All Forum Posts by: Jaron Walling

Did purchase or refinanced this property during the ultra low interest climate a few years ago? What are the numbers and why does it not cash-flow more? Are you at market rate rents? 

The interest rate on a loan is one factor (of many) you need to consider when building a rental portfolio. The condition, age, and future capex issues are more important in my opinion. If the property is bleeding money every year from repairs, maintenance, or turn over you'll never get ahead.

You can tap equity with a HELOC (challenging right now), cash-out refinance into a new loan (much higher rates), 1031 exchange, or sell (tax hit) but the numbers and property condition need to guide this decision.

Class E (war zone) is my favorite. Look for the barbed wire, empty shells, and houses falling down. 

That's a joke. War is never good. 

So what happens in the 4th quarter of the game (Sept. 18th) when the FED decides to not cut rates? Asking for a friend. 

@William Pichardo I read and like this real estate quote, "Every BRRRR should be a good flip, and every flip should be good BRRRR." 

Have multiple exits when you buy investment properties. Think about worse case situations like a low appraisal (kills the LTV on a refinance), lower than expected rents, lack of showings (selling), etc. when running the numbers. Don't change your [buy box] to make a deal work. Maybe you run into surprises during the remodel and blow the renovation budget. More money into the deal better equal a higher ARV or listing price. Stick to your numbers and strategy but be flexible on the exit. 

@Brian Sherman You need to gather the last 12 months of water bills and get an average for use. Divide it out based on sqft. then charge the tenants accordingly like @Nathan Gesner mentioned. Without submeters you can't do much else. 

Side note; why does a rental need an irrigation system? Personally I'd disable, winterize, or remove it due to costs of maintenance.  

Buy a SF rental, add some value (minor rehab), and refinance as the FED reduces rates in 2025-2026. Look for cash-flow near the 1% rule, hold $10k in cash reserves, and expect 2-4% appreciation. 

Like mentioned already you're in a good market. In my opinion you can't fail unless you don't screen tenants correctly, buy in a bad neighborhood, or get over your head with a rehab.

There is strong evidence of slowed consumer spending. I think a good amount of STR and MTR investors are pivoting to long term rentals thus increasing the number of available units adding downward pressure on rent prices. The best markets have been saturated for years (Airbnb/STR got way to trendy) and locals tend to hate them so additional LTR units will be welcomed. 

Some investors will cash-flow negatively, be upside down, or both but every REI strategy comes with risks. Can you pivot or sell for a profit is the difference.

@Michael Gonda You guys really hustled. Congrats on the success. Cash-out refinance a few like @Joe Villeneuve mentioned and enjoy. I'd do the same thing if we had 25 units!

How did you pay off the properties so quickly? We make an extra payment on each rental per year (doesn't help the numbers) but we want to get them paid off faster.

Powerful, grounding, responses here. These are some of the best answers I've read in a while for a question like this. 

@Francisco Camberos Sounds like attachment issues. You don't owe them anything. From my point of view you need to separate work and investing by giving them deadlines and sticking to them. If the tenants pay rent on time, communication is good, and the property isn't torn up offer the MTM rent and keep the boat sailing. 

Based on the responses to buying a house, mommy daddy down payment $$$, and lack of motivation I wouldn't work with them to buy a house. Keep your sanity and let them buy a house on there own (whenever that is).