All Forum Posts by: John Steffen

Investment Info:

Single-family residence buy & hold investment in Weatherford.

Purchase price: $317,000
Cash invested: $30,000

Short term primary -> long term hold with a 3.25% interest rate. New construction SFH in a B+ grade community across the street from the high school and middle school. We lived here for 18 months then placed a tenant. We are cash flow break-even, but we love the steady equity growth that requires nearly zero bandwidth to self-manage.

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $317,000
Cash invested: $30,000

Short term primary -> long term hold with a 3.25% interest rate. New construction SFH in a B+ grade community across the street from the high school and middle school. We lived here for 18 months then placed a tenant. We are cash flow break-even, but we love the steady equity growth that requires nearly zero bandwidth to self-manage.

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $85,000
Cash invested: $150,000

Contributors:
Hannah Holland

BRRRR in a small pocket of SFHs that is surrounded by commercial near downtown, therefore our lot is zoned commercial, not ideal for pulling out as much cash as possible, BUT due to Weatherford STR regulations, I am now eligible to STR this "commercial" property. So, I am capitalizing on its highest and best use. I am one of the very few STR's in a town surrounded by 10+ wedding venues, university, businesses, mass construction, etc. You have to love the simplicity of supply and demand!

What made you interested in investing in this type of deal?

My wife and I's goal is to own a "bullet proof" portfolio in our hometown on the DFW outskirt. To be "bullet proof," diversity is key ESPECIALLY when investing in one sub-market. Here, we were after an asset we could pay off quick & cash flow aggressively. Yes, it's surrounded by commercial, our appreciation & resale value will take a calculated hit...but, that's ok, the goal was cash flow! Now, the aggressive cash flow can go toward accelerated debt paydown of our equity focused assets.

How did you find this deal and how did you negotiate it?

Direct mail. We were after a very specific product within a tight radius, so we were able to mail almost all the houses that met our criteria without breaking the bank. We put a lot of shots on goal and stuck to our numbers when interested sellers called. Our number just happened to work perfectly for this seller's situation.

How did you finance this deal?

Hard money.

How did you add value to the deal?

Full gut remodel.

Lessons learned? Challenges?

Hard money stinks, but sometimes it's the best option and it can absolutely get your foot in the door when starting out. Do what you can with what you have to earn a profit. Reinvest the profit into the business. Repeat and trust the compound effect. This one property we landed with a hard money loan and only $10k out of pocket will soon be a paid off $260k asset cash flowing $2,000/mo with which we will use to help pay-off a $500k 30 yr loan..in 8 years.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

Can't go wrong with the Steffen Realty Network!

Irving Texas has been a great spot for our MTR / STR clients - right between the DFW airport, Lovefield internation airport, downtown Dallas and UT Southwestern Medical Center - the largest in Dallas. As a bonus it's also only 15-20 minutes from the entertainment district in Arlington. And while multifamily supply is so slim accross all Texas markets, Irving is one spot there's actually consistent inventory. Irving or the Bishop Arts district for all the same reasons!

Tommy, let's hop on a call if you have a few minutes I'd love to hear more on your ideal buying criteria. I'm happy to keep an eye on the Fort Worth market for you. call/txt 570.445.7820

Love Bryant's suggestion - know what your buyers are looking for first, you should notice commonalities, these metrics will help direct your efforts. Good luck!  

 Definitely a good idea ask the title company in advance if you plan to use your own. Is there anything deterring you from using the TREC 1-4 Family Residential contract? 

LOVE IT! Find yourself a knowledgable lender that is quick to reply and willing to analyze deals with you. Analysis paralysis is a common killer for first time home buyers in a competitive market like Fort Worth. Most first time home-buyers aren't sitting on a mountain of disposable cash, so I find it helps a ton when a good lender paints a detailed picture of your projected cash to close and monthly payments. This should help you take down a deal with confidence. Good luck! 

@Todd Lennig What!? I did not know that existed. Just ordered it Haha much appreciated. 

Randall hit just about everything. One thing I'd reiterate is although there are plenty of no-low money down buying strategies, you will absolutely need to have money in the bank for marketing, reserves, repairs, escrow, so on and so on. You sound hungry, so I would fuel that fire during the day by finding work in the industry or offer hustle value to an investing mentor, then bar tend / wait tables at night to stack cash. 

In addition, eliminate the housing expense ASAP. If you don't have a housing expense yet, keep it that way as long as you can and save lol. If you can't get your hands on a property purchase, rent a place and airbnb bedrooms or split rent with buddies.