All Forum Posts by: Jeff Ronningen

@Kyle Mitchell. Casual observation. That could be a 5 or 10 year list. In order to achieve #5 you may have to dial back #1 through #4.

@Terrell Hall It’s the story of The Tortoise and The Hare. Slow and steady wins the race. It’s a get rich slow scheme and you have the benefit of being young. In my opinion you should focus on two areas: 1) Get an education or a skill/trade that allows you to have a regular job so you can establish income, credit, and funds to invest. This could be related to real estate (real estate agent, appraiser, mortgage loan originator, carpenter, plumber, electrician, property manager, etc.) or not. 2) Educate yourself, Bigger Pockets is a wealth of resources, learn how to evaluate properties and run numbers. Focus on a market and really get to know it. When the market turns more favorable for buyers, and you’re ready to qualify for a loan......house hack. You can move to bigger and better things in time.

@Theo Hicks. All good points. I find it challenging to get historical income and expense information for smaller buildings. I call the utility companies myself and get historical expense information. Property tax is publicly available. Make sure you research the valuation which property taxes are based on and understand how much it could be adjusted if you purchase. This is potentially a big ticket item. For insurance you can get your own quote. Also find out costs for trash, mowing, HOA, etc. For income rely on your research and find out what tenants are paying today. Find out if they are MTM or if not when lease term ends. Determine the amount of the security deposits seller is holding.

@Clark Jarstfer. 1) FHA owner occupied loan for 4 family with less than 5% down and closing costs financed 2) you work in the industry, start researching and networking lenders, become an expert 3) hardest part for a young man like you is qualifying for that first conventional loan based on income and funds needed to close

@Rasmus Elmstrøm I think investors who do lowball bids and try to buy below retail rely on volume. They are making bids all the time but very few work out. The ones that do work out have been purchased at good prices which leave room for profit. Many experienced investors say that the money is made at the time of purchase. So unless there’s something special about this property, forget the asking price. Do your own due diligence and determine what you want to pay. Expect that it will likely be rejected and move to the next.

Samantha, completely agree about sharing.  Just trying to give you a mindset of not regretting or worrying about a decision that's already made.

@Samantha Miller. You said you’re too far in to back out of closing. You’re not willing to skirt the rules. So that’s the end of it, your decision is made. You’ll follow through with the purchase and won’t rent extra rooms for 12 months. Move on mentally, it’s done. Focus on the good reasons you did it. Leveraged down payment program, low interest rate, etc.

@Matt Gilroy. I think cash flow is more predictable than appreciation but it’s going to vary by market. Out west you may have more appreciation but higher cap rates. In the midwest the opposite, better cap rates but less appreciation. I consider equity gains from paying down mortgages to be akin to appreciation. It depends on your business model and the property. Nothing wrong with a strong cash flow property with little appreciation. Depending on the market that doesn’t necessarily relegate you to C properties. You want to gain equity at purchase by getting a good deal and executing a good value add strategy. Beyond that your equity will depend on the whims of the market.

@Collin Schwartz. Great post! Inspiring! This is a how-to guide. Thank you for sharing your story. I’m certain your success will continue.

@Tim Chiu You say “after digging into paperwork” you found the handwritten note. When did you receive this paperwork? If after closing documents were signed then in my opinion you may have a legitimate claim to pursue the seller for the funds. If before, tough luck. I always assume rent roll is not accurate. The actual leases are the true info. I’m not an attorney and this is not legal advice. Perhaps you should consult an attorney. All RE investors should have one.