All Forum Posts by: Hadar Orkibi

Thanks you for sharing the rehab info Alex now i have more of a picture of the level of work done.

The cost of rehab sounds lower in the US then in NZ. New Kitchen bathrooms, floor covering, paint throughout, light fittings etc - what we call cosmetic Rehab ("Reno" in Kiwi) would cost around 50k-60k for 3 bed house one bath and with new roof you can add another 15k. labor and material are expensive in NZ. Sound like in the states you get bigger bang for the buck.

We also own one house which is pre 1930s and never replaced the wiring or plumbing. But prior to purchase we had to have the wiring and walls checked for insurance assessment.

In NZ Some Insurance companies will not provide cover with old wiring and Scrim & Sarking walls as they are very flammable. 

Cheers H

Thanks for the comments @Alex Craig, i agree with your strategy of providing the tenants good customer service and attending there concerns and maintenance issues (within reason).

Im holding some tenants for 5-8 years with some of my buy and hod in Auckland NZ. and that's with increase of rent yearly by $10per week ( in NZ we charge rents 52 weeks of the year) so that's comes to increase of $520pa on rent. and this is in blue collar area. the last 2-3 years we had growth of 7%pa in rent. 

The point is that i wouldn't feel i could increase the rent by that much if i would have not been attending the tenants basic maintenance needs.

No doubt tenants who live in A Class area would be more affluent and could probably afford a small $15pa rent increase.

You would like to know that a friend of mine who is now based in LA purchased a property from you few years ago and he did mention that he is happy with it. 

What is the typical cost of rehab you are doing for the TK offering Alex? do you rewire and re-plumb the houses? the Mid South Home buyers advert saying that they completely renovate their houses i was wondering what Completely means...

 HI Bob, thanks for the post and link.

SF, LA, London, Hong Kong and Sydney in Australia are all appreciation markets.

Auckland N.Z which I invest in and flip also becoming an appreciation market only. house prices increased by over 75% from the peak of the last boom in 2007 and the median house price is near 1 million dollar. say +800k. 

The NZ Reserve Bank now introduce Loan to value restrictions to 60% for second property purchases I.e investment property. so now we need at-list 300k for deposit to buy any average house in AKL. although im still active in the AKL market i would like to diversify and make the money working harder for me producing better cash-flow. Cash-flow is king and only cash-flow can pay the bills and send me and my family on 6 weeks holiday every year. I don't believe in "living off equity" as equity can run out and its not reliable as steady cash flow.

It is known that some markets are appreciation markets and some are cash flow markets, Memphis looks like cash flow market but is lacking solid long term appreciation. 

The point im making is that each market can't have it all, unless one buy well and force equity out of the asset which is what the pros on the ground are doing in Memphis. its the same in any market.

I get the infinite return when there is no money in the deal. all my buy and holds are like that now in NZ as its essay to pull the money out when you have 10-15 growth per year. 

I take it that you guys don't regard yourself as TK @Dean Letfus ,so you leave equity in the deal?

"The best way to make a small fortune in real estate in Memphis is to start with a large fortune and keep buying turnkey property at or above retail prices :-)."

Is this sarcastic mate or did i miss something in translation?

thanks Dean, it sounds to me that the only way to make a market with stagnation of rent and prices work is to enter the market for diversification from growth and no cashflow market. I.e Auckland for us.

Put 25% in on purchase then 6 month later after "seasoning" refi all or at list 15% of it out. 

Say you have 10% of the value in the deal as cash, returning reasonable cash on cash return and some equity. 

If this is doable then it's worth pursuing. 

For this to happen one need to buy under retail from turn key provider or commit to buying Volume from a provider so they cut thire margines. (Buying bulk). 

Hi Team of Memphis Investors, Experts and Property managers.

I'm doing some research prior to jumping in to the market and seeking to confirm what is the rent growth trend in Memphis. it is known that Memphis is more of a cash-flow Market then appreciation market, but I would appreciate some insight information about the rental growth in Memphis. 

I'm asking that as if one is to invest say $100k for property an say it is returning $12k per year with hardly any rent growth over the next 10 years (or just keeping up with inflation) and no capital gain as bonus then one is going backwards or just holding mediocre investment.

I have researched and found this Freddie Mac report, note page 10. stating that "Memphis will fall short of expected inflation" http://www.freddiemac.com/multifamily/pdf/2015_out...

Also here over 9 Years the rental growth in Memphis is gone up from $809pm to $851pm from 2005-2014 which is "bugger all" and hardly keeping up with inflation.

http://www.deptofnumbers.com/rent/tennessee/memphi...

Also i note that vacancy rates are trading down But seating at around 10.5% according to this info.

Any info and feedback from "Boots on the ground" investors and operators would be much appreciated.

Thanks Hadar

Does anyone here use Corporate Direct by Garrett Sutton? 

https://www.corporatedirect.com

Is this Arizona Dean? 

As the saying go "you make your money when you buy". 

I never buy retail, but sometime I do pay "asking price" if the asking price is under retail OR have an added value opportunity of minimum 15%.

By buying under retail value one can protect himself in case of unexpected event or change circumstances when he need to off-load the property.

Some deals have multiple exit strategies and some have Just sell. you want to make sure that if you are in the Just sell category at-list you are not running at a loss. and buying well is the key.

For how long would that loan be @James Wachob , Is it hard money?