All Forum Posts by: Paul T.

@Josh CaldwellThanks Josh. My current attorney leans toward having me pay the double closing. He is great for everything I've done so far, but perhaps I should seek out other attorneys for closing.

5% transfer tax! That's insane! I am Harrisburg metro area, as far as I know it's 2%, but I'll double check.

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This has been asked a few times on this forum before, but I want to get fresh knowledge or experience: When you wholesale in PA, do you have to go through a double close, thus deal with a double transfer tax? This is significant because there is a 2% transfer tax in PA.

The best suggestion I've seen so far is to record an option with the seller, then have your end buyer pay you a "release fee" for you to unencumber the property. See the comment here https://www.biggerpockets.com/forums/93/topics/403...

Will that work? What do wholesalers do here?

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Originally posted by @Llewelyn A.:

Interesting Thread, I have to say!

I have been an Investor for 21 years and own $20 Million plus of Real Estate.

I became a RE Broker a year ago.

I will say that if I, as an Investor, were introduced to ME as a RE Broker.... I would be buying from ME!

Or is this getting really confusing?! haha!

Not only am I a skilled, proven Investor, but I can fund your multi-million dollar deal or at least point out a few lenders who can!

I will also tell you if you are buying in my market, and I really like your deal, I'll ask if you want to Partner for the deal.

What this does is two things. 1) If I am willing to Partner with you for this deal, IT'S a GOOD DEAL and 2) I'll also Manage our Investment cheaply. Additionally, you can learn as much as you can from me.

SO....... if you refuse to at least look into the right Broker..... you will miss someone like me! :)

Haha... anyway.. I'm touting my own horn a bit here, but I often wonder why I have friends and family who are not successful wind up with either no Broker or a Different Broker?! Makes no sense to me!

I'm sure investors would love to work with a broker like you in their markets. The problem is, everyone can talk the good talk, how do you really know who is a good broker in your local market?

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@Account ClosedCan you provide some insight into capex? With such low rents, can you still profit when you have to set aside funds for capex?

I agree with you on how overrated peoples' opinions on low end areas is regarding tenant damage and safety. I have spoken to a few trusted contacts of mine who specialize in this sector, and they reveal that while tenant turnover is more frequent than B class areas, turnover cost is almost nothing because you don't have to make it look nice for the next tenant. They are in poor areas, but not "war zones" with mostly boarded up houses in the block.

In my opinion, the overlooked concern is the capex, which does not necessarily scale down with the lower market rents.

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@Josh Caldwell @Chris K.Harrisburg and Hershey area. I talked to a real estate lawyer referred to me and he said he's never seen this done, even after working with dozens of successful real estate investors.

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Can anyone recommend a lawyer who could close subject-to in PA?

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Are you guys able to do this (rental arbitrage) with apartments/condos in your market? In mine, I don't think STR income is much higher than LTR income for 1 or 2 bedroom units.

However, whole houses or townhouses look good.

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Originally posted by @Joe Kim:

Originally posted by @Paul T.:

@Joe KimInterested in seeing your numbers for Atlanta and Indy . I am trying to break into a tertiary market, but I still need to analyze the numbers. I don't know if it will really work if I rent at market price then run STR on top of it. Might have to just buy with large down payment to make the numbers work. Only seeing gross rent about 2X of LTR rent.

Now, I'm getting gross rents between $3000-5000 (peak)/month per unit. so on average around $7000/month

So let's do the ROI math. since my expense are EXACTLY the same in terms of PITI - $1200/month.

Instead of $2200/month rent for traditional rentals, I'm making $7000/month.

Instead of net cash flow of $600/month (which by the way got completely destroyed by the one eviction) vs. $5500/month.

I would say that's pretty close to 10X "forced" cash flow.

WARNING- INDY is a very competitive market for Airbnb. Already a veteran host who operated closer to downtown area shutdown his Airbnb homes since he was not making enough money. Not everyone makes money doing STR.

Thanks for sharing. How are your expenses the same when you have to cover utilities for airbnb, and I assume your cleaner handles turnovers themselves so you don't have to pay a co-host? Co-hosts take 20-50% and that wipes out the profit most of the time.

Why do you think some hosts fail while others succeed? What makes yours succeed over the veteran airbnb host you mentioned?

2 Votes

All Forum Posts by: Paul T.

Paul T. has started 7 posts and replied 33 times.

Post: Rental Arbitrage -how to do airbnb without BUYING

Post: Rental Arbitrage -how to do airbnb without BUYING

Post: Wholesaling in PA and double transfer tax

Post: Wholesaling in PA and double transfer tax

Post: Why Do I Need A Real Estate Agent?

Post: I Made Huge Returns on Low-End Rentals and You Can Too!

Post: Lawyer in PA who could close subject-to?

Post: Lawyer in PA who could close subject-to?

Post: Leasing a Property or Apartment for AirBnB

Post: $200,000+ rents in 1 year - 10X cash flow