All Forum Posts by: Matthew Vitlin

Pretty much what @Nate Wightman said.  I recently ran into a situation where a woman would take $60k for her house we did some reasearch and found out that she owed $100k on her mortgage.  Turns out she thought she only owed $5k, but that was just the amount she was late on.  Yes in part it is a bit of a leverage tactic, but it gives you a rough floor for the minimum they would need to be able to walk away from their house if they are underwater.  If she is getting defensive then be upfront and explain that you want to make sure that any offer you make will cover what she needs on the house, otherwise you could make an offer and there is no way they would take it.

My mother loves Texas weather, but she is always cold so the summer is when she just basks in the heat, and hibernates when Texas gets "cold."  She also lived in Boston for a few years and I spent a year and a half in Montreal so Texas has never really hit "cold" for us.

As far real estate concerns, DFW is a strong market.  I work for an acquisitions firm and I've lost track of how many offices we have opened in that area (I think it's 5 at this point).  There are lots of properties to be had for a fairly low entry point, definitely a good market for some looking to get started with investments.

Awesome, glad to hear your first deal is working out for you!

I would say make sure you have an account set up for the little repairs that come along the way, as well as keeping track of when the big ticket items were installed/replaced (water heater, roof, etc.) to know when you should expect to replace them or work on them.

Otherwise if the tenants are good and paying on time it sounds like you are golden.

I like to think of leverage like this:

All cash yields a greater over-all return, but lower cash-on-cash or percentage return.

Leverage yields a lower over-all return, but greater cash-on-cash or percentage return.

Buying 100k house, rents 1k a month, PITI of 650 on 80k loan

All cash gives 1%/month or 12% annual ROI before expenses

Leverage gives you $350/month or $4200/year, which is a 21% annual ROI before other expenses (4200/20000 = .21)

It sounds like you might have an issue with analysis paralysis.  You hear about a great idea, get all fired up and dive into to the research, then run across people who have done poorly or had negative experiences and get gun-shy.

There are lots of people who have made a killing in real estate, and there are a lot of people who have been killed by real estate.  But one good thing I like about real estate is that barring a market collapse or significant "correction", you can't be completely wiped out.  You might buy a house for $100k thinking you can get $300k for it, and after cost-overruns on your rehab, some permitting delays and a sellers market, you only wind up selling it for $200k and no profits or some loss.  At the end of the day you still own a lot and/or house and it will still have value.  You might lose money on a deal, or your flip can go sideways on you, or rents might not be what you expected, but as long as you do your research and due diligence you won't be wiped out.

And in the name of everything holy, be careful about using leverage when you are new.  It makes getting into a deal much easier, but also makes it easier to lose your shirt if things go sideways.

Technology has lessened the need to be able to go out and "touch" your property, but wherever you want to invest you need to be confident in your systems and the team you have set up to oversee the investments. If you are comfortable not needing to be near your properties, then you should go after the areas with the best cap rates to maximize your ROI. If you need to be close to your investments, then look for the best cap rates within a reasonable drive of you. This is countered by your desire to move into a better school district, which complicates the equation. Given that, I would say A is probably your best option to get the best of both worlds. You aren't hitting the 1% rule, but that isn't always practical depending on the market. As long as you are getting some solid cash flow on your rental that is as good a start as any.

Stay persistent, keep pinging them every few days.  If they countered then they do want to sell, they might be trying to delay for another/better offer but it's only a no when they tell you no.  I can understand trouble with Docusign and Travelling, depending on how long it has been since you got these responses they could still be MIA.

like @Agi Anderson said, persistence pays off.  Don't mentally kill/write off this deal because then it will be gone.  Shop around for options if you NEED a property come August or before, but don't give up.

A lot of people get started trying to wholesale properties, as it involves locking up properties for a relatively small amount of money.  I generally see 5 day options for $100, with the idea that you then pass on the property to someone else for $5k+ than you are contracted for.  Most wholesaling involves a great deal of networking and marketing, so you will pay with your time more than your money to start investing this way.

It depends on just how much effort you want to put into your tracking, and how you have the campaigns set up.

I would imagine a spreadsheet with one sheet per campaign, tracking how many DMs were sent, how much it cost, when they were sent, and what the response rate was.  That should give you a feel for how long it takes people to respond and how many responses you have per hundred/thousand.

You are constrained by the current leases.  If there are options to get out of the leases early then you will have full legal rights to use those, but not to just cancel the existing leases.

Of course keep in mind that in terms of getting income from the property, making the sale contingent on eviction and/or removal of a tenant might upset the seller, and at best will drag out the process probably at least 30 days.