All Forum Posts by: Irish A.

Hey Sean!

Another thing to think about is the level of involvement you want to have when it comes to operating the rentals. For example, I know a couple in Bay Area who's house hacking a duplex and renting the other unit out through AirBnb. The other unit covered all their mortgage so they were able to save a lot of money and get another duplex a year later. More start up time initially, but their systems are now automated so not as much time operating it.

I personally bought out of state, but my velocity of money would have been quicker had I purchased in bay area at the time I bought last year and leveraged the greater increase in appreciation to buy another property. Hope that helps!

Hi Jason! For me, I tracked everything and saved roughly 50% of my income after taxes. I worked my way through undergrad + side hustles (sometimes working two or three jobs), up until I got a corporate gig. When I quit that, I found a job working for some investors and continued to save money that way. Also, I know someone who took out some student loans to help with their downpayment for a house in the Bay Area 5 years ago and they said it changed their lives - not saying this is something you should do, but it's interesting to consider :)

Investment Info:

Single-family residence buy & hold investment in Huntsville.

Purchase price: $130,000
Cash invested: $43,000

Goal with the first OOS rental was to find a SFR that was primarily rent ready or required light rehab by Summer of 2021. My criteria minimums were $200 pure cash flow, 10% CoC return and purchase price around the $125k range that met the 1% rule.

How did you find this deal and how did you negotiate it?

Backstory:
This property was listed on the local MLS as "coming soon" and I reached out to the listing agent directly to see if they were entertaining early offers. As soon as the listing agent got back to me, I had my agent write up an offer that was my highest and best offer.

What was the outcome?

Numbers:
Financed 20% down conventional
Listing Price - $125k, Purchase Price - $130k, Appraised for $133k
Seller Credits - $3k
Rehab - $13.4k
All in - $43k
Current rent - $1300
Pure Cash flow - $260, CoC Return - 9.7%

Lessons learned? Challenges?

Don't get too caught up with the numbers. Started analyzing deals in this market in February and found properties that were very close to my minimum criteria. But did not make my first offer until May mainly because when I analyzed deals, it was either $20 below the minimum or pure cash flow was 1% below minimum. In hindsight, I not only lost time but potentially money as well as the recently sold home prices were rapidly increasing.

Investment Info:

Single-family residence buy & hold investment in Huntsville.

Purchase price: $130,000
Cash invested: $43,000

Goal with the first OOS rental was to find a SFR that was primarily rent ready or required light rehab by Summer of 2021, with the criteria minimums of $200 pure cash flow, 10% CoC return, purchase price around the $125k range that met the 1% rule.

Backstory:
This property was listed on the local MLS as "coming soon" and I reached out to the listing agent directly to see if they were entertaining early offers. As soon as the listing agent got back to me, I had my agent write up an offer that was my highest and best offer.

Numbers:
Financed 20% down conventional
Listing Price - $125k, Purchase Price - $130k, Appraised for $133k
Seller Credits - $3k
Rehab - $13.4k
All in - $43k
Current rent - $1300
Pure Cash flow - $260, CoC Return - 9.7%

Lessons Learned:
1) Don't get too caught up with the numbers - Started analyzing deals in this market in February and found properties that were very close to my minimum criteria. But did not make my first offer until May mainly because when I analyzed deals, it was either $20 below the minimum or pure cash flow was 1% below minimum. In hindsight, I not only lost time but potentially money as well as the recently sold home prices were rapidly increasing.

2) Triple check everything with the lender

3) Learn to balance providing a good quality home with staying within rehab budget

4) Long distance RE investing really is simple. First deal doesn't have to be a home run and it is really meant to build confidence and momentum for the next one.

5) Be kind and show respect to each person you meet, and the reciprocity of abundance will come back ten-fold. Keep it simple and don't overcomplicate things :)

@Gorden Lopes hi gordon, thanks so much! will send you a pm!

@Brandon Sturgill Thanks Brandon! It fits my criteria for the types of jobs and affordability that I'm looking for in a OOS market. Also, I like that Alabama is generally landlord friendly, property taxes are low and the secondary markets around Huntsville seem like good opportunities down the line.

Hi BP Community! My name is Irish and I'm from San Jose, CA. I'm a tax associate for a large public accounting firm and my focus is on corporate taxation for financial statement audits (think 10-K, 10-Q and company carve-outs).

Goals for this year is to have my first out-of-state SFR by summer 2021 and have another one under contract by end of year. Also, I want to expand my network and looking to connect and learn from other investors in the community. As far as what value I can provide, I grew up, went to school and currently live in San Jose, CA - so if you need someone to check out a property or have questions about the surrounding area, feel free to send me a message.

Currently, I'm looking for realtors, property managers and wholesalers in Huntsville, AL. If you have any referrals, please send them my way.

Thanks!