All Forum Posts by: Jon Miller

Hello!

Always run the numbers, but as a general rule condo fees eat all your profit. Also, if you are renting, know that a lot of condo associations restrict rentals. If less than 50% of a complex is owner-occupied, the whole complex doesn't qualify for FHA financing, so they can forbid you from renting your unit.

As for 2/2, I have 3 townhouses that are 2/1 or 2/1.5 and I love them. I’m in Chesapeake and I have zero trouble renting them out, and I think there is less competition below the 3/2/1500 line, but in our area I don’t think that is founded. 

Good luck! Post an update when you get a place!

Congrats on your investment! I would hold off on looking for your next deal at least until you have enough signed leases to cover the mortgage; I've found it takes a couple months to get tenants placed and get rents coming in consistent enough that I consider a property self-sufficient. I've never done a total overhaul on a property before, so you might not have as many surprise repairs or as long a lag-time, but paying mortgage payments on an investment eats at your confidence even if you can make the payment from your W2. @Mitch Messer is right that the deals won't wait for you, but especially as a first deal, I would ride out the whole process and take a moment to see what you learned before you go for your second. 

Hello Ryan!

I am 33 and started investing in 2015. I own 3 townhouses and 1 fourplex. Since I started I did 2 house flips (the first one was a failed attempt at a BRRR deal). I started by saving up cash from overtime and buying a townhouse off the MLS. I think townhouses are a great place to start, even "big" problems aren't that expensive, but you still gain experience and cashflow. Good luck!

Thanks for all the input! I appreciate all the help!

@Joe Villeneuve the reason I want to specify a niche is to help focus my business and to get better at analyzing deals. It also helps so when a wholesaler comes across a property that fits my specific criteria, they think of me. It also helps in pulling lists from listsource and other websites. 

I like the business card idea too!

Thank you! I don't want to over-constrain, but I also want to avoid "I buy real estate". I can certainly make it more open.

Hello BP!

I am looking to become more professional in my real estate investing. In listening to the real estate podcast, something that came up is defining your niche and becoming an expert in that specific area. Here's where my definition is currently:

I invest in 2 bedroom, 1-2 bathroom townhouses without HOAs in Chesapeake, VA. I am looking for mid-80's built townhouses worth $100k-120k after repairs that rent for $1,000-1,200 per month and require medium to light renovation.

I believe the above statement captures the area that I invest in well, but I am looking for feedback to improve my statement before I add it to an investor packet and start looking for investors. Does my definition adequately explain my area of expertise so a potential investor understands what I do? Any other input on defining a niche is appreciated! Thank you all!

I'm currently a small fish and I'm at 80% LTV, but I like the idea of having paid-off rentals. That being said, I don't know if I would leave anything between 80% and 0% in a rental.

Paid-off rentals offer reduced risk from market valuation and increase cash flow (not ROI), and fully leveraged offer better ROI. Anywhere in the middle doesn't help grow your business and doesn't eliminate the market risk. It looks like you have enough equity to refi one property and pay off the second, so I would recommend going that route.

I would refi before you move out so you get primary residence financing. If you have an LLC, you can gift the paid-off property to the LLC (gives your LLC cashflow and assets, so it can get a credit score and you can get business loans if that's what you want. Keeps you from doing everything in your personal name).

Good luck and keep at it! 

Congratulations! That looks awesome.

I currently own 2 rentals and my primary home. I'm trying to buy a 3rd rental now, but then I don't know how to continue financing rentals. All 3 properties are in my name. I found a bank that will refinance my 2 current loans into a 5 year ARM in my business' name. Does anyone know a better way to get more rentals than the 5 year ARM? I haven't been able to find a bank that will do in-house loans or do a fixed-rate mortgage for a business. I have rented out the first property for 2 years now and have a 1-year lease signed. The second rental has been rented out for a year.

Kevin,

Originally I set up an LLC myself in Virginia (the state corporation comission has directions on how to do it, I think the website is SCC.gov, cost about $100 to start, $50/yr, and $75 to cancel). I was never fully sure I did it properly or that it would protect me in court, so I went through my lawyer and he set it up ($100 for the SCC, $400 for him). I'm not sure if my lawyer set it up any better than I did, but for less than $1k (tax deductible too) I'm happier with the lawyer doing it. You have the added complexity of doing business across state lines, so I'd say go with the lawyer.