All Forum Posts by: John Daley

The best thing you can do long term is get more familiar with rehab costs, and while reading books is a good first step, there really is no substitute for experience and learning to 'see' all the hidden costs.  While you're doing your next rehab, get your contractor to walk you through the different phases of the job.  As an investor, if you can walk in and estimate the rehab to the nearest $5k, that will save you and your contractor a lot of time.  He will certainly thank you for it down the road.

There's really no right answer to this one.  When it comes down to it, it's whatever the two of you agree to.  I have a couple of different contractors that I work with and they will do it for free, but I have also used them for quite a few jobs and they know I'm not going to ask them out unless I am serious about the deal.  I also don't ask them to make up a detailed estimate until I own the property and am ready to begin work.  If you trust the contractor, a good verbal, non-binding ballpark estimate is all you will need.  A competent contractor can take a walk around the house and come up with something reasonably accurate very quickly with minimal time spent. 

Last year I started using a new contractor that came highly recommended.  He looked at two jobs for me at no charge before I hired him to do anything.  He knew I was a serious investor, not a tire-kicker, and wanted my business.  He invested his time in our relationship and didn't ask for any compensation.  I ended up using him for 3 full rehabs that year and plan to continue using him in the future.  I appreciate that he was willing to invest in our relationship rather than try and make a quick buck off me. 

Personally, I look to work with people and providers who put the relationship first.  If they just see you as another customer and the work as just another job they're probably going to be more difficult to work with going forward.  On the other hand, if you don't think you will be able to give them more jobs down the line maybe you are just another job to them, and that's ok.  Whatever you do, represent yourself and your intentions accurately and come to an agreement that works for both of you. 

This is one of the few situations that I would say renting a property is the smart move vs. buying.  I'm big on buying, investing, etc...but in this particular situation I would say find a decent rental for a year, get your family moved, then go look to purchase when time is on your side.  It's just that the stakes are so high, it's not something you want to rush into...because extricating yourself from a possible mistake of that magnitude will be costly.  I would never trust someone else to pick a house for me to buy and live in.  It's not that I'm particular, but I've been around real estate long enough to know that there are MANY potential issues to consider.  It's one thing when you're running the numbers to purchase investment property that other people are going to live in, but completely different when you're the one who's going to be there day in and day out.  So unless you're willing to take a few trips, spend some time getting to know certain areas, and finding the home that works for you...I would advise to rent first.  (Not the advise you were asking for, but there you go.  Now I will wait to see if I get booted from BP.  ;)

Thanks so much to all of you for the warm welcome.  It's so much fun to be around people who love real estate as much as I do.  And I already see a familiar face...how's it going, Jason!

Feel free to contact me for any reason.  More networking means more opportunity for all of us!

Hello BP members!

I found this website earlier last year and have been watching it but yet to post.  So here we go.

I have been a local investor in this area for several years, starting back in 2009 when property values dropped.  At the time I was working in the remodeling industry and had been thinking about purchasing rentals for quite a while, but never made the leap.  Needless to say, that was the perfect time to start. 

Since then, I've been involved not only in purchasing rentals, but rehabbing and reselling (known to many as 'flipping', but I've been trained not to use that word because of negative connotations) for myself and others, property management, project management, and retail sales. 

I began investing full time in 2014 when I became a franchisee with Homevestors of America.  I operate in the greater KC metro area as a cash buyer, wholesaler, and rehabber. 

I have mostly worked on my own and with a small group of investors, but am currently investing in and actively growing my business and look forward to being connected with the larger investment community in Kansas City.

Thanks and I look forward to meeting some of you guys, here or in person!

There are a lot of things you need to account for when looking at a potential investment property. I'm sure there's some good basic reading you can do on this site to find them, but you need to know ARV, rent rates, yearly taxes and insurance costs, and rehab costs, just to name a few. You need to have a goal as to how much you want to make on it each year (known as ROI: return on investment). You also need to know what kind of terms you can get as how you purchase the property can mean as much as how much you purchased it for. How are you going to manage it? How long are you going to keep it? I could go on, but that's a good starting place. Bottom line is there are a lot more questions you need to be asking yourself before jumping into this. (And maybe you already have, I'm just going by your post.) Basically, you first need to develop your goals and then evaluate the property to see if it meets them.

Also, be very careful using tax appraisals to determine property value.  More often than not they are significantly different than the actual market value.

I would always advise a new investor to keep things local for the first few deals.  You don't have to know everything yourself, but there is a steep learning curve and you don't want to go through that so far from home.  From the numbers I would say it looks like a decently good deal for turnkey, but, since this is your first one, I would *highly* recommend you accompany a qualified inspector to take a look at it in person.  I look at a lot of houses in Independence and the location is critical.  There are some good A & B neighborhoods there, but mostly C & D.  If it's not in a decent location you can lose your shirt to break ins and theft.  And again...certainly not something you want to rely on someone you've never done business before to take care of for you.

If you are going to invest out of state, relationship is key. 

I like how you're willing and able to jump in.  That's certainly the best way to learn.  But do it close to home, even if your numbers aren't as good.  The education you will receive and experience you gain will more than make up for it.