Ok, so I have bitten the bullet and gotten a HELOC for 120K. We have been searching for a house to flip, rent and refi out in AL preferably on a lake to AirBNB. We have not been as lucky to find something so we have been looking at alternatives. We have found a property that we love, but the cost is higher than we would like at 70K. That would leave us tighter on the build of a tiny home than we would like. The owners have other land near this plot and our future plan would be to build a tiny home, rent, refinance, and repeat in the same area. I am concerned about the refinance as the property cost is higher and just not sure how the value of the property will pan out. We can not find any really great comps as the rest of the properties are cheaper, but they are restricted properties (no tiny homes). My question is should we keep looking for a home to reno or other properties? Does anyone know how to find the properties actual value verses a restricted property? Do restrictions even matter to the actual value for comps? Side note we have asked if they would take less for the property and they declined.
All the best,
KC
Hi Everyone,
I'm just starting out in my real estate journey & I've compiled a BRRRR checklist, inspired significantly by the wisdom shared right here on this forum. It's designed for efficiency and thoroughness in your real estate ventures.
You can duplicate & modify it.
I'd love to hear your thoughts.
Eyal
Eyal,
Your checklist is AWESOME - nice work and thanks for sharing!
R/
KC
Hello everyone!
I have been living in an older home (100+ years) for about 2 years. The house is on radiator heat. We bought a new steam boiler during the winter of 2021. I've been told that boilers are an efficient heating source, but we've generally seen extremely high heating bills i.e. $300+/month during the winter season. The gas company has come out and said that the meter is fine, but I feel like there's something that's causing the higher bills. I was wondering 1/ if anyone has dealt with a similar problem and could tell me how they went about fixing 2/ I'm assuming a natural gas plumber would be the best person to call to get an assessment, but was wondering if anyone had any thoughts around the best professional to use in this situation. Any and all suggestions are welcome. Thanks!
Good Luck,
KC
The real estate market has been all over the place in the last few years, and it forces us to adapt our strategies in how we invest. I invest in long term buy and holds, and with current interest rates tightening our cash flow, I'm curious to how everyone is adapting. Lately, I have been acquiring properties that need moderate rehab, fixing them up with my own funds, and renting them out. Instead of refinancing right away and pulling cash out, I am waiting for rates to come back down in order for the cash flow to make sense. I'm pretty much just sitting on the built in equity and cash flowing decently until I choose to refinance. The only downsides are needing more capital up front and keeping it in the deal for longer, but it works if I don't need it immediately and have it available. How are you guys doing it?
Chris,
It sounds like you've developed a solid approach to navigating the current real estate market fluctuations. Your strategy of investing in properties for long-term hold and waiting for more favorable refinancing rates is prudent, especially in an unpredictable market.
Like you, many investors are exploring alternative methods to maintain and expand their portfolios. One approach gaining traction is utilizing unsecured term loans. These loans can be a flexible tool for acquiring additional funds without tying up your assets. They offer the advantage of not requiring collateral, which can be beneficial for investors looking to keep their existing properties unencumbered. This could be an option worth considering, especially when you need more capital upfront for your projects.
It's always essential to weigh the pros and cons of any financial product, but in scenarios where immediate cash is required without the desire to leverage existing assets, unsecured term loans might provide that necessary flexibility.
Happy Investing,
KC
This is more of a reflecting post thinking about what are the data points that fix and flippers look for to pass or pursue a deal.
I wanted to provide clear, concise data to help our users make swift investment decisions in real estate. The challenge? In a market with hundreds of variables, new investors often find themselves in a black hole of information.
If you're one of the early users who reached out to me, you recall we used to show several properties on a page. Users toggled between options, rarely reaching a definitive 'Yes' or 'No'. To tackle this, I drew inspiration from an unlikely source: Tinder. For those unfamiliar, Tinder simplifies dating choices by showing one profile at a time - swipe right to connect, left to pass, and never see their profile again.
We applied this 'swipe' functionality to real estate investment properties. And the impact? Decision-making became faster, more intuitive.
I am curious, what are those 5 crucial data points you look at a flip deal before deciding to pursue it or pass it?
I have flipped a few houses now with conventional loans getting started. Made some good money. Bought a 325k house in one of the best neighborhoods. Worth about 450 if fixed up. Been here 6 months with a roommate that rents from me. I don't want to sell this. I would rent it. Currently doing a non-live-in flip that I am funding with hard money. After the flip is done I will have about 80k liquid cash to play with. Should I just buy something else with 5% down and move into it? I have been HUNTING for more flip deals that I can buy whenever i want with hard money. Just nothing really out there. I don't want to be in limbo. Should I broaden my search to out of state? I am feeling some analysis paralysis. Flipping houses is my main source of income.
Hey y'all.
I completed my first BRRRR on a SFR a few months ago. Was able to pickup a duplex as well under the same criteria, and currently have two more SF BRRRR's ready to close and ready to rehab. I received a conventional loan for the duplex, have one of the two SFR for cash, and the last from the refinance from the first BRRRR. My lender let me know that I'm exceeding my Debt to Income and they wouldn't want to loan out anymore without a significant increase in income. My question is, if the right deal came along, I would certainty want to throw my hat in the ring, but with the lack of traditional financing or BP lenders (rural midwestern state), what options would I have to continue on?
Hi Clay,
Congratulations on completing your first BRRRR and progressing in your real estate investment journey! It's impressive to hear about your achievements with the duplex and the additional single-family rentals (SFRs).
Regarding your question about financing future deals given your current debt-to-income (DTI) situation, here are some potential strategies you might consider:
Partnering with Others: You could consider partnering with other investors who have the financial capacity to qualify for loans. This could be through a joint venture or forming a small investment group. Your expertise and track record can be a significant asset in such partnerships.
Seller Financing: In some cases, sellers might be willing to finance the sale themselves, particularly in rural areas where traditional financing can be more challenging. This can work if the seller is not in immediate need of the full sale proceeds.
Private Lenders: Private lenders or hard money lenders can be an alternative, albeit often at higher interest rates. These lenders typically focus more on the asset's value and potential than on your personal DTI ratio.
Creative Financing Methods: Strategies like lease options, owner carry-backs, or even subject-to-financing can be explored. These methods often require less traditional bank financing and can be structured in various ways to benefit both parties.
Wholesaling: Temporarily shifting your focus to wholesaling properties can be a way to generate income without adding to your DTI. This involves finding good deals and selling the contract to another investor for a fee.
Improving Rental Income: If possible, finding ways to increase your rental income (like adding value to your existing properties to justify higher rents) could improve your DTI ratio.
Refinancing Existing Properties: If you haven't done so already, you could look into refinancing your existing properties to secure better terms or release equity, which can be used for further investments.
Remember, each of these options comes with its own set of risks and requirements, and it's crucial to thoroughly analyze and understand these before proceeding.
Good luck with your future investments!
KC
Hi,
As mentioned above, my dad's neighbor bought a place downtown and is looking to offload the property. I naturally raised my hand as interested but don't have the cash to buy it outright (this would be my first rental). Anyone have any recommendations on creative ways to solve this that they have done in the past? I have heard some people talk about assuming their loan but no idea how that works exactly.
Thanks in advance!
Gabe
I have a performing STR in the Florida Panhandle that has around $100k in equity I'd like to tap into. Does anyone have a lender or is a lender who does HELOCs on rentals titled in an LLC?
KC
I am looking at a bank owned multifamily, 200 units in FL. There is no T12, just a rent roll. Does anyone have a method to analyze this and create pro-forma without T12 expenses? Does anyone have standard pro-forma expenses they use for sunbelt properties? Or another method to evaluate the property? TIA