All Forum Posts by: Philip Calixto

@Nathan Gesner Yeah that's what I will be doing. A roofer will be going there in the next couple of days to check it out for a free estimate. 

Thank you everyone for your input.

Hi. My tenant recently notified me of a leak in the roof after some recent rain. My property manager went to check and says that the roof will need to be replaced. The property is 1025 sq ft. single story, 3 bed 1 bath in Missouri and the work will cost around $5000. From doing a quick check $5000 seems pretty fair. 

I'm out of state and have not seen the property for a few years. I've had my current PM for at least 5 years. The only problem I have with them is their accounting software and communication can be better. 

Whenever the PM say that a repair needs to be made, there's always a voice in my head asking "what if they're lying?" I haven't replaced the roof since I purchased. So it really may be due. But how do you know?

I'm sending a separate roofer to come and inspect. Is this bad business etiquette? I just don't want my PM to take advantage of me being out of state.

I need some tips on managing my manager. How do you other out of state investors verify the repairs that your PMs say need done.

Thanks


  

@Dennis Cosgrave ah yes, That makes sense. I forgot about roi. I wouldn't want to be in a hole in the first place, so maybe it would be better to flip?  

When looking for an area to BRRRR using 1% rent/price, do you use purchase price or ARV? In this case, ARV no?

@Jay Hinrichs 

I just saw some recently sold numbers on Zillow and just had a question. 

Thanks guys for the input though!

Hello BP!! My name's Phil I'm new. Thanks in advance for checking out my post. 

So yes, I'm reading about BRRRR and had a question during refi stage.

I understand that the main idea is putting in money into an investment, then taking it back out to go invest in another property. This happens after rehab and you were all-in at 75% ARV. Then you get a refi and the bank gives you back your 75%. What happens if you go all-in at less than 75%? This is because you buy very low compared to the market. I'm sure this can happen because it says it does in the book. And it's great.

However, you want to take out all that extra cash, but now the monthly payment on your cash out refi is too big for your rental income to cover. Let me break it down.

  Recently sold home that I saw on Zillow:

sold at $46,000

+rehab $24,000 (I made this up)

All in at $70,000

ARV: $340,000 (this is the Zestimate)

all in at 21%

Refi for 75% = $255,000 (daaaaannnnngg)

but now your payment on that refi is $1600/mo. but rentometer says the area rents for $1500 and you confirm it.

What do the real investors do? Do they just take back their $70K and leave the rest in equity or do they say "oh well this is no good. I'm just going to look somewhere else?"

I know I made up some numbers, but hopefully you get my question. And I know I could've searched harder for this answer on the forums, but I really wanted to say hi. 

Anyways, thanks for checking out my post.

Peace.