All Forum Posts by: Jamie Oliver

Hi everyone - looking for contractors that are more investor targeted (so many seem to specialize in luxurious renovations and only want those jobs). My house is an older 3/1 that I am interested in bumping out a rear bedroom and adding a bath that backs up to the current bathroom so I can have a master suite. One contractor told me my 20k-50k budget is not enough. If that’s true I’m not sure it’s worth it for the value it would add? I’ve considered combining two bedrooms into a master suite which should be cheaper because it wouldn’t add square footage but not sure if a 2/2 is much better than a 3/1 in the market. 

It seems contractors are so busy that their prices have gone up even more than real estate, and so many are unwilling to take on a job like this one.  If anyone knows any contractors in Phoenix that are “investor-minded” I would really appreciate an introduction. 

So, I've been a lurker on BP for several months and following real estate sporadically for several years.  At one point I even got my license just for kicks and hung it "inactive". A few months ago, for the first time, I decided to get serious about it.  So I started reading books, reading BP, watching webinars, and listening to podcasts while I drive for Doordash in the evenings and on lunch breaks from my real job.  I also started researching the possibility of activating my license, casually looking at which brokerages would fit me.  Then I discovered the Rookie podcast and I have to say hearing about people taking action who were recently in my situation (lots of interest and research but no experience), really inspired me.  

So the first thing I did was decide on a plan, and that is to house-hack.  There are a million differing posts from experts on the BP forums about how best to respond to the current COVID environment, but almost everyone I've seen comment on house-hacking has agreed its a solid bet.  

In my market (Phoenix) every decent deal that hit the MLS would go under contract almost immediately, but suddenly things were staying on the market much longer, so that gave me some time to really look and make a decision, and I was able to find a two-unit where the rental comps would make up most, if not all of my mortgage.

Next, I contacted a lender.  I was super nervous about this part.  As a youngster, I made some poor and reckless decisions with my credit that have haunted me since.  I eventually grew up and took control of my finances, and now I have very little debt but the score itself is still lower than ideal, and speaking with anyone about the issue has always given me anxiety.  I was also nervous because I've heard so many stories about lenders tightening up recently, so I wasn't sure I'd get anything at all. BUT, my lender ended up being super awesome.  I got pre-qualified and then pre-approved for not only enough to cover the asking price, but he also got me into the down-payment assistance program in our state, so my down payment is covered as well! He's been crazy responsive through all of it so far.

Meanwhile, I also activated my real estate license with a broker.  I chose this broker because they assigned a mentor with you for the first three transactions, and I thought this would be perfect.  Unfortunately, in all the emails I received after signing up, they mentioned it would take 7-10 days for a mentor to reach out to me! So that is a bit frustrating.

So next I reached out to the agency that has the house listed to schedule a showing. The tenants had just moved out that day so we agreed on the next day. Then enters my MVP. The lady who met me there was not the seller's agent, but an agent who worked with her. During the showing she actually asked if I had heard of BP and the BRRRR method, so I knew right away she was pretty cool, but I had no idea yet how awesome she really was...

After the showing I knew I wanted to make an offer, and being that the brokerage I was signing up with wouldn't be sending me a mentor to help me out with all this for at least a week, I decided it would be worth it to forgo the BA commission to have someone help me out through this. Given that the lady who showed me the house was familiar with BP and is actually an investor herself, I decided to ask her.  Her response was essentially, "I'll walk you through this every step of the way, but we'll do it through you as an agent so you get the commission, I just love this stuff and love helping people out who are just starting."  My mind was blown.  And let me tell you she wasn't kidding.  She has been right there for me every step of the way, even meeting me on Sunday to put my offer together and send it over. Today we've been on the phone 3 times going through counter offers, and now we've got an accepted offer and an inspection scheduled for Thursday. Obviously that and the appraisal still need to go smoothly so I'm trying to keep my excitement in check for now.

And to top it all off, I have a 3rd interview with a company tomorrow whose office is less than a block from this house, totally unplanned.

@Cristian Ramos I don't off the top of my head - I just know for an old job I used to deliver medical equipment to patients' homes there and would end up in some less than stellar neighborhoods fairly often.  I know a few people who might have a better idea so I'll text them and get back with you on this thread.

Hicksville = Huntsville, the city with the highest concentration of degreed engineers in the country? 

I’ve heard certain areas of Montgomery are really improving, but there are some really bad areas too. There’s also a military base there that would provide really solid renters, but just outside of it are terrible neighborhoods. I’m not a local (from Birmingham) but I’ve been there a lot. I’m positive there are deals to found, just choose your neighborhood wisely and find that balance with cash flow. If I were investing there I’d focus on that military base and find out where off-base families tend to live. 

@Ryan Swan I don't at the moment - it's been hanging inactive since I got it, though I am currently interviewing RE teams so hopefully will be able to soon and I'll get to play around with the searches.  If you've got any systems in terms of search fields that seem to help out I'd love to hear about it.

@Derek Jackson Like I mentioned just now - my license has been hanging inactive since I got it so I don't have MLS access yet - hopefully that will change soon. IMO the pros of getting your license are MLS access (which you could also get through having a realtor), the ability to collect commissions on your purchases, and the ability to sell your own properties w/o paying commission. The cons are it takes time and money to get licensed, money to get MLS access and to join the various associations you have to join, and time to become familiar and comfortable with the whole process (highly recommend a mentor realtor while starting out, which will reduce commissions, and there are probably fewer mentors willing to help if you aren't trying to become a full-time realtor). Hopefully this is helpful and I apologize for not having real-world experience in this yet to support it - I'm sure Ryan and Chris Tran above could provide better context than myself.

I'm curious if anyone has space they rent out either short- (a few days to a week) or long-term (a month or two) to RV travelers, on the same property as a SFH or 2-4 unit? I'm speaking mostly about occupied RVs with people that are traveling, and less so about storage, though I would be curious to know about that as well.

If so, how do you go about finding renters? Are there zoning permits and laws you have to consider where you live? Has the difference in cash flow been worth it?

@Derek Jackson

Welcome to BP and thank you for your service! I moved here about 4 years ago.  Lived in Gilbert for 2 years and now live downtown.  Although I'm about 10-14 months out from my first investment, I've been analyzing deal after deal here for several months now, and have seen the same thing you have been seeing.  Crazy thing is, even not-great deals for 2-4 units were getting scooped up within 3-4 days of being on the market!  Now I am seeing them stay a lot longer, and many have dropped their prices.

Something else I noticed recently - there are LOTS of SFH homes that have guest houses, and the only way to find them is to read the descriptions because they aren't classified on Realtor.com or Redfin as multifamily. You can do keyword searches but even then you will miss some, which drives me nuts because I'm obsessively thorough. My plan is to find one of those and live in the guest and rent the main house. Given the family, you could do the opposite, maybe going with AirBnB for the guest house and get just as much cash flow, depending on the part of town you live in (of course assuming covid doesn't lock us down forever).

Anyways, once things open back up I'd love to connect sometime and chat.  Good luck out there!

Congrats on the first step! Is your mortgage broker national or local? Looking to do something very similar myself soon!

@Ben Leybovich & @Sam Grooms nice work on this complex! I live in Downtown Phoenix and commute(d) to Chandler pre-coronavirus.  Sometimes I bring my gravel bike and ride a loop that includes that canal after work.  When I first started I was really surprised and the number of "nice" areas sprinkled throughout the South Mountain area.  With easy access to recreation, shopping, Chandler, Tempe, and Downtown this area is sure to continue to explode.

Thanks @Michael Rivers.  I am certainly planning to join such groups as soon as this mess passes.  

@Anthony Angotti Solid ideas, thank you.