All Forum Posts by: Kenton LeVay

Yikes, sorry to hear that. I've also had my fair share of contractor issues. As long as the work is done (I said 'done', not pretty), I'm not sure there is much you can do. You promised to pay him and it's on you that there was no clear expectation on finishes or quality of work. Next time you're working with a new contractor, start small and be very specific with what you want the final product to be. Sorry man.

My advice: move wherever you want and invest remotely where it makes the most sense.

In regards to flipping in OH or CO: For the sake of this answer I'm just going to use this comparison as a proxy for "high appreciation market" vs "better cash-flow market". It depends on your investment goals. If you are trying to make as much return through flipping as quickly as possible, clearly the high appreciation market is better. If you're trying to establish a long-term strategy and potentially move into rentals, the better cash-flow market makes sense. I will say, as someone who used to live in Columbus, Columbus is in a unique position in that it is appreciating but the market isn't too mature to cash flow. So maybe you start flipping in Columbus and then do some BRRRR or buy-hold rentals if that interests you.

I think each state has what I would describe as a "routing" process for assets not in a Trust. For example: children->spouse->siblings, etc. If the state can't find someone to give the property to, it will go to public auction. I would imagine you'd be able to find the exact routing process online or you may need to give the state/county a call to clear that up. Then you can run a genealogy report based on who is relevant, approach with sensitivity. I don't think you'd be able to buy the property straight from the county before it hits auction...

Fully acknowledging how difficult it is to even find a place right now...but if you do end up house-hacking, I recommend either using property management or buying under an LLC. I say this because it's generally better if the other tenant doesn't know you're the property owner. Not that they would necessarily try to take advantage of you, but you'd be more likely to let things slide if you had a personal relationship with the other tenant. My suggestion would be to just pretend you're renting out the unit as well, it will keep your relationship with your tenants much less complicated.

Depends on your strategy? Is it flips, long-term buy and hold, short-term/vacation rentals, commercial, multi-family syndication, etc...different strategies will work better in different markets. My suggestion would be to pick one or two strategies and find a market that satisfies one or both then execute. For example, if you're interested in flips and long-term rentals: flip in an expensive/high appreciation market to get the most value and then use that money from the flip and buy long-term rental property in a less expensive market more suitable for cash flowing rentals.

Well I guess it would just depend on the ARV is. Different lenders have different restrictions on their minimum mortgage amount. I'd ask lenders in your area if they would do a refinance on your ARV value because that should be higher than the $40k purchase price. Another option you may have is to use a HELOC to pay off your personal loan, as that would likely have a lower interest rate.

Hey Denise,

That's a good question. I'm down in Raleigh and was able to find a contractor to do a reno on my personal residence, but I don't think he'd go up to Greensboro for a job. I can't speak for Greensboro specifically but I think there are just a lot of people doing renos are spending time at home because of COVID and wanting to do renovations. With that increase in demand, contractors can be selective in who they do business with. It may not be anything about your projects specifically, but it could just be too big of a project for them to take on when they know they could make quicker money elsewhere or maybe they prefer to work with an existing client. Keep on reaching out. You may need to offer a bonus structure to incentivize them if time is an issue.

Hey Tucker, yeah I'd lean towards selling stocks. Taking a loan on your 401k is a bit risky as you HAVE to pay that back. Another downside of the 401k loan is that often times, you cannot contribute to your 401k with pre-tax income until the loan is paid back, which would increase your taxable income and remove any employer match until you can pay off the loan. At least that's how I understand it works, you may want to check with your brokerage or a CPA though.

If the properties are fixed up and livable I don't see why you'd have trouble refinancing. I'd check with a lender first to make sure. I'd imagine some lenders could loan on each individual unit and some prefer to loan the total value as if it were a duplex. 

I think New Construction gets a bad rep in the investor community because it's hard to add value like you can on an old, neglected property. However, there are advantages to buying New Construction as rental property, mainly being that you should have relatively low maintenance costs in the first couple years and lower vacancy because tenants want to move into a new, clean place (vacancy is obviously heavily dependent on the market as well).

I guess it just comes down to how you want to use your cash. The advantage of BRRRR is that you can own a rental with low or no money down but it requires a lot of work. The benefit of New Construction is that is essentially turn-key but you will likely need to put 20%-30% down.

All this to say, I don't think there's anything wrong with buying New Construction property long-distance. Just make sure you have a great property manager who has market knowledge and you should be good.