All Forum Posts by: Jeff S.

Hi John, 

My (fairly inexperienced) opinion is that the "easy pickings" are gone but there are still deals to be had.  Are you new to the Springs?   If not you probably realize that a lot of people here are experienced flippers, many with backgrounds in the building trades.

So what, as a newcomer, is your strength?  One possible niche you might consider is the "live-in flip".  This spring you buy a liveable but cosmetically dated house (for a low price).  Use owner-occupied financing (3.5—5% down).  Spend your free summer hours fixing it up.  Then either (a) sell it, (b) rent it, or (c) live in for 2 years and sell it tax free.  It's not enough to quit your day job, bit it's a start.

I've got mixed feelings about this.   Why would somebody want their full name and photo appearing on completely public (i.e. tenant/seller/buyer-visible) threads with topics like:

• What tricks can I use to raise my rents even higher?
• I've got a horrible tenant I need to evict ASAP -  please help.
• Need to talk seller into a lower price - what would you do?
• Property is losing money - time to sell? 

I agree that it's nice to see all the shiny happy familiar faces on BP, but I'm still not convinced its a great idea....

My experience of AirBnB is a little different. A couple of summers ago, I travelled around Europe for two weeks and every single night except one I stayed in an AirBnB house.

Back in the early 1990's, I lived/worked in Europe for a few years, including a lot of travel, but found it extremely difficult to make any but the most superficial contact with local people. (Granted, working 80 hours/week didn't help...)

Compared to that, the AirBnB trip was absolutely amazing in terms of *being* in the culture. I was able to carefully choose my stays using the profiles and was able to meet and spend time with a priceless variety of people: people with cats, people with awkward teenagers or adorable tantrum-throwing urchins, people who lived in semi-restored historic ruins, bohemian weirdos with artsy communal lifestyles, widowed intellectuals with priceless antiques and hours to spare patiently correcting my grammar, people who forced me to eat and drink meals worth 3x what I was paying them, all of whom didn't speak (or agreed not to speak) a lick of Anglais. 

I've quietly viewed enough churches and paintings already; my goal was to break the insurmountable barrier of politeness and actually make contact with regular people, people who aren't trained in the hospitality-industry art of being efficient and polite. It took some work, but with a lot of "screening" beforehand I managed to arrange some unforgettable experiences.

My understanding of the origins of AirBnB is that this was precisely the kind of experience the creators had in mind - real people sharing their homes and lives.  Maybe not, but I have a rather gullible and idealistic nature and refuse to believe otherwise....

What irritates me the most about AirBbB today is that, because of it's success, that type of experience is becoming harder to find. Now it seems  swamped with commercial-minded property owners seeking to cash in on their dull, anonymous real estate investments. (And as a dull, anonymous real estate investor I can understand this...)

If I could suggest (or impose!) a change on AirBnB it would be to improve the social media/personal profile/search tools so that the face-to-face, life-sharing kind of experience I had would still be available.

Maybe the authorities just neet to tax the €¢£$ out of them so only the selfless idealists bother....

I'm new to this, working towards my first fourplex deal and doing a lot of geeking out on all the details.  Here are some of the issues I've come across that might be new/unique to a 2-,3-, or 4-plex investor :

• Landscaping, snow removal, litter cleanup : Ususally covered by owner.
• Setting/increasing rents : Tenants are neighbors, so expect that they will talk to each other. I've heard it is best not to have any big discrepancies in rent.
• Parenting: Disagreements between tenants about parking, noise, ??? need to be smoothed out.
• Mortgages: Some terms might vary depending on number of units.
• Timing: Showings/inspections/repairs take a lot longer to get scheduled and completed when all units are occupied.
• Turnover: Some people report a higher turnover rate compared to SFH.
• Maintenance: My observation is that n-plexes tend to be cheap and simple boxes built to do nothing but cash flow.  So maintenance costs should be lower.  OTOH, I've heard that tradespeople will sometimes try to jack up their rates on a MFH b/c you are an "investor" and must be very rich.
• Tenants: My observations and others are that often fourplex dwellers are looking to escape the uptighness and rules of an apartment complex.  So expect things to be a little less tidy unles you really hold the line.
• Resale:  MFH's are a less liquid asset.
• Appreciation: A 2-4 unit MFH is said not to appreciate (or depreciate) as much as a SFH. I'm not so sure that's true in my current market, though.
• Upkeep: With 4 times as many thingies (furnaces, appliances, toilets, countertops, ...) to break down or wear out, I'm imagining it might make sense to replace 4 at a time.  If one has (clearly) reached its useful service life, the other three are probably close to it.
• Neighborhood: Seems like in my market, fourplexes come in clusters.  Makes it easy to compare sales prices and rents, but makes for a shabbier street appearance.

If anybody has more, I'd love to hear 'em.

I for one do not recommend breaking into luxury properties.  Those people got alarms n s%!t.

Sorry, couldn't help it......

@Les Goss, that is very encouraging to hear.  Do you recall (even roughly) what % of your post cards got responses ?

Okay, thanks @Christopher Brainard and @Alexander Felice.

Yes, the price is pretty low already.

Maybe this would be a good place to use a 203(k) loan to fix the roof and freshen the place up a little.

There is a foreclosed property I've been watching that is owned by "Secretary of Veterans Affairs". I assume that means someone defaulted on a VA loan ?

It has been on the market a while and the price recently dropped by $10k.  It doesn't look too bad, but one problem is the roof : layers of asphalt shingles over old wooden shake shingles.  (Property is old, built in 1899).

If I was going to put a bid on the property, would it make any sense to ask that the roof be replaced ? Is the VA just like any other seller in that regard, or do they play by different rules ?

Your pan sounds good. A few thoughts.

1) When you are young it is easy to live with roommates.  So do it! Great way to house hack without having to find a MFH.

2) You don't neccesarily want to pay off your house. Since your goal is growth, you would do better to use your cash flow to save up for another property.

3) Since you are a first time owner, don't forget: things cost money! And there are a LOT of things you will be needing. Lawnmower, hoses, yard tools, ladders, paint supplies, power tools, extension cords, garbage cans, .....   Make sure you have a way to pay for all the "incidentals" without racking up consumer debt.

Then there was that tower in Italy.... Probably not a bad deal if you picked it up for the right price!