All Forum Posts by: Riley F.

I'm looking to build some new construction in Scottsdale, AZ, and am in very early DD. A couple of quick questions for your Scottsdale vets:

1. What price/sqft (roughly) can I expect for contractor-grade new construction in Scottsdale?
2. Can anyone recommend a reliable contractor that does new construction in Scottsdale?

I sold the duplexes. I will never do that again. You're drastically limiting your customer pool, which is the exact opposite of what you want to do in multifamily housing.

I don't think I would touch the deal you're describing with a 10 ft pool. You are basically going to own 1% of the housing stock in a very very small town. It could go well, but it could not. I'm leaning toward the latter. If you ask me, which you didn't, Don't do it.

I don't usually chime in on this stuff, but this idea that equity is dead money is nuts to me. 

If the market keeps going up, yeah, equity is dead money. Equity isn't dead money in a drawdown environment. And my crystal ball is broken. 

This idea that equity is dead money is largely the cause of forced sellers at the bottom of the market. Rents drop, you have a 5-10% equity position on your properties after the drawdown (if you're lucky) and you're tapped out on capital because cash is "dead money" too. And look at that, a roof and two HVACs go. Forget the other side of the equation that you can't be a buyer without cash, so you forgo opportunities as well.

I'm not saying people need to batten down the hatches, but I am saying having a nice equity position and a strong cash cushion is prudent, not stupid. Cash and equity give you options, and options have a positive value.

There is a reason people look at DSCR AND net debt to EBITDA. Your balance sheet is going to be an absolute mess if you operate like that and go into a drawdown.

Originally posted by @Account Closed:

@Craig Kleffman - I'd say I learned a few things, and a had a couple of successful deals out of these mailings. 2 to be exact, which ended up with a positive ROI. I'm not really mailing anymore, because I'm too busy with work to handle the call volume and follow up in a way that I think it should be handled.

My takeaways aren't going to be news to anyone who reads the wholesaling forums, but I'll summarize them anyway:

1. Wholesaling is a volume game - get a large quantity of letters out there with quality copy and you will get calls
2. What you do with the calls is just as important as getting the phone ringing
3. Wholesaling is a lot of work, this is NOT passive income
4. I think the reason people say you need repeat mailings is because it appears that way, in reality though, I think people get your letter and hold on to it, and may call you 6 months down the road from a piece you sent long ago. If they're not distressed or selling when they receive your piece, they aren't going to call you.
5. There are deals to be had with just about any list, but fertile lists will yield more results than infertile or overworked lists (read absentee). *duh*
6. I think yellow letters work FAR better than post cards for generating call volume. I'm not sure about close volume, but that's been my experience. 

Hope this helps. 

Anthony, one is occupied, one is vacant. Thank goodness I bought these at 2% rule, or I would be hurting for the cashflow.  

I also bought a pair next door to one another, so I almost think of them like a 4-plex.  If1 unit is vacant, I'm still cashflowing on the other 3.

The property manager is the same that I've been using for the rest of my properties. Met him here on BP. 

If I were going to give advice to someone buying rural properties, it would be either:

1. Buy  a number of them so you can weather the vacancy for a single unit
2. Have cash reserves to weather vacancies
3. Make sure they underwrite well at 16% vacancy - JUST IN CASE

We will see. I just had 3 units come on line all at once. We are turning them right now, will see how it goes!

I think I speak for everyone when I say "Congratulations" and "How in the world did you land her?"!

Hello all,

I am an out-of-state investor out of NYC, and am starting to shop for small residential properties in Philadelphia a bit, in particular Fishtown and the adjacent. I'm planning a trip to the area in the next month, and would love any agent recommendations or anyone that I should meet while in town.

Many thanks.

Thank you for the recommendations!

Probably the wrong forum section for this question - I just noticed. Apologies for the inconvenience.

Hello all,

I am an out-of-state investor out of NYC, and am starting to shop for small residential properties in Philadelphia a bit, in particular Fishtown and adjacent. I'm planning a trip to the area in the next month, and would love any agent recommendations or anyone that I should meet while in town.

Many thanks.