All Forum Posts by: Andrew J.

I can only speak to Milwaukee, but on average the three distressed properties I have purchased over the past ten years have appreciated an average of 200% all while providing steady cash flow.  Do your homework, build a team, and avoid analysis paralysis.  Good property management will help to eliminate tenant turnover.  At the end of the day we can screen our tenants all we want, but cannot control what people do.  

As echoed by many, the Midwest, specifically Milwaukee continues to be a strong market for cash flow.  We are finding many properties needing light to moderate rehab in the 100-125K range.  Average rents for a well maintained 2 bedroom apartment are easily $1000.  Taxes are reasonable (in most areas), and there is a significant lack of quality affordable housing.  

@Anthony Angotti I am, we are doing the painting ourselves and the tile finish in the bathrooms.  Just enough work to get it to meet the appraisal number we need for the refinance and move in.  Then once I am I can dive into some more work, backsplash, minimalist kitchen features, etc.  

Jesse - It was 15% down and 100% of the renovation costs.  

Greetings, I have been a long time member of BP, posting here and there and listening to the podcast regularly. 

As I am sure many have who are active on these forums, I purchase a distressed property in on Feb 28 located in Cudahy WI.  As an educator who is adapting to "remote learning" I am also trying to connect with more folks digitally, because a single guy with a dog living in an upper duplex currently while I understand the importance, shelter in place sucks.

Here are some details on the deal:

The former owner was a hoarder and had let the home fall into rather rough shape.  The saving grace of this home, all the natural woodwork was kept in remarkable condition AND since the home is in the flight path of the airport, 5 years ago Mitchell International came in and replaced all the windows, exterior doors, installed 2 new furnaces, 2 new central air units, basement dehumidifiers, and water heaters.  Had that not happened the home would not be worth it.  While the home was purchase as an investment on a 12 month interest only loan, I will be refinancing to owner occupied.

Here are some details:

Purchase Price $137,000 including the adjacent vacant lot

Construction Budget:  $33,500 included in the loan (real costs are more like $50,000) lesson #1 - Increase knowledge on renovation costs.

ARV: $196000

Rents:  $1600/month conservatively

Again the plan is to refinance, move into the lower, and rent out the upper.  We are about 1/2 way through the renovation and while this is the 3rd home I have purchased for renovation I am always learning more...and more...and more:

#1 - I recently moved back from Colorado and had lost many connections of contractors that I had before I left.  I was reminded quickly, HIRE GOOD CONTRACTORS.  The first guy I hired was a clown, stole from me, and cost me both time and money.

#2 - Costs always seem to be more than budgeted for, even when budgeted for on the high side.

#3 - Don't buy on emotion, while the numbers are still good on this property from both ARV, rents, and appreciation this house was hands down bought from 2/3 emotion and 1/3 business. Could have, would have, should have. If I would have purchased a nice turnkey duplex in January, I would likely be moved in, have a tenant paying 1/2 my mortgage, and more cash on hand to invest during this pandemic. All that said I am very fortunate at this point to still have equity in an appreciating asset AND a full-time job.

If you are reading this be well, stay safe, and please provide any feedback or questions you may have.  This was my first experience with a  National HM Lender.  While the experience has generally been positive, good lord did that loan get costly quick.  

While my experience was in Fort Collins and Greeley, I see the same.  A $400,000 home is quite the low price point if one is coming from San Diego or SF.  It is a beautiful place to live from a weather standpoint and natural beauty.  That being said traffic is an absolute nightmare on I-25, I-70, and most cities along the Front Range.  I just moved back to WI after 5 years in CO as I was looking to reinvest in Milwaukee and seek other opportunities.  I was able to catch some nice appreciation in Greeley and move back.  A big part of the move as was mentioned before is water.  There simply is not enough water in the West to sustain the growth.  

After the DNC this summer Milwaukee is going to be put on the map as an affordable city with water and great culture.  Certainly we have our problems, as does every major city.  

It does indeed, thanks Jamie.  

I am looking to relocate to Greeley for a buy and hold SF or MF home; live there for a year, complete some minor upgrades, and then rent out.  It is a model I have practiced in Milwaukee WI, and find Greeley provides an opportunity for me to do so here in Norther Colorado.

I know there a few investors out there who have properties in Greeley, and was wondering what some rents are for SF and MF homes?  Outside of a few craigslist ads I am unable to find much online; hopefully because everything fills so quickly for quality units!

Thanks much,

Andy

Good Morning Milwaukee BP'ers, I was wondering if anyone had any insight into quality fire/dwelling coverage for rental properties in Milwaukee.  Since moving out of state and having to change my auto coverage to a different carrier, my rates on the policies for my rentals went up astronomically; nearly threefold.  

If anyone knows of a great agent or broker I would love to give them my business while keeping the rates competitive.

Thanks much

Andy

Thanks for all the recommendations!