All Forum Posts by: Geoff Husa

@Account Closed have you seen any of those delinquency numbers specific to the Phoenix area, or AZ in general?

 Thanks. Your response lines up with a lot of what I've been coming to understand regarding marketing and financing and the other stuff. And yeah, I can imagine the seller needs to feel pretty confident that you've got him covered!

Elliot Smith has a fair bit to say about negotiating and selling a 'solution' and just addressing people respectfully and being real with them in negotiations. Sounds like you're saying the same thing.

Anyway, I'm not looking to get into REI with no money. I've got some saved up that, after we take care of our primary residence (which we'll be turning into a rental after we return overseas, by the way), should allow us to do another deal (using your numbers as a higher end hypothetical for the second property) while leaving plenty of reserves for both properties. Of course there are any number of other strategies I could employ on the second property depending on whatever financing possibilities I can utilize.

It sounds like my struggle will be finding the deals. I keep wondering if maybe sticking with a trusted wholesaler wouldn't just be the best way to go. But D4D sounds fun, as does experimenting with other methods like mailing and calling and sms; if nothing else, just for the education and experience... but hopefully maybe even to get a deal out of it!

It's good to chat a bit with another investor in the area! Thanks for your responses!

Yeah, that's what I'm starting to see more and more. That's the decision I have to make, is how much time and effort I can give to it, and what's a reasonable expected outcome. I love my full-time job and want to keep doing it. But I live off fundraising, and have for the last 16+ years. The fundraising takes time I'd rather put elsewhere. I also live overseas for roughly 3-4 years at a time. My ultimate goal is to eventually be self sufficient through REI so that I can be free to continue to do what I love doing and not feel so tied to the fundraising part. My struggle is parsing out the information I get about REI and figuring out which strategies will work given my circumstances. For a while here I've been thinking when we get back to AZ I could play around with some different strategies like D4D and direct mail and even some calling and door knocking, kind of part time hustling. I could easily devote 20+hrs/wk, for quite a bit of the year. Not in the hopes of generating a consistent flow of deals, but to see if I can score one or two deals in the year we're home. The more I learn and hear about others' endeavors, the more hopeful I become that that can be a reality. But my friend with experience, and it sounds like you're concurring, is telling me it takes more than dabbling to get things refined to where you can get deals and not lose your shirt; especially learning the ropes enough to know what needs handling in regards to clean titles, probate issues, etc. So maybe I'm going about it the wrong way and need a different mindset. Definitely committed to getting into REI, and have enough capital to get started with a couple purchases in the area, but just trying to figure out what works in the market I'm interested there in Phoenix, and what strategy will be best for me to chase after.

Sorry for hijacking the thread with a seemingly different topic. But this does springboard from the 'hottest' market topic. Phoenix is definitely a hot market though! Think of it as a noobie's side-thread springboarding from the original topic. Also, maybe this can be a dose of reality for others looking at 'hot' markets and trying to decide if and how they want to jump in. Or maybe I'm the one who needs a dose of reality :)

A couple of months ago I wouldn't have understood a bit of this... haha. But thanks to BP and it's resources (and a rather large time investment in reading and youtube vids) I get gist of what you're saying here. I've actually been reading more about subject to, and lease options (both as the lessor and even the lessee, for acquisitions) lately. The part that throws me is the bit about off-market turnkeys for $60K... Whaaaaat?! Where are you scoring that kind of deal in Phoenix area? Or is it one of those secrets you could tell me, but then have to kill me?

This might be getting off track for this post, but it starts with having a goal of reaching FI. I don't know if I could say I'm in as much of a hurry as the subjects the OP is asking for. I also have a bit of time (as I currently live overseas) before I can do much. But when we return to my home area in Tempe/Chandler next year... Anyway been learning about creative financing and how to find and negotiate deals and much more... how wholesaling works, the steps to take when you find a deal, etc. Just trying to define how we want to move forward. I like the possibilities of subject to and lease options though. I've been running my ideas by a friend of mine who I've known for close to 30 years, who is a long-time reputable wholesaler/flipper/agent in the area (over 20 years), and the feedback I'm getting is that the market is so hot right now that a lot of the stuff I'm reading about on BP about finding and negotiating deals just isn't realistic for someone like me who just wants to score a deal or two a year. So when you talk about getting turnkey deals for $60K...! Throw this dog a bone, dude! What kind of properties and areas are you talking about?

@Shiloh Lundahl is doing some cool stuff with the lease options. I don't think he's getting nearly as much as you mention for the option payments (I think he's mentioned $2-3K), but he can correct me if I'm wrong. @Jay Hinrichs, regarding what you mentioned, Shiloh seems to be following some of the recommendations in Brandon Turner's book on financing deals with little or no money. He helps people get on track with education about finances and connects them with a lender and provides some accountability so they can reach their goals of making that purchase. I like that a lot too! Shiloh, you can correct me here if I've misrepresented anything you do.

@John Farady

Curious what strategy you use primarily in Phoenix area. Straight buy and hold, or brrrr, or.... ?

Thanks. In reference to your suggestion about 'margin', I'm only vaguely familiar with that term but find myself confused by what it really means in various circumstances. Do you mind explaining what this is? My simple understanding of it is borrowing money to invest with. I'm not sure how that would apply in regards to my brokerage account and withdrawing cash.

I wasn't clear on on my original post, but we're not talking about using all or even most of our retirement savings. This is a small portion of our retirement savings; a portion of which monthly contributions we designated over 10 years ago as specifically for the eventual purchase of a house. Now it's just a question of how to take that money out and how to use it most strategically.

If you're talking about the roth accounts, then yes, I would totally agree. Not wanting to touch those. In fact, wanting our REI ventures to be well insulated from our other retirement investments.

We do indeed have a CPA who does our taxes. Not necessarily in the REI world though, so wanted to reach out to see what those experienced in this realm have to say. We are US citizens living and working abroad. And you're right, there are some special tax considerations to keep in mind with that. Not sure how they'll play into REI. Just starting to dig into that some more here.

Thanks. Just sent a connection request. He's a wholesaler, right? Have you bought from him?

Has anyone had any experience or have thoughts about using a lead generating service such as 633 Real Estate Solutions to find sellers in your area?

 Thanks! Will have to check him out!

Thanks for your input! Yeah I've been thinking about the FHA and 203k. Problem is that that has so much red tape that it really limits one's ability to close on a deal.

We currently do not rent or own a house at all in the US. The only house we own is a little house in the middle of the jungle in Papua New Guinea! No joke! Built it from scratch. Has no resale value whatsoever! But we're planning on coming back home, to AZ for a year next May/June-ish. That's when we were going to get this first house. Actually would love to do 2 houses in that year if the first BRRRR works out decent.

We are on track to have about $35K in savings by then, and roughly $51K that we've saved and invested over the last 10 years in the stock market for just this occasion. So I think we'll be OK on a down payment between those two. Just looking at how best to liquidate (is that the right word) the funds in the stock market that we allocated for home buying. We want to insulate our REI from our other retirement savings. Except for the one bit that we've specifically invested with the mindset of putting into a house some day. I can't imagine a scenario where we'd do well to dip into the roth accounts, but figured I'd put those out there anyway just in case there's some scenario that I'm overlooking.

I did talk to a broker in the area who told me with our credit (above 780) and other details he's figuring he can get us a conventional with a low 3% down (No kidding... had to double check I heard right) and 3% interest. Of course that was more than a month ago, so perhaps rates are even lower now. And who knows where they'll be by the time we need to move on this next year.

Our plan is indeed to live in the first house for the year, first off because we need a place, but second, so that we can get a residential mortgage. We're even specifically looking for a place with an ADU so we can do the house hack thing during the year we're home!