All Forum Posts by: Jaron Walling

@Alex Houser You need more numbers and a proper inspection to justify the price. 

Summary of expenses

NOI

Cap Rate 

Condition of the building systems  

@Troy Smith We had an appraiser miss a 1/2 bath in the basement one time. Because I meet at the property and asked if he had any questions I caught it. He went back inside and got another photo of the bathroom. It was a small $$$ project but time consuming because that was something I DIY'd while living in the property. I know it helped our value. Every dollar  matters when you're starting out. 

@Troy Smith If this is your first BRRRR deal I'd meet the appraiser, shake hands, and provide a paperwork describing all the renovations you completed. I usually provide our budget as well with totals spent. It's a great way to showcase the improvements made and helps appraisers not miss stuff. A lot of investors provide comps (residential RE) but I avoid doing it because it's like telling them how to do there job. Hopefully you bought right in an area with comps so they can them. That's the tricky part part about investing in rural areas. 

It's such an exciting part of the process! Best of luck. 

 I'd pick the closing day if they already live there, but haven't signed the lease. The lease starts once you close on the property, collect rent, security deposit, etc. 

Follow your lease. Prorate the rent for the first month. Call your insurance and tell them it's about to be a tenant occupied property on 1/13/2025. 

@Ketch Bays I started with the exact same amount of money.

I was forced to buy my first house because my roommate moved out and I couldn't afford to live alone. All the friends I trust were out of town or married, and I was done living with strangers. It was a blessing I just didn't realize it at the time. I saw it coming so I forced myself to learn REI strategies and to read this forums 2-3 times per week. It's a free education.

Every dime went into a SFH, live-in flip, and my brother was paying $400 to live with me. If you want to start investing today (everyone does) what can you sacrifice to get it done?

Ask yourself how you can, not if you can invest. 

Here we are in 2025 and I'm still reading the forums. 

@Chris Kay Lots of good comments already and I agree with @Gregory Schwartz and @Alecia Loveless. My wife and I have never really followed the $$/sqft. approach because it's not as accurate. If you're just starting out every dollar needs a purpose. Every project needs a quote and you should be able to estimate the material costs. This stops you from over paying and renovating beyond the neighborhood. The budget was so small on the first few properties I BRRRR you'd think I was joking. You'll learn way more renovating a few properties. It's a balancing act if you DIY projects to save some money.

Search for and buy a bad roof. Leverage it during the negotiation. It's a valuable repair and boosts your ARV which is everything when doing a BRRRR.

@Jonathan S. REI is pretty unique and comes in many flavors. Instead of asking questions about passive or active you need to ask yourself what sacrifices can I make to get started. If were talking about a group of investors they need to bring value to the table. 

There is no passive REI. Lets make that clear. From SFH BRRRR, flip, or complex syndication apartment deal they all require effort. At a minimum they require babysitting (response to a PM company), research, and educated decision making (accredited investor status). Few people get into REI and find out it's totally hands off. If you want hands off get into the stock market and buy bonds, and S&P 500 index funds.

The challenge for passive investing is you have little control. If the stock market goes on a roller coaster ride you have no control. With REI we have ALL the control. I created my lease from scratch and dictate what happens in our properties. I control rent (income) and manage maintenance (expenses). A small amount of effort yields a good long term ROI.

Targeting returns with REI is based on market analysis. You run the numbers on targeted properties in specific neighborhoods, repeat a bunch of times, and something finally sticks. Every house can be a deal if the numbers make sense. Every strategy targets a different ROI and each come with varying levels of effort and risk. You have to value your time, leverage your skills, and execute a long or short term play.

@Beau Wollens "What can I do refine my estimate a bit given that I am not allowed to a formal inspection on the property?" - Given your experience level, without an inspection, I'd turn around and walk away. Family or not it's giving big red flags. 

Every house I have purchased was sold "as-is" (good opportunities) and had no bearing on the deal. It's not like a REO auction or tenant occupied property. We do inspections on every deal and make realistic offers that are usually low. 

Cash out your IRA, take a Vegas vacation, and throw it all on black. Be a man.