All Forum Posts by: Harry Arnold

Hi. Flood zone purchases are worth the effort with some due diligence. Some suggestions - make sure it doesn't have to be raised, get a flood insurance quote, brush up on the rules around improvements (below 50% rule or it triggers FEMA's new guidelines). I have 3 properties in flood zones, below BFE. Dealing with the towns was not pleasant - but, the deals are solid and worth the work. I'm in Monmouth county. If you have any questions reach out.
Harry

Congrats on your first property! The first one is the hardest and you’ve done something that 99% only talk about! Good for you. I’m in Monmouth county and the rental market is super tight. I don’t think you’d have a problem renting it for a lot more if the current tenant doesn’t want to pay the extra $. Also, the rehab you’d have to do to get top dollar would be minimal. I recently rented 2 places - received 50+ applications within 2 days and receive more rent than I asked for. There’s very few rentals out there. 

I use my attorney for leases. It costs about $400, but there’s a reason I spend the money. I get free advice if I need it during the tenancy, and he has skin in the game if I need to evict for some reason. I look at the $400 on each unit as a good investment. In your case, you may be able to go back to the attorney you used to close and ask them. They may even do it for free. 

I’d wish you luck - but, you don’t need it! The investor itch will start in a few months and you’ll be on to #2! 

Harry

Maybe I’m different than most, in the way I learn. I’m not a fan of people talking from a pulpit, or claiming expertise in a field they only read about. I learn from listening to others experience - the good, the bad and the ugly. The folks that impress me the most, are not the ones telling others what they “should” do. Instead, the people that share their fears, failures and set backs, while living this life are the quiet rock stars! Whenever I tell my wife I’m a rockstar - she rolls her eyes and tells me to bring out the garbage. 

This post is for the person that may be "thinking" about getting into REI, but is yet to pull the trigger on the first deal. There's plenty of RE gurus to read about, listen to and buy their stuff from. They can be entertaining, and motivational. Their claims can be real, or they can simply be masters at marketing. Suggestion; don't judge yourself against their "huge successes" and think less of who you are.

Short answer; Yes - REI can change your life! However, it's hard work and it's not for everyone. For me - the pros far outweigh the cons in REI. I am living a life beyond my wildest dreams and REI is a huge part of it. This is coming from a small fish in a big pond. My numbers are modest - compared to others. However, that's the best part of the message I'm trying to deliver. You don't need hundreds of properties, or have an advanced degree to change your life. Suggestion; have lofty goals, but enjoy the ride.

As mentioned, my REI numbers are considered modest, and I make no claims of being an expert in any "business models." However, for me, it's a real life rags to riches story (and I remind my wife about it frequently!".

3 and a half years ago I quit my W2 job to do this full time. My wife probably thought I was off of my rocker, but was so supportive that I’ll always be grateful to her. I used her credit cards to buy my first deal! Since then, I’ve purchased 10 houses, and hold 7 as rentals. Our net worth went from negative $30k to just going over $1M last month.

The above net worth increase gets my juices pumping! But, I'm into instant gratification too. I wanted my lifestyle to change as we build an "empire" (the wording is for dramatic effect, but it's true in my mind). My personality will not allow me to live poorly, while stashing away equity for a "future good life." I guess I want my cake and…. REI allows me to eat it too.

Sometimes I think I sound like a cheerleader for REI. With what it's done for me and my family, why wouldn't I be a cheerleader? Here's the rub - there were sleepless nights where I was full of fear, and financial insecurity. Fear about letting my family down, looking like a failure, people saying "told you so", etc. I've had to grovel to building inspectors and other "nay sayers" along the way. I've crawled in the nastiest crawl spaces, and inhaled more mold than I want to admit. The critics have given me "constructive criticism" without me asking for it. I've had deadlines and pressure like I never had at the 100 W2 jobs I've held over my lifetime. Juggling credit, loans, and cash has become a stressful art. I've had dark dreams about losing it all, and having to crawl before a new boss.

Conclusion. I only have one regret. I wish I did this sooner! This is a life beyond my wildest dreams and can be yours too. 

Good stuff Nathan. Never been to WY - but, I didn’t think the whole state had 33 rentals! Lol. That was a Jersey joke! Wow, you must have your hands full. I quit my W2 job 3 years, 6 months and 4 days ago (who’s counting!), to do this full time. I’ve bought 10 sfr and hold 7 as rentals. I feel so blessed to be in the position I’m in. Money wise? Went from negative $30k to just going over $1M net worth. I’m so grateful for do-overs!

just out of curiosity - does a background story like; I’m doing this for my elderly, frail parents from another country - eliminate the need to abide by a contract?  

“some sellers will do the right thing”?

The seller sold a property as-is and now the buyer wants to back out because they found something they don’t like. Hate to sound harsh here - however, maybe the buyer will do the right thing. And that is buy the property as agreed upon “as-is” or lose the earnest money. The right thing to do is not place blame or try to squirm out of a contract you signed. It’s not like you’re forced to buy it - you just lose the earnest money. What’s next, buyers start asking for inspection fees, inconvenience fees or whatever else they want. 

Well written!

I bet there’s another side to this story. 

I have the tendency to try and say things as kind as possible. That creates confusion, and is definitely something I have to work on. What I meant to say in my original post is this. 

It seems that BP is no longer a forum where people help each other. Where the atmosphere isn't "self help", but an equal giving and receiving community. Now, there are people that are giving advice, that never even pulled the trigger in one deal. It's filled with people that have a "passion" about REI, but only talk about it. There seems to be a lot of people that want to "get rich quick" and never do any work to get there. In other words, BP seems to be a great place for "dreamers" that like to talk theory and "what ifs." BP used to be a place to come to for encouragement and fellowship, around a common subject - Real Estate Investing. Now, it's a social forum for people to hear themselves talk.