All Forum Posts by: Pat Lulewicz

@Stuart Udis no need to call people out for their suggestions when "based on the numbers [she shared]" good-ole, 4th-grade math says there's margin; make your point in a more worthwhile way...on Tgiving nonetheless.

If those are real numbers - flip it! You're probably in for $180k - $185k. After closing costs, you're probably netting $21k - $26k...if you're newer and this is a deal in your hands, I'd run with it all day.

Depends on your goals. Primary markets will continue to hold their value though tough to make them cash flow. Secondary markets will give you a balance of appreciation and cash flow if you buy in the right pockets and a good asset. Tertiary markets can be cash flow heavy but tenant/asset risk exists. You'll find turn key properties anywhere. Secondary/tertiary will give you BRRR opportunities. LTR, MTR and STR work in most larger markets (~top 30-40 cities by pop, or be proximity to metros/attractions/employers). Still landlord friendly. Still hungry lenders throwing loans around.

Highly recommend (I require) collecting first month's rent prior to handing over keys. However, there isn't a standard form like a NAR lease agreement; it just needs to provide some general information. PM me if you want to get my template of the form.

Federal programs will require you to use GC/licensed folks for a lot of the work and they will get reimbursed by the institution that your loan is with; many GCs don't want to wait on the float time of requesting funds and getting them.

Depending on the program and rehab/condition of the home, you may not be required to live in the home (think black mold remediation...bank isn't going to put you in a compromised position) however they may have min/max of when you need to move in. Just need to ask around and do some homework on the fed websites for the programs.

Is/are the loan(s) on the properties a high int rate? Higher than now? Only way to make refinancing work. Otherwise, it looks like you may have 1031'd into "bad investments" for the tax deferment but are now eating the cash flow as a result. 

Does the tax deferment still substantiate the negative C/F? Are they good assets (A class, good location, high demand)? If so - self-managing, for the good assets at least if not all of them) may be the way you help claw your way out of there. You probably also have an opportunity to trim some fat on your PM fees if you still want to outsource the management because that's heavy.

I generally think what "works" is based on your personal and professional expectations. To your points:

1) Comps imply residential properties; these will vary based on location as appraisers look at homes within X.X miles of the subject home that you're looking to purchase.

2) Cap Rates imply commercial properties. Is this the asset class you're looking to get into? If so, any specific commercial asset class? The cap rates range widely based on that too. Plus need to consider if you're talking about value-add properties or those that are already leased at market rates.

3) ROIs a bit "easier", but that needle can move based on your financing.

It may be more beneficial for someone to help or know how to help if you express your goals qualitatively or quantitatively.

Thanks for sharing, Isaac. Any more info you can provide on MSA, what your rents were before vs after renovations, what kind of renovations you did and the total cost, and your return profiles? I'm sure it would help a lot of investors, new and experienced, who are looking at multifamily projects in the Carolinas.

Go to any of the large, national hard money lenders, including the ones which advertise here on BP. I've been doing 80%s for the last 4 years, including COVID pull-back times. Rates do come up a touch vs 75%, but immaterial at the moment from the quotes I'm getting.

Congrats KT and look forward to seeing your around the Triangle next year. Growing business with networking is a wonderful opportunity, but with no experience in the RE space in the Triangle, I'd recommend you spend all of your time learning the market with this much runway. Master areas and neighborhoods, "drive to the areas" with google maps, etc. Its a complex and large MSA