All Forum Posts by: Nate Bell

Pay off your debts, work on building some marketable skills while you all get the best jobs you can, and save what’s left over from that $80k as an emergency fund until you can buy your own starter house. This is a 2-4 year plan, not 2-4 months. Be patient and work hard. 

I wouldn't recommend trying a first BRRRR long distance. Next to buying right, controlling rehab costs is the most critical part of a successful BRRRR. If you have minimal experience, you'd have a hard enough time coming in on budget if you could see it regularly, and almost no chance of staying on budget doing it remotely. I see you're in LA, and you probably feel like you have to look afar, but really, you might just be better off buying something turnkey and saving yourself 4-6 months of non-stop stress. Especially with all the shortages going on.

You need to be prepared to pay rent and a mortgage if the deal you’re looking for comes up; you can’t be that cheap in this market. 
Do not underestimate the need for adequate parking. Your life will be miserable if you have four or five roommates with parking for two. And don’t count a one car garage at the end of a driveway that serves as the rest of your parking as one of your spots- it’s going to become storage and it’ll be the most inaccessible parking spot of them all- not practical. 
Hot neighborhoods are a fine place to look, but in your situation, you’re likely to attract young professionals, so proximity to business districts and office parks may be more important and a little less competitive. 

This really only comes from experience, is hyper-local, and is very specific to the depth of the project, level of finishes, etc. You’re really best off just getting bids, especially in this climate with supply chain and labor shortages. You’re probably setting yourself up for unrealistic expectations if you try to estimate yourself without a catalog of prior projects to refer to. If you’re gutting it, doing plumbing, electrical, roof, hvac, paint, flooring and all the finishes, you could probably safely go by square footage at like $150/SF. Otherwise, there aren’t really rules of thumb, especially right now. 

“Fair” is very subjective, but if you each bring equal amounts to the table, you’re not really gaining much by taking on partners. If partnering would allow you to buy 3x as many houses, but you’re only getting 1/3 of the benefit, you might as well just keep doing them on your own. You’re taking a risk by finding/recommending the purchases, and you should be compensated for that. A 20/40/40 split seems more appropriate. Leave the 20% management fee out of the equation of what each party brings to the table. You’re doing ongoing work, and deserve ongoing compensation for that. 

A couple years ago I bought a condo with the thought that I would AirBnb it and use it some of the time. What I soon realized is that if I was using it, I was losing the rental income and I might as well go rent elsewhere. If the property you own will bring in a higher amount than a property you’d be comfortable in would rent for, don’t go into this with the thought of “using it some of the time”. It doesn’t sound like you have particularly strong feelings about where you want to spend your time in Florida, so why limit yourself to one town or even Florida for that matter? Buy an AirBnb in the best performing market, and then spend your time wherever you want in other people’s places. 

@Tracey Dixon

Can you afford the payments if you finance 100%? If you can’t afford a 20% down payment, 100% financing seems risky.

You should consider looking to buy something at 70-80% of market value, pay whatever down payment it takes to get that property, and then refinance in 6-12 months to get your money back.

@Payson Scott

This is a very personal decision, and you don’t mention what you’re studying. You also don’t mention if that $75k will cover the rest of your college, or if you’ll have to take out additional debt to finish.

If you’re not studying something your interested in and that has big demand in the marketplace, change your focus of study now. $75k, doesn’t go all that far and it’s more likely that you’d end up working low wage jobs trying to figure out how to pay your bills than it is that you find financial freedom through real estate without ever working a day in the real world. Your degree, if chosen wisely, has value that can can fall back on for the rest of your life and exponentially increases your earning capacity. Success is a marathon, not a sprint- don’t try to shortcut it.

@Dwayne Gilbert

Cancel your contact and have one of the two parties pay you on the side. You could use a promissory note to secure it.

@Stephanie Ro

I had a condo in Bend, OR for a year and hated it. Vetting an HOA's financials is about as complicated as vetting a multifamily syndication, but riskier in my opinion. I never felt like I "owned" the condo. It felt more like I was doing STR arbitrage. I'll likely never own another condo, and I'd recommend either SFR or syndication instead.