All Forum Posts by: Kristie S.

Hey Austin, I am a little late in commenting but thought I would add them anyway.  The first things I would recommend are:

1.Reading investing books or if you are short on time, Podcasts.  Both if you have time.  The more you can learn and listen, the better prepared you will be.

2. Learn to run your #s VERY well. If you accidentally underestimate the rehab or overestimate the ARV, you will leave more money in the deal than you want to. Your first deal is not likely to be a homerun - especially right now, so keep your expectations in check.

3. Fine tune your "buybox", target area, and strategy.

4. Consider house hacking - either with the approach Wain mentions above or with a duplex and renting out the 2nd side (although hard to find in some areas).

5. Talk to at least a couple of investor friendly lenders so you can give them an overview of your situation and see what they have to say about available products.  First time homebuyers, owner occupied properties and veterans have great loan products available.  

6. Make sure your credit score is decent, don't have too much debt, have stable income (W2 job better), some cash reserves and be careful not to over leverage yourself. 

These are the biggest things off the top of my head.  Feel free to DM me if you would like to chat further. Good luck!

@Alex Agreda

@Jhoana Olarte

Hi Alex, I share your concerns - Houston is such a hot market!  

Jhoana, any advice for newbies looking to cash flow in Houston?  I am looking west of the beltway in 770 and 774 but there certainly is not much multifamily out west.  We did 1 flip so far but it seems like making a profit on flips is also hard in this market....

@Stone Saathoff

Thanks!  Appreciate the comment.

Investment Info:

Single-family residence fix & flip investment.

Purchase price: $195,000
Cash invested: $175,000

3214 Sqft house / 11,370 Sqft lot.

What made you interested in investing in this type of deal?

We have always wanted to flip houses and thought there was a lot of potential in this one - also a lot of spread between purchase price and ARV.

How did you find this deal and how did you negotiate it?

We bought it from the wholesale company New Western

How did you finance this deal?

Hard Money and a SBLOC

How did you add value to the deal?

We put a lot of special touches into the house to attract buyers and take it from the ugliest house to the nicest 1983 house in the neighborhood.

Lessons learned? Challenges?

Check out my blog for many lessons learned...

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

Kimbra Valachovic was our realtor - very knowledgeable in Fort Bend and a big part of our team!

Hi, I am looking for advice on what more seasoned investors would do in this situation.  We were in the middle of a large flip when COVID hit.  Ran out of cash, it took too long and we lost money on the deal.  We were using a SBLOC - Securities Based Line of Credit to help fund the rehab.  We were able to pay back all other debt with the sale of the flip except some of the SBLOC.  Paying 6-7% interest and there is no term limit or extension fees or anything.

What I am wondering is if we should liquidate some stocks to pay that remaining back?  Our stocks are performing at better that 6-7%, so is that a reason to leave the money in the stocks for now?  Plus the fact that we would have to pay Capital Gains taxes if we sell?  

What would you guys do?  Thanks!

Hi, with regard to content on BP - I am a huge fan of the site and really love the podcasts.  I see that many talk about the mobile app needing improvement so won't go into that myself.  What I would like to mention is that for newbies, many of the podcast guests on the Real Estate one seem almost "superhuman".  Making it sound like they can do it all.  Just listened to the one with the mom of 6 kids who home schools and built a real estate empire, etc etc.  She makes it sound so easy.  If it is for her kudos.  For most of us mortals, it is far from that and I found that podcast very discouraging.    Wish you had more interviews that talked about mistakes people make, what they learned from them and how they recovered.  The Sunday broadcast is an improvement - covering mindset.  

@Miguel Devaughn

Ouch - an AE zone is the worst kind.  It means that property is in a waterway - an area that the county says is MEANT to flood. Really stupid that they allow properties even in these areas - don't even get me started on that subject.  On the house we owned - we bought it in 1992 and it was not even in a flood zone at that time.  As development grew around us, they slowly rezoned a couple of times.  Flooded for the first time in 2009, then again in 2016 and when Harvey hit in 2017, we had 5 feet of water in the house, 6 feet around the house and could not access our property for 6 days.  Everything in it was a total loss.  We were zoned as AE by that time.  If you choose to buy it just get REALLY good flood coverage and be prepared for it to flood at some point.   P.S. You will want to find out if it has ever flooded as well and how many times.  Good luck.

@Miguel Devaughn

It depends on the severity of the flood zone and if you feel like you could "stomach" a flood and have lots of cash reserves for the rehab time, loss of income etc.  Have you looked up the address to see how it is zoned?  You can look up addresses on the below website.  If it is zoned as AE, I would not suggest buying as a newbie.  We owed a house that was in this zone and flooded 3 times in 8 years.  Was horrible to deal with.  I would be happy to answer any additional questions you have about flood zones. 

https://msc.fema.gov/portal/search

Hey thanks @Ryan Blake

Sounds like I have a lot of homework to do to learn this....

@Eugene Davis

Hi - I can't figure out how to past a link to the blog.  Still working on navigating this site. I get to it by going to bigger pockets.com/member-blogs.  Doing on my desktop computer - I find it is easier to navigate here than the phone app.  They seem to function differently.