All Forum Posts by: John Byrne

Because you seem pretty new let me break down what net income and cash on cash retrun is for you.
Cash on Cash return = annual dollar income/total dollar investment.
With rental properties the total dollar investment is typically in the form of the down payment that had to come out of your pocket to secure the deal. If to get the deal done you had to put down $10,000 in order to reach the 15% cash on cash return your positvie annual cash flow would have to be $1500 or $125 per month.
To be clear cash flow is the amount of money that is left over after the Mortgage, Taxes, Insurance, and other operating expenses are paid on the property.
With net income I am assuming @JonK is referring to is the capitalization rate (if I am wrong let me know). The cap rate is the annual income divided by the total value of the property.

Before doing any deal you have to really calculate all of the costs associated with owning the property.

@Adres Calderon
I believe it would take more than buying 1 rental property for me to quit my current desk job as the typical cash flow in my area with 20% down is probably around $200-$300 per month.
I have approximately $150,000 to begin operating with, I just want to make sure I am starting off right.

That is a really good question. I'd say the main thing that I have learned over the last four years is that you aren't just managing rent roll you are also managing, in my case, 256 different personalities. You have to remain consistent and fair with everybody and stick to the policies that are in place. As soon as you bend the rules for 1 person it is like high school and every other resident knows about it almost immediately, and will expect you to make the same concessions for them.
For example if you have a policy in place for evictions or charge a late fee for rent paid after the 5th, you have to follow them to the letter, no matter what story the resident comes up with. A lot of times it is heartbreaking having to evict somebody who just lost their job or if there was a death in the family.
A lot of the reason for having to be consistent has a lot to do with being compliant with Fair Housing Laws. When HUD comes in to audit your files, you will be fined, or possibly criminally charged, if they see inconsistent applications of the policies.
The one area where this will effect the landlords of smaller properties is when it comes to advertising their available rentals. You have to be very careful with how you word the advertisements, they have to make sure they can not be construed as discriminatory. For example I will see a lot of advertisements on craigslist that will say things such as, "This is the perfect home for a family". That is something you don't want to put on as it could possibly be construed as discriminating against people without children.
I would recommend all landlords take a course on Fair Housing at the fines are serious and they are very diligent in enforcing them.
Thats all I can think of for now, if there are any other questions I would love to answer some more.

Hello Everybody,
I posited a comment in the member introduction page a little earlier, but now I wanted to take the time to get some feed back and opinions on how to proceed with starting my REI career.

In my research I have concluded that there are 3 options for people who are just starting out in Real Estate Investing (in no specific order):

1. Wholesaling
2. Fix and Flip
3. Buy and hold for Rental Income

Because of our financial situation and me being a licensed Realtor the Fix and Flip and Buy and Hold strategies are the most appealing to me at this time.

My question to the community is if you had >$200,000 to invest into your real estate business would you begin by buying and fixing rehab properties or would it make more sense to begin to accumulate income producing properties.

One of my main motivations for wanting to begin to build a real estate investment portfolio is to free me from my 9-5 job to be able to spend more time with my family and focus on building the most solid financial foundatation as possible for our future. I am interested to see what this community think

Hi @Andresa Rosa,
Its awesome how quickly this site allows us to connect with other investors with the same types of interests. What areas of the city do you focus your rehab activities in. My wife and I are possibly looking at areas around Port Richmond but are definitely open to other areas.

Hi All,
I just recently found this site from the blog at 123Flip.com, and I must say I am really impressed with the level of engagement that this community brings to the table. My name is John Byrne and I have been interested in Real Estate investing since I was a freshman in college about 10 years ago when I had my first run in with the Rich Dad, Poor Dad book series.

Let me tell you guys a little about my experience and what my goals are. I have had my real estate license since 2005, and have been working in the property management field since about that time. Currently I primarilly work for a large apartment community leasing apartments and managing a 256 unit property in the suburbs of Philadelphia. As of 2 weeks ago I have relocated my real estate license to Keller Williams Real Estate in Blue Bell PA.

I was married last year and my wife and I are expecting our first child, which has forced me to reall start to focus on what my future plans are to give my future child the best possible upbringing I can provide them. I have decided to focus on building my Real Estate agent business while also following my dreams of accumulating rental properties as well as completing a few fix and flips per year.

I am looking forward to becoming a contributing member to this community and I look forward to any help and advice I can get. Thank you all for taking the time to read my post and if anybody has any questions or is in the area of Montgomery/Bucks/Philadelphia and would like to meet up and talk business or would like some information on comp data or available properties please let me know!.