All Forum Posts by: Kurt Grossman

Add bedrooms and or an ADU to make money in CA. CA Law allows for the construction of an ADU. You can rent it out. The interest rates are high now. The prices are high. But the money per room and bathroom makes sense. If you add 1,400 square feet you can easily put 3 Br/2 BA on it for $210,000. Your payment goes up $2,200 and your rent goes up $2,600. The property value goes up about $350,000.

A 6-Unit property just purchased and the rents are low but the tenants are good. Did not want to raise rents but now that I'm trying to refinance the lender says it doesn't "Cash Flow". Would you raise the rents or shop harder for a better lender? Or both.

99% of the investors that I have dealt with invest with their own money and make payments on a property then secure a tenant. 1% are investors with someone who wants to buy a property but can't quite make the down payment, income, or credit requirements. Has anyone done a Cash on Cash or Risk Reward analysis on Co-Buying property? Example: $500,000 home; 20%/$100K down; $400,000 loan; PITI; $2,465. Co-Buyer pays all the Closing Costs.

Co-Buyer Owner Occupant agrees to pay $3,465 per month for 5 years before refinancing to pay back the initial $100,000.

What's the ROI? What's the risk/reward? What's the legal challenge? Is it as good as the "normal" way; worse, equal, or better?

I am looking for a way to get Pre-qualified 1st time buyers into homes that investors buy. I have tenants prequalified for loans who are willing to pay over Market Rents in order to move into a home now that they plan on owning at a predetermined price. I have a model where the annual IRR over 2 years is 18%. I want to see if people in the business think it is a viable business plan. Big Pockets seems like a good pond...Thanks.

$700 - $1,200 per month positive cash flow on a $400,000 sfr with 25% down is pretty good in California. $400,000 homes rent for $3,100 per month in Bucks, PA? Hmmm...I can see that a 2-year hold makes a lot more sense. Also a 7% appreciation rate pencils out much better too.

Working with 1st Time Home Buyers the problem is not so much getting them approved for a loan but finding a property. If you buy a property for $400K would you be willing to sell it for $420K in a year or $441,000 in 2 years? What if Market Rents are $2,600 but your tenant is willing to pay $3,100 a month? What is the ROI for a 2-year hold?