All Forum Posts by: Jon Coleman

Conrad,

Thank you for taking the time to share your advice and input! I'm currently halfway through David Greene's BRRRR book and had his title on long-distance investing on my list as well. Extreme Ownership sounds like a valuable take on leadership from two people who were in a situation where it is absolutely critical to be an effective leader. I've been fortunate to be able to get my hands on a number of helpful books and Evicted was particularly eye opening for the plight of people living in low-income households struggling to find affordable housing.

You bring up some excellent points about being mindful of valuing the time and energy of others.  The concerns you shared regarding looking for properties with your realtor friend are concerns that I've had as well.  Given that I'm interested in pursuing affordable housing, I expect I may end up with properties that are less expensive, resulting in smaller commission checks for the realtor.  I appreciate your advice on striving to be more decisive and concise in working with a realtor as a way to provide them more value.

You spoke about your main focus being sustainability.  What have been the main differences for you in moving from work on commercial properties to residential?  What have you found to be the most beneficial areas of focus when it comes to sustainability when doing new construction and/or renovations?  Is your priority more on the efficiency of appliances, construction materials used, or different factors?  It sounds like your companies cover a lot of areas of sustainability with reclaimed materials, energy efficiency, reducing water usage, and the like.

Thank you again for taking the time to share your thoughts and insight.  I look forward to learning more about your work with sustainability in construction and development!

Michael,

It sounds like you have a lot of ideas and enthusiasm!  It'd be easy to get bogged down in the details of the 5-10 year plan (Will your second property also be a house hack? Which state/city will you move to? What attributes will determine a great location there? Are you going to do short-term rentals while still doing long-term rentals on top of also doing flips?) so it helps to start with figuring out where to begin. Brandon Turner often talks about focusing on the MINS (Most Important Next Step) and that may be a good place to start, especially if you're feeling overwhelmed with so many thoughts on what you'd like to accomplish in the coming years.  

Based on what you've shared, it sounds like the area you feel like is most important to address right now is getting funds to invest.  I'm assuming you've already decided on a property type, area, budget and the like for your first house hack.  Have you taken a look at how much you'll need to buy the property?  Since it will be owner-occupied, you should be able to get attractive financing and may be able to swing a lower down payment, although you may encounter some challenges with underwriting having just started a new job.  Have you spoken to any loan officers to get a better picture of what kind of down payment you'll need to have to see if you can make the purchase in less than two years?

While having long-term goals and a plan of how to get there is wonderful, you don't want to become so lost in those ideas that you get stuck on what to do today.  I'm confident you'll be able to make your first purchase for a house hack sooner than you think, particularly given that there are so many folks in the BP community willing to share their advice and experience!

I recently joined BP after having been enjoying the benefits of great information and discussion across the site.  My background is in retail banking and I've since moved to a management role at a fintech firm but I'm interested in getting involved with real estate investing.  

I'm new to REI but have been working to rapidly grow my knowledge through reading a variety of books, attending webinars, meeting experienced investors, analyzing deals, and finding advice on the BP forums. I started building my knowledge base by reading a number of books about REI in general, landlording, and deal analysis, but have since shifted focus in an effort to learn more specifically about my local market.

The area that interests me the most is affordable housing for low-income individuals.  I'd like to be able to strike a good balance between making rent affordable for tenants while also earning a fair profit.  It certainly seems like there are plenty of challenges in this area (limited appreciation, troubled tenants, evictions, deferred maintenance, Section 8, etc.) but it is still something I'd like to pursue.

I'd love to hear advice from folks in the BP community on their experiences not just with affordable housing but with REI in general. I've been able to learn a great deal from forum posts but am always open to advice and hearing more about the experiences of others!

I could also use the community's advice on another topic related to getting started. A big challenge I have right now is trying to determine how best to provide value to others who I'd potentially be working with (realtor, GC/handyman, property managers, etc.). I recognize that many experienced folks would be apprehensive about working with someone who is newer to REI and that there is little incentive for them to do so, so I'd love advice on suggested ways to provide value. Bring referrals? Offer to help with manual labor on a rehab? Something else? Thanks in advance for your thoughts and advice!

@Melanie Parkham Out of curiosity, what types of issues do you identify most often as part of sewer inspections?  Thanks!

I am still new to REI but it seems to depend on a great number of factors. There are more options for loans with very low down payments if they will be owner-occupied and rates seem to trend lower for properties you can purchase under a conventional mortgage (such as SFH, duplex/triplex/quad) than for a property that might be under a commercial loan, like an apartment complex. Additionally, loan rates will generally be significantly influenced by your credit score. In good news, 30 year fixed mortgage rates have dropped under 3% so you should have the opportunity to lock in at a very attractive rate!

I'm sure some of the more experienced folks of the BP community can weigh in and leverage their extensive knowledge of financing options for investment properties and provide additional insight.

Congratulations on such a successful flip!  How long did it end up taking you from start to finish?

Kudos to you in taking initiative so early! My suggestion would echo that of other folks to get a W-2 job for now. In addition to that, I would strongly suggest building your knowledge of personal finance. While there is a good chance your career goals will change over time (as they do for most folks) you'll always benefit from having knowledge of financial basics.  Good luck!

I grew up in the greater-Lansing area, living in Okemos, Mason, Lansing and East Lansing over the 20 years I was there.  Where you'd want to buy would depend greatly on where you work, the importance of schools, what you value most (walkability, privacy, etc.) and all the usual factors.  There are generally a lot of affordable options across the greater-Lansing area where you can get a newer home with a great school district (if that is what you're looking for).  Good luck in your search if you haven't already made a purchase!

I agree with the others suggesting Google Voice as I've used that and can vouch for its effectiveness.  It can be very helpful to have a separate number that can be forwarded to the phone of your choosing and to make changes when needed (such as forwarding to a different phone/individual later).  Not having your personal cell phone number out there and also not having to carry a second phone are both big positives.

I am interested in potentially starting a benefit corporation but am unsure if it really makes sense to incorporate that way in this industry.  I found a thread from about 8 years ago on the forums discussing benefit corporations in real estate investing, including a lot of valuable insight, but I didn't find any recent conversations.  The overall impression I got from others was that it would be better to either establish a non-profit or to go the traditional route and pair it with charitable donations on the side.  

One of the reasons why I suspect filing as a benefit corporation may not be as good of a fit is due to the size of the company.  My intention would be to initially be the only employee, and I see that many of the B Impact Assessment questions are geared towards employees who aren't also the owner.  It also seems like filing as a benefit corporation may make more sense for large organizations, particularly those where the CEO would need to put greater emphasis on looking out for employees and the community instead of being primarily driven by stock prices/performance.  On the plus side, it appears that you can elect to convert from one type of corporation to a benefit corporation at a later date and don't have to be one from the start.

Another argument made against filing as a benefit corporation is the additional oversight and requirements.  An annual report is required (varies by state) and that an organization has more limitations placed on it as a benefit corporation.  Additionally, there can be significant cost and effort involved with getting B Corp Certification by B Lab annually if you choose to also pursue that.

I'd like to make it make sense to file as a benefit corporation but it seems like the arguments against are stronger.  Some of the reasons I'm drawn to the benefit corporation option are to strike more of a balance between the needs of shareholders, clients and the community.  I recognize that this approach can still be taken with a more traditional corporate structure, particularly when it is a very small company, but I also appreciate the accountability.  As for the nature of the business, it would be primarily focused on rentals in lower-income areas.

I recognize that a benefit corporation is likely too impractical in this scenario but I would still greatly appreciate input.  What are your thoughts on benefit corporations for real estate investment?   For your own business, how have you elected to approach giving back to the clients/tenants and community?