All Forum Posts by: Jim Kalish

When wholesalers ask me what my buy box is I tell them I would like to be all in at 70% of ARV. I go on to say I realize on this market that's not usually doable any more. I then tell them as long as it looks like there will be some meat on the bone after I rehab I'd love to see the deal. I do this so they know I would love a home run but I do not expect one. I think it conveys 8vw been doing this a while but I'm reasonable.

Hi Justin. I may have missed it but I didn't see any New York folks responding. I'm assuming when you say NY you mean NYC. (there are other cities in NY you know. :). Yes, I'm from upstate). Take a look at your local Real Estate Investor Association group. Try REIANYC.org. They look like the type of REIA that wants to help. Good luck.

It sounds like you have a really good handle on finding properties to hold. My suggestion would be to stay the course. Rental properties generate passive income, which means you are building what will some day, if not already, allow you real financial freedom. Flipping is a great tool to generate capital quickly but since you already have the capital you can skip that step. BRRR allows you to use that capital you have to grow your business and grow your wealth. Remember, if you stop flipping the cash flow stops. If you concentrate on rentals the money just keeps coming.

And then there is the timing of this. Unless you already have a flipping team in place it may be really tough to pull one together. Especially your rehab team. With the prices of homes being so high people are turning to remodeling their current homes. So finding a good contractor that is ready to go when you find a house to flip could be a problem. A good friend of mine who has been flipping for a few years has switched gears to doing remodels for homeowners. He is booked 2 years out. And this is pretty common. I know you will have to do some rehab on buy and holds but it's usually not to the extent of flip and hopefully you already have that team 9n place. 

Best of luck

I completely understand what Craig is saying.  RDPD is a great book.  I've read and got it on audible.  But it all depends on if you are looking for motivation and mind set or looking for books on this is how you invest in real estate.  Sure RDPD touches on it.  But it doesn't get into the nitty gritty like books by David Green, J Scott and Brandon Turner do.  All on BP BTW.  Since my background is engineering and project management I look more towards the hard core this is what you do books.  I already have the mind set.  But if you are looking for motivation start with the RDPD type of books.  But eventually you will need the down in the weeds "text books".

Hi Joe,

I would think your question should be LVP or hardwood.  I'm with you on the LVP in rentals.  When a tenant moves out and we have carpet that needs replacing we go straight to LVP.  I don't know your area so I don't know if 700k is a high end flip or your run of the mill house that a young couple is gong to buy and stay in for a few years before getting into that really "nice" house they want.  Around me 700k is usually not a house a young couple buys.  Its a middle aged couple with teenage kids and both have pretty good jobs.  So hardwood all the way.  Of course I'm probably older than most of the folks responding so for me hardwood means upscale and big bucks.  But then again when I was young if you had AC in your house you were upscale and had big bucks too :).  But in any event I would stay clear of carpet, at least in the major areas.  I'm still torn about the bedrooms.  But so far I've gone LVT throughout, including kitchen and baths.

Hi Ginger,

Of course there are a lot of different answers or ideas.  And not knowing your background or long term goals my ideas may not be right for you.  But here are a coupe.

Since you like to do renos you might consider a duplex and house hack.  Look for a duplex that needs a little work.  Fix it up and live in one side and rent the other.  The advantages are your tenant pays the note while you save money.  Then in a couple of years you can do another one or use the income from both sides to offset the note and show income above and beyond what you are making at your job.  Now you might be ale to qualify for that second note and use it to buy/build your long term home.

If money is the issue you could partner with someone. You use your money and credit and W2 to buy/build your house and partner with someone who has the money but to the time or knowledge to do a flip. If you don't know anyone who wants to partner with you join your local REIA club. You will meet a lot of like minded folks. Or just ask friends and family. You might be surprised who wants to take the plunge.

Looking for a house that needs a lot of work has its advantages when it comes to buying.  But then the repairs are more extensive and therefore more expensive.  Once you become a seasoned flipper and can turn around a major rehab and flip in 3 months this is a great way to generate cash.  But if its going to be a do it when you can and take a few years type deal its not going to get you any further along than you are now.

And one last comment on your desire to flip. I love the idea of flipping. I think it can be fun and it does generate cash. But its a short term fix. Once you stop buying and flipping you stop making money. And you may stop buying not because you aren't trying but because the market gets tight. Give some thought to buying and holding if you want to generate long term passive income. Read up on the BRRR method. That's Buy, Rehab, Rent, Refi. There is a great book right here at BP on the topic by David Greene.

Bottom line is you have already taken the first step and have the real estate investing bug.  Good luck!

I agree with JD. From a rental perspective it will not have an ROI since you won't get any rent from it. But there are some reasons to replace them. If you will be living there for a few years it will have an impact on your heating and cooling bills. So depending on the quality of the window you may get a good return from that aspect. And then when you go to rent the windows need to open and close. Or at least in the bedrooms. It's a safety issue. And if the place is well maintained and the tenants realize the new windows are keeping their HVAC bills down they may be more willing to sign a second year lease. So there are pluses to replacing them. And if you are going to use vinyl replacement windows it's really a simple DIY project.

A single family refers to a home that has just 1 unit. In other words what you are probably living in now. Technically a single structure with 4 or less units is a single family home from a tax and code perspective. But when I say a single family home I mean the very basic. I building. I house. I family. A residential multifamily is a 2-4 family unit. 

How you use the HELOC and your own money should be part of your business plan and well laid out. But as for me I look at HELOCs as ready short term cash, not for the long haul. If you are looking to finance a property with the equity in something else you may want to consider a cash out refi. In my area if you can't buy for cash, you can't buy. Or at least nothing you are going to make any money on. And the MLS isn't the place to find it. So my approach is to find an off market property to ether buy and hold, usually small multi-family, or a flip, usually a signal family. Then use your HELOC to either buy it in cash or use the HELOC as a down payment with a private money lender. A private money lender's first concern is the property, not your credit score. You will have to show you can pay the note back in 6-9 months and make the somewhat larger monthly payments during that time. But if he is in at 70% of ARV he is usually pretty easy t work with. But you are leveraging your HELOC. Then when you have fixed up the distressed and under-valued property, and yes that is what you ill need to buy, you wither do a cash out refi on the hold and replenish the HELOC or flip it and replenish the HELOC. If you find the right property, which takes a lot of effort, you end up with either real cash flow or a nice chunk of change without risking any of your own money. Now just do it all over again. Oh wait, did I just describe BRRRR?

One last thing. You never said if it was your primary home or an investment property that you were going to pull the equity from. HELOCs on primary are pretty easy to get. Right HELOCs on investments are almost non-existent. I just got one from PenFed but they have stopped taking new applications. TD Bank is still doing them though. 75% LTV and 43% DTI. Matthew Paterno. BP won't let me give you his info so you need to look it up.