All Forum Posts by: Ross Lombardo

I'm currently at the Refi stage in the Brrrr method and I must say it has been very difficult. Banks typically like to lend money to people who don't need it.    I am applying to a small bank in Ct, but they still asked for 3 years tax returns for both my personal and business.  Add on another two tax returns from a real estate portfolio I have with a partner and that totals 8 tax returns I needed to supply.  I also had to fill out a Personal Financial Statement and jump thru a firey hoop. 

The property is flowing nicely, but it has not been seasoned for that long.  If I cannot do a cash out refi, I will not be able to afford my next property purchase (Repeat).  That might not be such a bad thing since the home prices are waaay overpriced. 

I am trying to be a bit more patient with my purchases anyway.  This buying frenzy that we all are experiencing cannot last forever.  What goes up MUST go down... Eventually.

It's a good formula.  Even if Moses didn't hand deliver it.  I just think to make it a bit more accurate, the multiplier should be more like .85 

Lets face it, we all are paying much more for these properties in todays market and the profit margins have gotten tighter. 

 Still beats my last office job!

You can make all the offers you want, but if you are relying on the (arv x .7) formula, I fear it will be a waste of time.  Here is my example:

  I bought a house in Norwalk Ct for $236k

  I put in about $75k in rehab

  The house appraised for $350k

If I used the arv x.7 formula:

(350,000 x .7) - 75,000 = purchase offer

245,0000 - 75000 = $170,000 ( Optimal purchase price}

Let me make this very clear.  If I bid even 230k for this property, I would not have gotten it.  Bidding 170k would be a total waste of time.

Maybe this formula worked 5 years ago but in todays market it is unachievable. 

Thanks for the speedy responses.  In my opinion it was a no brainier to go Pro.  I already received a great education lurking in the forums for the past couple of months.  Besides, I am dedicated to this, and I want to learn from the best.  

My competitive niche is that I can do all the rehab and landlord work myself, so I am hesitant to factor in a contractor/manager/handyman into my analysis. That seems counter productive for my business model. I already have 100% of my properties an hour plus drive away,  and it's a schlep to say the least.  Trying to bridge the gap, I have looked at several neighborhoods along my commute from NYC to CT, but I found that since I am not from these neighborhoods, I am at a disadvantage. It's tough to fix a leaky faucet while sitting in mid day I95 traffic. But it's still shearer than hiring someone else.  I would  like to keep my hunting grounds to about a 45 minute commute from my home. Portchester NY has shown the best potential thus far. 

As for financing: I have had to buy my properties for cash. The BRRR approach has been my only choice. When I finally am able to refi (fully rented units and great cash flow), the banks still make me put up 35% of the money. I am in the process of seeking out other lenders but their responses have all been the same. "No Soup for You!"

Hello everyone!  My name is Ross and I am greatful for all of the advice I have received on this site. I just upped my status to Pro because I am that dedicated to learning everything I can.  I am delighted to be part of the BP team!

I have been investing in Realestate for three years now and have accumulated 4 multi family properties with a total of thirteen units. All of my houses are in Stamford Conecticut because the yields were much higher than I was able to find in New York where I live.   My partner and I do 90% of the rehab work and are pretty much the full time landlords of the properties. We do everything from kitchen and bath renovations to screening new tenants to landscaping and maintenance. All of our properties have increased nicely in value due to our hard work.   Unfortunately, we have not been able to buy a new property for over a year.  We keep getting outbid, or the numbers just don't make sense for us to pull the trigger.  I have recently tried to broaden my hunting ground and am eager to get involved in the South Bronx and East NY Brooklyn areas.  Since I live in NYC, I would like properties a bit more local.   I feel as if I am spinning my wheels lately. All the properties I see are complete garbage and highly overvalued.  When I do my analysis the best cap rates I seem to get is 4%..., and that's with me going light with the expenses as well as being very optimistic with the potential rents.  I thought SoBro and East NY were still "untapped" markets, but it appears that there are no bargains to be had.  

 Is anybody else feeling my pain??