)

With these numbers we will recoup all but 20.5k of our initial investment. That means the ROI is about 2.0%. If the property were to appraise for 390k though, the cash flow would be $1200/year and we would recoup all but 35.5k of out initial investment, making the ROI about 3.4% This goes against all my intuition as I'd obviously like the house to appraise for as much as possible, but in this case it's causing a lower return. Any insights on this?

Note: I understand that the cash flow numbers are low and that's likely what's causing this. Calculating the Cash on Cash ROI probably isn't the best metric in an high appreciation, low cash flow market, but I thought this was interesting and wanted to see if anyone had some advice for a situation like this.

Just go for it! Action is the best experience. I'd start out getting pre-approved and then start looking. I was in your same position a couple years ago. Message me and we can set up a time to chat.

I don't have an article or data to back that up. It's purely based off of my personal rentals, rentals of other investors I know, and their comps. 

All of this is driven by demand as you probably know. It's possible for home values to rise without rent increasing if more people are moving from rentals to owning their own home. In general, Utah rents have not kept up with the rising prices until recently. Over the past few months we've seen large increases in rent. This is likely because people are having difficulty buying a home and are opting to rent in the meantime. 

Adding to the demand are people who are selling their home right now and waiting for the market to "cool down" to buy a new one. This only adds to the demand and thus the increase in rents. 

Obviously no one knows exactly what will happen, but this demand is likely not going away anytime soon with the overall growth of Utah, and thus, in my opinion, the rents will continue to increase.

As a rule of thumb right now, if I can break even while including all expenses (Cap Ex, Vacancy, Maintenance etc.) then I'd say it's worth buying. This is because Utah is not a great cash flow market, it's appreciation where you'll make most of the money. It's also worth noting that rents will likely continue to go up with all the inflation that's around the corner, and your payment stays relatively fixed.  

I've got a great spreadsheet I can send your way if you'd like. Message me.

@Adam Galindo Yes, you should be able to earn some portion, if not most, of the commission on those deals. It would depend on the team/agent you are working with.