All Forum Posts by: Jack Schwartz

Best of luck on your BRRRR journey, Mary Lynn! And a thanks to Brian for the insightful comment.

The scenario you described is akin to playing the role of a lender and paying yourself the loan percentage—investors pay themselves much like how a bank or private hard money lending institution would handle it. 

As Brian emphasized, consulting with your legal team is crucial in such matters, 

Upstate NY, to start building your portfolio,

please be more specific,

I find it commendable that members of the BP community showcase their properties, highlighting the staging process and curb appeal enhancements made, 

Quote from @Jake Baker:

@Ken Chud

We do 20 Flips/BRRRRs per year in Jacksonville FL and we use a hybrid approach. It is also very hard to "perfect BRRRR" here. We BRRRR 8-10 per year and the flips supplement the money left in the BRRRRs. How do we choose which ones to BRRRR? - Location. It is not about how much is left in the deal for me. It is about the long term appreciation of the asset.

Your insights are well-articulated, Ken.
I prioritize the long-term appreciation of the asset over the immediate value of the deal. By the way, could you explain what a hybrid approach entails?

Quote from @Kaylee Walterbach:

I used a HELOC on my first property to be able to buy a second property. We chose HELOC instead of refi because we didn't want the rates to change (we got the first property during those golden days of 3% interest).

I just recommend making sure the HELOC payment makes sense from a numbers perspective—consider the interest as another "expense" when you're calculating cash flow. You'll need to plan to pay it off within ~10 years, too. We're making substantial improvements to property #2, so worst case we could always refi to pay off the HELOC.

Always run the numbers and have a Plan B, C, and D! Good luck!

Thanks, Kaylee, for your great comments,
Regarding viewing interest as an additional expense when calculating cash flow. However, I would appreciate further clarification on what you mean by having a Plan B, C, and D.
In my experience playing the BRRRR game on a smaller scale, typically with homes valued around $200,000, I have found that it can be challenging to generate significant monthly income, Instead, the focus is often on building a portfolio without having to make substantial out-of-pocket investments, which is indeed advantageous. When considering a $200,000 home, with $30,000 in rehab costs and receiving $18,000 in rent, the question arises – where is the profit? I would love to hear your thoughts on this and welcome any feedback,
Best regards,

Joe, 

Your observation about the value of the MLS and agents is appreciated. However, who specifically benefits from services like Offerpad or Opendoor?

Regards, 

According to my vision, 

Have you considered investing in the burgeoning real estate market of the southern portion of Sullivan County? Many New Yorkers are choosing to purchase vacation homes in this area, particularly along NY Route 17 from exits 106 to 99. Areas such as Liberty, Ferndale, Swan Lake, Woodridge, Monticello, and Woodbourne are quickly becoming popular among buyers. The demand is high, with people from New York City investing in homes ranging from $350,000 to $750,000 for more luxurious properties.

Consider the following approach:

When investing in a rental apartment, ensure to provide essential items that a tenant would typically expect from a landlord. The items need not be high-end; they can be sourced affordably without compromising visual appeal. It is advisable to outline in the contract that the landlord holds no liability for internal issues, while the tenant assumes responsibility for fixtures and furniture. In a scenario where the landlord resides in the same building, 

It may be wise to hold off on making substantial investments in the apartment where the landlord plans to reside for the first 3-4 months,

This approach can help prevent any perception of discrepancies in the living standards between landlord and tenant. Subsequently, after establishing a balanced relationship with the tenant, you can consider making upgrades to the landlord's apartment,

as a sidenote: Should any usable items be removed during renovations, offering them to the tenant can foster goodwill and enhance the tenant-landlord relationship.