All Forum Posts by: Matthew Bailey

So this is a deal that I came across, it’s out of my league but I was curious what you guys might think. It’s a vacation rental on a lake, for sale for 1.3M. They claim (an investor selling it) it has $190,000 per year in rental income (which could go up since the current owner lets family and friends use it some months for free. That’s a 1.2% rule on a property over $1,000,000. For comparison, I live in Silicon Valley. A 1.2M home here might rent for about $50K per year. Beside the volatility of the rental market (I assume it’s much more dependent on the economy and if people are willing to splurge for a vacation rental property at like $7k/week as the seller says) this looks kind of compelling. Ignoring the details of the property itself and just looking at the numbers, for arguments sake, what do you think? I can’t afford it, I buy and sell vacant land personally so this is out of my niche and out of my league but I have an interest in rental properties and this seemed like an interesting deal. I’d love to hear everyone’s thoughts on it, if not just for the conversational value. If you’re interested in the property I can point you towards the seller.

Hey guys, I'm looking to get into wholesaling and I'm about ready to get some actionable plans down on paper.  I'd like to get into wholesaling to generate capital to begin buy and hold and build passive income, you know the deal haha.  To do so I have prepared by reading a few books, most recently "The art of wholesaling properties," listening to BP podcasts, and reading BP posts. I have a ton of notes organized in a giant word document.  I want to refine this document into the first step of my master plan, wholesaling.  I will be writing subsequent posts for each stage of the process, i.e. finding cash buyers, finding deals, speaking with sellers, contracts, closing deals, etc.  These posts will be the aggregate of my notes from each source and what I believe to be the best/most effective way to go about becoming each step.  At the end of my series I will be hitting the "go" button and jumping in.  My hope is that as I go through this process of sharing my ideas I will be forced to analyze each step and fill in any knowledge gaps I may have taken for granted. This way I can really hit the ground running.  I would like to believe that I have some tips and tricks that I've picked up in my research into wholesaling that will provide value to everyone that reads the post.  Moreover I look forward to reading responses from you guys which may help save me from costly mistakes.

The first post will be "Finding Cash Buyers." So feel free to go ahead and "follow" me or "become a colleague" on BP if you're interested in reading through my process for any tips you may not have noticed or if you just want to be a great guy or gal and proofread my process!

Have a great weekend everyone!

-Matt

Hey everyone, my name is Matt and I'm new to the bigger pockets website. I live in Sunnyvale, California and I'm looking to build wealth and eventually achieve financial independence through real estate investing. I'm coming to bigger pockets after listening to the first 23 podcasts to fill in some of my knowledge gaps (pretty sure I'm going to listen to every single podcast by the way haha). I've read a bunch of books on different topics and I've got a whole bunch more stacked on my desk ready to go! I'd like to lay out my plan and see what you guys think. The problem is, I'm not sure what kind of numbers to expect in the bay area. So here is the plan and hopefully some local investors can let me know what to expect out of a rental/flip/wholesale/etc in this area.

I am particularly interested in multifamily properties to build cashflow. Of course in the bay area those are expensive and I don't have the money to get into those just yet, let alone purchase multiple properties. Therefore, I have determined that I need to use some other means to generate the capital necessary for the down payments for those properties, i.e. flipping and wholesaling. Eventually I would like to be cash flowing enough to retire and live off that income. This is where I begin to lack specificity in my master plan. Let's say I can get my hands on a quad for $1M. How much cash flow per unit should I plan on for this property, in the Silicon Valley, to consider this a good deal? Let's say due diligence completed, how much would a typical investor in my area expect to cash flow on each unit in order to make the deal? $100? $200? etc. These numbers will help me determine how many units I will need to acquire to reach my monthly cash flow target.

Once I know how many units I need, I can begin to determine how much capital I'll need to raise/create in order to acquire those properties. If each property is $1M and I need 200K to get in, how many flips or how many wholesales would I need to accomplish in order to acquire my income producing properties. This is where I'm hoping some local flippers and wholesalers might read this and say "if I can't make 40K or 60K or X amount of dollars on a flip/wholesale, then I won't go in." This will help me determine how many properties I'll need to flip/wholesale to reach my goals. I understand each property is different, I'm just hoping someone can chime in and say, "well, if you need 200K that's going to be # of flips in your area."

I am working on nailing down my due diligence by visiting and evaluating properties and trying to nail down rehab costs. I'm just not sure what type of profit margins local investors would accept or decline so that I can learn what my master plan really needs to consist of.

Thanks to everyone who takes the time to read this and I look forward to any and all feedback!

Sincerely,

Matt