All Forum Posts by: William Amiteye

So we just purchased 11 units. There is a property manager on site who used to work for the previous owner. They made a side agreement where he, the property manager, is in one of the units and his rent is only $200. He was given a lease until 2025 at that $200 price. We don't like that one bit for the fact that the rent is too low and locked in for too long.
He also has his daughter in one of the other units. 
We don't mind keeping him but we are thinking of re doing his lease for one year, so he pays full market rent ($1000 per month) and we pay him a 'management fee' for the difference of his current rent and what the market rent is. This will be for 1 year while we assess whether to keep him long term or terminate him after the year depending on his performance.
By having him pay the full rent on paper, it will be good for the bank when we go to refinance.

Question for those with similar experience, is it ideal to keep a guy like this or is it better to start off anew or how will you restructure things?
Our concern is his connection to previous seller, him having his daughter in another unit and his really low rent AND him having his maintenance equipment on the property.
Thoughts or any additional questions you have before giving me your thoughts!

Investment Info:

Small multi-family (2-4 units) buy & hold investment.

Purchase price: $55,000
Cash invested: $20,000

How to BRRRR with tenants

What made you interested in investing in this type of deal?

Price was right

How did you find this deal and how did you negotiate it?

Off market. Reached out to owner who owned property opposite one I already had. First time she said yes she could consider selling. First, she agreed to sell, then a month later said no, then came back a month later and said yes. She then said she had another one that she could sell together with the initial one.
We closed the deal and we made off really well on both via BRRRR method.

How did you finance this deal?

Hard money at 8%. We took 4 months on both properties to buy, fix and refinance

How did you add value to the deal?

One unit had an empty apartment upstairs so we pretty much rehabbed the entire upstairs unit. The downstairs unit we fixed few issues and left it at that. We were able to triple the purchase price after refinance.
The second unit had 2 tenants on both units. We rehabbed both with tenants inside. We tripled the value of that as well. This was a good purchase!

What was the outcome?

we tripled value for each unit

Lessons learned? Challenges?

You can BRRRR a property with renters inside if they are willing to work with you. Win win!

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

no

Investment Info:

Small multi-family (2-4 units) buy & hold investment.

Purchase price: $55,000
Cash invested: $20,000

BRRRR

What made you interested in investing in this type of deal?

Price was right

How did you find this deal and how did you negotiate it?

Off market. Reached out to owner who owned property opposite one I already had. First time she said yes she could consider selling. First, she agreed to sell, then a month later said no, then came back a month later and said yes. She then said she had another one that she could sell together with the initial one.
We closed the deal and we made off really well on both via BRRRR method.

How did you finance this deal?

Hard money at 8%. We took 4 months on both properties to buy, fix and refinance

How did you add value to the deal?

One unit had an empty apartment upstairs so we pretty much rehabbed the entire upstairs unit. The downstairs unit we fixed few issues and left it at that. We were able to triple the purchase price after refinance.
The second unit had 2 tenants on both units. We rehabbed both with tenants inside. We tripled the value of that as well. This was a good purchase!

What was the outcome?

we tripled value for each unit

Lessons learned? Challenges?

You can BRRRR a property with renters inside if they are willing to work with you. Win win!

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

no

@Krishnarine Hardyal

I am in both Schenectady and Amsterdam and other surrounding towns. We’ve amassed about 40 units over the last year and a half.

You can certainly do it if you’re buying and renting without needing to do any rehabs. You just need a good wad of cash that’s all.

If you have limited cash then you'll have to rinse and repeat (BRRRR).

There are plenty of opportunities for straight buying. Cap rates in the 8-10 percent range will get you good properties. Just be careful WHERE you buy so you can attract good quality tenants as well as being able to exit easily.

Depending on your definition of cash flow, ie what are you subtracting from the gross rents, expenditure an average of $200 net per unit, which means about 25 units.

We BRRRR all our units so a team is important.

Goals are good, time frames are good but most important is just get started!

@Christian Valencia I am not renting to college students. I am actually running 5 aibnbs in those units next to the college which do very well. 
I do have many other regular rentals in neighboring towns that are starting to get attractive. 
nearby towns such as Amsterdam NY are starting to ‘buzz’ which is where we have done several great BRRRRs so far including a 9-plex. 
the new deals we got near union college were off market that we plan to fix and hold. 
At the end of the day many markets are starting to get interest in the upstate NY region. 
I don’t know much about endicott but I was interested in Binghamton NY a year or so which I see is not far From Endicott, but I never ended pursuing further. 
sounds like you got a good deal which hopefully will help give you an awesome experience. If it works keep going ...it’s all about the deal and buying right!

William. 

Hey Christian, I invest in the area including Schenectady. 
where did you buy the duplex?

I currently have a few near union college just off of union street. And just put an offer on two more right by the college. 
all the areas you mentioned are good if you find the right deal. That’s the key. 
- Eastern avenue: great corridor. It’s up and coming and the city is pumping a lot of money into making it a good corridor especially the side closer to Nott terrace. We flipped a duplex there 2 years ago and it sold quickly. 
union street : great street. Hard to find great deals but if you do, go for it! 
- stockade: this is one of the nicest historic areas of Schenectady. Hard to find deals but also hard to make any exterior changes as it is a historic district. Building codes  are much stricter. 
- scotia: nearby town. Haven’t done anything there but it’s a nice town over. Not sure if there are many deals to be had. I will stay in Schenectady. 
Glenville: pricier next town over area. Not sure if you want to start there. Great area though. 

Good luck on the journey  very exciting !

Hi Lauren, I do both. I have 6 Airbnb’s in Schenectady and I have 20 doors scattered around the area. And working my way to many more. 
I definitely enjoy the Airbnb more because it produces better returns and the clientele is very different. But it is a bit more involved in terms of your involvement such as keeping units stocked, arranging cleaning crew, sometimes catering to needy guests(which is an exception rather than the rule), but on balance, it is still great. 
Schenectady has good and sketchy areas. As a newbie, I hope you have someone on the ground to point you to decent locations so you don’t start off and be overwhelmed and give up before you get properly started. 
considering you seem so ready quit your job, keep in mind that this could be a long road if you don’t have enough to start and scale up fast. 
I highly recommend you have good people to guide you along the way. 
feel free to ask questions as you plot your way in and around. 
good luck. 
william. 

@Jonathan S. I am in a similar situation. We are about to close on an off market deal. Owner needs to sell to stabilize her financial situation but does not want to leave because she’s lived in the house for a while and wants to remain.

She wanted a 2 year lease but we were able to guarantee a 1 year lease with her rent being about $200 under market value.

Being in New York with tough tenant favored laws, we are writing the lease with rent at market rate but we will offer her a monthly discount to our agreed upon one year rent. If she wants to continue then she continues at market rate on signed lease.

This a first one for us as well.

We agreed to this rental deal and price because we are purchasing the property at almost half its current price market value.

It was a back and forth negotiation. They were quite adamant at their price but after Covid-19 lockdown we stuck to our lower offer considering the unknown future and risk, and that were we’re paying cash.

They accepted our lower offer which gives us a pretty fat buffer. It is a duplex that we were going to do a light rehab and rent so having a tenant to begin with ain’t too bad. We figured at $2400 rent loss for one year, is nothing compared to the price we are getting it at.

@Shawn Legree

Congrats on finally being ready to get into the game. Lots to learn but exciting nonetheless.

A few questions.

1. Are you talking having saved enough for a down payment or enough to buy and rehab? If just down payment how are you going about with rehab? Hard money?

2. Which part of upstate? It's quite big. I am situated in upstate NY in Saratoga county, just north of Albany, and I do quite a good amount of BRRRR and flips here.

I know many NYC guys coming up here to places like Schenectady (where I own a few units), Albany, Cohoes, Saratoga, Ballston spa etc etc.

and I also know many who drive further up to Rochester and Buffalo looking for deals.

plenty happening upstate.

But like any where else, run and stress test your numbers to make sure they work. There are lots of deals to be had.

Make those weekend drives. Nothing is better than boots on the ground!

My business partner and I are still moving full steam ahead with deals. We just closed on two deals and waiting to close on a third.

I have contemplated Connecticut as well. Will soon start driving out there to map out areas.

Good luck!

Investment Info:

Small multi-family (2-4 units) buy & hold investment in Amsterdam.

Purchase price: $30,000
Cash invested: $30,000

This was a wholesale deal that we purchase cash and immediately refinanced. Purchased at $30K and refinanced at an appraised value of $50K. No work done to it. Has tenants so this was an easy deal.

What made you interested in investing in this type of deal?

Someone came to us with the deal. The price being offered was below market and we knew this will be a quick flip without doing any work so we purchased it all cash and refinanced immediately to get our money out. We walked away with cash on this deal.

How did you find this deal and how did you negotiate it?

We advertised on facebook as buyers of properties. A wholesaler reached out to us with the deal. First time dealing with this wholesaler. But the deal looked good so we went for it.

How did you finance this deal?

We had just flipped another deal and used the proceeds to rinse on this one.

How did you add value to the deal?

We didnt. We knew we were being offered this deal at pretty good price. The property was already occupied by tenants. There is some work that will need to be done but nothing immediately.

Lessons learned? Challenges?

If the deal adds up don't hesitate. Go for it. If it is priced such that you can buy all cash and refinance immediately and recoup your cash, its a big win!

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

We mostly don't work with agents on the buy side unless an agent brought us the deal. Otherwise we go with the selling agent and usually we have them also represent us. This tends to give them an incentive as a dual agent. We sometimes get a great deal that way.