All Forum Posts by: Jason Howell

When you are just starting out, its easy to think you aren’t doing enough, quick enough, to get the ball rolling. If you are a relative newbie to this (as my wife and I are), its easy to think you don’t have any valuable knowledge that you can pass along to others who are even greener than you. But its so important to realize how far you HAVE come. 

What HAVE you done? I bet you’ve done something that someone else would find value in. And I guarantee that you are farther along than someone else who wishes they were where you are at this moment. So list it out! Then others reading might find something in your history and reach out to YOU with questions/opportunities that draw from your experience. 

I’ll start.

• Two years ago, I began listening to REI podcasts (primarily Bigger Pockets) and reading at least one book per month on the topic (thank you Audible)
• One year ago, we signed up with Provision to begin to plan out our business strategy and set up an LLC
• Last August, I realized that the local Junior College has a pretty great Real Estate department. Signed up for the first class simply to educate myself
• Nine months ago we decided to invest in Turn Key properties in Indianapolis with the goal to close one at least one property by the end of 2017. We would be using the equity from our primary residence in the Bay Area that had accumulated equity thanks to the red hot market here. Put it to work via HELOC.
• Last December, we closed on our first two properties with days to spare before the end of the calendar year.
• This January, signed up for my second real estate class.
• This March, we closed on our third property in Indy
• Last month, we closed on our fourth.
• That fourth property is the last I will do that’s turnkey (for now). I want to OWN THE PROCESS.
• Going forward, my goal is to partner up with someone who has experience with multifamily deals, to buy opportunities, rehab, and enjoy the benefits of that ALL WHILE LEARNING to increase my own knowledge and skill set.
• Oh, and a bonus: With only one more class to go, I can test for a Real Estate License. That was never my goal (I have a pretty amazing W2 job at the moment) but I figure I will never be as ready for the exam as I will be when I finish this third class so WHY NOT.
• Another bonus: A few months ago, I implemented the Miracle Morning routine and I’ve NEVER BEEN MORE SATISFIED AND PRODUCTIVE. Things have accelerated BIG TIME.
• Another bonus: I'm now active in monthly REI meetings and that's paying off BIG TIME. Meeting amazing people with tons of experience, and enjoying coffee with new Bigger Pockets members almost on a weekly basis.

KEEP THIS TRAIN MOVING.

My point with this post is to simply point out that even when we think we aren’t accomplishing enough, its super beneficial to list it out and see for yourself what you HAVE done. 

I can’t wait to read what you have been up to. PLEASE SHARE YOUR STORY.

Driving for dollars is something that feels too far outside my grasp. Living in the bay area, EVERYTHING is remarkably expensive, so even a "deal" around here is a huge outlay. I'm almost forced to do all of this outside of my market area and that means I will need to make that relationship with an out of state agent for those kinds of opportunities.

Our holiday was spent camping with the family! It was FANTASTIC... but it was also three days NOT spent analyzing and learning. But hey, we all gotta take a break some times. :) Sorry you had to work!

Yes, this was very helpful. In fact, you've been consistently super helpful and informative with my wall of posts in this forum the past few weeks, so I really thank you for sharing your insight. It's all a part of a Google doc I keep on the various topics to be referred to as I progress through this stuff. 

I think what I'm realizing (and really already knew tbh) is that using the MLS will make finding deals that fall under that 70% mark rather difficult... at least in the Indianapolis market. I could find deals through wholesalers perhaps... but I really think I will need to strike up a relationship with an investor-minded agent in the area that can tip me off to deals that qualify before hitting the MLS. Then maybe I'll be lucky enough to score some of those. More so than what I'm finding using the usual sites (Realtor, Trulia, Zillow, etc) for these number studies. But again, it's ALL part of growing and learning.

View report

*This link comes directly from our calculators, based on information input by the member who posted.

Disclaimer: This is all educational for me at this point. I have no intention of buying at the moment, just learning. Having said that:

My goal right now is to understand what kinds of projects would be good BRRRR opportunities that, in the end, would result in a cash out refinance that would make even a small fraction of extra money over the top of what I would have put into the deal.

When I saw this one, I first thought "this would be a great BRRRR analysis." Great neighborhood with higher property values, good schools, this is foreclosure so the price is reasonable. There's obviously some work that needs to be done. Low property taxes. I'm sure this will pencil out.... there does appear to be a fire station across the street though :(

But then I ran the numbers and not only does it garner negative cash flow, it also doesn't seem to hit an ARV that would allow a cash out refinance (70% of the ARV basically equals what I would have put into the deal... so I'd get my money back but nothing more)

I'm hoping someone with some experience in this area and who understands true reno costs could run their own version of this same exact report and see where you come up differently, if at all, and share the link to that report so I can compare side by side. DOES this actually work and I'm getting it wrong somewhere? I'd love to see where our numbers differ. THANK YOU!!

Just out of curiosity: If its a house hack, would you still have a property manager for the other unit or would you be managing that yourself? If that latter, that saves you a good chunk of change. I suppose down the line, were you to move out and rent that second space, you might be more inclined to THEN get a property manager and you'd be in this predicament then so maybe that doesn't help in the long run. then.

Also, what is your "Misc" category? You are already accounting for repairs and CapEX... not understanding why an additional 10% would need to come out.

 I completely agree that at some point, I must tour the area in person to get a better sense of what I am dealing with, I highly disagree that any of what I'm doing right now leads to nothing. In my case, I'm doing this purely as an exercise to learn and understand all of the components of deal analysis and that only comes from, well, analyzing deals. The more I do that, the more I understand first hand how each component interplays with the next.

My plan is to take a trip out to Indy to tour some of the areas first hand later this year. I really want to tour the properties I already own as well as get to know some of the neighborhoods that I'm looking at online daily. None of this is a waste of time. It's all about education at this stage.

Totally right. If I look at the four properties I currently own in the area, insurance is more in the $50 per month range. Not sure why that wasn't clicking before. Thank you!

As for the 50% rule, the BP Calculator also lists the 50% rule as part of the final list of info and I've been taking a look each time at what appears there compared to what I get when I break out the components individually... to get a better sense of both approaches.

Man, this episode is filled with some great nuggets... I could hardly keep up while writing all this stuff down.

One question I have is around building the criteria that informs the relationships you make with agents.

@Andrew Cushman talks about looking at 99 bad deals to get to the 1 good deal. I totally get that. Let's say I've contacted a few agents in my market, I've detailed what makes a "good deal" based on my own criteria and they are actively sending me deals that they think fit that criteria. If hypothetically speaking, in this example, there are 99 bad deals within those, how do you gracefully communicate with the agents on a daily basis (they advise to call them within 24 hours even on the bad ones to communicate what made it a bad deal) without the agent throwing their hands in the air and your relationship souring along the way.

There must be a point where agents question whether their time spent sending you deals is a waste of time if you truly pass on 99 out of 100, no? Or what am I missing?

(and yes, I totally understand that IF they are indeed sending you properties that DO fit perfectly into your specific requirements, you should respond positively to those... otherwise, they *will* question why given that they're giving you exactly what you want and still you pass them up.)

I found a property in what appears to be an amazing neighborhood, it looks like it has minimal work required to bring it up to snuff as a rental. The numbers on it as its listed (a 2BR) are not amazing. But I just discovered that it's listed in public records as having 3 bedrooms. I'm not entirely sure HOW it could be a 3BR since its a total of 720 sq ft. But the comps for the area for 3BR makes this a screamin' deal.

Would a 720 sq ft 3 BR make anyone uneasy? That seems so cramped that it likely wouldn't see  its value match ALL of the other 3BR in the area that have more sq footage.

Hi again! Still in hot pursuit of honing in my abilities to analyze properties quickly and test my gut response. I'll reiterate that at this stage I'm not yet ready to jump on any one property, this is purely an educational exercise for me. Having said that:

This property is listed as a 3BR in Lawrence, IN, but was once a 4BR so the ARV is boosted to reflect the extra bedroom. Rent wise, it only boosted the rent on Rentometer about $45 per month. I put in $12k in repairs but feel like that might be a bit low considering the listing says it needs "some repairs" which (at this stage in my education) seems to be a big indicator that it's more than just light touch ups. Looking at the outside shot of the home, I can see that the roof isn't in perfect condition... it's either really old or structurally there's something wrong with it and I know roofs are a VERY expensive thing to address. In fact, as I type this I'm feeling more and more like my Repair cost is low and that right there would possibly kill this deal as it stands right now.

Those of you familiar with the area, though... I'd love your analysis based on your own experience. How would you have analyzed this differently? I feel like I'm zeroing in on Lawrence (I already have a few properties there at the moment and they do well for me)

and THANK YOU. I learn so much from you all, I appreciate it.

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*This link comes directly from our calculators, based on information input by the member who posted.