All Forum Posts by: Keith Gilbert

Absent the information the other responses asked for, @Caleb Jordan hit it. Hard Money shouldn't be used in a long term situation.

Ok - so just to make sure we're clear: House-hack and those numbers are based on income from just the other unit? Meaning you'll cash flow from a single side?

If so, I think it looks like a solid play. If you extrapolate those numbers out for when you move out down the road, you'll have a very healthy cash flow and ratios.

If they wanted 25% down and 4 max, sounds like you were looking for a residential loan. I would recommend seeking out a local institution and talking to the commercial lender. They tend to be a bit more flexible and the economics of the deal itself would be one of the driving factors for approval.

On your first discouragement point, any other option at this stage is likely to require another party as either a part owner/investor, or as hard money with a BRRR.

On point number 2, I wouldn't actively discount smaller buildings, especially at first. You can use them to build out your processes and get through the entire purchase & cycle with less risk to start.

First question to ask is how can you benefit the sellers. What would make them want to hold the property longer and assume the risk of the deal never coming to fruition? In many cases, that's either removing headache for them or more money.

I'd try to dig a bit more on what they value most. Moving properties quickly, maximizing profit, just getting rid of headache, etc. Maybe it means you offer them a contract written such that a sizable earnest deposit is forfeited if you fall through. That would shift some of the risk from them to you. Maybe you can find some buyers for their other properties?

Depending on the numbers and the way it shakes out, a special wholesale deal may also work if you can find someone willing. IE: Another party purchases the property from the owner and agrees to hold for you longer in exchange for a higher fee.

In any case, I'm not sure I'd see an outcome here that doesn't result in higher costs for you. It just doesn't seem like something that would be particularly worthwhile for a seller in a good market otherwise.

Depending on market and situation, 1 unit (SFH), especially if it's something you lived in and moved out of and will now rent. If purchasing new, grab a duplex and go! It wouldn't be feasible for even close to the majority of folks to start with a 50+ unit scenario.

Old thread, but thought I'd add some perspective.

Right now, I think the ATV (since they can ride on city roads) and Snowmobile community is the primary upward potential for the Berlin area. That's a risk and is reflected in the MFH pricing. That being said, there's at least one out of state company that was formed and moved int o buy & rehab properties. They seem to have primarily stuck with the AirBNB model for most of them. Given the demographics, it's very possible that's the best option for that area at this time.

If you can find properties with covered/locked storage space, it may be interesting to look in to seasonal rentals. I know lots of folks from southern NH and MA travel up to that area frequently for ATV and Snowmobile activities. Being able to leave your equipment on site is a bonus...

Local here - do you primarily focus on flips? Haven't found anything appetizing for a buy & hold given pricing and property taxes.

As others of noted, it doesn't look like the rent ratio is great on the property in the current situation. Having PMI definitely doesn't help and as you noted, you won't be able to drop it. Based on your current margin, once you factor in the additional management costs, vacancy, etc., I would consider it a risky property to rent.

You mentioned ATL is the local market? What are the trends like? Is property still appreciating as fast as it has been?

I would likely look at selling and then determine how much buying power that will give you in your market with rough cash flow estimates. If you net 70k, you could consider house-hacking a multi-unit under and FHA loan option and using the rest for a traditional 20-down to avoid your PMI again.