All Forum Posts by: Owen Dashner

Do you attend meetups and the REIA in your area? This is going to be the best way to find someone you can learn from. I would also suggest approaching this more like you making friends than just looking to be a "taker". Think about how you can add value to someone or their business, regardless of specific knowledge of real estate. I'm sure you have experience, connections or knowledge that might be beneficial to experienced investors.

I am mentioning this because all too often experienced investors get approached by new investors asking to be mentored while offering nothing in return.  I would suggest a more informal approach - experienced investors are generally happy to share knowledge, but it can be a turnoff if the person asking is completely selfish about their intentions. 

On the other hand, you could pay someone for a more formal, structured mentorship and not feel bad about using their time. 

There are several banks in my area that do 80% LTV loans. Just keep asking around. They are absolutely out there.

You will likely not get an offer accepted if a foreclosure was recently listed. The more time on market and the more REO properties the lender already has on their books, the more likely they are to consider "lowball" offers.

However, one thing that generally comes out of offers on bank foreclosures is, you will generally get a counteroffer - so at least you know what their real number is.

Join all of the meetups in your area, better yet - start one yourself. See if you can work for a successful investor in your area in some capacity so that you can learn on the job. Listen to tons of podcasts. Work for a successful larger property management company to learn good systems and processes. Get your real estate license at a good firm with training and learn from an experienced broker.  Go walk through 100 houses so that you understand values.  Get to be friends with contractors.  So many ways to learn - good for you for starting so early.  Best of luck to you!

Are you just bird-dogging some leads? Or looking to get properties under contract to assign/double close? Or are you an agent looking for commission?  We need more details to give you the right answer. If you are wholesaling, you dictate the price. 

If you are just bird dogging some leads on vacant properties and he is doing all of the work, you likely will make quite a bit less (flat fees for properties bought).  But you could negotiate about anything - like see if you can get a piece of the equity in leads that turn into deals...  

I would recommend Yonah Weiss at Madison Specs, they have done cost segs for me and other investors I know.

Economic vacancy is very often overlooked.  Ditto with the time and cost (possible evictions) of getting rid of undesirable tenants, not to mention the risk of additional unforeseen damages when unhappy tenants have to move out.

Mom and pop owners are notorious for not counting expenses, not the least of which is their own labor and management. "Oh, my operating expenses are only 10% because I do all of the maintenance and mow the lawn and shovel the snow".

Weird situations are also hard to underwrite for, yet they seem to happen every few years.  Like you have a small fire in an apartment unit. Sure, your insurance might cover some of it, but you might also have $5-10K out of pocket, depending on your deductible and insured value.  

None of the work you described would require a permit in my area, with the possible exception of doors.  I would not get one for smaller cosmetic remodels like it sounds like you are doing.  

It's not the noise as much as it is the traffic.  Mornings and afternoons can be brutal with traffic near schools, especially on a 2-lane street.

With that being said, you may have a stay-at-home parent that doesn't have to worry about commuting during those times and desperately wants to have their child in a good area/school district.  If the property is in a top neighborhood like you say, it should appreciate just fine.

I always look for properties in desirable areas.  You may have a somewhat thinner applicant pool due to the traffic considerations, but I would bet you'll have good demand.  Lots of parents like to be close enough to school to walk their kids to and from.  I wouldn't let it deter you from buying it.

You are not taxed on your downpayment.  There are some details that are not clear from your original post (whether or not you have lived in the property), how long you have owned it, was it part of a 1031 exchange when you purchased it, etc.

In general, it's what you sell it for minus what you bought it for, then add back in any depreciation you have taken against it.  The amount left is your taxable gain.  The details above are important in determining if/how much you will be taxed on that gain.  Here is a page with further explanation and scenarios: 

Capital Gains Tax on Home Sales (investopedia.com)

*Not an accountant