All Forum Posts by: Jamie O'Connell

start slow! You will learn new tricks and things you wish you had done differently with each flip. Im on house #7 (fix and hold though not flip) and while im happy with jumping in and spending money on the first few, I make the dollar go a lot further on the last few from learning from mistakes. I like Fix and flip loans. if no experience you might need to bring 15 - 20% down but they will prob cover most of your flip budget. 

 Yes I am lucky I knew someone in the town (I am out of state most of the time) who is a people person, smart and also handy enough to do small little things like toilets, trying small fixes before calling in professional etc. So you definitely need someone who can work on their own so it takes a bit to find normally but definitely worth it. 

I would say you've worked so hard to build it up and I assume it's a great margin that you should hold on. I would say if you make a good amount I would go about hiring a specific person to do what you do. So if your making 20k a month in profit (just an assumption but using for a point) spend 5 - 7 k or something a month and hire someone full time to do what you do so your making 13k a month but its 13k a month that is truly "passive". 

Still a very solid income. You know your numbers better than anyone but thats what I did. I hired someone who handles everything and just comes to me when it's something big aka we need to evict or need a new roof etc etc. so while I make less a month, I do nothing for that income. 

I would say house hacking would be your best option. That way you can put less down (as mentioned in other posts) live "rent free" in one property and in two years do it again OR in year two buy another multi family with 20-25% down. If you do that you can buy the first one year one, buy the second one year two and then repeat and buy another "personal" one year three. By that time you will prob have enough monthly coming in you could go out and buy a personal home that isn't a multi family in theory.

Side note: Remember that if you are going from W2 to non W2 that to get approved for a personal Loan you would need two years tax return on that non W2 income most likely. 

Investment Info:

Small multi-family (2-4 units) buy & hold investment in Elmira.

Purchase price: $70,000
Cash invested: $10,500

I bought the 2 unit 2 bed in each unit for 70k . I put 10k down with a one year Seller Finance note and put another 22k into rehabbing it. I turned both units into 3 bedroom units by turning a second living room in each unit into a third bedroom which raised the FMR by $400 for each unit. I took the property to my local C and it appraised for $121,000 and I could take out 70% of the value I paid off the original loan and got reimbursed exactly $30,000 so I essentially only "put" $2,000 down.

How did you add value to the deal?

Rehabbed both units and turned one of the two large living rooms into a legal bedroom in each unit.

Lessons learned? Challenges?

1 year might be TO short for a seller finance. In theory its enough time but once you get tenants out, rehabbed, new tenants in, the time for appraisal and bank to do work and most importantly your taxes done if it falls towards the end of the year. Waiting on my 2024 taxes ended up pushing me to the deadline. I would definitely suggest atleast a 2 year SF loan with no prepayment penalty just to give yourself some time.

Investment Info:

Small multi-family (2-4 units) buy & hold investment in Elmira.

Purchase price: $70,000
Cash invested: $10,500

This was my first of two Seller Finance deals so far. I bought the 2 unit (up/down) 2 bed in each unit for $70,000. I put $10,000 down with a one year Seller Finance note and put another 22k into rehabbing it. I turned both units into 3 bedroom units by turning a second living room in each unit into a third bedroom which raised the FMR by $400 for each unit. I took the property to my local Credit Union and it appraised for $121,000 and I could take out 70% of the value so I paid off the original loan and got reimbursed exactly $30,000 so I essentially only "put" $2,000 into the unit that now brings in $2,700 a month.

How did you add value to the deal?

Rehabbed both units and turned one of the two large living rooms into a legal bedroom in each unit.

Lessons learned? Challenges?

1 year might be TO short for a seller finance. In theory its enough time but once you get tenants out, rehabbed, new tenants in, the time for appraisal and bank to do work and most importantly your taxes done if it falls towards the end of the year. Waiting on my 2024 taxes ended up pushing me to the deadline. I would definitely suggest atleast a 2 year SF loan with no prepayment penalty just to give yourself some time.

Welcome!

There are a ton of avenues open when you start out in real estate, my best advice is to pick one and give it your all v. doing a few things at once. For me, I did not want to do the cold calling and talk to 200 people to get 1 person maybe interested so Whole sailing wasn't for me, even though its your "quickest" buck if it does work out. I had built up some capital so I was able to go into the BRRRR method which has worked out for me.

I became interested in all forms of real estate investing based off a bunch of different Tik Tok people but I definitely suggest not to get sucked into what they say is so easy because it definitely is not. It takes a lot of time, work AND money to get started and I was 2 years in before I finally felt like I got a true "win" in real estate. Which was just one appraisal coming in above where I thought it would haha.

 I agree, but nothing appraises above maybe 250k for a very nice single family house on a few acres. I have also tried with the appraisers and no luck so far. and I have done about 10 appraisals there. Idk it could be me but nothing appraises high there. I dont want to get a loan for more than the true sales value of the property but I would like to get atleast the normal amount back for the money I have put into it. 

 Look up Elmira NY hahaha. it is a very poor town. That is the problem with the appraisals. For every 1 property that has sold in last 3 months that is a match for my prop and sometimes on the same street, theres about 5 that sell for half the value. It is best matched with like Cleveland, Baltimore etc. Except much smaller obviously. 

 They are LTR, sorry I should have put that in there. 2 Have been there for 1.5 years now and 2 just moved in Feb 1 after a renovation was done.