All Forum Posts by: Jake Saliba

Start with a fantastic deal and go from there. If you find a great flip deal, you should not have trouble finding a money partner. If you find a deal and then post an ad for partner wanted in the marketplace and don't get any bites, then you likely don't have a great deal. 

So: how do you plan to find great deals?

If you have something lined up that looks like it makes sense, shoot me a message. Maybe there will be a way we can help each other. Good luck!

Take your cash investment to upgrade the unit. (3000-7000?)

Divide by your annual loss from keeping rents under market ($600-1200?).

This is the number of years until you lose money on raising rents. If you can do 3+ years, could definitely make sense to keep the existing tenant.

Luis, if you can hold on to your current rental situation for a few years, I would do it without thinking twice. If its temporary, then thinking about what to do next is great. 

Instead of concentrating on purchasing a buy and hold property, maybe you should think about getting your license and generating extra income through being a realtor. You could use this to pay down some principal on the 11.25% private loans or save for down payments. I would not worry about the loans at less than 4% until you are in a much stronger position.

Just remember every time you pay those loans down you get a guaranteed 11.25% return on your money. (Money saved is money earned!) That's a killer rate for a guaranteed return. 

The personal finance forum is great. They wont recommend a lot about RE, but they will help you sort out your income, debt, and budget to get you in a strong position for when the market is offering a little better deals than it is today.

@Luis Aguilar

If your rent is $300/mo, that's a very strong position to be in. You are also probably paying zero maintenance cost. Are you paying utilities? I don't think you can improve on that situation by much.

Be sure to run the numbers very carefully on any house you're looking at. I strongly suspect that in many scenarios, you will end up out of pocket MORE than $300 a month once you add in taxes, insurance, maintenance, and utilities. 

I think in your situation, I would be using the extra savings from your very low rent to pay down debt and build savings. We would really need to know your full financial picture including interest rates to advise properly.

You may want to consider asking here for an alternate viewpoint: 

https://www.reddit.com/r/personalfinance

@Luis Aguilar, what is your current rent situation? How much are you paying? I think this is critical to giving you the best possible advice.  

If you were to purchase, I agree with everything @Stone Jin said.  Probably the best viable route for you is buying a small 4 bedroom house in Mesa and renting out 3 rooms.  Purchasing multifamily and then renting out the other units is usually going to have worse cashflow and be too expensive purchase-wise for you to afford in the Phx market.  

In most cases, personal finances are too tight for my liking when purchasing at the max approved purchase price a bank will approve. I can't imagine paying the rest of the bills when trying to finance even more. 

This buyer will likely always be going paycheck to paycheck with no ability to create savings to weather any unexpected medical bills, unemployment, etc. First bump in the road and they are missing payments.

Besides the fact that this makes your investment particularly risky, I feel like this could be assisting the buyer in making a potentially self destructive decision. If it was my friend, I would try to help them by talking them out of this decision.

@Jason Enos

Im current ly flipping in Central Phx and the east valley. Lets connect and please add me to your buyers list!

Paying down your debt is a guaranteed return. Debt is like a negative bond. Paying it off is mathematically equivalent to buying a zero risk bond at the % of the debt you paid off.  

If your debt is 3-4%, I might comsider paying more slowly and investing. If your debt is 5% or greater, youll be hard pressed to find any 0 risk return investment anywhere that can bring the same returns as paying down your debt. 

Money saved is money earned. 

In Phoenix, Offerpad is also purchasing a lot of homes at trustee auction.  

Hi, im late to the party, but I have a couple good tips.

Use closed listings for your comps. You want to know what the guy did whose house sold in 5 days. You dont care so much about the houses that are still having open houses after being on the market for 2 months. 

Use redfin.com if you are not an agent. They keep all the old listings and pictures so you can even see before/after pics many times. Go to listing history and click the links for prior sales to view the old listing and photos.

Also, make sure you budget for staging. After trying to go without it and then later giving in to spend the $$$, I am now a big believer in the power of staging. I would go so far as to say that done right, the cost of good staging does more for your ARV and DOM than if you spent the same $$$ on additional improvements to the house!