All Forum Posts by: Sarah Shockley

So this is a fairly common misconception...... in short, No.

The foreclosure process takes a looooooong time. Assuming foreclosures start happening this year (which is highly unlikely), best case scenario it will be 2022 before that inventory begins to trickle onto the market.

Florida is a judicial foreclosure state, which means that foreclosures are processed through the legal system. In 'normal' circumstances it's not unusual for this process to take over two years - often up to 4 years. 

First of all, usually a homeowner has to be over 6 months behind in their payments before the foreclosure process begins, and the recent government 'pause' on evictions and foreclosures will delay the process further. Even once it starts property owners are given many opportunities to catch up on payments and stop the foreclosure, and recent legislation will ensure that more assistance is available than it was during prior recessions.

Recent unemployment numbers in Florida are pretty alarming - but the data indicates that most who have lost jobs recently were making less than $40k/year. These are not people who own property; for the most part they are renters so they don't own any properties that could be foreclosed on.

That being said, I don't have a crystal ball. It is certainly possible that foreclosure activity could increase in the future, but regardless it will take time before we see any effects in the market. 

 

Hey @Aaron K. - I'm looking for Florida specific information (this is posted in the Jacksonville Florida forum.) 

That being said, I'm still interested in your general experience. You built one in Riverside CA?

Hello! I'm interested in building a garage apartment (over a carport) at one of my properties in Riverside. Has anyone done a project like this before? I'm curious what the permitting process is like, ballpark costs would be, and if there are any common pitfalls to avoid. Feedback is appreciated! Thanks

Hi @Pradhan Cadabam

I agree, the property taxes are too dang high!! Anyway, the Duval county website has a handy property tax estimator - here's a link:

http://taxcalc.coj.net/

For a $150k house the property taxes would be about $2700 - assuming you don't have a homestead tax exemption, which would reduce the taxable amount by $50k.

The rates for homeowners' insurance vary widely based on many variables - the age of the building, age of the major systems (roof/electric/plumbing/hvac), size, flood zone, and level of coverage desired. I don't own any properties out-of-state so I can't say how insurance costs here compare to other areas.

Hi @Lindsey Clark good luck with your deal!! 

I'm a buy and hold investor with 9 doors in Riverside, and without knowing anything else I'd say $215k for a triplex is a sweeeet deal.

Also the current tenants are definitely paying considerably below market. My cheapest apt rents for $750 and my 1-bedrooms are around $1k these days. Sounds like there's a good potential to increase rents, especially with renovations. One thing I will say is the the rental rate you can get in Riverside ranges widely depending on the level of renovation done. For that reason Rent-o-meter is almost useless. 

@Jack Bobeck is providing some good information regarding holding costs. Yes your property taxes will likely go up - and I agree - the property taxes are too dang high! However I disagree that your money would be better spent on a flip - renovating a 100-yr-old property from long-distance would be difficult strategy for a newbie - investing on hard mode for sure. Unless you have a background in historic building restoration I wouldn't recommend that.

That being said - definitely get an inspection and try to find an inspector familiar with old buildings. 1920s buildings have different common pitfalls to check than 1950s buildings and 1990s buildings. The most important things to check are things that are more expensive to repair. Other than the foundation; usually the age of the systems - roof, electric, plumbing, and hvac - can tell you if repairs/replacement are needed. I've had to replace the water and drain lines on all my multi-family properties, for example.

Also, separating the meters will be extremely expensive. If you're talking about electric meters that may be worthwhile, but separating water meters probably not. Most of my buildings I pay for water/sewer and include that in the rent.

If there are security deposits, have the seller transfer them directly to the new property mgmt company outside of your closing. If you include them on your HUD (closing disclosure) they can inaccurately be counted as a seller's credit - so keep an eye on that. I made that mistake once.

One aside - this is an off-market deal and there's a realtor involved?  Are you paying them out-of-pocket? At a certain point you might consider learning to handle the paperwork yourself. In Florida there are only 2 standard contracts - I'm a licensed realtor but I feel it's fairly straightforward for most deals. You'll need some negotiation ability, and also to be able to communicate your offers clearly to a seller, but I've found it worthwhile to diy in exchange for a price break.

We're out there!! I'm a buy and hold investor with 14 units (and two more under contract!!) in north Florida, and also am a licensed Realtor. I agree that BiggerPockets is very "Bro"heavy, for whatever reason. Recently I've reached out and found more female real estate investors on other forums/groups - specifically there are multiple groups on Facebook for female investors. Check out "Invest Her" which has local chapters all over, for example.

Surprised no one answered this! 

I have a recommendation - Jason Stevens with HomeVantage Mortgage. Not based in Jacksonville, but has done multiple investment property loans and cash-out refis on my properties here in town. Jason is top-notch and knows his s***. When I was first starting out he made a loan happen for me so I could purchase and refi the best investment property deal I've ever gotten - he's a creative problem-solver and I would not have achieved the success I have today without his work.

Hi @Soujanya Masna  - I'm a buy and hold investor with 9 rentals in Riverside. If your budget is $150k you're going to have a tough time buying here - right now there's only one house on the market below that price and it would require at least $60k in renovations.

The Riverside and (adjacent) Avondale neighborhood regularly ranks in the top neighborhoods in the country, and values have risen steadily for years now. I disagree with @Jake Sink s comments regarding "crime being more than expected". I've  lived here myself for over 10 years, as well as managing multiple properties in the area without issue. Sure, we get kids checking car doors at night but that's about it.

However what he mentioned about buildings being old is true - a majority of the properties were built in the 1920s and 1930s and are within a historic district so if you are not familiar with historic building restorations it would be a challenging area to own property in.

Honestly at that price point I think you will have difficulty buying in any neighborhood most would consider 100% "safe." But as for neighborhoods you might could find a sfh under $150k to rent out profitably, I have recommendations.

Argyle Forest - lots of 80s and 90s construction sfh and townhomes, so these properties generally just need small renovations

Lakeshore - 1940s homes, values rising, inside an "Economic Opportunity Zone" so some extra tax benefits to investing here

South Riverside and Lakewood - mixed bag of 1920s and 1950s homes, adjacent to some very nice neighborhoods

Arlington - large area with multiple sub-neighborhoods within, mostly mid-century homes, more cheap listings but not as nice of an area

Anyway I hope that helps. Good luck!

Is @Ronan Donnelly the only person on this thread who's actually bought from a turnkey provider? lol 

Good insights there - thank you for weighing in!

Since we're all just throwing unsubstantiated opinions around I'll add my 2 cents. 

Inventory is at historic lows in many areas of the country, which increases competition and prices. Turnkey providers are not immune from these market forces - and the returns they can offer are FAR below what an experienced individual investor could potentially achieve. At the end of the day, the point of investing is to turn a profit, so I don't see how buying from a turnkey provider is worthwhile.

(I am a buy and hold investor in Jacksonville with 13 doors, and live off my rental income.) 

Personally I'm not a huge fan of JWB (although I've not bought from them) but that is mostly because they throw generic builder-grade tract homes on every low-quality lot they can get ahold of - whose only value is their "newness" - then sell, rinse and repeat. The work they do doesn't really improve the areas they're building in. In ten years you'll own a house that's starting to fall apart on the worst lot in the neighborhood. JWB exists to make money for JWB.

You might considering being a hard money lender - they definitely get paid more than 6% - just sayin'

Hi @Dena Zeid - It's ok, I don't mind talking shop. I have two houses and 4 multi-unit buildings, all in Riverside, Avondale, and Murray Hill neighborhoods.

All of my properties have mortgages, but still cash flow enough to live off the profits - not too bad for 6 years of work! Basically I get good deals by making cash offers on properties needing significant renovations, and then my husband Jon and I do most of the work ourselves (I can use power tools and everything lol). Then we have totally renovated, basically brand new apartments to rent. Yes, I also do our property management.

We started buying several years ago when properties were on sale ..... it's harder to find "good deals" these days. Prices are just too high for most properties to turn a profit.