All Forum Posts by: Leon Y.

Check out the smaller cities with good neighborhoods. The cheaper the properties are the more mistakes you can afford to make. If you really want to flip it's probably best to live in the place you are flipping, that way you're saving your housing costs as well as commuting costs as you try to learn flipping. I'd also suggest try to fix everything yourself. Once you have that experience you can easily tell which contractors are good or bad.

I think the numbers are pretty decent despite the fact that you may not be cash flowing. The rental return based on your purchase price is pretty decent and if you have a long term tenant it isn't too bad (most of the negative cash flow is coming from paying down the debt, which in my opinion is not too bad, and also on paper you'd be losing a lot of money and that helps with your taxes). Although I'd be concerned with whether it is an easily rentable property. And have you met the tenant in person?

If you use agents to sell your property, chances are you won't be netting much if anything at all after the sale (I generally estimate about 8% selling expenses in my market). Don't waste that equity. Keep holding on to it. Besides, having debt on your property helps you save money on taxes too. Don't necessary use all the money you have to pay off debt (unless you have a 10% interest mortgage or something crazy like that). Save the money for purchasing the next property.

Last year I drove through Williston and I remembered a motel cost $300+ a night and food was very expensive as well. The prices weren't reasonable at all and it's only a matter of time it is going to collapse. If you were in early, that's good. I wouldn't want to get in now. ND is not going to be the next NYC.

Find another lender! Different lenders have different overlays so go out and ask around! The way I have been leveraging is through borrowing from the seller - seller financing. The seller finances my purchase. It is not as sexy as a conventional loan but you can expand very quickly that way.

I've done a seller financing deal in which I bought 3 properties from the seller with less than 10% down and the rest carried on an average of 6.25% 20-year amortization. Negotiated the deal so I'm cash flow neutral but I'm paying down the loan very fast with the 20-year amortization. The one mistake I made was having the loan in my name instead of my LLC, which shows up as a financed property against conventional loans. So now I'm in talks with the seller to roll those 3 loans into a free and clear home I have.

While it's important to have your own idea of cap rate, you should also be concerned about other factors as well, such as appreciation, neighborhood quality, whether there are any management headaches etc. I have a fourplex that's supposedly getting a great 15-17% cap but in actuality with the headaches and time wasted dealing with bad tenants in a bad neighborhood, I'd much prefer going to invest in a better neighborhood with a lower yield.

I agree with James. Otherwise, you might as well go with a flat listing fee on MLS. And make sure your agent put a great description with your property and also make sure there are some GOOD pictures. I hate how some agents don't put any property pictures or really bad ones.

Doesn't seem like a good deal... unless you're getting 1,000 a month in rent, then you can cash flow a couple hundred bucks a month and you can make back your initial down payment fairly quickly. Sometimes cash flow > price. But I'm guessing this property isn't that rentable...

Should probably look for a mortgage broker with less lender overlays.