All Forum Posts by: Matthew Soignoli

I think it depends on several factors. 

1. Water/Sewer Rates -- Revere is over 70% higher than Saugus for example. 

2. Size of the Units - larger units generally equals more tenants equals higher usage. For example, my wife and I live in Saugus and our bill averages to about $50 / mo while one of our 5 bedroom rentals in Revere averages over $300 / mo 

3. Rental Demand - higher the demand on your rentals, the more likely you won't have any issue having tenants pay for water. 

Other notes: 

- Tenants that pay for their water usage are more likely to be more conservative on the usage and also inform you about any maintenance issues as opposed to a tenant that does not pay for water and let's a running toilet, or a small leaky pipe under the sink, go unmentioned. 

- I don't know a lot about Condo Conversions however if shared meter, can just wrap that into monthly Condo Fees 

Hope this helps! 

Hey Corey - I'm happy to give you some free advice! I might know some buyers too. Feel free to message me. 

Hey Matt - I too live in the Boston area. I also have several family and family friends that live in Boston area and have rental investments in TX. Now TX is a big state and the markets will vary greatly from costs to cash-flow, etc. Getting in Austin now is most likely less cash-flow while maybe places like North TX you may have a better chance for the cash-flow play. 

FYI, the Houston metro area is where most of the knowledge/connects my network would be. 

If I were you I would speak to a few lenders to help you identify different opportunities for your situation. There's all sorts of options and ways that you could go about this. You could qualify for this next purchase in TX as a "second home" in which tends to reap more benefits than an "investment home".

You could look for a multi-family that can serve a diversified market and have say one unit long term rent, another unit short term, etc. 

How close to breaking even could you get if you were to rent out your current primary home? With the appreciation market that we have in Boston area, it could be well worth holding on to it. 

I also know some pretty good contractors in the Boston area. Could you say spend $50k - $100k for some rehab at your current primary home, maybe convert it to a Multi-family? or add an ADU? the ROI there is usually pretty attractive too and that extra (or separate) space could give you more flexibility for you during this next step you want to make.

If you aren't ready to refi for a HELOC, you know Fannie just came out with a 5% down product for 2 - 4 unit properties, if Fannie is doing it, I imagine you can find others offering similar products like that.

I wish you the best. Feel free to reach out and connect with me. 

Thanks, 

Matt

Quote from @Tre DeBraga:

Nice Matt, I am an agent in MA as well looking for my first house hack. I like gradys question about how you analyzed the deal!

Tre, thanks for the response. I went ahead and replies to Grady’s comment on how I sort of underwrote the deal and what I saw in the place. I hope that gives more context. 

Quote from @Grady Baltimore:

Great deal Matthew! 

Interested in your underwriting technique though on how you analyzed this deal. Was the original asking price above or below your purchase price? 

Love how you went to all 3 open house days, great play! 

I went 5k above the list price in a market that was going aggressively above asking. Going to open house all three days and speaking with listing agent I was able to gather that the price was listed to sell and other peculiarities about the seller. But most likely the big reason we got the deal and there wasn’t a lot of competition (even though there was a good amount of parties that came to open houses) was because one of the one bedroom units wasn’t available to view because of tenant. So typically people shy away from pursuing further when they can not see a unit because of the tenant. So I put in an offer with that unit being “site unseen” however I added a contingency of something along the lines of satisfactory viewing of that unit prior to P&S. Additionally as far as underwriting goes the views of the property were amazing as it’s oceanfront. 

Investment Info:

Small multi-family (2-4 units) buy & hold investment.

Purchase price: $870,000
Cash invested: $184,000

total monthly rent income approx. 7,300 and PITI approx. 5,600

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

big appreciation play with room to grow, possibility for future short-term rental space, and numbers made sense.

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

I'm a real estate agent in Massachusetts and I was looking for a small multi-family for my sister-in-law for her to house hack. This one was a out of her budget so my wife and I scooped this one up! I visited the open house all three days (Fri, Sat, & Sun), building rapport with listing agent and checking out the foot traffic (competition).

How did you finance this deal?

traditional mortgage loan for investment property w/ 20%

How did you add value to the deal?

came in around list price but left offer clean with minimal contingencies.

What was the outcome?

4 figure monthly cash flow

Lessons learned? Challenges?

don't overcomplicate things and trust the process. when you see a good deal, go for it with an offer that if turned down you'll be okay to walk away from.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

I used myself as real estate agent, my go to lender who I've used before.