All Forum Posts by: Kenny Colato

Hey there guys! Thanks for taking your time to read this :)

I’m on the fence on either buying a property in Clarksville, TN, or buying the property on where I currently live.

I’m located in Los Angeles, a rough area, but in Los Angeles property value will always increase and appreciate is insane here. 

My thoughts are to purchase the property where I live from my landlord and see if I can seller finance the deal.

Here’s the thing, the owner owns many properties all over LA and I don’t know if he’d sell it to me. We’ve been living here for about 8 years, and the property contains two units and a garage. The property is a duplex, and there’s a garage in the back that I can possibly turn into a rental by turning it around into a livable area.

How do you guys think I should approach the owner? Seller finance, Lease Option, or how?

Thank you for your feedback.

@Will Gissendanner

Hello Will, it honestly all depends on the way you decide to invest. What are the return numbers you’re comfortable with? What cash flow amount are you happy with? How much down payment are you planning to leave down?

Have you contacted the property managers in the area to confirm that you can get $1,500+ rents?

In essence, it depends on how much return on your investment you’d be getting back. If you’re comfortable making 5% back on your money annually then go for it.

Let me ask you this? Have you ran the numbers through the BiggerPockets calculators? Have you set aside expenses, capital expenditures, property management fees, and vacancies? I’d love to suggest that the bigger pockets calculators are a great tool to use and can help you from falling into a bad deal.

Hope this helps :)

@Daniel Han

Hello Daniel, in my opinion there are many options for investing in Los Angeles… I currently have no rentals quite yet, but it depends what you really want at the end of the day.

We all know that properties in Los Angeles within 5 years, will be worth a lot more money than any property in the Midwest due to our insane appreciation here in LA.

You can do several things with $200k, you can purchase a property near a university, (USC) and make it a student rental and rent by the room and have 1 year leases with students.

Another thing you can do is house hack a 2-4 unit property and live in one unit for about a year and move out so you can get the most profit out of your properties.

(If you decide to house hack, you have to be bankable, meaning banks will loan you some money, because prices are really expensive here in LA, specially for multi family.) or ( You can seller finance a property with an owner and give some down payment for their property)

I’m not a CPA or attorney but in my opinion I think just screening your tenants is the best way you can get excellent paying tenants. A lot of people have worked from home and still paid their bills without hesitation during COVID. I understand COVID gave some wings for tenants not to pay their rent, but I believe they are obligated to pay their rent now. Again I’m not an attorney so you’ll have to check that out on your own.

Again; it depends what your end goal is, to invest for the long run and build equity through time and appreciation, or to have immediate cash flow to sustain your life style.

Hope this helps. :)

@Wale Lawal

I totally understand and thanks for your insight. But yes, doing a flip and a buy and hold is difficult because it’s two strategies.

Thank you!

@Andrew Postell

Hey man, I love this! Thank you so much for your insight. I will definitely utilize this when shopping around for a loan!

@Wale Lawal

Hey Wale, thank you so much! A lot of people add fear is a huge component onto why you’ll hurt to lose some money. In the long run, it’s like paying a tuition for school, where you learn( nothing) very little about making passive income.

As I have read and watched videos, people are afraid of leaving some money in the deal and not being able to refinance all of their money out, but if you really think of it, it’s the same as buying a buy and hold, just that the returns would be bigger than a traditional buy and hold.

That’s my opinion, but I’m not afraid of pulling the trigger, neither fear is in my way. I want a healthy successful life.

Hello Guys, I’m Kenny!

Like many of you, I am very interested in Real Estate and had some questions towards this:

How does a BRRRR sound for newbies? - I am currently thinking of starting my first deal as the BRRRR strategy as a newbie but I'd love more insight towards this topic from people who've done BRRRR's before.

In my situation: I live in South Los Angeles, and to buy a property here is pretty expensive. I'd love to purchase a property here, in the near future when I have equity from some of my future properties, but for now, it's looking kind of green. Anyways, I have been looking in Northeast Indiana, towards Gary but that market is kind of dangerous, but I'd like to go to the expensive side of Indiana to build equity and gain appreciation as well. It may be near to impossible to gain appreciation in Indiana (since it's known for cash flow) but I can maybe force appreciation on some of the more high end properties because I will be using the BRRRR strategy.

I am currently 20 Years old, and have some capital ready to get started, but there’s one thing…

I am currently self employed, projecting to make a little under 6-figures this year, and also next year. I have spoken to some lenders and they say it’s really difficult to get a loan because I am self employed.

Banks require at least 2 years of tax returns and want your DTI to be less than 50%. I currently have no debt under my name, thanks to reading rich dad poor dad, and am set to live off of Real Estate Investing.

I’d love more of your insight, any comments or suggestions would be great,

Thanks!!

Hello Serena, would there be a problem if you are under age? I’m 19 but the issue is that I’m not sure if I would be allowed into the brewery. If I’m allowed, I’ll definitely be there. 

Hi, where do we attend these meetings? 

@Charles Simon

Sure thing Charles. I’m already joking his in two weeks, so now I’ll join both. Thanks.