All Forum Posts by: Jordan M.

Hey @Jordan M., as has been mentioned it totally depends on how much you put in but we have a ratio we use to determine if a property is a good investment and Id be happy to share that with you (its similar to the 2% rule but modified for STRs).  Feel free to message me directly.

Are you planning to finance and if so what would your terms be like. Hard to calculate cash on cash return if I don't know if you're purchasing all cash or financing.

This same question has been asked many times on here already.

Lets see your numbers including the total price you paid, rehab  costs, holding costs for insurance, property taxes, utilities, unexpected cost budget, time from purchase to closing sale date, expected sale price, selling commissions and costs. Then, maybe, you can get some sound advice before the water gets boiling hot!!!

Hi Jordan.

If you read my Bio, well I have done a few.  Over 2600 mostly as a contractor and about 10% as an investor/contractor.

It has been a great living and I love my work.  I have seen the world, raised my own kids, and still 

wake up to do another.  I have worked with wholesalers, Real Estate agents, and have bought a few on auction.

I could go on and on about the success of flipping, but to answer your two major questions.

Your first of second is all in how you buy it and your contractor.  This two issues will determine the extra

profits.  Your Real Estate agent is key to buying great deals. Wholesalers if you can handle their integrity!

Biggest challenge is your other investors driving up the price of properties.  If you can find a city or area that

their are great deals and a pretty good economy and don't have 200 people trying to do the same,  then your in a good area!

Congrats on your first flip! I finally pulled the trigger on my first in Jan and this week closed on my 4th! I don't have any plans to hold for awhile as right now I am enjoying this process & with houses selling so quickly & above asking I feel it counters the tax consequence a bit. I see your wife is a Realtor so that will help w/ finding deals, knowing your comps & hopefully her company has an investor friendly commission plan. To answer a few of your questions; I know the biggest challenge (aside from finding the deals in this bizarre market!) is hiring good contractors that are available to start asap. I asked for referrals from other Realtors and investors and then got bids from 3 plumbers, electricians, hvac etc on my first flip which help me put together a team I am still using. By quickly buying 3 more homes I have been able to keep them busy & in return they are are putting my jobs first & willing to come look at properties before I bid on auctions or make an offer. Available appliances are limited so don't wait until the last minute on those.

@Jordan McNelly

Heck ya man. Get a portfolio lender (fidelity bank does it if it's large enough) then refinance some or all of your portfolio along with the commercial property purchase.

Flipping is a job man. In my opinion you give way to much away to the government when you go that way. Cash flow is king, but equity is where you build real wealth. The more properties you have in your portfolio the stronger it becomes and the faster the equity builds. If you fix and flip you lose equity appreciation over time and the government takes a big chunk of your cash. If you use debt the government will let you deduct not only the interest payments but depreciation that is earned mostly by the bank giving you the loan but you claim it all. If I can hold on to a property I will. Every single time. ROE is so much more profitable than ROI.

Every person has their own strategy, but I've always felt buy and hold and keeping a manageable amount of leverage across your portfolio.

Let me put it this way. I underwrite a lot of loans for CRE. I have seen people earn millions in cash flow and pay $0 in taxes because they are always buying new properties and keeping a manageable amount of leverage across their portfolio. You do fix and flips you aren't going to get that. You are going to pay like it's W2 income. The government definitely wins in this strategy. The laws benefit long term buy and hold real estate investors. Particularly those that use leverage. Banks win, you win, and the government gets little to nothing.