All Forum Posts by: Travis Beehler

I'd ask more along the lines of what you are doing to determine what the appropriate amount is.  If you are doing all the work, but they are putting in all the cash, I'd say something like 60/40 or 70/30 isn't unreasonable.

If there's a property manager, and all you are doing is picking out the places, and maybe making some quick phone calls, I'd say 80/20 or even 90/10 isn't unreasonable.

 Welcome from just across the river! 

 Hi Chad!

What they are all saying is absolutely correct.  Finding that one person who has your back and is trustworthy is CRUCIAL.  So, feel free to press people with difficult questions when "interviewing" them.  Sometimes you happen upon good people, sometimes not.

For example, I've got a realtor and property manager whom I both trust implicitly.  They have steered me away from deals that I thought were good, but found out later that they would have cost me money.  I also have a property manager for a property that absolutely stinks.  His communication level is awful, and he's more trouble than he's worth.

Also, become rather friendly with the bank.  Since they are the one's who'll ultimately decide how far your real estate empire goes, it's a good idea to make sure you've got someone you regularly talk to there, and knows what you're trying to accomplish.  I lucked out on that regard as well, and I only speak to the VP of loans in my area of investing.  

I'm sure that there are people who could recommend people in any particular area you're looking to invest in.  Have you decided which area yet?

Travis

 Absolutely welcome!  Everyone here is right.  Baby steps is the way to go.  A single family home is the best way to get your feet wet.  Best to get your butt kicked on a $50k property than a $180k property. :)  

Oh, and this is totally up to you, but I would HIGHLY recommend you getting a property manager for your rentals.  They will take care of the core issues about landlording, and will be worth every penny.  They will deal with all the headaches when it comes to being a landlord, and they will issue you a check once a month.

Now, they generally take between 5%-10% of gross rent per month, so keep that in mind when you look for a property.

Also, check out the analysis spreadsheet here:

http://www.biggerpockets.com/files/user/JasonScott...

If you don't have a copy of Microsoft Excel, you can use LibreOffice which is free, found here:  http://www.libreoffice.org/

Hope that helps!

Travis

 Hi Liz,

I would avoid the hard money/flip route, because who's to say that you would make enough money or any money at all on the flip?  Now you've got a hard money debt, AND a home that might not be worth what you thought.

Personally, I'd start with a few smaller single family homes.  Enough to get into the game (I hate using that word. :) ), but not trying to bankrupt yourself doing it.  Then, once you have a few places under your belt, you'll have the profits from those places as the down for the next place, and so on.

Now, I went the route of cashing out my 401k, and buying a single family home for $110k here, and renting from there.  Then the market rebounded hard, and I did a cash out refinance and bought two new places.  Only you and your husband can determine if that is a way you want to go.  It worked for me, but might not work for you.

That was 3 years ago.  If you are patient, and save your cash for the first down payment, it'll all start to build.  I know it's frustrating to want to do something like this and not have it within your grasp.

But trust me, doing the hard money/flip way will very likely cause you bigger headaches than it's worth.

If you have any further questions or issues, feel free to give me a buzz.  I'd be happy to help!

Travis

 Not entirely true, but semi true.  I bought two places in Ferguson RIGHT before the whole Mike Brown thing went down, and while my places are "diamonds in the rough", and I'm making very good money off of them, there are a LOT of places that are war zones.  I'd recommend staying out of St. Louis area for the time being.

I was in a similar situation, but I just dusted myself off, and went back at it.  I invested in one rental and really just forgot about it and let my property manager deal with it.  That was 3 years ago, and I now have 3 rentals, working on the 4th, and hopefully can get things moving in a forward direction again! :)  Keep at it though, it will get better.

It actually looks very similar to the one you talk about here.  I say try them both, see which one works best for you. :)

Travis

I found out I wasn't supposed to put it in Dropbox, so I've put it on here. :)  

http://www.biggerpockets.com/files/user/Scine/file...

Hello all!

I've posted earlier about a spreadsheet I use to determine profitability of a home that I'm looking at purchasing.  I was soon asked by many people for a link to the spreadsheet.  So, I have decided to put a post up and share a permanent link for the spreadsheet.

Here's a quick rundown of what it does.

Calculates mortgage payment.

Calculates down payment (assumed 25%, but can be adjusted)

Calculates taxes, insurance, property management fees, misc. fees, etc.

It also will take into account maintenance, estimated revenue increases, advertising, utilities, total cash outlays, etc.etc.

At the bottom of the spreadsheet in red is your total net profit or loss.  At the top of the spreadsheet it shows you how much you'll profit per year with and without a property manager.

All fields can be modified to your specific needs.

I got this spreadsheet years ago from someone on the internet and have tweaked it to my needs, so I can't take 100% credit for it.

Hope this helps everyone out!  If you have any questions or issues, please feel free to let me know!

https://www.dropbox.com/s/ea4nz29qq294du8/Bigger%2...

Travis