All Forum Posts by: Jon Reed

I would say you should not be putting an offer on any property if you are unable to calculate the financial return on a property without having to source it from a forum. 

There are tons of due diligence that needs to be done on a million dollar property that is way more in depth than what you can source from the bigger pockets community with a forum post. 

Take the time to invest in yourself and gain some knowledge before putting in offers. 

@Susan Wilhite I would be interested to know what makes the property attractive to 'certain mindset'? I feel like you could be walking a fine line because marketing to LGBTQ can actually look like discrimination from the outside, even if your intent is the opposite. 

Wouldn't you replace it with the same size tank that it currently has? That is if the current size tank is supply an adequate amount of hot water for the units.

Always buy all RE through your LLC. Have business bank accounts created in your LLC's name. Get commercial loans in your LLCs name and be the guarantor of the note.

If everything is in your LLC name then you are protected from tenant lawsuits... unless you show gross negligence then they can still sue you personally.

The LLC will not give you any protection from defaulting on loans, avoiding taxes, and other government agencies. You protect yourself from that by doing business in a legal and ethical way.

OHh bonus tip! Get an umbrella insurance policy, just in case. 

This may make me a bad property manager but I always lean on the side of kindness. I know... I know... this is 'business' and 'contractual agreements'... but it really is all about people and profitability. 

When a person is already going through something traumatic like a divorce, family death, or other emergency I always try to make sure that their rental situation isn't just another stress on their life. I do inform them that they will not get their deposit back but I will do all I can to make their situation better by letting them move out when they need to. 

I love my approach (which I have been using for the past 10 years) because when you talk to someone and tell them not to stress about their lease their entire demeanor changes and a bit of relief hits them. They will be more than happy to return the favor by getting the unit as clean as possible and ready for the next tenant. Now, when they share the story with other they will tell everyone how great the property manager was and how thoughtful they were in the situation. 

Also... this approach make the best financial sense. If you try the intimidation method (aka 'I could make you pay $XXX for breaking the lease) you put the tenant on the defense and they will not going up and out of their way for you... they will do just want is needed to avoid your threatening hammer of fines. It also may spark some tenants to go to the extreme and end up damaging things on the way out because they feel like they were miss treated.

So... be kind and treat people like people, we all go through tough times. In the end you will make people's lives better and you will save more money in the long run.

@Issa Elevo Have you read any books yet on real estate investing? If not, read through every book you can find and that will help you find out what investment method works for YOU (because you have decided your risk tolerance and long term goals).

Never wait/try to time the market to see if the market comes down. If you are investing for the long term then you should always be buying smart investments.

You may want to re-check your math again. 

Your principal+interest payment seems WAY too low.

$357,840 - Principal

5.0% - Interest Rate

30 Yr Note - $1,921 per month

20 Yr Note - $2,362 per month

Congrats on starting your hunt for an investment property! 

My first question would be: Why Florida? 

There are plenty of amazing opportunities in the Midwest States. For example, 300K in Springfield MO could buy a new construction duplex that is a 3/2 per side. Or it could fund a nice BRR on a 4-6 plex. 

So, if you are not already set on Florida I would look around to different states where your $300K will go much further. 

Go and get some bids from 3-4 remediation companies. Then you will have a good range of what it will cost.

So... when you are saying 'inside protection' are you referring to an LLC protecting your personal assets from investment debt? If so then you are probably going to be out of luck. When you are first starting out you will find it almost impossible to get a loan where they will only hold your newly formed LLC liable for the debt. They will want you to personally sign for the debt as well.

An LLC is really only good for protecting your personal assets from a liability lawsuit.