All Forum Posts by: Account Closed

Hey Ryan, good question! It all depends if your numbers are correct. A lot of people make the mistake of saying their property can get $1200 in rent a month when in reality it probably will get $800. So i suggest rentometer.com or zillow or ask neighbors who are renting, and what they are paying. Alot of people run numbers and make a plan in their head, and its all good until they find out that their numbers were wrong. Ok so rent, insurance, hoa fees, if its sfh, you dont pay for water or sewer, the tenant pays that. so you don't have to worry about that. Also when i run numbers, I always run "worst case senario" numbers. meaning that if all my research suggest 1000 in rent, ill just write in 800 to be safe. if insurance is 80 bucks a month, ill just put in 120 bucks just to be safe. This way, if your off on the numbers, you can still save yourself. Also and most importantly is the mortgage and the cash flow you will create. just add them all up and subtract from rent and thats your cashflow. You asked how do you get the numbers, well rent you have to reasearch of the sites i addressed earlier, and insurance is pretty basic, you can call insurance companies and get quotes. Hoa fees you can just ask who is listing the property if there are any. Alot of people underestimamte hoa fees. 

hope this helps. any other questions. lemme  know.  

I'm not trying to discourage you from taking the deal, Im just speaking from experience thats all. The best way to explain it is thats its like playing poker for the first time. since its your first time you wouldn't just walk up to a poker table in a casino and drop 50 grand right off the top right? of course not, you would play 100 bucks first, then maybe 500, or even 1 grand... its just smart to warm up to the feeling. Ive seen the smartest people ive ever met, go so so so wrong in real estate because they feel like they know everything. I don't think that you are that type of person, I think the fact that your even asking questions on this site and trying to learn is a huge upside. You even said that you work another job, so maybe start with something that needs little repair, or something like a condo thats a 1 bedroom in a semi nice area. even if your profit margin is only 5 grand. thats fine!!! YOU WILL LEARN!!! it will prep you for the hundred and thousands of dollars of deals you will make in the future. 

 It was my first deal...i lived and learned.... no worries...I got the next one right... and a couple more after that lol. 

 Its a matter of opinion. My personal opinion is based on what I have done and been through. My first deal was a cash deal. I didn't even buy a house, I bought a 900 sf condo for 40k. It had hoa dues of 200 bucks a  month. I would work my 8 hours, and then come to the condo and work some more. I went to home depot probably 40 times a month. sometimes 2-3 times a day if I really miss-measured..lol. but it was a learning experience. The condo was a dump, but I put granite counter tops in the kitchen, watched youtube videos on how to install tile and backsplashes. I re-did the bathroom to marble floors and I installed crown moldings. I could not hire a contractor because all my money went into the 40k to buy the place. I learned how to be a plumber, tile setter, crown molder, all in one yr that I owned the property. I sold the property for 180k with less than 1 yr of ownership. This helped my real estate investing career to a quick start. Not all deals will be like this, but the point is I started small. So thats what I always tell people when they are beginning. Now if this was your 5th or 6th flip, I would say just go ahead and do it. but forst timers is hard. buy a cheap condo, fix it and sell it. Get some experience and  confidence, even if you only net a little, but you will learn a lot with not having a 100k or whatever hanging over your head, it will be more like 30k or 60k. those numbers are more manageable if hell breaks loose. You know what I mean?

 I came to the same comclusion. Especially for a first time investor. He should invest in something less than 100k or a little over and play around and get experience before rehabbing 100k in a house. I've done enough rehab work to know that no matter how much experience you have, little surprises can cause big problems $$

Its never a bad thing to overestimate repairs, especially since it is your first flip. I'm sure you will have many little surprises that you will learn from, hopefully no big surprises. lol. Also is it 20k after capital gains tax or before? because that makes a big difference. 

Flips can be easy or difficult depending on the person. Is this your first flip? how much experience have you had with flips? 80k in rehab? that seems like a lot of work for only 20k profit. Usually 80k in rehab means a lot bigger profit because it means the property was completely shot when you got it at a great deal. As far as if you can get it at 235k from the listing price at 300k. It all depends if its bank owned or owner owned? Because you attack certain situations differently.