All Forum Posts by: Lior Rozhansky

@Mladen Krstin welcome to BP! A 4 bed house hack would be a great place to start. Depending on the area you could get anywhere between 700-1000 per bedroom, which should help pay a good chunk of the mortgage. If thats your plan you'll also want to account for making sure you have appropriate number of baths (at least 2 full bath, ideally 2.5 or more) and enough common living space! 

@Nate Hubley If you are going to house hack a 2 fam anywhere around Boston, you will almost certainly have "negative cash flow", though that would just be your housing expense. Even when you run the numbers in the scenario when you move out and rent both units out, you are most likely going to have pretty negligible cash flow (I'm assuming you are going t0 FHA and have a loan of 95% LTV). On a 3 fam you can get close to breaking even when living in one of the units, and on a 4 fam might be possible to get a little cash. But 4 units around Boston (~5 miles) are incredibly expensive (typically starting at 900K), so you'll need to make sure you can qualify for that kind of loan size.

@Pratik Tembe if your goal is to hit 7-10% CoC, you can look closer to Boston proper as well. Areas like Dorchester, Everett, Chelsea etc--you can pick up 3-families there and typically be on the lower part of that range for CoC, plus be closer to Boston. All depends on your strategy and what you are looking for.

@Yuzi Stha welcome to BP! Those areas you mentioned are real solid, and I think all of them have good appreciation potential. In terms of other areas you can consider, I think Revere by the T is an attractive option, you can look at Medford (both wellington side and West side depending on your budget), Everett (West Everett is right by Wellington), and Watertown. Most of these areas your cash flow won't be anything to brag about, but all these areas are going through a lot of change and development. 

As for lenders, I'm not a lender but I would get a number of quotes from different lenders and see where you can get the best rate and terms. Let me know if any questions! 

@Adam Munekata welcome to BP man! You have a lot of points in your post, so I'll try to hit them all. 

You're 100% right, Boston/Cambridge is very, very tough market for cash flow. You are not far off from your cash flow projections, which is just simply the return profile you can expect to get. But as you mentioned points on recession and stability, this is the reason people buy here. You are trading in monthly cash flows for much greater stability, especially when you are talking about markets like Cambridge and Boston (and especially since you are buying more or less retail product 100% leveraged, its going to be tough to have amazing cash flows). 

Now in terms of finding "good deals" now, you just need to know how to look at the market. There are certainly listings in Camb/Boston that fly off the shelf today, but if you look closer you'll also see that there a lot of (quality) listings that for whatever reason sit on the market. Rather than getting into a massive bidding war over the "hot" properties, I would look at those that are starting to accumulate days on market. I think it's more evident than ever before. It's a numbers game, and especially now that there is more inventory coming on the market now that the rental market is hurting (which I believe is temporary), I think there is good opportunity to find a good deal. 

And finally, I def would not use your standard BP rule of thumbs in the Boston market. The 1 or even 2% rule, or the 50% rule, are just not really relevant to a Class A market like Boston/Camb. Its comparing apples to oranges looking at investors who use these rules in markets like the mid west or the south vs Boston, which is literally one of the most attractive markets in the US. Different ball game here! Feel free to PM me if you have other questions. 

@Jeff Chaves welcome! Most of my portfolio is in Dot and Roxbury. I absolutely love these markets, but doing clean BRRRRs in them is very challenging and pretty unlikely. That being said, you can still find some great properties that will have great long term value and solid cash flow. 

As for the agent question, I don't think it will really help you. The "agent" industry is a whole different beast that has it's own learning curve, just like investing. I'd probably just get someone experienced who can help guide you on your investing journey if thats what you are passionate about. good luck! 

Hey @Clinton Holmes you've got a number of options. 

If you are willing to house hack, you can go owner occ loan on a multi fam and buy the property that way with 3.5-5% down. 

If you have enough equity in your first property, you can try to get a HELOC and use that as cash for down-payment.

Finally, you can go through the path of raising money from investors and using commercial financing. You'll have to make sure the deal provides strong returns to your investors. 

Hey @Nick Avola where exactly are you going to be hunting? Most agents have strong lending relationships. As for GCs, if you are going to go 203K you can only work with 203k certified contractors anyways, so just be mindful of that. 

Welcome @Matthew Gavis! I'm an investor out here and most of my units are in Dorchester/Roxbury. For maintenance I typically underwrite at 5% of gross income, which i've found to be on the high side but not terribly inaccurate. For your standard triple decker that comes out to like ~$300 per month, which is 1-2 handyman trips. For capex I typically go bout $50-75 per unit per month, though that number obviously changes depending on the condition of the building (if I'm gutting it upfront it would be lower). Haven't run into trouble with it yet in 4 years lol. For physical vacancy rates you can google them, I've seen stats as low as 2%. I don't personally like underwriting that I think it's a little thin, so I typically go 4%, which I think is more reasonable especially since I'm a long term buy and hold person. Let me know if you got any questions! -L 

@Dedawnte Vassorwelcome man! BRRRR strategy is great and be pulled of with the right deal and execution. Make sure to select your criteria of the type of cities/areas you want to go after, how much rehab you are comfortable with, and start analyzing a lot of deals. There are still a lot of deals out there that can work!