All Forum Posts by: Jackson Carr

Hey @Brandon Benifield,

It is as simple as putting away a certain percentage of your Gross Income per unit per month.  I am in the maintenance field so I try and plan everything out.  I use a very large excel spreadsheet.

2021- New roof on duplex quoted at 12k.  That is 5 years from now meaning I need to put aside 100/unit/month for that. 

2018- Replace Back unit range quoted at 600.  2 years at 13/unit/month

Emergency Issues- 100/unit/month based off history, age of units, and tenant pool. 

Total Maintenance/Capital reserves = $213/unit/month. 

ETC.  My list is much longer including driveway, garage doors, painting, bathroom fixtures, kitchen fixtures, retaining walls. 

If you need any help or would like to see an example of the spreadsheet I would be happy to send it to you.

Goodluck,

Jack

Rent it Month to Month. If it gets bad then let them go and you are right back where you started. Now with 1 or 2 months of rent in hand, and save up any cash flow to help you float. 

*This is an purely an opinion. If you bring in someone with a record into your unit it is at your own risk. 

Good luck,

Jack

Joe Splitrock a bit of both honestly. I was slightly exaggerating to make a point. I've sent in 20-30 offers to get a turnover rate of 1 house. Mostly it's emails or calls to the owner to see if they will even entertain in that range. But my real estate agent knows that he spends.....what 1 hour on an offer letter? Math says he spends 1 hours X 20 offers = 20hours on offers. The average price of the houses I've flipped is around 300k. At 3% commission that is 9k commission/20 hours. I close on a few houses a year, and the guy has never complained. Given that is not all a real estate agent does or spends their time doing. But my point still stands.

Derek Hemerick look what you started here!! Bottom line is there are many ways to buy real estate and people have differing opinions. Offer what makes sense to you and your strategy. Dependent on the heat of your market, low balling may work and you get a great deal or may make you get a new real estate agent. Either way you won't know until you try. One thing I do know is that if I ever saw a 100k house on the market that is worth 200k I would put in an offer ASAP. People sell for a myriad of reason that are unknown to you. You just might get it. Listen to podcast 197. Great example of low balling and the outcome it can result in. Good luck

Respectfully as possible Russell. You have much more experience than me, but saying putting an offer in on a property you view as vastly under valued as a "waste of everyone's time" is ludicrous. I have bought multiple flips in SF/Northbay CA area in markets that are hotter than hell by putting in offers on MLS that are undervalued and won and then made money off those flips.

There are flippers and people who buy and hold on this site who send out 100s of offer letters to just get one good deal.  It is not a waste of time. It is a grind to get that property that is 100k under market value.

@Derek Hemerick Keep offering whatever works for you. If i listened to my realtor to not lowball, I would not have gotten some of my best deals today.

@Bin Chen I was lucky enough to get a new unit that they were more interested in. I moved him into the new unit and very specifically outlined what is covered by Tenant and what is covered by Landlord on the new lease. This got rid of 95% of the issues.

Honestly, if he is asking for you to redo insulation then get him out of there. Sounds like a nightmare. Next he will ask you to redo the roof because it is not at a pitch he likes. Or ask you to redo the bathroom because the shower is too close to the sink. 

Goodluck,

Jack

Russell Brazil I am unsure what you mean. If it's listed at 100k and worth 200k. That is not a waste of time. That is a deal. He should be looking for properties that are being sold cheaper than their actual value. Derek Hemerick I am also from an area with expensive properties where it is hard to find deal. You need to grind everyday to know your market and see that 200k property being sold for 100k. Look for for sale by owners, (if you are handy) slightly dilapidated properties, and ask your real estate agent to send you all the new MLS every morning with your specs. Good luck, Jack

Hey @Bin Chen

I had the exact same thing. Take the advise of many on here. Learn to say No and ignore. I had a tenant who was complaining about the toilet seat falling too fast, the door having the wrong pushing force to close, etc. I spoiled them rotten for a few months, but it is way too draining on time and money. Learn to say No. 

Jack

I thought VA home loans were only for Owner Occupancy? At least for a nominal amount of time. I would check on that prior to any purchases.

You are in a great area and are moving down the right path. Keep working with that residential contractor and try to absorb as much as possible. Having that knowledge opens you up to flipping, and buy and hold of deferred maintenance properties at cheaper costs. Also, if you do not decide to go down either of those paths it allows you to understand construction timelines and costs to properly evaluate numbers.

Good Luck! Enjoy the 7-10% cap rates I see down in the Orlando area. 

Jack