All Forum Posts by: Paul De Luca

@Rochelle Fernando

I agree with @John Warren. Go in with the expectation that in this current environment it's going to be difficult to break even, let alone positive cash flow. It's not impossible, but you need to (1) make improvements to the property & raise rents (2) take a longer time horizon (3) buy in "up & coming areas" on the fringes of more attractive neighborhoods. 

It's way more challenging to get the numbers to work at higher price points. I've sold several house hacks in the past few months but they were all below $650k and did generate positive cash flow once fully rented under the assumptions the buyer will make cosmetic improvements and eventually rent out the units at market rates. And these were all in C class neighborhoods.

Don't look for a home run deal in this market otherwise you will likely pass up decent opportunities. If you can reduce your housing expense by thousands of dollars over the course of a year, that's still a massive win.

One strategy you can use to improve the numbers is to negotiate a large seller credit and then apply that credit to a rate buy down.

@Brian Berry

Check your lease and investigate CHA's rules for terminating or not renewing her lease. You should also notify her if she is violating the lease terms.

Most leases in my experience say you have to provide 24-48 hours notice for access to the property for you or your contractor.

@Mark Ainley can likely give you some advice on how to handle this situation.

@Gregory Schwartz

If you're looking for a specific answer and want it fast, using ChatGPT could be more efficient than trying to sift through the forum posts on BP. Although I've usually been able to google the specific question I have along with "biggerpockets" and that usually gets me the results I'm looking for.

ChatGPT is a useful too but in my experience it won't offer dissenting opinions or alternative perspectives right off the bat like you see on the forums. You would just have to be sure you prompt it with the right questions to get those different opinions/arguments.

@Evan Alexakos

I agree with @Nicholas L., $13k is too little to get started with flipping, at least in Chicago. Most fix & flip lenders will require 10-20% down.  

I've bought house hacks with less than that but that still leaves you with little to no reserves. I recommend saving up more cash to get closer to $20k and then use that money to either (1) do a house hack (2) live in flip to put 3-5% down and fix it up over 1-2 years.

If you can partner with family or friends for your first deal, that should expand your options. Definitely worth exploring.

@Jonathan Alvarez

I recommend getting started by house hacking, ideally a 3-4 unit property for better cash flow potential. $30k should be more than enough cash to purchase your first house hack, especially if you're using a VA loan (0% down), although by putting 0% down your expectation for cash flow should be pretty low unless you're making improvements to the building.

For paying off the debts, I recommend focusing on the credit card debt.

@Svend W.

I agree with @John Warren. It would be best to outsource this to a landscaper.

We've had issues with tenants leaving their dog's poop in the yard, so our landscaper charged us for that. Since we were repeatedly getting charged for this, we passed the cost along to our tenants. And what do you know? The tenants stopped leaving dog poop in the yard. People respond to incentives.

@Brian Detlefsen

I agree with @John Clark. She has shown herself to be indecisive and a time waster, which is a red flag. Trust your gut and ignore her.

@Mario Morales

We haven't had to replace a specific piece, but we did have to replace a small section one time after there was water that got under the flooring due to a leak. Didn't have to redo all the flooring because of it though.

@Jay Garrison

Definitely connect with @Jonathan Klemm to see if he can help. If you need a few other recommendations feel free to PM me.

What's the scope of work?

@Mario Morales

I'm a fan of LVP flooring. It looks good, it's durable, water resistant or waterproof, and it's affordable. I think the only brand we've used is TrafficMaster and click-lock. I believe each time we also had a an underlayment installed to reduce noise. Overall we haven't had many issues. 

Sure there is wear & tear over time but it's held up pretty well.