All Forum Posts by: Jonathan Hankins

 Good for you! I don't know how much you follow the larger market movements - but I work with investors all over the country. Columbus is getting a lot of attention right now because of the chip plant that is planned to go in in the area. That definitely might be a good market to hold onto a place for a while if you are able to refi it after the rehab is finished up.

Hi @Zachary Thompson. Congratulations on finding a deal! We pay tax on the money we make - not the money we handle. That is the reason people use leverage to finance big deals. 

For a lot of new investors, the book Rich Dad Poor Dad by Robert Kiyosaki is a great starting point. If you haven't read or seen his stuff before you might want to check it out.

Hi @Tony Gorokhovsky, I hope you have had some success on your search since you first posted this topic. Unless you are specifically looking for a less seasonal market or something, I don't think there is any reason to get out of NY. I work with an investor group that looks for properties all over the country, and two of our most recent buys were near Saratoga Springs. I know there are people looking around markets like Lake Placid right now as well.

You should have some really good options right there in your home state. Sometimes the greenest grass is in your own yard lol.

Good luck out there!
Jonathan

Quote from @Paul Sandhu:

There is a motel in my town.  They have bathtubs and showers.  They have color televisions.  They have telephones.  I have none of that.  How would I compete against a motel with tub/shower, color tv and telephones?  I do have indoor plumbing in the kitchens and various outdoor cats.  People have to bathe outside with a garden hose though.

Color TV's??? 

Sometimes, a man just has to know when he's beat...

@Ryan Shekell First off, I know that feeling. I look at markets all over the country on AirDNA, and the market breakdown they send out at the end of each quarter seems to be a long way from reflecting the properties I see listed in some of the small attractive submarkets.

That being said though, I think that is just sort of the way markets seem to work. There are lots of markets where the returns are poor. No one is going to San Diego or L.A. looking for a 24% gross returns right? For a while deals are easy to find, then they are rare, then they only pop up at probate court or tax auctions or wholesale forums. 

The easiest solution is probably just to change markets - but if you are married to the area, you will have to back the numbers out to see what kind of an offer you can take - and start making offers. If you can close fast or waive some inspections, you may still be able to pick up a property for a little below asking. It seems like everyone in the country wants to buy in Florida right now though, and that is eventually going to make deals tough to stumble into.

Good luck out there!

Congratulations on successfully house hacking your primary place @Joe B. That's a big deal, and ironically a lot of real estate people can't do it when they start out because they are technically self-employed. 

I think the guys have already done a better job of answering your question that I can - but I will give you my caveman breakdown incase your brain works like mine. 

- In the last four years, have you been offering on properties?
- If not, why?

The answer to the "why" question is where your problem is - because you haven't been offering for four years and getting beat out every time :)

It sounds like you have not really determined what a "good" deal is. You are just waiting for a unicorn to wander up to you. You really need to decide what your deal is going to look like, and then go find it. I know an investor from Las Vegas that sold almost a hundred doors here and started buying in St. Joseph MI... and then moved his entire family to Kansas City to buy there. Over the last couple years, he has purchased almost 400 doors, all while the guys that stayed in Las Vegas are wondering where all the deals went.

Just pick a lane and go for it man! Make sure the locations are good so you can weather a little downturn if the markets cool off for some reason.

Good luck out there!

I think what @JD Martin said is exactly right. I just got married this year, and I did not really appreciate the difference beforehand. If you are really committed to your fiancé, you should pull the trigger and get married (even if you only do so legally and save the big party for later). It definitely changes your family dynamics, even if you have been in a longterm - multiyear relationship. Stepping in 100% to your wife, might clear up some of the mixed feelings about borrowing money from someone who is right now only "almost" family.

I think as with any business, the human element is the most important. If your father-in-law is the kind of guy you would be ok partnering with - then go for it. I think it is a pretty natural thing for a guy who has cared for a daughter his entire life to want to give her a solid push forward when she transitions into another life phase. If the guy genuinely wants to help you out, and isn't just some psycho trying to find a way to manipulate you or something, it could be a really good deal.

I would suggest writing out terms though, as money situations often have a tendency to leave bruised feelings. Make sure you are clear about what is happening, how long it is going to take, and how you are going to calculate profits after the sale. It's very likely that your first project will not go as planned, and you want to make sure that the terms are clear to everyone. What happens if you buy a property and the value tanks? Do you live there for free for five years while the market recovers, or will dad start charging you rent because he loaned you the money he was hoping to retire on?

Good luck out there!

If the economy falls off a cliff, do you want to be finding tenants for one beautiful house on the beach, or two nondescript mediocre ones five minutes into the neighborhoods?

I knew of some out of state investors from California who wanted to purchase commercial property in Las Vegas when the market was "hot" before the '08 crash. Of course everything was expensive, so they decided that a great way to get a bargain was to buy buildings that didn't face a major thoroughfare. It was a great idea at the time, and of course all of the properties were full, so everything started off great.

Of course, when the market collapsed, everyone found out that they had grossly overpaid. When rents were forced down the owners with the good locations ended up with all of the surviving tenants - and the owners of the poor locations were in hot water.

I think it is a common mistake in judgement to think that "luxury" items are the first to go in an economic squeeze. Did a lot of luxury brands, stores, services and restaurants get wiped out by Covid - or was it the stuff in the middle that everyone gave up? And, who came back faster after the smoke cleared? 

What's the golden rule for real estate? Location, location, location. It seems less applicable when every address seems to be doing well - but sure enough the time will come back around to prove the point true again.

Good luck out there!

I think that is a pretty great idea actually. I mean, you have zero downside, and all upside. McDonald's has made all the money in the world with the simple "would you like fries with that?" questions - and grocery stores are set up the same way with all of the $0.99 items right where you have to wait to checkout. Upsells are a phenomenal way to boost your per-customer income.

I would wait until the guest has just one day or so left and send them a message like "Hey there, I hope you are enjoying your stay. I've noticed that I don't have a booking right after you checkout, and wanted to offer you a ($) discount in case you would like to stay another night". What's the worst that could happen? I would assume you wouldn't find that you have to ask as hard for good reviews after checkout too.

Great idea! Good luck with implementing it!

I think you want to break the plan down into a goal of monthly cashflow. No one get's a million bucks and rides off into the sunset anymore :). $55k is definitely enough out there in TX to lock down a property that will pay you every month to own it. That will make you life better, lock you in for appreciation, and give you more income to take down your next property. I am not super familiar with where you are at down there by the coast - but I know there are some areas with good returns a little West of Fort Worth. Texas is a great state to invest in though.

Good Luck Out There!