All Forum Posts by: Selina Giarla

Wow lot of people coming at you for this post and your struggles. I think this is a more than fair post. I also do not think you are trying to start a new career finding motivated sellers some other people are really trying to get you to work. All though knowing what you have to spend would be helpful. I would imagine you have at least 50k-100k to utilize. You mention rents not keeping with prices. Rents will catch up in nearly any place you buy. There is just not enough homes available. Some experts say as many as 5.5 million homes short. We can say 3 million to be conservative. You will see upward pressure on rents. People who cannot buy will continue to be forced to rent. Especially for the entry level homes. I think you just need to possibly look a little more east and maybe deal with some snow. Plenty of new homes that can cash flow with 20% down at a 7% interest rate. Instead of buying 2-4 units buy 2 units in a BTR community. I am in Orange County and nothing cash flows here without at least 50% down. So out of state is the only play for me. Happy to connect on what I have found out there. States I like Alabama, Tennessee, Georgia and Indiana. With some interest and more research to do in the Cleveland and Kansas City areas. I also like north Florida but it is getting a bit too expensive.

Thank you for your kind response. I work full time as a VP at an institutional asset management firm and work probably 50+ hours a week, commute 3 hours a day and travel 25-30% for my job. I have two young kids under 4 and manage 6 doors locally. I am doing my best to find deals but only have been looking on zillow/retail since I don't know how to find anything off market and as you can see... every moment of my day is accounted for and it's a little harsh for folks to berate me for this. My husband and I had no mentors, no houses handed to us, we worked hard and slowly created this portfolio of 8 doors and our own home and want to scale our investments but feel like we are in a choke hold. If anyone is considerate enough to help share some listings I can underwrite that they aren't willing or able to purchase, please help me out. I would love to connect on what you are finding in Alabama, Tennessee, Georgia and Indiana. I am particular on the state income tax rate, and if the state is a red state/landlord friendly. I haven't looked into those 4 much. Thoughts? DM might be easier. Thanks again!

1 Vote

Quote from @Bud Gaffney:

Are you open to out of state investing? How about Detroit, Baltimore, NEW BEDFORD?

I am open to out of state, preference for TX. I am also from Boston (northshore) and have 6 doors here in Lynn. I am totally done with rentals in MA. I noticed your comment on a few hundred dollars a month, I would say that yes I agree it's still profit however, the return of only a few hundred isn't worth the risk of tax, insurance vacancy or some repair pushing me over the edge there, I would rather find something a little more appealing if I am tying my money up. I usually also focus on the % return rather than the $ amount because to your point, in a way you are correct... if $200/mo profit was based on a 20% return, I would go for it, but if only for a 4% return, I would rather my money in a HY savings account making 5% with no risk.

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Quote from @Jake Andronico:

@Selina Giarla

In Reno, NV w/ 50% down there are a ton of turnkey deals. We're seeing new builds as some of the best value right now because they're looking to offload their inventory before the end of the year.

Would be happy to send analysis.

Hi Jake - yes I would love to hear more about these. The nevada state/city tax is higher than the MA state tax I pay so I would also need to factor in the income tax to be paid there in my analysis.

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Quote from @James Cordeiro:

@Selina Giarla

Hey Selina, Fix/Flip and BRRRR deals are harder to find for sure.

The shortage of housing and higher prices have put more pressure on new construction to fill the gap. I am an investor's realtor and investor in the North Central Florida market. We are working with our investor's on new builds. With our lender partners, the out of pocket costs are similar to fix/flips and the upside is much better.

What's more appealing to a buyer for the same price? New construction or rehabbed fixer?

@Selina Giarla

Hey Selina, Fix/Flip and BRRRR deals are harder to find for sure.

What's more appealing to a buyer for the same price? New construction or rehabbed fixer?

I would be interested to hear more. Can you share anything you are working on that is open to investors?

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Quote from @Adam Bartomeo:

There are ALWAYS deals to be had... you just have to look for them. If you want to find gold or diamonds you cannot walk around and go "I don't see any, so, there isn't any. You have to go to the right spot and dig, dig, dig... The MLS is NOT the right spot!

Ugh I hear you. Where do I start? I have never understood where to find off-market deals.

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Quote from @Guy Gimenez:

@Selina Giarla

Sounds like your sourcing your "deals" from the MLS (retail market), which means you're paying retail most of the time. It's always hard to cash flow retail deals which is why most investors market heavily to locate motivated sellers. Profitable deals are found primarily off market through dedicated marketing or through relationships.

I would love to understand how to get into the club of these off-market deals. Where do I start and what makes them "off-market"? You are correct, I am only involved in searches on zillow, crexi, and the like. Would love your guidance here.

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Quote from @Alecia Loveless:

@Selina Giarla My sister has been investing in Denton, Texas for the past 15 years. She has 17 SFH but has not bought anything new in Denton in the past 3-4 years because the property taxes keep going up by at least 30-40% each year which has turned her meager cash flow into almost nothing. She is an attorney so is able to easily fight the property taxes herself through the system without having to hire anyone else to help her but only has marginal success. She was also able to refinance the loans that made sense to near rock bottom rates when rates were low.

To her it no longer makes sense to invest in Texas for just the same reasons you have mentioned. Costs have increased too much and she’s only been able to increase her rents by about $100/month over the past 4 years.

She and I have recently partnered to purchase a multi family property elsewhere that has solid cash flow and more stable property taxes and bills.

Hi! Interesting. How are things going now and where have you landed in the US for your new ventures?

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Quote from @Bob Stevens:

Quote from @Selina Giarla:

I'll start here... I have 8 doors. I have been involved in many facets of real estate. I am not a newbie but my portfolio is small and I am eager to grow it fast. I like to stick with 2-4 unit properties so I don't need a commercial loan, and I don't have a ton of cash in the event of a massive vacancy or capital investment, so more expensive isn't necessarily in my wheelhouse. I recently started out of state investing in Texas. Since I am out of state, I like to avoid the uncertainty of older home and prefer new builds or houses that are within 10 years old, max. I prefer Texas because it's a landlord friendly state, there is no state income tax so I don't need to file taxes in TX and MA (where I am from), the tenant's pay for a lot of the repairs, maintenance, etc. and there are no snow removal costs. Construction/Labor is cheap and its a growing state with respect to population, and lack of available housing.

All this being said...I CANNOT find a good deal. The houses are expensive, the rents haven't caught up, the int rates are through the roof, and the rent alone cannot even cover the operating expenses and debt service, nevermind turn a profit. Even if I go up to 50% equity, and zero out my vacancy factor, cost to lease, R&M and CapEx underwriting, I barely turn a profit (a few hundred a month). I want find a deal and put in an offer within the next 2 months. How are you all finding anything that makes sense?!

Go out of state. I know dozens that live overseas and all across America, including me and do all their business in the Midwest Double digit net caps are the norm. I get deals sent to me daily. I just locked up 7 more SF all will have about 15% or better net caps.

All the best

Hi there! I haven't investigated rentals in the midwest. Where in particular are you seeing good returns? Do you have any deals you would be willing to share? Are they rehabs? Multi-family? Are you holding for cash flow or are they short term equity flips?

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Thank you all very much. With the DSCR... what happens if I can't make the ratio month over month (ie: vacancy drops for a period.)

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I have two 3-family homes and 1 duplex, none of which trigger the commercial loan requirement. I am interested in going bigger - anywhere from 5-12 units, and anywhere from one building or multiple homes. I understand anything above 4 units will require a commercial loan. As I navigate the numbers, I would like to understand current rates with 25% down. I also understand there are DSCR options but not certain I want to go that route. I prefer 30 yr fixed so I can have some level of certainty while I get accustomed to the larger properties and the caveats that comes with, but not sure I could get a 30 yr fixed. I also have managed warehouses and considering purchasing a warehouse or storage facility so if lending also differs for that, could you please let me know?

Aside from that... I would like to reiterate my main question which is: what should I factor in my underwriting for interest rates? I have high 800's credit score and prefer 0 points. I have a preference to investing in texas but looking all over the red states. Thanks everyone!

2 Votes

All Forum Posts by: Selina Giarla

Selina Giarla has started 5 posts and replied 37 times.

Post: Where Are The Deals!?

Post: Where Are The Deals!?

Post: Where Are The Deals!?

Post: Where Are The Deals!?

Post: Where Are The Deals!?

Post: Where Are The Deals!?

Post: Where Are The Deals!?

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Post: Dipping toes into commercial multi-family - how does lending work?

Post: Dipping toes into commercial multi-family - how does lending work?