All Forum Posts by: Joseph Torres

Now I'm aware all of this can change and it all depends on who you get to invest but I'm more looking for how does one go about doing this from nothing. Who is doing this or something similar that I can speak with? Is an LLC the way to go? A partnership? How do you disperse dividends to investors? Do you give quarterly reports on how their investments are doing? etc.. The nuts and bolts are what I'm looking to learn.

So, I’m not entirely sure where to start with this question so I will just jump right into it.

For a while I have wanted to be a Real Estate investor. The hunt, the find, the returns, all excite me to no end. That said, last year was a big year for me. I started out and purchased a newly renovated and remodeled multi family. It has given me a little over 31% CoC return and 14% CAP rate. Bought it with no renters and in 24 hrs. had both units rented for the next year.

Well, since I constantly look at the markets around me (Triangle area of NC) to see what is going on I bumped into another multi-family (I only care about multi-families) and after seeing that this too was just recently renovated and remodeled I saw another great opportunity. Put an offer (had to fight a bit to get it) and closed late in the year. This was turn key in the sense that all 4 units were just recently rented by previous owner. This is giving 34% CoC return with right around 15% CAP rate.

Now there is of course more to each of these deals but so far with some dedication, organization and solid communication the portfolio is starting to build nicely and perform well.

My ultimate goal is to start an investment company/partnership. I have had about half a dozen people come to me wanting to give me money since they hear how well these investments are performing and hear about returns that can be handed out. However, out of those I would say 3 are truly serious. My question is this. Where would I start? Who would be a good person to speak with? Any tips and advice is very welcomed.

Thanks!

I too agree, multi-family is the way to go. You are spreading the risk across multiple units. That said, I own a duplex that have shotgun style 1b/1ba units. Had a crazy amount of interest when I listed them for rent. Here is where it gets interesting. They are in a solid B- possibly touching on C location but, it is right near a hot DT area. The rent is cheap enough to attract many renters and I can then select the ones I like (single ppl, preferable single female). I'm doing right around 30% CoC a month. I may have high turnover every year but with the interest I had last year I'm not to worried about it. Make sure you know the area and what will attract. Put a budget aside for renter turnover/transition and you should make money.

I'm currently in the middle of closing on a quad-plex in Burlington, NC. Every unit is currently rented for the next year, which is a good thing. I have all of the leases and everything looks good. I just did final walk thru yesterday and noticed that a tenant has cats which is not part of the lease agreement. The existing owner has asked that they remove the pets but I have a feeling they will not. My question is this. I know that I have to honor the existing lease which I'm fine with but can I make an amendment and require them to give me a non-refundable pet deposit and additional money per on the rent? Or, I have to hope this person actually removes the pets per the discussion with previous owner. 

I don't love the idea of pets because they can cause damage but I would be OK with a cat especially if they already had it before I took over ownership. I have another duplex that purchased 6 months ago but I was able to hand pick those tenants and selected those with no pets. 

Not entirely sure on my options.

This is great info guys. Yes, I'm trying to be as conservative as possible with all my numbers. Also, putting into account Mgmt, repairs, maint. My fear is analysis paralysis too but much rather be careful vs doing a deal just to do a deal. Yes, to the east Durham location question. Area is ripe with rentals but the drawbacks are clientele and care for their place. Not trying to be ugly, just stating facts. However, any time I have looked the units themselves are maintained pretty well. It's the property on a whole that seems to be neglected more due to owners not paying close enough attention to their investment.

Yes, it is a class C neighborhood but is growing in the right direction. 10 min from downtown which is also growing and Duke hospitals and college as well. So I see some potential appreciation. I will know more when I look it later today.

After doing much reading here I'm going to be looking at a duplex near downtown Durham NC and it seems pretty promising. Here is the math: -Price = 100k -Rent = $1100 from both sides -Down payment= 25% & 4.8% interest -Tax= $1160 yearly -Insurance= $600 yearly -They pay utilities. Floor furnace, city water, city sewer, electric, etc. -No PM company as I live close and for the first one I want to be as involved as possible. No repairs needed at this time and so far 50% occupied. I will have to find a renter for the other side. At $550 a month for this nice little house I don't see that being a huge problem especially with it being close to downtown, colleges, etc. I have a cash flow of around 20% (give or take) if all goes as planned. Am I missing something completely here? I understand vacancies and repairs but I feel like I may be missing a key component. Or is that pure fear I'm feeling :)

@Daniel Hyman oh I have been all over the podcasts and everything else I can read and listen to.

Great to hear.

Thanks!

Hello All,

I'm new to this site and to the world of real estate investing but not real estate itself. I bought my first house when I was 22 and haven't looked back. I am finally at a stage where I feel confident enough to start investing but not sure which is best for me (Single fam, apt, etc.). I'm hoping to gain that knowledge here.

Thanks,