All Forum Posts by: Daniel Ortiz

Right now, I would be able to afford a property that is around 325K or less.  I've been looking at a lot of 2br apartments and condos in areas like Malden, Medford, and Swampscott.  I need to be accessable to downtown Boston, but also to the north shore as my girlfriend works frequently in those areas.  I would be willing to house hack while renting out the rooms in my own apartment to friends.  But my main question is whether I should wait to save more so that I can afford something with more rooms.  Buying a duplex in these areas would be at least 600-700K.  Should I keep spending 900 a month on rent or just get started on something smaller that won't save me much money but at least I'd be paying down a mortgage instead of rent?  I appreciate any advice!

Hi Everyone,

My wife and I are looking to buy our first multifamily to take advantage of the FHA loan in either north shore or Reading/Wilmington area. Based on this thread it seems like people are worried about Salem's housing bubble, but is that something to worry about on a buy and hold if we plan to keep it long term.

Also if anyone else is looking in the area I would love to connect and share knowledge.  I am a total newbie to real estate.  I am also looking for recommendations on an agent who might specialize in this type of property investing.

Thanks,

Robert Chain

@Daniel Ortiz What I'm looking for in ANY investor I work with (not just a new investor) is someone who is willing to make offers that are realistic.

I've had lots of discussions with newbies who have taken one of the many "guru courses" out there, and they really come away with some horrible information.

For example, homes in Plymouth County sold in the last month averaged 98% of list price.  If an investor wants to submit an offer at 80% or even 90% of list, and that list price is properly supported by the comps, we are wasting our time.

There are times when the list price is just unreasonably high and 80% can make perfect sense, but that's by far not the norm.

Likewise, if the property is listed on MLS I'm especially reluctant to submit "creative financing" offers. MLS listed properties get maximum market exposure and will sell at actual market value, +/- 3%.

When the market eventually shifts from what is now an almost unimaginably strong seller's market, it will be a different story.

For now, a savvy investor who is willing to take the risks involved, has the best chance of winning a property by doing a walk-through and then offering all cash, a high, non-refundable earnest money deposit, quick close (or seller's preference for a date) and no contingencies.  

That kind of offer will get you some discount, but probably not a ton.

@Daniel Ortiz  That is the smart strategy for the seller's agent, and it's one component of the formula I to help @Johnny Quilenderino to sell his SFR rental in Quincy at $59,600 over asking with a waived home inspection.  I just used it in Hyde Park to get another SFR under contract for my seller at $52,000 over asking.

I do get some off-market deals from wholesalers. Look in local REIA groups and call the numbers on bandit signs. Be prepared to show that you're serious about making a purchase.

There are lots of people - real estate agents included - who won't even call a newbie back, simply because so many are time wasters.

@Daniel Ortiz I get some off MLS. The key to success there is to be able to act very quickly.  You should be prepared to get to a newly listed property and put an offer in the same day.  You'll need a good agent to run comps at a moment's notice.

You might think that it's smarter to put an offer in sight unseen, but many agents (including me) will discourage sellers from accepting offers until the buyer has seen the property, as these offers are a lot more likely to be withdrawn. If you want to go this route, consider making at least part of your EMD non-refundable.

Of course, the strongest offers are all cash with the fewest contingencies.  If you can get your contractor / home inspector to view the property with you, and if you're OK with the obvious risk, you might consider waiving the home inspection.

By the way, a sharp agent will see right through the kinds of proof of funds documents that hard money lenders let you print out on your own. We know that there's still a strong chance that the deal will blow up at appraisal if the HML doesn't see sufficient value in the property. If you really want the best chance of locking a deal up - especially at any kind of a discount - show cash in the bank.