All Forum Posts by: Josh Humbert

 Hey Josh! House Hack opportunities are available all the time here in the metro area. House Hacks are analyzed slightly differently and provide so many other benefits that it's not all about the cash flow on day one that you are concerned with. Ill shoot you a DM and we can discuss it some more! 

Hey @Dominic Holt, you've already gotten a lot of great feedback here.  My thoughts are that you shouldn't look at the house hack from month 0.  Think of years 2-5.  That is when it will finally start to pay off after rent increases.  I have helped a lot of house hackers and have analyzed hundreds of properties for house hackers.  You will not be able to break even in our market right away.  However, you will make tens of thousands of dollars after 5 years or so.  @Grant Schroeder and I have worked together to help people in your situation.  Let me know if you want to chat about different seniros.

 For all of my rentals, I've worked with realtors.  Both of them (different cities) have investment properties of their own.  One is also a PM.  Give them your parameters (max price, number of beds and baths, location, type of building-eg single family home).  You can pull the numbers off the listing and run them yourself, but they should be able to identify ones that should work well as rentals.

Hey @Josh Humbert! Lots of good advice in here already, and I would definitely echo the sentiment that a perfect BRRRR is very difficult to come by, and is one of those unicorns in REI that everyone seeks out. BRRRR does not necessarily mean that you pull all your money out, but people have come to understand it that way and if your deal doesn't do that then you think it's a bad deal, that's not the case. Look at the big picture and the deal as an investment. 10 years from now you won't be worried that you left 20k in the deal, you'll be saying "Wow, I bought that house with only 20k invested". This is especially true here in the Denver market, where properties are expensive, rehabs are expensive, and lending is expensive, I have to work with investors every day and educate them on the market they are working in, and at the end of the day, if you end up with only 20k invested in the deal, that is a lot better than the $100k+ that you would have had to put down for a traditional purchase.

As for your analysis paralysis, maybe instead of jumping into a BRRRR for your first deal (Im assuming it's your first deal), which has so many moving pieces and items that you have to address, maybe start with something more simple for your first one just to get your feet wet and then grow to the BRRRR. Start with a house hack here in Denver, where you can get in with 3-5% down, rent out a portion of the home, and lower your living expenses. Maybe buy something with some rehab needed but not a full rehab, and get to understand how it is working with contractors on your own property. This will give you the training wheels to understand how to manage and operate an investment property, with very low risk. At the end of the day, there is no replacement for actually jumping in, but the fewer variables and the lower risk you can have, the more likely you are to act on it, and the better off you'll be.

Focus on the big picture. Nothing in life is perfect.  Find something where the numbers work and go for it.  Find a realtor who is used to working with investors and listen to what they say.  Decision is still yours, but don't nitpick .... big picture.

Hey Josh,

It is hard to accept but there is no such thing as the perfect deal.

There is something that at some point will go south, either financing or rehab work.

But you can minimize these with experience and jumping in. 

The more you think about it the less action you will take because you always will find the "BUT.."

Being in this mindframe will never land you a deal. It is good to know all your risks, but you must balance it with action taking. I have never closed on a perfect deal. I believe in constant base hits, and a few home runs every season.

BRRR's have been harder with the low inventory and higher demand so it is more common to leave money in the deal. If you run the numbers and are OK with it I'd go for it. Everyone has a different criteria for deals. Just be thorough with each step of BRRR especially the rehab part

@Josh Humbert We have money trapped in every property we own. That's why it's called investing. You need 2 of 3 things to get into real estate - rehab skills, money, or a deal. 

When I started I had some rehab skills, basic wood working tools, and money. I knew nobody in the industry. I found a local agent and found a distressed deal that would cash-flow. I could predict list prices for other remodeled houses (+/- $5k). Market research is so important. You could have all three skills and still buy wrong. Buy right or don't buy property. The BRRRR strategy is challenging because the numbers are tighter. It wasn't much easier in 2018. Rents were lower. DOM was longer but that's about it. Aim for a single or double base hit. That's what it takes to scale and find the homerun deals you're probably reading about in the forums.