All Forum Posts by: Jake Handler

I am not sure where exactly this property is, but this is an example of why I prefer B class neighborhoods or better when looking for rental properties.  Many people I speak with initially gravitate towards the "cheaper" areas because "numbers are better."  Until we speak further and dive deeper into their "why."  

With the situation you're going through, your first thought was likely "I'll raise the rents to cover this."  That is also the first thought I would have.

If your property is in a B or better neighborhood, your tenants are way more likely to not blink at a $1,000/year rental increase.  If they do, then you can likely find another tenant for that amount fairly easily, as I would assume the entire town's taxes are up- so if someone really wanted to be in town, that price is the new normal.

If your taxes increased that substantially in a C neighborhood, your tenants would way more likely give push back for that type of increase- even though you're not being greedy, you're just imposing the same raise you were given.

Often the buyer who had the "well, the numbers are better" mentality is only looking at year 1.  It's like drafting a rookie QB and expecting to win the Super Bowl his rookie year.

Based on the tax increase, my assumption is you chose a great appreciating neighborhood and have a similar mentality to me.  You'll come out on top no doubt.

Is it listed with a realtor? On first look of that Zillow link it seems like it's not. You will get 10x the exposure listing on the MLS among plenty of other benefits going that route.

With the newer 5% down conventional loan for owner-occupied multifamily option, I generally advise people to start analyzing from there if they want to house hack a multifamily with minimal down. You don't need to refi to remove PMI if it's a conventional loan. Once you have enough equity you can go through the process of removal without refinancing. I've done it for two different properties and happy I didn't go FHA for that reason- although everyone's circumstances are different.

@Andrew Giunta I noticed you posted this over a year ago... were you able to make any progress on this? I own an HOA management company in Hoboken and it's led me down this thinking-path as well.

I am under contract on purchasing an off-market home, seller finance in North Jersey.  I am getting a 5% interest rate, 30 year amortization with no balloon, no prepayment penalty.

I am deciding the best way to fund the rehab.  The home is in semi-rough shape... liveable (barely), but certainly not rentable.  Although I'm confident I can fix and flip it, my plan is to keep it as a rental.

My dilemma is... where do I get the rehab funds? This home can use 200k of renovations. The seller is already in first position and in a perfect world I'm not refinancing out of those terms, and I'm not giving up equity to a money partner. A HELOC may be an option but I'm full time real estate (no W2) and have a couple properties and my DTI is relatively high. Perhaps a bank statement HELOC would work for me... still figuring that out.

Any other creative ways to get money for a rehab? And then ideas to pay it back? The ARV supports the juice, but I think either my "perfect world" has to be compromised, or a HELOC of some sort- if I can. Hopefully people smarter than me can chime in here for more creative ways to get rehab money, perhaps using the house as collateral in second position if possible.

Great question. I have been messing around with some no-doc HELOC scenarios with a lender. Also looking into DSCR cash out refi on my investment property. Tough pill to swallow because the rate I currently have vs what I would be refinancing into... so not sure it's the right move for me yet. Following this forum to see what other people with more experience on this suggest.

Your liquidity is a nice start, but also not a direct advantage while exploring the BRRRR strategy. When I've used hard money, I put down 20% of the purchase price. The way more challenging part is #1 finding the deal of course, #2 finding great contractors that would take on this type of project with payments to them working through installments, #3 finding great terms on your refi.

My advice would be to look aggressively for #2 and #3, so if you do come across the golden ticket of #1, you are ready to pounce.  Also my advice would be to not think it's a loss if you don't pull out 100% of your funds on the refi.  That is an extremely difficult accomplishment in the near-term.

Turn a profit how? Flipping?  Cash flow?  Any property can "cash flow" if you put down enough money.  I can also show you plenty of on-market properties that cash-flow by putting down as little as 15%.  

There's a reason I'm not buying them though... because if cash flow is the driving factor for me, Fanduel has some great parlay boosts :) I want wealth and putting down 50k to make $150/month doesn't excite me.  

My advice is to try to be more specific with your inquiry and your boy-box in general, to achieve the best results.  Credit to you for posting in the forums with a question that probably many people want to post but don't!

Morristown has fairly tight restrictions on short term rentals.  It may be difficult to find a <30 day stay for anything more than 1 bedroom (owner occupied has looser restrictions).  If you message me, I can reply with a facebook group that I'm in which would be worth a post to see if you can connect with a landlord through there.

I know a couple MTR hosts in Clifton and the surrounding areas.  Message me and I can link you together.