All Forum Posts by: Rick Albert

Thank you both! 

I am considering flipping in Birmingham. My concern is that I'm out of state. I know they can take photos/videos, creative payment schedules, etc. but often times that isn't enough, especially when it comes to the little details.

Have you experience hiring your own project manager to assist with things like this? What have you seen? What was the payment like?

Any assistance would be appreciated.

Thanks!

This is a tough question because it depends on (1) price and (2) your target buyer. You will find a buyer for all these categories at the right price.

The question becomes, what's the worst that can happen? It is all about calculated risk.

Are you buying the properties cash? Worst case you cash flow really well. Even if you end up leaving some money in the deal, it's no different than if you bought it traditionally. And even then you might end up cash flowing better because of the smaller loan amount.

I've done it once and in the process of doing it a second time. This second time there might be money left in the deal but I have to wait 6 months anyways and it is already rented out so I'll make it up in cash flow. It's a win-win. 

Hello,

Would like to speak with a few contractors in the Birmingham, AL market. Considering flipping but I do BRRRR (working on my second one now in BHam). Any referrals would be appreciated.

Some things I'm looking for:

1. Can provide recommendations from current and past clients, ideally with contact information.

2. Can provide before and after photos of past projects.

3. Has experience working with investors.

Thank you!

Whenever you do FSBO, it's generally two types of contacts that will reach out. The first are Realtors trying to get your business. The second are investors who want it at a discount. There have been numerous studies that have shown that FSBO homes sell for much less than if they paid an agent. And I'm unbiased here because I'm not an agent in your market.

With that said, it doesn't really matter if the tenant leaves or not. Either way an investor is likely to buy it.

In terms of going after the Seller, it is all about knowledge. They may have done the work without permits and did not know it. You would have to prove that they had knowledge of the lack of permits. Most cities provide access to permit history. It is part of your due diligence.

The town doesn't have to have proof. If they don't have the permits in their records then it is what it is. Governments are monopolies and will do what they want.

Just be nice with the City and do what they ask. Keep in mind some inspectors think they are gods. Play well with them and you will move things along much nicer.

The reason why people are suggesting you get a pre-approval now is because you need to see where you stand. If I'm going to be honest, the majority of the time I meet clients who think they qualify for $X end up qualifying for less. It would be good to know where you stand today and then you can take the necessary steps (pay down debt, work on your credit, get a side hustle, etc.). Knowing your constraints helps you in better planning.

This is what we did recently, even though we are looking to buy a new primary next year. We wanted to see what we would qualify for and what we needed to do in order to put us in the best position going forward.

Even if it does ding your credit, typically it bounces back after paying off a bill, etc. Plus on a practical basis as long as you are over a 740 credit score, it almost doesn't matter. Talk to a direct lender to confirm.  

Hey Anissa,

I'm a 2x LA House Hacker here in LA (and a case study in the BP Book, The House Hacking Strategy). I also own properties out of state.

Happy to discuss your goals and see what makes sense. Most of my clients are house hackers where we have been able to expand their portfolio both here and out of state.

It can be a factor but it just depends.

You used Texas as a great example. They don't have state income tax. So as an out of state investor, the higher property taxes are a turnoff because I don't really benefit from the no state income tax plus in real estate there are tax write offs. So one argument can be that you need to find a hybrid of low state income tax (where you have write offs anyways) and lower property tax.

It is a factor in your net cash flow but that's about it. If the numbers work, go for it. If it doesn't, move on.