All Forum Posts by: Jeremiah B.

For years our first and only rental lost about 250 per month and I have no regrets about that decision as it was better than the alternative and still in line with our goals.

Today we average about 100 per on each of our two rentals. It may not be much by its a big win for us.

Regarding REI:

1- Positive Cashflow of $2000!!! Long story short, even though we've owned a rental for 3 years, we expect 2013 to be the first year that we actually make money!!!
2- Purchase a SRF out-of-state. Cash will be tight next year due to a lot of time off (expecting a child), so this is a stretch goal with a lot of moving parts. Frankly, if we are 'in position' to purchase with everything lined up, I'll be happy. Thanks in large part to BP, we are well on our way to this.
3- Change PM on one of our rentals. We tried a new PM for our new property, and had a horrible time renting it, so I think a change may be in order. Small, but important.

@Joel Owens That's a great point about taxes - my home market is very similar due to both city and county taxes. And that's crazy about the infrastructure!

@ Rob K - I didn't know that about Detroit, but that's great to hear. My reference to the economy of the city is really two fold: First - I will need to be able to convince my wife that the city is not going the wrong direction. And second, as this is a long-term thing for me, I'm hoping to avoid markets driven largely by one industry or employer. This is a big concern about my home market which relies heavily on Intel. Detroit and Vegas both look like great investments, but are slightly higher risk-reward than I'm looking for.

@J Scott - you win the gold star. Your website is great and you do simply amazing work!!! And frankly, the level of upgrades is right about what we will be looking for. In a few months when we are closer to purchasing, I'll reach out to you and see if you have any anything in the pipe.

(in the future) That 90K-120K would really be our sweet spot for a first investment. If we could find a 100K house in a good area that rents for $1300 - we would be a very happy family!

Thanks to all. We now know that this is the market that we will watch and really study. We are still months away from a purchase, but we want to be well educated prior to being ready to buy.

BP freaking rocks!!!!

I've been thinking a lot about investing out of state, and after doing some research, I'm leaning towards Atlanta. However, there is no better source of information online than the BP forums, so I wanted to ask: What do you think about Atlanta for a long-term, out-of-state, SFR rental investment(s)?

Because every investment's value is unique to the investor - here's what I'm looking for.

The house we're looking for:
1. Ready to be rented/Turnkey. Finishes don't have to be strong, but the place needs to be rentable from day 1.
2. 3 bed, 2+ bath SFR. Slightly larger also works.
3. Newer homes. Probably newer than 1990, but the newer the better.
4. Decent lot size (>.10 acre; preferably .15 to .25)/basic landscaping.
5. Suburban feel. Sidewalks, and tree lines streets are big deals for us.
6. We target higher-than-average rental units (60th percentile?), and are willing to pay a little more upfront and sacrifice some cash flow to do so.
7. Lots of house for the money. Certainty <$100/sqr foot. This rules out most of the US...

The city that we're looking for:
8. In a city/metro area that is larger than Portland. I think this rules out Austin.
9. A good cash flow on the type of SFR described above. Though this is a long-term investment, so cash flow is not the sole-priority.
10. A decent long-term outlook for their economy. This rules out Detroit and Vegas.
11. A non-extreme climate. This rules out Phoenix.
12. A rental market that isn't saturated.
13. Taxes and Rental/Tenant laws that are not prohibitive.

My research is suggesting that Atlanta is the best place for us to be looking. Am I missing something about the Atlanta market? Or - are there other obvious locations that I should also be considering?

Thanks for any advice, guidance, or thoughts that you might have.

Hi Chris,

I'm not a Pro on this type of thing, but I hope that my perspective is helpful:

First, do not walk away from your first. And, I'd caution you against a SS as that may also kill your credit.

Second, have you talked with a RE agent? Understanding what the house might sell for, and what you would need to bring to the closing table might be helpful.

Third, what would the prime rate need to be in order for the current rent to not cover the mortgage?

Fourth, how many mortgage people have you spoken with? I would get at least 3 opinions, one from a large private bank, one from a local bank, and a mortgage middle-man (someone who would create a mortgage and sell it). You might find different options.

Fifth, I disagree with the "good money at bad debt" view. To me, you have a portfolio of real estate, and you should view it as a portfolio rather than a property. That's not to say that the money isn't better spent on a new location - just that in my perspective there is not good or bad debt/cash... it's all part of the same portfolio.

Great topic - thanks for sharing.

Will makes a great point about conventional financing if you decide to keep it. Even if keeping that much cash tied up doesn't negatively affect your ability to do other jobs, the ROI will increase if you refinance.

With that said, assuming that you went into this house expecting the flip it, I think selling is probably the right call. You have done a great job and either options sounds viable, but I don't view either option as lop-sided enough to second guess your original plan.

I don't have 200k sitting around, but I've wondered the same thing. Here are our priorities:

1-Primary intent it long-term wealth generation - most likely to support retirement in 20-30 years.
2- Must be low/lower maintenance. Or rather - I must be able to farm all of that out.
3-SFRs
4- Does not need to generate a cash flow, but should not be losing money in any one year.
5- Mid-level tenants. No Section 8 or 2500 sqr ft palaces.
6- Long-term appreciation is a key factor.
7- Not a necessity, but I tend to like houses on decent plots of land in suburbs.

Given this - what might be some good RE markets to invest in? And, should I be looking at MLS or wholesalers or other?

Thank you for this thread! I don't plan to ever be a wholesaler, but I've found it informative and entertaining.

Here's a question from a different perspective. I'm a (future) buyer and hope to find a, or a few wholesalers to work with on a small scale in Portland OR. As a general statement, do wholesalers struggle to find buyers, or are buyer's especially in demand? Or, is the general struggle finding enough properties to meet the needs of their current buyer's list?