All Forum Posts by: Mark Lee

Investment Info:

Single-family residence buy & hold investment in Matthews.

Purchase price: $370,000
Cash invested: $190,000

5 Bedroom, 4.5 Bath Class A property. Was my primary residence that I turned into a long term rental, and is my first rental property.

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

I became interested in the BRRR strategy in the summer of 2019, and have been failing miserable at trying to acquire my first property. My parents moved close to us one year ago, but unfortunately, my mother passed away from ALS last summer. To anyone impacted by ALS, my heart goes out to you. We decided to put our belongings in storage, and move in with my father. We are fortunate that this was an option, but I think my father greatly enjoys having us around, and especially his grandkids.

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

This was my primary residence that we converted to a long term rental. We found the house on the MLS, and negotiated with the home owners at the time.

How did you finance this deal?

Conventional mortgage as a primary residence

How did you add value to the deal?

No value add, however, we maintained the home in very clean condition.

What was the outcome?

We signed a lease today and have the security deposit. Renters will be moving in next month.

Lessons learned? Challenges?

Here are all the steps I took to try and BRRR.
1. Made contacts and spoke to other investors.
2. Took out a HELOC on my primary residence.
3. Spoke with real estate agents in the area.
After 18 months of just spinning my wheels, I still hadn't made an offer an a single property. After my mom passed away, we had the opportunity to move in with my dad and so we took it. I think the biggest lesson learned is that you have to be willing to get out of your comfort zone.

 Thanks Paul, we'll make sure to do a detailed cash flow analysis.

 This will be our first.  It sounds like you have some experience.  Are there any resources you would refer us to or tips so that we don't drop all the proverbial balls?

@Sean McDonnell - Sean, thanks for the response to my question.  After some input on other forums, I have come to the same conclusion. 

Luke, I am in total agreement with you.  I wouldn't want to be dealing with short term rentals.  However, my partner really enjoys interacting with people, and wants to be an ambassador for people visiting our lovely city.  She is also looking for a job.  When this real estate license came up, I asked her if she wants to be a more traditional agent, and she has no interest in showing houses and dealing with people buying houses.  Thanks for your input.

@Nancy Bachety - thanks for the suggestion!  I am a huge bigger pockets fan and have found the forums incredibly useful.

@John Underwood - thanks for the question.  I think this is where the real estate license comes in.  I don't believe we are acting as property managers.  There is an interesting case in Pennsylvania which appears to have much more strict laws than NC does where an airbnb host has had to stop her business and is being asked to get a brokers license.  We would be signing a lease and then subletting, which is as far as I can tell ok to do, as long as the lease doesn't have any clauses preventing one from subletting. 

I am interested in airbnb arbitrage, and am trying to figure out if a brokers license is required?  Specifically, I would sign a lease with an owner, and then list the rental on airbnb.  The North Carolina real estate commission representative we spoke with said because we are marketing and making a profit, a brokers license is required.  Does anyone in North Carolina have experience with this?

@Ian Olmsted, thanks for starting this thread. My wife and I love heading up to the mountains in western north carolina and we would love to own an STR that we could also use as a vacation home. Do you mind sharing where your STR's are, the types of properties you own, and if you have a recommendation for a real estate agent? I started using AirDNA. Do you have any experience with that platform and do you find the data to be accurate if you do?