All Forum Posts by: Matthew Abrahamzon

I think a lot of it depends on the real estate agent you find. There could be a lot of negatives with the wrong one. Make sure you find an agent that invests themselves or has worked heavily with investors in the past. I prefer to stick with ones that invest themselves. Call a few branches near where you want to invest and ask them which agents invest. Then when you get on the phone with that agent, ask them how long they have invested for and how many doors or units they own. One question I love to ask before the agent knows if you are buying or selling is, "Is it currently a buyers or sellers market?" That way you get a truthful answer and that they are not catering or changing it, to match what you want to hear. If they tell you anything besides it being a sellers market right now, they'd be blowing smoke. The main benefits are that as long as you are purchasing, the seller of the property typically pays the commission of both agents so it is free for the buyer. They have access to the MLS and their social network. This is huge because any real estate agent worth their salt focuses on their social networks and are a wealth of information later about well qualified specialists(i.e. plumbers, electricians) because they have used them before. Also, agents specialize in their area and it would be hard pressed to find someone who knows more about it than them (as long as you vetted your agent well). Another plus is they usually expedite the process as you aren't looking for the properties yourself or scheduling viewings, they do. The downside would be that they are paid by commission. Make sure they aren't rushing you into a decision so they get their paycheck faster. Also, if you didn't vet the agent well enough and they are used to their clients paying retail price for a home because they are emotionally attached, they will not be used to you offering a price that is based off your due diligence, facts and metrics that dictate the price you can offer. Often, properties are listed at the emotionally attached price, not what the property is worth as an investment.

Hey Nick, and welcome to the wonderful world of investing. To calculate vacancy rates, I visit the Census.gov website. They display the AVERAGE vacancy rate per state and even for the top 75 cities. I like to calculate a 10% vacancy rate for my property, even though Wisconsin is at about a 5% average. It varies from city to city and realize that yours may vary from the state average. You then take this percent and multiply it by your gross income from the property. Let's say you receive $1000 a month in rent per side for a duplex. That is $2000 a month times 12 months =$24000 a year. Then multiply that by the vacancy rate (0.10). That equals $2400 you should set aside per year to pay the mortgage in case you have to fix up a unit for an extended period of time or if you simply can't find a tenant that matches your screening requirements.

I agree on that one. As soon as you are ready to buy, definitely get one. Otherwise it is a waste of their time. You can still get to know a market without going into those homes.

Hello Cameron! I agree with you on a 4 day work week being nice, at least as a start :)

@ Ham Merritt

Ham Merritt Wow, that sounds too good to be true, I will definitely get a hold of you for my next FHA. Thank you

Trisha, I am a member of the Apartment Association of Southeast Wisconsin and they have all the legal forms you would need. You do have to pay a small fee, but the benefit is that all of the forms are reviewed by a Lawyer. I do not know about the Legal Blank forms, so really cannot comment on those. They may have an apartment association for the Milwaukee area as well.

Congratulations on the purchase! I too used an FHA for a duplex. I would just give the MTM tenant the notice to vacate. The previous landlord should have already given them notice and you shouldn't need to but you can just to make sure the picture is 100% clear. Just a word of advice down the road since you have an FHA. I would refinance your loan as soon as you are able to with favorable rates. I am currently in the process of refinancing my loan to get out of the FHA, so I will be able to use it again and only put 3.5% down on he next property. It sure beats the traditional 25% needed for an investment property. But now since the refinancing process is taking several weeks and you cannot have two FHA loans out concurrently, we may miss a duplex that just recently came up for sale. That way if you already have your place refinanced, you will be able to scoop up a deal quickly with another FHA as soon as it comes along. That is if you plan on getting more after this one. ;) Best of luck

Welcome Emily! I have not flipped anything yet, going for buy and hold for now.

All of it can be thrown in the trash, except for pharmaceutical medications you need to hold for 14 days but then those can be disposed of as well.