All Forum Posts by: Kiernan LaFaver

REO properties can be a little tricky to work with. I'm not familiar with the market in your area, but 45 days in my market is on the longer side as we're in a very hot sellers market. If no attention is being brought to the house by other buyers, and they are not wiggling on price, that tells me one of two things. Either A) they're letting it sit on the market until somebody takes it, or B)they cannot budge on that price because they need to recoup as much money as possible for their bookkeeping purposes. I've had lenders that can budge, some are firm in price, it's really property specific. The longer the property sits, the more leverage you have in terms of price. At this point it may just be a waiting game if you've already offered a healthy price

This is a highly personal question. What one person recommends is good for them, could be horrible for another investor. Will your property provide acceptable cash flow after you move out to cover your mortgage, expenses, and then have some left over for straight profit? How long do you intend on holding the property? Also something to take note of. You’re going to be living there. Would you live there if you were just a regular homeowner, if there was no extra money to be made?

Hey there! I'm in the Syracuse ny area and a lot of the houses are older as well, so I get exactly what you mean as far as "issues". For FHA 203K (rehab loan), all work will need to be done by a licensed contractor per stipulation of loan type for major renovations. Have you spoken with a lender about possible renovation budget? FHA inspection, in my experience, will primarily look at safety oriented things, including chipping paint, exposed woods, hand railings, properly fitted windows, etc.
With that said, there are definitely areas you should be okay with and areas that you should be wary of. If a property needs a roof and that’s it, okay. Should budget in the 10’s for roofing. But, if there’s a roof, bad plumbing, electric, water damage mold, if there’s multiple BIG issues, it’s a no go as it will not be cheap. Same thing with foundation. If the foundation is bad, in conjunction with others, leave it be. If it’s only one or two of those things, sure you can do it. I would highly recommend leaving electrical and plumbing work to professionals, and your area may even require work to be done by licensed professionals. Check with your lender, but the 203K requires work to be done by professionals (at least the major stuff required for them to release funds) to be done within a certain time period. I believe it’s 6 months or a year after close. Again, they are mainly focused on safety and construction issues for this loan type. Hope this helps!

As far as negotiating furniture, I would include “furnishings negotiable” or “comes furnished” in a contract. To my knowledge buyer is not obligated to buy any furnishings that aren’t permanently affixed to the property. If the new owner wants to occupy property, he’s just a standard landlord that lives on property. In our contracts, there’s a paragraph that says whether or not the buyer plans on living there as their primary residence, for insurance and tax reasons

Welcome to the community! I’m in the Syracuse ny area.
so you’re looking where to invest. It’s important to figure out your goals and objectives, and then that will ultimately give you a few areas that you can narrow it down to. Everything is highly individualistic and there isn’t a “right or wrong”, but what works best for you and your situation.
1) what is your ultimate goal for your ideal investment property? Is cash flow the main objective? Appreciation? A combination of both? It’s important to figure out what metrics are important to you.
2) what Class areas are you looking in? Each class has different tenant pools, appreciation, turnover rates, etc. I’ll attach a link to a page that describes this in detail as there’s some things to note.

https://www.realtymogul.com/knowledge-center/article/what-is...

3) who’s your ideal tenant? While you can’t completely control who applies to live in your properties, you most definitely can find areas that are popular with students, young professionals, families, etc.

4) just as important as finding the property, you need to have an exit strategy in mind for the property. Will your identified markets be an easy or difficult area to sell once it’s time? Is this a 5 year property or a 20 year property? All things to consider.

5) how do you plan on managing the property? Out of state can be difficult if you don’t have a reliable team in place. Property managers can also be expensive. Typical rates are 8-12% of income either monthly or yearly depending on manager. Obviously, this can impact your overall cash flow.
6) it’s important to find an agent that knows the area well and understands how to work with an investor, as the process is very different than buying a primary residence.

these are all things to consider, and there is going to be a learning curve associated with the process. I’m happy to be a resource for any questions you may have as you start out the process!

Local county records, zillow, trulia, any other big online site like that, hud homes, hubzu, spark offer. Some require that you pay a fee in order to see the lists of foreclosed properties…I have yet to find a way around this

Happy to hear your journey is off to such a great start! Would love to connect and possibly work together someday!

I have a lender in the Syracuse area (although I believe they’re in multiple states) that finances the large majority of purchase price and rehab costs. Would be happy to extend their info as a resource

Yes as you suggested it does sound like hard money would be the best route to go if you are by yourself and don’t have the two years worth of “income” to support a traditional mortgage. There are some lenders that will still work with you, albeit you likely may not get the best terms and conditions. I have a lender in the Syracuse area that deals strictly with non owner occupied investment properties that I’d be happy to extend as a resource. The alternative is, do you have a co-signer or business partner? If you worked with someone that has sustainable income for a traditional mortgage, any lender would also factor in their income as well. 

Hey Neal, welcome to the community! I’m in the Syracuse ny area. 
so you’re looking where to invest. It’s important to figure out your goals and objectives, and then that will ultimately give you a few areas that you can narrow it down to. Everything is highly individualistic and there isn’t a “right or wrong”, but what works best for you and your situation. 
1) what is your ultimate goal for your ideal investment property? Is cash flow the main objective? Appreciation? A combination of both? It’s important to figure out what metrics are important to you. 
2) what Class areas are you looking in? Each class has different tenant pools, appreciation, turnover rates, etc. I’ll attach a link to a page that describes this in detail as there’s some things to note. 

https://www.realtymogul.com/knowledge-center/article/what-is...

3) who’s your ideal tenant? While you can’t completely control who applies to live in your properties, you most definitely can find areas that are popular with students, young professionals, families, etc. 

4) just as important as finding the property, you need to have an exit strategy in mind for the property. Will your identified markets be an easy or difficult area to sell once it’s time? Is this a 5 year property or a 20 year property? All things to consider. 

5) how do you plan on managing the property? Out of state can be difficult if you don’t have a reliable team in place. Property managers can also be expensive. Typical rates are 8-12% of income either monthly or yearly depending on manager. Obviously, this can impact your overall cash flow. 
6) it’s important to find an agent that knows the area well and understands how to work with an investor, as the process is very different than buying a primary residence. 

these are all things to consider, and there is going to be a learning curve associated with the process. I’m happy to be a resource for any questions you may have as you start out the process!