All Forum Posts by: Greg Gaudet

Originally posted by @Scott Passman:

@Greg Gaudet ROI is great and we all strive to make money. But at the end of the day, I think most of us want to provide a quality place to live for tenants and if you can do so while still making a solid return and simultaneously creating less work for yourself down the road...that's a win all around.

I really like your comment Scott.. That's something I don't consciously think about as much as the others, but I do have a couple units that I just did a band aid rehab on, and I do feel some guilt over those units... I am not particularly proud of those.. Not like I would be if I had done full reno and made em shine. 

On the other hand, those two units that are the most original are the greatest tenants I have.. they both are constantly thanking me for giving them a home and for being "the best landlord they've ever had"... I wonder if the condition of the unit has anything to do with that. Another important factor is that almost all of them are HUD. I've also found that my maintenance costs generally have been pretty low. So for me, I feel like it just comes down to getting a higher value to refi, adding value and equity to the property and my net worth, and providing a quality place to live, and changing people's perception of the "greedy landlord".

Just my thoughts and experience.

I always struggle with this.. I can get the same rent whether I do a full rehab and spend $20k, or just band aid my units (paint, fix anything broken, etc) for $500-2,000. About to close on my next one and trying to decide which one I’m going to do..

Maybe it’s bc we have a housing shortage here so anything gets rented even if it’s dated (also dated properties are the norm here, it’s rare to find a fully renovated rental)

One reason to rehab is that I’ll get more cash out if I refi afterwards.. another is that I should have less maintenance calls.. and the other is that I will attract the best quality tenants.

Ok that’s all for now; guess I didn’t have a question, just needed to remind myself why I should spend the 20k haha!

Maui investors: Don't miss the meetup tonight! 

Come prepared to learn and network, but most importantly share your experience. Text or email me if you have any suggestions for topics and things you'd like us to cover, otherwise it won't be covered! 

And CLICK ATTEND EVENT if you plan to attend!!!! 

@Roderick Baker Jr

No I’m on Maui. I host a meetup here. Although I do get some deals on Oahu. Mostly Maui though. I have two wholesales available on mahi right now.

Hey Everyone,

It's time for our next real estate investors meetup on Maui. 

WE HAVE NOT FOUND A PRIVATE MEETING SPACE YET! IF YOU HAVE AN OFFICE SPACE YOU'D LIKE TO CONTRIBUTE PLEASE TEXT ME! Or email me: [email protected] (I don't check my BP messages often)

 Please come prepared to learn and to share your knowledge and experience so that we can all help each other and grow our businesses together! Or if you're looking for a deal, be prepared to find it at this meetup! (Brandon and I have a surplus of deals at the moment so we have some available for wholesale assignment - email me for details) 

The Maui Wealth Builders group was organized by Maui Home Buyers to go a little deeper than our normal meetups. We will be holding events with experienced full time investors presenting and sharing their knowledge, and we will have events where you can bring a deal you are currently analyzing to present to the group and get feedback/input/suggestions from the most experienced investors on Maui.

If you have a deal you are analyzing and would like input on please bring all the numbers if you’re willing to discuss. Or if you have completed a deal you would like to do a deep dive on and discuss for everyones benefit, please message me so I can reserve a time slot for you. Sharing a deal is an excellent way to expand your networking, everyone leaves with an impression of you as a succesful active investor.

Message me with any questions or suggestions for topics or what you'd like to learn about, and PLEASE share this with any other active investors you know AND CLICK "ATTEND EVENT" on this page (right below the time and location) so we know how many to expect and have a seat for you! 

Cory Nemoto from Keco Capital hard money lender speaking at our last meetup!

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Legends: Ryan Murdock, Cory Nemoto, and Brandon Turner are regular attendees!

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If you would like a seat we HIGHLY suggest clicking the "ATTEND EVENT" button on this page and arriving early!

Originally posted by @Brandon Rollins:

@Patrick Franta

I appreciate your response. The info on using a local bank will certainly save us some time when we do take the plunge.

Since posting these questions I’ve looked at several pro formas and the numbers just aren’t rationale.

My question on the long term vs. short term was based on the cash flow proposition primarily. It appears short term rentals sell for a slight premium and would only make sense if the math did as well. We’re still looking, but I’m not interested in a “capital appreciation” investment that would bleed out 1k monthly.

The point on not using in house mgmt for rentals is interesting. I have much to learn about the short term mkt. Untill then, I’ll just keep chugging along in the Lafayette, Indiana mkt where the flow still makes sense.

Regards, 

Brandon, 

I'm an investor and wholesaler on Maui and have a couple off market vacation rentals available, as well as a couple residential properties that work as long term rentals. I believe all of them cash flow. They would be wholesale deals, so you'd have to be willing to do some rehab for most of them, but could have a couple hundred thousand in equity after rehab. 

I also know that Patrick Franta and Loren Clive are both excellent Realtors, so if you're looking for turn key you should talk to them. 

I'll send you a DM. 

Originally posted by @Marcello Di Gerlando:

Hi BP family. Its been a minute since I've been on the forums. First, I want to let everyone know that I have had great success with BP since 2011 hope you all have too. I don't do a ton of deals but the ones I have done are thanks to the BP community. Thanks to BP my net-worth has shot through the roof. Not to brag but I'm working on my 2nd big M$. Thanks @Joshua Dorkin and @Brandon Turner for making this a real thing. I have two single family flips under my belt both purchased at trustee auction, two hard money loans I issued to flippers', two buy and holds one is commercial and now I'm about to open my first STR ski vacation house up after a full rehab....but the reason I really called is...I'm now looking for a STR beach house and need advice from BP on where one would find the best deals on real estate, ROI, occupancy, friendly STR laws/regulations etc. I'm already working with Evolve on my current STR and have used AIR DNA. looking for folks that have personal experience with beach STR's. Maui sounds nice so does San Diego. Any input would be appreciated.

If you decide to buy something on Maui shoot me an email (contact info on my profile - I don't get on BP much). We have a few right now, just signed an assignment to another investor to sell them an oceanfront 2/2 STR for about 100k below market value, and it's only around a half a million PP! I doubt they'll default, but if they do you could have a shot at it. Thought about keeping it for myself, but my focus is LTRs right now so we do flips and wholesales to fund our LTR business growth.

Anyway, we get a lot of deals here, and we often wholesale them. I just sold one for 200k that only needed 10-15k rehab and was worth 325k. 

Originally posted by @Austin Works:

When flipping houses that are projected to be complete during the winter, is it better to go ahead and list at that time or possibly rent it out initially with plans to list for sale at a later time when buyers are more aggressively looking?

I've never seen snow, so I can't really understand how having that stuff on the ground would interfere with my investment strategy.. 

Like Luan mentioned, winter is prime selling time here. We are dragging our feet on one of our flips hoping to hit the MLS in mid November because there are so many buyers here on vacation that buy while they're here.

Originally posted by @Isi Nau:

Hey @Benigno Cunanan

Cash flow is possible in Hawaii.  The best I've seen for long term rentals are condos, $30k-40k down payment, giving about $250 a month in cash flow.  Then there's the appreciation.   ;)   I can't wrap my mind around how it is considered speculative.  Maybe in other parts of the country, but in Hawaii there's the historical data (annual housing reports, etc.) and also anecdotal data (multi-generational family portfolios) that make it difficult to argue against.  Before joining BP I had never heard of appreciation being described as speculative, especially not in Hawaii.  Anyways, on to your other questions.   :)

As for cap rates on multifamily, you're looking at 4-5%, maybe 6-7% on the Westside.  This is for legal mutlifamilies.  Nonconforming homes can get 7% pretty regularly.

Vacancy rates can be kept pretty low without much sacrifice on rent rates.  The housing shortage on Oahu is unfortunately at a critical level.  Our units are vacant on average for a week.  On average our tenants stay in place for at least 2 years.

Hawaii is a solid place to invest.  Even though it's expensive, it's definitely possible.

 I should've read the entire thread before responding! There's my boy Isi backing me up!

Yes, it's harder to achieve cash flow in Hawaii.. but 15, 20 and even 25% COC ROI is still fully attainable. I just wholesaled a house to Brandon Turner here on Maui that makes just under 15% COC returns.. should've bought that one myself!

Hope all is well on oahu Isi. I mentioned in my other post, I have a lead for a LH STR in Waikiki and one for a water front 3 bedroom in Hawaii Kai. Not sure if they fit what you're currently focused on, but Email or text me if you want the details.

Originally posted by @Lane Kawaoka:

San Francisco, Hawaii, Los Angeles, Seattle, Boston are examples of primary markets which are NOT ideal for cashflow investing.

It could appreciate but I consider that gambling. Sophisticated investors invest on cashflow where the rents exceed the mortgage plus expenses (and enough money to pay for professional property manage to do our dirty work).

Sophisticated investors look at the Rent-to-Value Ratio and look for at least 1% or more to be able to cashflow after expenses. You find the Rent-to-Value Ratio by taking the monthly rent dividing by the purchase price. For example a $100,000 home that rents for 1,000 a month would have a Rent-to-Value Ratio of 1%. Most people I work with live in primary markets (as opposed to Birmingham, Atlanta, Indianapolis, Kansas City, Memphis, Little Rock, Jacksonville, Ohio, or other secondary or tertiary markets) where the Rent-to-Value Ratios are under 1%.

Plus Hawaii is a very blue state with strong laws favoring laws. Call me crazy but I think if people don't pay rent they should be kicked out

Lane and I tend to have different opinions on this. While I agree generally that cash flow is hard to find in Hawaii, I believe in just being creative. Someone already bashed on Harbor Lights on this thread (someone that admittedly doesn't own there); but I can argue that sophisticated investors, like one of my mentors who has been a REI since the 1980s, owns over 10 units at harbor lights.. and he just bought 2 more! I personally own 5 there, and my average cash on cash return is 25%. I might regret bringing in more competition at HL.. but I have to say that it has performed very well for me. 

Buying low end rentals is one of my favorite strategies for creating solid cash flow in a market that's too expensive for cash flow or strictly a speculative market. My main rule is that I screen my tenants thoroughly, am very stern, tell them on day 1 that I'm a great landlord but I file eviction on day 6, and I come down on them hard if they mess around.