All Forum Posts by: Jason Brown

Welcome to MIA REI. Always good to see another Miami investor out here.

There are NO properties in Miami on the MLS where your rent to purchase ratio will get anything close to a decent return. I look everyday and if was there I would have bought already....CASH. At 650K with you holding one unit and renting out the other your looking for rents in the 3-4K range. Not likely to be found anywhere and even less so in any decent neighborhoods. Unless you can STR the other unit out and up its income producing potential you're going to have to go off market to find anything decent here.

A month ago I paid 160k cash with a zero day inspection for a condo unit in little havana that had just gone up 20 mins before. It's more of a long term play since it's close to Brickell and the property is very well managed so I believed rents and property values were headed in the right direction. Today I checked property values and I can't find anything under 225K in that same area from just 45 days ago!

My advice if your funding is conventional? Go off market and try to find a deal in good enough shape to get approved for a mortgage because once it's listed....... its gone.

The answer to this is simple. 

Step (1) Wait. 

Step (2) Then read about others getting started. 

Step (3) Then wait some more.

Step (4) Then read about those same people and their initial struggles.

Step (5) Then wait some more.

Step (6) Then read about those same people slowly (or quickly for that matter) start to get their legs underneath and them make progress towards their REI goals.

Step (7) Then wait some more.

Step (8) Then read about these same people consistently posting about crushing their goals and acquiring more wealth generating assets and realize that had you skipped step 1 and just jumped in with the others for step 2 you would be in some position similar to them now. 

You will never invest until the fear of missed opportunities outweighs the fear of potential failure. It's that SIMPLE.

Very few young people sit back and say to themselves what if this college degree doesn't pan out or doesn't turn a profit in the next 5 years. Why not? Because we live in a society that has trained them to have faith that a consistent pursuit of higher education will pay worthy returns regardless of whether or not that is true.

Real estate is no different. Have faith, pick your major well (do your due diligence), and make the jump.

@Anthony Carrasquillo

There are no terms that can beat cash. Hence the reason why it's KING.

You must up your offer and find a property where the seller cares more for the bottom line take home price above all else.

Thanks @Alberto Nikodimov

Will do.

@Jason Pierre

Welcome to MIA REI! Always good to see another S. Florida investor out here.

Welcome to Miami REI. I am an investor here in Miami and I focus primarily on buy and hold rentals which I've financed through a series of fix and flips.

I've bought direct from seller, through realtors and from wholesalers like yourself.

I've also used all the typical avenues to search for seller leads: Direct Mail (yellow letters), Bandit Signs, Social Media and more.

So here goes:

1. There are no 250K SFH houses and duplexes in Miami (condos and apartments sure). That ship has gone and sailed as of 2019. Within Miami city limits what you will probably see are SFHs in not the best areas with starting ARV's in the mid 300's and quickly escalating from there. I sold a flip last year October in North Miami off of 17th avenue by 95 in a TOUGH area and it went under contract for 320K within hours.

2. Don't overthink the 70% rule. Yes as a buyer I want to be in a property for 70% after rehab so I'm looking for a wholesaler to bring me something close to that but that should not be your biggest focus. The biggest issues you will have down here are locating sellers who are truly under distress. Without that distress you could offer them 95% of ARV and they still wouldn't take it given how competitive the market is.

3. As stated in #2 you must find people in distress and distress = PROBLEMS. Problem properties will be your best bets. Liens, taxes, rough neighborhoods, illegal additions and anything that has scared away traditional buyers or has not allowed them to get bank financing will be your best bets. Locate a problem property and a seller in distress and then you'll have an opportunity to negotiate your 70% of ARV deal.

4. Last but not least don't BS us investor/buyers. We already know what the property is worth as soon as you send us the address. If you get a 3/2 property under contract and give me comps of 400K but I look and i see that the city has the house listed as a 2/1 (meaning illegal or unpermitted additions were done) then why would I pay based on square footage for illegal work. 90% of my frustrations with wholesalers down here is them trying to sell 2300 sqft property to me for a "great price" only for me to look at the county records to see that only 900 sqft are legal and the rest isn't. As is common in Miami if you're going to sell me problem properties don't use problem free properties as your comps.

Best of luck

Investment Info:

Condo buy & hold investment in Miami.

Purchase price: $160,000
Cash invested: $30,000

Small Condo in downtown Miami (Little Havana) that we plan to hold long term as we see increased demand for rentals and higher prices.

What made you interested in investing in this type of deal?

We were looking to concentrate more of the proceeds from our fix and flips towards buy and hold properties given the huge demand for housing within our city.

How did you find this deal and how did you negotiate it?

The deal was listed by our title agent who had just opened up their own brokerage and this was their first listing.

How did you finance this deal?

Cash Purchase

How did you add value to the deal?

Complete interior rehab.

What was the outcome?

Rehab still in progress but we expect to be able to command top rent given the location and the quality of the rental.

Lessons learned? Challenges?

We continue to work on setting our team (contractor, realtor, etc) in place and finding more ways to leverage them for tasks that would take away from our time.

Rule of thumb. Any time you are working with the 4 systems (Plumbing, Electrical, HVAC & Roof) check for permits. In Miami where hurricanes are prevalent you would also need permits for changes to windows but that may be one of the local to me. Things like foundation work while not common will probably also need someone licensed however if you are taking on projects with foundation problems you've hopefully already got someone on your team pretty experienced with permit pulling to begin with.

Best of luck.  

@Stacey Bochenski

Here in Miami a good appraiser would not take these lower sales as active comparables when doing an appraisal. Typically homes bought at significant discount are labeled as “atypical” in the county meaning they didn’t go for as much as they should for whatever reason. Primarily because they were not exposed to the market.