All Forum Posts by: Sam Lewis

Hi there! Looking for one ticket, feel free to message me 

Hey folks! Title says it all - looking for someone who is selling their BPcon ticket. Feel free to reply to this post or send me a private message!

Hey Dulce! Welcome to the forum. 

My best advice is to network with other local investors in your area, see what investing strategies are commonly working there. In the same vein, I would find a local realtor that can put you on a daily MLS update for listings in the towns that you are interested in. By searching through these listings, you can get a very good idea of what properties are selling for in your area. 

Truthfully, there is no better data than driving and exploring neighborhoods you may (or may not be) interested in. While comparing boots on the ground data with your MLS portal search, you can then switch your focus to a neighboring town where the prices might be more conducive to your particular strategy (buy-and-hold, flips, etc...).

Book list

A few books could really help you out, and ones I've read at least 2-3 times:

• The BRRRR Book by David Green
• The Book on Rental Property Investing by Brandon Turner
• Rich Dad Poor Dad by Robert Kiyosaki
• The Richest Man in Babylon by George Clason

Hey Gina, what I've found is that greater Baltimore has fewer multifamily properties than other parts of the U.S. - a lot of the traditional househacking - living in one unit and renting out the rest is harder to apply here. What I've done is curated multiple househacks in student and young professional hubs such as in Towson and Federal Hill - in these cases renting by the bedroom. 

My general advice would be to determine whether you are open to renting by the bedroom, which would require you to share common area space with roommates. In 95% of cases, I recommend finding a single family home (SFH) in the suburbs of Baltimore (think Anne Arundel, Baltimore, Howard counties, depending on where your work is) and renting to 20-somethings.

Key criteria for a successful SFH househack:

• Suitable zoning criteria, i.e. room rental laws (county by county)
• Within 1 mile of hospital, major company HQ, public university, and private university (to attract 20-somethings)
• At least half as many bathrooms as bedrooms (i.e. a 4 bed / 2.5 bath could work, but 4 / 1.5 could get sticky)
• Plenty of driveway space / street parking (1 per roommate)
• Plenty of kitchen space (since the kitchen is the most occupied room other than individual rooms)
• Basement or side entrance entry point (i.e. if you wanted to turn the basement into your living space, you could enter from a side entrance)
• Un-involved neighborhood community (cul-de-sacs can be the worst spots)
• Turn-key quality (i.e. you won't need to fix much of anything when you move in)

This list is by no means exhaustive, but things to think about when you work with an agent on a SFH househack. I generally recommend the following suburbs of Baltimore for solid rentership: Columbia, Glen Burnie, Towson.

Hey Robert,

As you are probably aware, eviction is a long, drawn out process in Baltimore City. This is a delicate situation since you don't want a squatter, and the remaining tenant likely thinks he can get away with paying 1/3 rent and staying as long as he can. 

My property manager has managed for several years and manages over 100+ properties in Baltimore City. Believe it or not, he has never had to evict a tenant in his tenure (many of these properties are in run-down areas). He has always been able to address their problem and figure out a solution. 

That's where you come in. I would have an initial phone call with the remaining tenant and make it clear to him that you want to work with him. Listen to his frustration with the other tenants leaving, the potential drama, etc (validate his problems as much as you can). 

When I have had tenants pay late, I always let them get everything off their chest and ask open ended questions - then I mention something along the lines of:

"Hey man, I really want to work with you here. At the same time, I have a mortgage to pay, and if I don't collect the rent for this and next month, I may not be able to pay the mortgage - which means I could lose the house. Again, I really want to work with you here. What do you think the best solution is?" 

Don't bring up anything about eviction, make threats, or offer to pay him to leave. An open ended question is your first step at solving their problem without stirring the pot. 

Usually they understand and will suggest a timeline to move-out, paying rent in chunks, etc. If they push back, this is where you can mention an incentive to have him leave by X date, give him the full deposit back, give him $200 etc. - whatever it is that could be a baby step that would put a little money back in his pocket.

If he's still pushing back, you may need to increase your price to get him out, maybe that's $300, or $3,000. Start with as small as an amount as you have to. 

If all else fails, this is where you mention that you have legal options, and that you don't want to use them. This is the truth. The eviction process is long, drawn-out, and expensive - mostly due to the loss of rent.

This whole conversation may take 1, 2 or 3 calls. Judging on your relationship with them, you may be able to meet him face to face to see how you can help him - in person is always best. 

I am no expert at the eviction process, and I sure as hell don't ever want to be. I hope this helps.

Hey Cory, the 3-5% down is the "down payment" on the property purchase, which is not truly part of the offer itself (more on the financing side), but it could sway a seller's reason to accept your offer if a similar-priced offer comes in that is less leveraged, e.g. a 10% down conventional loan, though very unlikely. 

I believe what you are thinking of is the earnest money deposit - which is "the down payment of the down payment." They are easy to get mixed up.

So situation: you find a 300K home in Greater Annapolis that could be a great househack. We offer 300K, with a 2% (e.g. 6K) earnest money deposit.

On the mortgage side, let's say you and your lender understand that you are pre-approved up to 350K (you qualify for a house up to that purchase price), and you are doing a 97% LTV (you bringing 3% down at closing) loan. This the 3% down you agree to bring at closing. So if you bring a 2% earnest money deposit as part of your initial offer, you would bring a remaining 1% of your down payment to settlement.

So in this case, you would close on a property with right around 25K (it will be the 3% of 300K down, along with about 4-5% in closing costs, so about 8-9% of 300K total).

In a more stable market, you could request the seller to pay for up to 3% of your closings costs (for a conventional loan), so you could hypothetically offer 10K over asking price, and ask for roughly 10k back at closing so you are closing with as little as 14-15K out of pocket, like I did back in 2018.

I hope this helps!

When people are fearful, opportunity arises. Don't be fearful, just be prepared. A close friend of mine manages 100+ properties and has done so for several years. Many of the properties are located in run down areas of Baltimore City. 

He's never had to evict one of them. How? He treats them with respect, addresses their maintenance issues right away, pays the good ones to stay, and pays the bad ones to leave. 

Hey Cory,

Welcome to BP and wishing you the best on your journey. 

The most deals I've purchased have been from wholesalers who specialize in finding off market deals. I met a lot of wholesalers early on through in-person networking events (Baltimore REIA), FB groups (Maryland Investors Network, among others), and in person real estate meet ups (a weekly meeting I joined with a friend of a friend in Northern Maryland).

The way I got started however was by purchasing a househack and renting out rooms. This was the safest option for me to get started because I learned how to screen and place tenants, write leases, manage maintenance requests, and analyze my rental cash flow while living for free.

I think if I started by jumping into a rehab on my first deal, I could have either been taken advantage of, or taken too much risk that would have slowed down my progress long-term. That being said, I like househacking because the properties are typically turnkey, meaning they require little (if any) work, and a mortgage company will provide up to 97% of the financing (assuming a 3% down conventional loan). 

My first purchase allowed me to cash flow more than $500 a month and eliminated by previous landlord's monthly bill of $1000 a month, plus utilities. I was then saving about $1500/month right off the bat to buy my 2nd property. I then took that dual income stream and bought my 3rd, 4th, 5th etc. 

As I continued to grow, my confidence with those initial purchases did too (many in the beginning were off the MLS btw) - I was then able to slowly but successfully analyze and buy off market deals.

If you want to jump in straight for an off market deal - nothing is holding you back. If you decide to do this, I would network with wholesalers, become familiar with a pocket of the market you want to invest in (5 or 6 zip codes), and pull the trigger when the deal makes sense. 

That being said, you will likely need hard money financing, reputable contractors, and an "out" - aka a way to either refinance the property (assuming you keep it as a rental), or sell the property if you decided to offload and reap a profit.

I hope this helps and wish you the best,

Sam

 

May be worth a shot. Trust your instinct where possible - I do not know much about them but see their marketing. Make sure it doesn't suck you in or require a next tier level to get true value out of it...

Best regards,

Sam

Absolutely you are more than welcome to reach out to directly,

Looking forward to it,

Sam