All Forum Posts by: Matt Leber

@Justin Larese do whichever has better cash flow at the end of the day. One advantage to having two units vs one is that you are less likely to have both vacant at the same time. With a single family, if it’s vacant, you’re not covered at all. If it’s a duplex vs 2 singles on the same street I don’t see much difference. Other than that you might have 2 loans with the singles where you can pay one off before the other and snowball some payments. If that’s your goal.

@Keith Hackett as is true in a lot of places around the country. But that doesn’t mean there aren’t deals that cash flow. I’m a believer in NOT trying to time the market. Regardless of where we are in the cycle, if you buy it right you will be fine. There are no guarantees that lending or market conditions will be better tomorrow, so if you have a deal you in front of you, invest today. That being said, don’t buy a property that doesn’t work for your goals. Do your due diligence and consider different criteria or markets if you are not seeing anything that works where you are currently looking. Good luck!

@Jonathan Jaffe I use interior antique white Walmart color place flat paint on my rentals. Gives the place a nice clean feel and it’s the brand that gives the most bang for your buck. It probably doesn’t cover quite as well as other brands, but you normally have a second coat either way, so it gets the job done. I’ll use a semi gloss bright white on the ceilings and trim. In the bathrooms, I’ll paint with Zinsser mold primer first and then the second coat will be the Walmart brand. That helps block the moisture.

Exterior I will use a higher quality paint bc I expect to paint less often. Usually, I will see who’s doing a sale at the time and end up with Sherwin Williams or Behr brands.

@Minh Nguyen not sure what the differentiation is. I thought they would be one in the same.

Or potentially the “cost to close” would be the final, total amount (cost) you need to bring to the closing table. For example, your 20% down + all closing costs would be “cost to close”. But then the 6% estimate given would not really make sense. I’m sure someone who knows more about lending practices will be able to help you on BP.

@Minh Nguyen also, about the 6% cost to close, that seems like they might be giving you a ballpark estimate that is conservatively on the high side. Our properties were in the $150k range and closing costs were usually around 5-6k total. Which is in line. I wouldn’t expect it to be a blanket % of the purchase price though. But usually it takes 45-60 days to close and some of these were paid in the early weeks of that period and some at the closing table. My main point is, your closing costs will probably be somewhat spread out. If you are working a full time career with a good salary you shouldn’t feel too worries about it.

Closing costs will consist of broker fees, origination fees, points to lower your rate, inspection fees, survey fees, title and doc stamp fees, etc. the list can go on. I’m sure your broker can give you a better rundown. Also, most of these fees can be adjusted depending on the loan package.

@Minh Nguyen I would call around. I know from my experience that they will usually need some “work experience” going back longer than 6 months, but they should be able to satisfy this requirement if you say you were a college student during that time. Eventually you will need to provide transcripts. At least that was my experience when I started investing soon after graduation.

@Luis Bolanos III I think you should go for it if you have the down payment and are knowledgeable about your market and you are confident the numbers work. Nothing will do more for your learning like jumping right in. Just be sure you’re numbers are correct. I wish I would have started in college and rented out to my friends.

However, I would consider waiting if you know you will be moving far away for your career. Unless you were already planning to invest at a distance, then I don’t see an issue. Just something to consider. It will be easier to manage and learn from your first investment if it is local.

@Nathan Simons I wouldn’t kick them out so quick, but that’s just me. In Florida, 5 day grace period is standard. Not sure about your area. Once you learn the local law, make sure to post a 3-day notice to pay or quit as soon as you can, even if you suspect they are going to pay you by the 8th. If you don’t post the 3-day and wait till the 8th, if they fail to pay, you can’t just start the eviction right then. The 3-day has to come first, then the waiting period. It starts the clock in your favor. This is why it’s so important to do that part as soon as possible.

As far as the eviction goes, I would post the 3-day ASAP and then wait until the 8th to collect. If they are playing games, start the eviction on the 9th. If you give them a chance to pay on their promise date and they were being truthful, you will have avoided a lot of time and cost associated with filing the eviction and then cleaning/fixing up the unit, marketing, and not to mention vacancy. If they do pay this month, be sure to remind them firmly that if they are late the next month you will not give them a second chance, and you will start the eviction process as early as possible. Just me.

@Shane C. Downs it started when I saw my college landlord charging high rent by the room and thought “what a smart guy!”

Went on to buy a foreclosed house on Hubzu that would work as a rental but that I would live in with my wife for time being.

Jumped in with our first cash flow rental purchase 6 months after!

@Aline Zamora we have some small multis in 32210 on the west side. It is west of i295 and south of Normandy Blvd. I would say it’s a C+ neighborhood, but we’ve had success so far. They bring in ~1.8% rent/purchase price ratio. Seems to have less crime than the “red” areas east of i295 and north of i10. I’ve spent a few nights working on the units until midnight and never felt too bad about it.