All Forum Posts by: Samuel Coronado
Samuel Coronado has started 27 posts and replied 293 times.
Post: Mobile Home Conference - April
- Investor
- Huntsville, AL
- Posts 297
- Votes 172
I've never heard of this one. I am developing in north Alabama. I'll take a look at this, but probably going to skip it unless there is a live online version.
Post: New RE Investor
- Investor
- Huntsville, AL
- Posts 297
- Votes 172
Do not discount the initial security deposit. Take your time in vetting people. Meet in person, walk them out to the car and see how neat their car is on the sly. That's an indication of how clean they will keep your property.
Post: Investor approaching the Detroit market, looking to build my core four
- Investor
- Huntsville, AL
- Posts 297
- Votes 172
Quote from @Joe Hammel:
I'm pretty biased towards Metro Detroit for obvious reasons lol.
HOWEVER, I do personally make over $100k/yr cash flow from 16 properties here. All of which, I’ve purchased only within the last 4 years.
So I do practice what we preach, and it really freaking works.
Metro Detroit has what 99% of Real Estate Investors want. Couple hundred bucks a door monthly cash flow, double digit ROI, and yes the prices appreciate and you build equity.
There are 2 types of people who dog on Detroit..
1. People who don't actually own property in Detroit
2. People who did it wrong and weren't able to execute.
If you do it right, it’s statistically the best market in the country for cash flow.
I cash flow $100k a year off 23 doors and have built a ton of equity in a short amount of time.
Purchase: $80k-$130k
Rent: $1100-$1500 (no rent control in MI)
1% rule: 1%-1.4% rule deals
ROI: 10-14%
Cash flow: $150-$300/door (after all expenses and budgeting for maint, capex, vacancy)
Appreciation: 3-10%+ (has been double digit for a decade)
Location: C+, B-
These numbers are based on the "sweet spot" in Metro Detroit. These are largely in the suburbs and some markets within the city. You can find higher ROI (on paper) here and probably in other cities…but the probability of actually collecting rent significantly decreases. Where these numbers are found, there is a very high rate of rent actually being paid.
We have over a dozen Fortune 500 companies just in Metro Detroit with huge Healthcare, Auto, and mortgage industry National footprints. Ford, Rocket mortgage, Beaumont hospitals and more. All complimented with Amazon fulfillment centers, google, and more tech manufacturing jobs.
The bad reputation of “Detroit” comes from OOS investors wanting sub $40,000, D class properties in poor condition, because they pencil out to 2-3% deals on paper. We don’t buy those.
We have found what works and repeat it as much as funds allow.
Detroit has the the highest rent to price ratio in the country…and we’ve found the perfect balance of price/location within the area.
Here is a picture of my portfolio...
How hard is it to evict someone out there?
Post: Differences in building a duplex or quadplex vs building a SFH
- Investor
- Huntsville, AL
- Posts 297
- Votes 172
I am looking at building a duplex on a plot of land I acquired with some partners. I am wondering about the difference between the building a small multifamily vs building an SFH. When building an SFH, we had plans appraised and then went from there going from draw to draw based on phases the banks requested. When it was finished, we converted from construction financing to permanent financing and called it a day. Is this the same process for a duplex or quadplex or are there extra stipulations?
Post: Looking for Licensed Contractor in Huntsville
- Investor
- Huntsville, AL
- Posts 297
- Votes 172
Justin Goode LGCW Construction 256 874 3933 or
Clint Enfinger M&M Renovations would be great for this project. (256) 867-3332
Post: 5 acres for $50,000
- Investor
- Huntsville, AL
- Posts 297
- Votes 172
Quote from @Alecia Loveless:
@Samuel Coronado My experience with building lot purchases is they’re usually only worth what you pay for them once. Then they go down in value.
I bought a lot 18 years ago with the intention of building a home and moving there because my best friends lived next door. They ended up bankrupt and foreclosed on and I moved somewhere else.
14 years later my lot in a town where building had boomed, housing prices were up about 40% and there was solid population growth had gone from being worth $28,500 to being sold for $19,000. And I had paid over $20,000 in property taxes on it.
The reason your seller hasn’t sold the lot for $50,000 is because it’s overpriced.
Post: New to being a landlord
- Investor
- Huntsville, AL
- Posts 297
- Votes 172
It takes a certain personality to do it yourself and make a profit. I think it's more than possible, but you have to have a no-nonsense way about it. When a single mother has been going through a rough spot and falls behind, it is up to you to file her papers and have the sheriff escort them off. When a pipe bursts, it's up to you limit the damage and find contractors who can fix it in a timely measure. There's a few other stressors that go along with it. I think all of it is manageable but some people have lofty ideas and have been oversold the idea of "passive" income from companies like Rich Dad, BiggerPockets, etc. Self-managing takes a bit of the passiveness out, but once you get everything set up and develop the systems that work for you, then things can run very smoothly. Tenant selection and screening are great determining factors in this as well. Some tenants I have gone months without talking to and only talked to them because I haven't heard from them in a while (even though their payments come in electronically with no issue). Others want to talk to you all day for no reason or have a bunch of nitpicky ways. It takes a little bit of experience before you can get that intuition.
I currently self-manage 7 rentals.
Post: How To Not Build your First House
- Investor
- Huntsville, AL
- Posts 297
- Votes 172
All great advice! I am preparing to build my first build-to-sell house from the ground up right now.
Post: Today I fired the Own It Detroit team after spending over $800k with them.
- Investor
- Huntsville, AL
- Posts 297
- Votes 172
I would chalk it up much more to the demographics and laws in Detroit than just the management. The entire city has an entitlement mentality and protections for tenants outweigh the incentive to invest there. As an alternative, I am investing in the secondary markets of Huntsville. Much more landlord friendly and the vetting process allows for a better control over everything.
Post: 5 acres for $50,000
- Investor
- Huntsville, AL
- Posts 297
- Votes 172
Quote from @Chris Seveney:
Quote from @Samuel Coronado:
I have some land about to be under contract where I plan to clear it, reinstall the utilities, and either build on it or have a smaller new home built on it. I'm having trouble finding someone to lend on this. I am confident the land will appraise by itself as smaller 1 acre pieces are going for 20k a piece right next to it. I've called a couple banks and they say they don't lend that low or they want 35-40% down, which would take away from my working capital and slow down the process. I am gathering some investor friends now to go in, but was hoping to do this small development without giving up equity.
see if the seller will do seller financing. Also if it is 1 buildable lot, the additional acreage may not add a ton of value. For example a 5 acre lot is not worht 5x a 1acre lot if it can only support one home. But based on what you wrote, lenders will not touch something that small.
On the lending front, I did find a couple of lenders. One with brutal, silly terms. The other with much more reasonable terms. Silly terms were 10.35% floating rate for 10 years with 35% down! The reasonable one was 15% down at 8.5% for 20 years. I am looking for this to be a short term development so however I can structure the deal where it's the lowest payment, I am happy. Going with the latter and hoping to establish a relationship with the local lender going forward.