All Forum Posts by: Matt Leber

@Joshua Zlatkin I have a 4% fixed rate HELOC on my primary. So far we have kept a zero balance but it's nice to have some cash on the sidelines in the event a slam dunk of a deal comes my way or a large CapEx item on one of my rentals.

@Harvey Corsino

We do not use a turnkey company. Why do you ask?

@Peter Aziz for CapEx accrual, our rentals usually range between $150-200, which is somewhat dependent on the property itself. So your number seems reasonable at the bottom line. Property management at ~12% is also a good assumption based on my experience. Our PM charges 9% of collected rents but there are additional ancillary fees and lease turns etc, as you have stated. Vacancy at 10% is reasonable, maybe a bit conservative depending on the market. But honestly, its better to run the numbers conservatively and overachieve your projections later, in my opinion. Looks good!

@Jeff Jansen Have you checked the biggerpockets marketplace? I’ve seen a few deals on there, not sure about your area. Also, attend a local meetup and maybe you’ll network with someone who has a property for sale. We recently purchased a couple duplexes off market from a gentleman who was liquidating his portfolio because he was in retirement mode. Met him randomly at a birthday party for a family member. It may seem like luck but networking can lead to good things.

@Ahmed Al-Absi I’ve used Zillow in the past and would recommend it. I’ve also had good success with Facebook Marketplace. I would recommend that you search for local Facebook groups, example: “(insert your location) Properties for rent” and join a few of those groups. When you create your Facebook marketplace post, it will automatically ask you if you want to share it out to those groups. That way you hit multiple pools of potential leads across Facebook. Leads will then contact you through messenger.

@David Wagner 1st property: 20% down conventional MLS

2nd: 20% down conventional MLS

3rd: 20% down conventional MLS

4th: 25% down conventional off market

5th: 25% down conventional off market

Don't like PMI and my wife and I save half of our income to invest so we have been able to do 5 properties in 3 years. We also opened a fixed rate HELOC on our 1st property in case we need to tap equity to invest or use for CapEx. Haven't tapped it yet though. The last two deals were multifamilies so they required an extra 5% down.

@Steve Emling My wife and I made only one offer to get our first rental property back in late 2016. I think the fact that it had tenants that still had quite some time left on the lease may have been unappealing to others. Turns out they’re awesome tenants though, we still rent to them! We only spent one day physically seeing properties.

9 months before that, we bought out primary home - also the first house we “saw”. Made a couple bids on Hubzu and got a great deal on it! It’s not a rental yet, but we bought it with the mindset that it will be part of our rental portfolio one day. Most importantly the numbers work, and for the time being we love living in our area with an affordable mortgage.

We had a few offers rejected on different properties while we were looking for deal #3. Maybe 3 or 4 offers before we finally landed the right one. Deal #4 and #5 were off market so we didn’t really have much competition.

@William Robinson I would recommend running the numbers with CapEx, vacancy, and routine repairs all around the 5-7% mark. Speaking from experience with our duplex properties.

I agree with @Erin Legler that it seems like single families are starting to slow down a bit here in Orlando.  Multifamily properties are hard to come by with how high the competition is for them.  However, there seems to be a fair amount of odd properties in this area that are zoned single family R1 but have additional dwelling units.  Not sure if I would touch those, though.

@Frank Nabors if you need help analyzing, Brandon Turner’s book on rental property investing has lots of actionable investment tips. My advice would be to create a simple spreadsheet that allows you to plug numbers into again and again.

As far as whether its better to pay of the mortgage quickly or not, that is up to you. Both are legitimate strategies. One strategy will allow you to use cash flow to reinvest and grow quickly and one strategy will give you peace of mind. It’s depends on what your strategy is.