All Forum Posts by: Paul Honen

Investment Info:

Small multi-family (2-4 units) buy & hold investment.

Purchase price: $319,000
Cash invested: $17,000

Triplex bought via House hacking

What made you interested in investing in this type of deal?

Just wanted to get feet wet in real estate investing. Also fairly low barrier to entry

How did you find this deal and how did you negotiate it?

MLS and through an agent.

How did you finance this deal?

FHA loan

How did you add value to the deal?

Raised Rent, had to get some plumbing done and will have to renovate one of the units when some of the tenants move.

What was the outcome?

Getting my Mortgage mostly paid (have to pay around 41$ out of pocket)

Lessons learned? Challenges?

So far, learning how to handle tenants and handymen.

The previous owners really didn't put lots of care into doing things the correct way as far as repairs go.
Inherited some tenants that might be trouble, too early to tell.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

Worked with Sean Smith as our Realtor. Really helpful and a great contact for beginners.

Awesome. Do you happen to have Jack's contact info you can PM me? 

Thanks. I'll look them up!

Does anyone know any investor friendly Insurance brokers in Chattanooga, TN? 

I'm under contract on a tri-plex and have just started looking at insurance quotes. The quotes I have so far seem a little high, but I'm unsure to be honest. The lowest one was 187 a month, which I could live with, but I'd like to get advice/more quotes from a recommended broker if possible.

Hey Everyone,

I'm interested in hearing the different ways people have found there partners and what was the first deal you both(or more) went in on?

I'm on the verge of closing on my first real estate investment deal and I'm look towards the future. My goal is by the end of next year I'll have my next, might need a partner though. We shall see.

@Heath M.

We are selling our SFH for a few reasons. We need the FHA loan but also the appreciation on our current residence gives us a good amount in reserve.

The multi family is near bonny oaks dr.

Thanks everyone, not too long after I posted this I asked my agent to go through and put forth the offer.

@Jeffrey Holst Very True. Thanks.

@Alexandra Hughes I currently own a SFH that we are selling. We are putting in an offer on the triplex so we don't own it yet. However, it does seem like it would be a very similar situation to the one you started with. Thanks.

@Benjamin Bleasdale the 560 a month is how it should operate once I'm out of the house and it is fully rented.

@Jonathan Greene it is repair and capex reserves, based on past maintenance cost on the property including big repairs since the seller bought the property (along with just some general estimates for the area). We've already went and looked at the major problem areas that might need fixing in the units. I've been pretty conservative with my numbers and wary of those provided by the seller.

I'm evaluating a property so I'm going to use calculations, it's going to be inspected so I'm going to make sure to get life expectancy on everything and negotiate with the seller on price or repairs. I'm not sure exactly what you are suggesting I do more of, reserves are for when the "furnace breaks" and having them included in the calculations and put aside every month makes sure that I'm not **** out of luck "when winter comes."

Looking to house-hack a triplex in Chattanooga TN, where the numbers are showing me paying/reserving a little more than half my current mortgage (889) while I'm staying there, which comes out to about 544.92 that must be paid/reserved each month, but once I move out and get it fully rented, I'll be making 186.69 per door (560.08 overall) per month.

I was coming into house-hacking hoping to get my entire or at least most of my mortgage paid for. Am I allowing that hope (of being mortgage free) to cast doubt on a good investment overall?

Hey everyone,

I was reading this blog post by J. Scott: 

https://www.biggerpockets.com/blog/2010-06-30-introduction-to-real-estate-analysis-investing

And it outlined some calculations for multifamily homes (COC, NOI, Cap Rate, ect.) and I decided to make an excel sheet that would give them to you if you provide the inputs. I know BP has some calculators that help out, but I don't think they calculate these directly (or maybe they do, I don't really know).

Anyway, I thought it might be useful for newbies trying to get some analytics on some trial house deals. Of course you would need to know what all the metrics mean, but that is in the blog post.

https://drive.google.com/file/...

As I'm also a newbie, take the calculations with a grain of salt. Let me know if there is anyway to improve this sheet, or if it is unavailable as I might need to make a new link.

Thank you everyone,

Paul

@Kelly Rastatter I've signed up. Can't wait to meet you all!