All Forum Posts by: Polly Wu

As for the CAP example ... yes of course there are more factors that were not covered in the simplified example, some to the advantage of the high CAP market and some to the advantage of the low CAP market ... text books could be written on all those differences, but the point is that a skilled local operator can select a property and investment strategy to make lots of money in either type of market ... just because there is a low CAP rate does not mean your total profits will be lower, just like having a high CAP rate is of no assurance that your profits will be high. This is the point that many newbies do not understand and the point I'm trying to drive home. That and a new investor will learn about all those nuances much faster and with much lower risk by operating hands on and local as opposed to hiring out everything and leaving it all to the kindness of strangers in an out of state market they no nothing about except for what they read on the internet.

Hi Polly, I agree with David Faulkner .
I think it is crucial that you look to your local market initially. To me, this is important for the simple fact that it's easier to learn the process if you can be more hands on with the deal.

The process includes the purchase, rehab, lease up, stabilized management, and eventual sale of the property. Each stage requires a certain amount of oversight with the most occurring in the first 3 stages.

You are likely more familiar with the market where you live, which in turn, will help you make better purchasing decisions. If you are an active BP member (listened to the podcast or read in the forums) you have heard the term "buying right" and know the impact that it this has on the deal.

If you want to become an active investor, learning the process from purchase to sale is almost as important as making the profit. Refining your process over time is what will make your craft replicable for future deals and future dollars.

Hi David, great point! A lot of info I came across emphasized a lot on how increasing NOI will increase the value, and I have not thought of the impact CAP have on Value. it is very valuable advise! Thank you!

I'm curious as to what specifically the one banker sited for denying your residential loan on an investment property? Was it lack of down payment? Your Debt to Income (DTI)? Some other underwriting policy specific to that bank? There is no other reason I could think of why you would be denied for a loan on a second investment property ... guidelines that I'm familiar with are that up to 10 conventional residential mortgages are allowed. 20 if you go with 10 under your name and another 10 under your husbands name ... so a bit surprised to here you are having trouble with 2 (or 3 if you include a primary residence) ... I would ask for the specific reason you were denied and shop around with other mortgage brokers (not necessarily direct with the bank).