All Forum Posts by: Jacob Pereira

Agree with @Ryan Kelly. The only caveats I'd give is that 220k is not a lot for our market, so you'd need to find additional money from somewhere, and BRRRRRRRR+ works best when it's a live-in situation which you can't do in Texas with a HELOC, although that's absolutely not a necessity.

Happy to give you some recommendations, but I think more information is needed:

At 220k you're probably looking at San Antonio or Austin MSA suburbs for wholesaling, and different people work in different markets, so just list the places you're looking and I'll PM you the ones I know in their respective areas.

I love my CPA and we've worked together for years, but he's not specifically real-estate focused, and by now I know the RE tax law well enough to be able to make up the difference. There used to be an Austin guy here who was pretty active (Brandon something maybe?) who you might want to reach out to.

As far as the rest, title is pretty much commoditised at this point, LLCs you can easily set up with a single form and $300, and with the amount of equity you have in your house a hard money lender only makes sense if you're trying to go well above your stated $220k amount.

You're in a great position. Please post what you decide to do so we can live through your adventure with you.

I couldn't agree more, @Jordan Moorhead. If you're looking for turnkey, you're usually better off putting your money directly into the stock market. I exclusively buy properties that need work.

By the way, we never ended up getting that coffee. Some time this coming week?

@Lien Vuong, My colleagues @Jordan Moorhead and @Neil Narayan touched on it already, but I'll add a bit of detail to their comments. According to the Austin MLS, in the last 365 days the median closing price for a 3-4 unit building was $542,000, and the average was $602,124. That came out to $157.64 and $175.81 respectively. Keep in mind that most of those buildings are far from "turnkey," although of course that depends on what exactly you mean by that phrase.

You could definitely go pretty far with 120-180k for a down payment in the Austin market, but would that mean that you would become a renter again? You'll always be your own best tenant, so keep that in mind. I've also seen that a lot of responses are warning you away from Austin; I highly disagree, but maybe I'm biased because it's been such a great market for me personally. If you want to explore it further, I'm happy to set you up on an MLS search so you at least know what's out there. I also know a good agent in Atlanta to whom I could refer you so you can compare the two markets. PM me with the basics of what you're considering and your email address if that interests you.

Even though I'm not super familiar with the Oakland market, I find it hard to believe that you could easily cashflow the property you currently own (the details weren't included in your post). If you're cashflowing, you should probably just go ahead and hold on to it and enjoy the income.

@Zach Yusuf, welcome to BP! I'd love to hear more about your Killeen investment. Did you find it panned out well? I often get clients asking about the area due to the low cost of entry, but everytime we delve deeper into the numbers it only really seems viable if they live close enough to do their own work and calculate a low cost of labor for themselves. Are you looking to continue buying out there, or are you more interested in areas closer to Austin?

Hi @Miles Klos,

I don't really have a regular enough schedule, nor do I still do enough of my own work to make it worth it for you to shadow me, but I'm happy to have an occasional phone or email conversation if you want to run something by someone who is impartial and has been doing it for a while.

A few observations off the bat:

1. As @Danny Webber mentioned, you're going to have to drill down on those goals. The one that stood out to me was that you were looking for both a $10M net worth, and only $10k a month in net income. You're describing just a bit above one percent of your net worth in income. At that point, you should sell everything, put your money in an S&P index fund, and just live off the just-under $1M (non-inflation-adjusted) annual income you'll be making without any of the work.

2. You mentioned house-hacking, but then down in the thread you said you would do it in Nebraska, not here where you live. Are you implying that you'll buy a house as an investor and then fly back and forth to fix it? If so, that negates most of the benefits of house-hacking. Figure putting at least 25% down for an investor loan, paying an extra percentage point or two on your rate, and not getting any of the homestead (and if you own it long enough, capital gains) tax advantages. Additionally factor in all the costs of flights, vehicle rentals, utilities, and your current rent+new mortgage.

3. You're working as a handyman; are you aware of how in-demand your trade is in Austin? I have yet to find one whom I can just assign a list of tasks and expect him to be able to complete them. Have you considered throwing your name on an LLC, getting some insurance, and then hiring a helper to make it truly viable? I regularly pay thousands in labor for a 1-2 day flooring, drywall, or paint job, and many of my clients do as well. Provided you can drum up the business, you should be able to reach that $10k a month number VERY quickly. It's also a great way to get in touch with more people who are actively flipping properties.

I personally invest in Austin (16 units currently, mostly duplexes and fourplexes), but maybe more to the root of what you're really asking; there's a TON of interest from California investors in our state. Here in Austin I'd say almost half of all my active buyers live in California and are just looking to diversify their portfolios with real estate.

I also have a few clients looking to move from the coasts to austin due to the lower cost of living combined with still having a decent tech and culture scene. If you're interested in moving here, reach out to one of the 30 agents that have already responded to your message and have them set up a search. There are no strings attached, and that way you'll be able to actively see what's on offer. 

Sounds like Port Aransas. I know a few people who have done well with STRs in the area. I don't personally know the market that well, but as long as you do your research and set proper systems in place, you should do well.

Both great markets. I will tell you that it's VERY competitive in Austin right now. I've seen success well beyond what I expected investing here. I know my friend @Jordan Moorhead would agree 100% with that. 

Hi @Christopher Xavier, I was born in your hometown of San Diego, but made my home in Austin about 15 years ago.

My advice is to tap an agent in every major city you're looking into and ask them to set you up on an MLS search. That'll give you some basic idea of what each market has to offer. You'll also want to talk to each agent over the phone after a bit to better understand what their market offers in cashflow, strategy, etc. Just be aware that in many hot markets such as mine, good agents don't have a ton of time to cater to clients who are just window shopping, so you might have to go through a few before you find one who is willing to help you out.