All Forum Posts by: Kyle Alberry

@Paul Timmins I actually am considering it at the moment. I would be able to learn more about rentals in that aspect, but I would be limited time wise if me and my father do decide to do flips. I would want to be able to stop down a couple times a day to our projects, and be open for questions while he works full time while we get our business started. Thanks for your advice!

@Frank Woodin This looks exactly like what I thought would be the case. The only thing I need help with at the moment is beginner training (how to search MLS, purchase order, closing, comps, market research etc.) Other than that if I am unhappy working as an agent I should try to look for a different money source to fuel my investing career, and the max I can probably get is ~$30-40k a year with no degree. Thanks for the luck and the kind words! I will hopefully be able to take advantage of my information and my young age to have freedom in my life!

@Kelli Foley I understand how to hustle and get my name out there and network, but the thing is I do not want to be an agent. I feel like if I focus those efforts from an agent, to getting in front of people who are doing the thing I want to do in this space, and talk about contractors/market and build relationships that way, it will be much more beneficial to me and my business . Thank you for your advice!

Hello again guys! I have been a part of these forums for a while, and I would like to ask a specific question regarding my situation. I am 19 years old and I recently got my real estate licence, ultimately, to get into real estate investing. I did not finish college and I decided to get a job while living at my parents house because I was told I should learn about the business before I start investing, so I became working as an agent. I was working at a small firm for a couple days (I am their only agent who is not family) and I found their training to be very flawed, and all I found myself doing was being a secretary , but I am getting paid on commission! 

I was only doing this because my father wants to get into flipping too. I figure if it will take me 6-8 months to get a $3000 commission check (houses are ~$120k here), we should just be trying to flip with a HML, work 8-12 months to potentially get a $20000 check.

I do not like working as an agent, and I would rather do something else, I am just wondering if I should try to jump into flipping with my father, or work as an agent for while and switch to a bigger more systematized brokerage. Or should I stay in the smaller brokerage? 

I am a good number cruncher, I like working with numbers and I have been studying biggerpockets and reading books for about 3 years. I am just wondering what path you guys think I should take if I want to start flipping.

Thanks,

Kyle

Hey guys! I have been on these forums for a while, and have soaked up a lot of knowledge with blogs/forums and books. I was just wondering what route would be more effective for me. I am 19 years old, and currently living at home with my parents. I got my real estate licence a couple weeks ago, and I was thinking about starting as a real estate agent.

The only problem I have is that I have to pay a lot up front, I may not see a commission for a while, and I want to start saving up money for my investments! In my eyes I would rather have a 40 hour a week sales job, that guarantees me a salary + commission, so I can pay off my student loans and save enough money for a 3-4 plex house hack, instead of a 100% commission base job that I have to advertise and spend a lot of time to be successful. 

My main plan is to work to get a good amount of rentals/flips so I can do this full time!!

What do you guys think? Learn the business by being a real estate agent or get 1 or 2 other jobs?

Thanks,

Kyle

Welcome to BP @Kendra Ross! I am actually in the same boat, I have passed all my tests for the real estate license exam in NY, and I will start by being a salesperson, and doing flips. If there is one tip that I can give you is to read The Book on Flipping Houses by J. Scott. This book is available at the BP store, and it really dominates the book market when it comes to flipping houses in my opinion. I have only read half so farm but it breaks everything down into small step by step guides like a little helper. What you have to do from the book, is develop a plan on how it relates to the area you want to invest, or your "farm" area, and use the information to learn your market.

From then it's all about finding deals, which you are probably familiar with because you have done so much research. Personally I am going to spend a lot of time on the MLS, checking new listings a couple times a day, and putting offers on houses that have sat for a while. If I have no luck there I will switch strategies to a different area, or use a new method of finding properties in that farm area.

I wish you luck on your licensing tests and your success in real estate! Be sure to interact with the community often and show your progress!

I am a new investor, have not completed a deal yet, but I want to give my 2 cents on this deal. Everything you have said to me just pops out as positivity. I do not know the area, I am just going by what you say, but there seems like there are many pros, and not too many cons. 

1. It is cheap, which means less risk and leverage on your part.

2. You know a guy in that niche, if something ever goes wrong and you need help, if he is truly an expert in the niche he will have an answer for you.

3. You said should have a tenant shortly, and for 12 months, which is a big plus since you do not have the place yet, and you may already have it filled. 

4. It's a 1/1 600 sq ft. That is good for capital expenditures(big repairs) and even small maintenance. Less sq ft of carpet, smaller roof etc. 

5. Paid off in 2 years? That's awesome. Extra $5580 per year when it is paid off less vacancy/repairs/reserves.

There is just one question, and this can be a con, but why is he selling? Is he a close friend and wants to build your portfolio with some cashflow? Is he liquidizing some of his portfolio? Is there any latent defects he may not be telling you? If the reason why he is selling is negative regarding the property then I would try to see what it is and see what it would cost to fix, then go over the numbers again. If it has nothing to do with the property in a negative way, I would lean towards making the deal. This is just my opinion though, and I have not owned any property yet, just trying to help!

Let us know what you decide to do!

Hey William!

I am a newbie at real estate, so take my post with a grain of salt, but I have studied it for years now and I may have some knowledge on how to analyze this deal. When I first read this i saw the 16 units for 1.6 mil. This is $100,000 per unit, and for a multi-family I believe this is really high. In some markets you can get a 4-plex at $150,000 and have $37,500 per unit. But this is not a huge issue, because it's all about the returns right? 

The NOI is $181,800 per year or $15150 per month. Since you do not have the details on the property yet, lets assume we use the 50% rule. If you are unfamiliar with the 50% rule it is basically stating that 50% of your monthly NOI goes to utilities, maintenance, cap ex, and so on. Then you take that number and subtract your mortgage payment from it. Lets play with numbers here and say you got an 80% LTV, so you need to find out how to get $320,000 up front. Lets say you get a 30 year flat rate loan at 9%, this interest is just an arbitrary number, but commercial loans are more expensive than residential. That would come out to be about $10,299.17 per month. 50% of the monthly NOI is $7575, subtract the loan and you get -$2724.17.

The GRM (gross rent multiplier) is 8. The cap rate is 7% you stated, and this varies from market to market. You have to either talk to a commercial broker, or research your market to see what the average values of these numbers are. They are also used with comparable sales, so you can also ask the commercial broker to pull up some comps for you with these numbers and see what they sold for.

So in my opinion if you know the GRM and cap rate for your area, you will be able to do a better comparison to see what is a better deal in your area.

It seems the like price is so high because of the 99% occupancy, which is really good and its a safe place you put your money in my opinion if you are just getting started and want to ease into multifamily investing, but these numbers would most likely not work out. Of course you would have to get the actual rent roll/pro forma to see if they are true, but this is how I would analyze the deal at first sight. 

Again, take this with a grain of salt as I have not done a deal yet, but only researched!

Have a great day and I wish you luck on your future endeavors!

@Ray Jacobsen I will absolutely do that! Thank you for providing the link!

@G.A. Miller That would be wonderful! I would appreciate that very much. I will PM you the details.

@Elizabeth Colegrove If I were to go back to school it would only be part time. I am not sure if I would want to go full time again. And that's a wonderful start to investing! Using a W2 to leverage income is what I am thinking about doing! Thank you and good luck in your future endevours!

@Gary Alford  I have supposed to go down there early March. My brother is supposed to in Virginia March 1st for his promotion, so I hope to be down there a couple days after that.

@Jeremy Tillotson  Thank you!

Hello BiggerPockets community! You may have seen me post some questions about real estate when I thought I was moving to Arizona, but my plans have changed! I was going to live with my brother for a while to help me get off my feet, but he recently got a promotion and is moving to Virginia. If you have not seen my posts, I am 19 years old and recently dropped out of college after 3 semesters so I can fulfill my dream of becoming a real estate investor full time! I understand it will take a lot to get there but I am willing to learn and start early. I have flooded my head with so much knowledge the past year and a half on the BiggerPockets website, that my motivation, drive, and excitement can barely be contained!

Now to the main part of my post. Like I said before I am 19 years old, and willing to jump right into the real estate business. I have researched a lot about wholesaling and rental properties, and minimally about flips. I was wondering if there is anybody in the Norfolk, Virginia Beach, or Richmond areas that is looking for an assistant to their growing real estate business, an employee in their property management business, or even a wholesaler they can count on. If there is also an individual around those areas that would like to become a mentor, that would also be greatly appreciated. I am just looking for opportunities that can get me into the business so I can gain as much knowledge as possible! I am young, not tied down, and willing to learn and gain experience.

If anyone also has some advice for me as I start my journey that is also appreciated!

Thanks,

Kyle