All Forum Posts by: Joseph Shevy

 Hey Michael,

Thanks for the reply. I do calculate cash flow taking into consideration property management, vacancies, cap ex, etc.. Although I do manage my own properties, I sub out some repair work. 

@Ozzy Smith, thank you for the reply and advice. As mentioned in my post, that is 100-150 per door. And these are not single family properties, so we are talking probably around 250-450/property, as they will probably end up being closer to the 150/door range. I think this is worth it for the cost of closing + increasing my cash flow, even tho it is less than I hope to get.

@Gino Barbaro, thanks for your input. It is appreciated. Although, like I mentioned above, the cash flow will be closer to 250-450/property which is not as much as I try to get, but its not Terrible. And how I calculate cash flow, takes into account possible vacancies.. So my hope is that future vacancy, won't hit hard. I also have my first two properties that cash flow around 400-450 each and that would help diversify risk. 

Hi BP,

It's been a while since I last posted, so I'm trying to be more active. I have a question that relates to a situation I could be finding myself in very soon..

I am 24yrs old (as of tomorrow) and my wife and I currently own 2 rental properties. We anxiously would like to expand as quick as we can handle!

So my question is, if u were in my situation, would you buy investment properties for 0% down through owner financing, assuming you would only cash flow 100-150/door. I generally would like to buy properties that cash flow a little more, but the deal is hard to beat.. I would be buying these from a family friend/agent that we know very well, so the properties would likely be at FMV, and with 0% down, the monthly payments would cut into cash flow a bit..

Thoughts?

Joe

Hi @Jose Alonso,

I dont have nearly as much experience as many others on the website, but thought id add in thoughts..

I actually just closed on a owner financed deal last month, a two-family property. If you are looking to persuade her do owner financing as opposed to straight out selling it, I would mention these couple things..

1) She will receive a nice monthly income for whatever length of time decided.. which includes quite a lot of interest income over the length of the loan. 

and..

2) You typically close on the property much faster, with less fees and possible tax savings from not having such a big capital gain in one year.

Im sure there are much more, but these two jump out at me... In my case, the landlord was getting to be in his 70s+ and no longer wanted to do it.. so it worked out for him because he still receives a monthly income from me every month, without having to do anything with the property..

Hope this helps!

Joe

Real estate investing has given me a passion, (BIG) goals of my own to strive for instead of solely helping my employer achieve their goals, turned my mindset away from "go to school, get job, live in debt", and it gives me freedom. Freedom to one day only work for myself, to live my life, to help my family and friends. 

Joe

Aaron,Thank you! Yes, I do consider her a huge asset! She is a family friend and is working extremely hard to get me to the a position much like hers! I will also be working towards my real estate license in about a month and she has offered me to work under her brokerage. I honestly couldn't ask for a better Mentor, Realtor, friend, to help me get to where I want to be. 

This one was a little easier to pull the trigger on, just because we did already go through the process once.. The only nervousness i had going into this was the fact that we are paying for our wedding thats in Sept, and renovations to our first apt. So, money was a little tighter on this purchase, but it was a great deal and im glad we went through with it!

Joe

Thanks Everyone! We are very excited for everything ahead! 2015 has been an exciting year so far!

And Matthew, Yeah sure, I can spill some details about the deal. First of all, The numbers don't show how great this property is.. 

The rent is currently at 650 for the 1/1 upstairs and 700 for the 2/1 downstairs. My principle & interest payment is 410/month, and taxes and insurance is roughly 360/month. So, 1350 rent - 770 PITI is only $580/month. I set aside 8% for vacancy = $108, and 10% for cap expenses and maintenance. Monthly cash flow = $337. WHICH, does not seem high, but I saw something in this property. The property is in VERY good shape as the owners took very good care of it. Also, many of the big cap expenses were fairly new! the furnaces and hot water heaters were pretty new and the roof was in great shape. Also, the location of this property is very good, being on a nice side road right in down town, and very close to the hospital. (Both of the current tenants work at the hospital).

My favorite thing about this property, aside from only needing to put down 7k :), is the rents are BELOW fmv as it stands. The FMV's of these units are: 1/1 is about 700/month and the 2/1 is 750-800/month. So that gives me quite a bit of increase to cashflow when I decide to increase the rents. The tenants, right now, are taking care of the lawn, snow removal, their own garbage, and are great payers, so by no means am i looking to get rid of them any time soon. If I were to increase the rents to 700 and 750, the CF would increase to $419 :) For now, they are great payers that take care of the property.. I will take that any day!

Joe

@Tracie Davis: I haven't started looking yet! Hopefully we will begin looking for #3 later this year! :)

@Milton F.: our family friend and real estate agent found it for us! She's very good! She knew we were not ready to drop 20% plus closing costs on a property so she looked around for motivated sellers.

Thanks everyone! 

Hi BP,

Just had the closing last night for my second rental property! The first one was through an FHA loan and I am currently living in it with my fiance, so we don't actually "see" cash flow with this property.. only rent savings. (Which is just as good in my books!) Our newly purchased 2-family is owner financed, and seemed like a great deal. The property was solid, the numbers worked out, owner financing enabled us to only have to put up $7k on the down payment, so we jumped on it!

All in all, My fiance and I started investing in buy-and-hold properties about 4 months ago, and already have on 2 properties on our hands! Now we will start to actually "see" some cash flow! In other news, we are getting married in less than a month, honeymoon the whole next week, then back at saving and looking for rental #3!

Thanks for reading!

Joe

Great thread! I love reading about others my age and their success!

I'm 23 years old and started real estate investing a few months ago by house hacking my way into a two-family using an FHA loan. I'm a big fa, personally, of buy and holds and investing for cash flow. My fiance and I are actually in close with a successful realtor and rental property owner who has been helping us a lot! We closed on our first property on March 31st, and we are already in contract with our second own through an owner financing deal!

Our goal is to have 3 rental properties in our first year, and accumulate 1-5 every year for the next 5-10 years. As I said, we love the idea of investing for cashflow, so wholesaling, flipping, etc. we arent really into. Our end game is to be able to retire very early with a solid cashflow, and be financially free. Also, we'd like to someday pass on our investments to our kids and teach them to be entrepreneurial. Thats our story! 

Joe