All Forum Posts by: Jacob Peistrup

@Brian Bertschi hey Brian I'm also in STL and looking to do the same hopefully by years end. FHA is nice because of the 3.5% down like you mentioned, but you have to live in the property for a year and you can't purchase in an LLC. You can wait to refinance into a conventional like you mentioned, and you'd have a lower payment and wouldn't have to live there, but you'd likely have to make way more than the minimum payment each month on the FHA to do that in a year, OR value add / rehab / buy below value in order to have enough equity for that. Either way you need to have the equity.

I'd recommend looking at your projected return depending on your goals. How much cheaper is it for you to do a FHA vs. conventional even if for only a year? With FHA you have a low down payment BUT you'll get less rent living there and FHA will have a much higher monthly payment with insurance than a conv, so you might not be making positive cash flow while it's FHA. Calculate your monthly costs because they'll be very different between the 2 loans and see if it's worth it to you to have a lower down payment but have to live there and sacrifice rent.

@Stone Saathoff A lot of the people who come to me are in the process of determining which market to get into, which I imagine is a lot to deal with when you have the whole country to choose from. Sometimes they choose St. Louis, sometimes they choose other markets with different statistics.

Most are also doing it for the first time. Do you have a lot of first timers? How do you help them through the analysis paralysis with OOS and actually choosing a market, neighborhood, and property to buy at the end of the day? 

@Caleb Brown awesome advice, I've been thinking about making a list and explanations of the most popular areas people ask about who aren't familiar with the area

@Alex Olson Thank you! I'll definitely have to read that book too to get some insight

As an agent, I get a lot of OOS people looking at buying in my market -- St. Louis, MO. 

I can't speak from experience when it comes to OOS investing, which seems challenging enough as it is, but a lot of them are doing it as their first investment. So my question to people who have succeeded in doing OOS investing, what do you recommend doing to start? What kind of support do you look for in an agent? What are the biggest challenges and how do you manage them? Do you do everything completely remotely?

Any insight that could help me better serve the OOS community would be greatly appreciated! Thanks to everyone in advance.

Welcome @Steven Kieran ! And congrats on being able to quit your job! Wishing you the best in growing your portfolio. 

@David Barnett I go to Northeastern and can confirm that a ton of people, both US and international students, have already decided not to return in the fall (myself included) and my friends at other Boston universities are going through similar situations. It'll be interesting to see what happens because so many upperclassmen opt for off-campus apartment rentals.  

I agree with David from above. Something else to add:
If you're looking for an agent to help you with investing, try to pick their brain on the analysis. A ton of people I talk to don't understand things like cap rate, cash on cash ROI, internal rate of return, levered vs. unlevered, deal analysis, etc... Ask the agent to analyze a deal, run some numbers, or work out a spreadsheet for you. Of all the people involved in your investment transaction, if the one consulting you on the purchase doesn't have a grasp of the finance involved, find someone else. 

Being close in age to you, I think a lot about this. I don't think I'll qualify for that much when I'm ready to purchase, so I think I'll need to get creative.

Have you considered getting private money from someone you know? Could be family or friends, doesn't have to be a relative, but it'd be a way to get money without having to cosign with them. Another possibility could be looking for hard money lenders.. e.g experienced investors who have money to loan out. It'll be more expensive in terms of interest, but if you find a solid deal it can work. You might be able to find someone here on BP if you show them the deal, your strategy, and work something out together. Hope this helps! 

I'm 19 and have my license. A lot of people I know in college are around my age with their licenses. The big benefit IMO to being an agent and investor isn't JUST having a license, it's having experience as a real estate agent and realtor. Just having the license won't do much, but working as an agent will give you a lot of applicable skills to being an investor... knowing the ins and outs of contracts, how to negotiate, how to do marketing, how to generate business for yourself, and how to analyze markets and properties..

There's a lot of ways to make money in real estate (e.g investing, being an agent, wholesaling, flipping, etc.) and doing any one of those (and being good at it) will make you better at all the other methods as well. They all build off each other because there are common elements.