All Forum Posts by: Sergey A. Petrov

The math is really simple. Say you plan on a demo and development in 3 years. You put in $120k to get the properties “rentable”. Will you collect more than $120k in rent (minus expenses and carrying costs while the rehab is underway)? If the answer is yes and the excess net income is a number you are ok with, go for it. The excess income could be $10k. Are you ok with making only $10k in three years in exchange for the time and effort you will have put into it?

If you want a partner who will bring all the money to the table but you split income 50/50, what do you bring to the table? The main question is why would anyone partner with you? Where is the value in you vs me investing on my own and getting that same value from someone other than you? Once you answer that, you can narrow down the type of investment and start your search 

Are you talking about being a commercial real estate agent or investor? If agent, your residential skills won’t translate to commercial. If investor, some skills will translate but the entry bar is a bit higher (can’t do 5% down unless you get super super creative and even then maybe not, can’t house hack, need more reserves and a more experienced set of professionals by your side) but the upside is better.

The short answer is yes you can just start with commercial 

No discount for the very simple reason-“Dear Landlord, my wife and I will be on vacation for a month. We aren’t vacating, moving our belongings out, and expect the place to be “ours” while we are gone. We may even return sooner than planned so please make sure the place and our things are untouched. We’d also appreciate it if you could keep an eye on the place and keep us informed just in case there is a fire or a flood. Thanks in advance! Since we, personally/physically, won’t be there, could we pay less in rent? We may have another vacation in a bit too. Let us know”

@Breonna Mahana - lots of variables here depending on what type of a mortgage you are applying for. I suspect it is a mix of needing to use both incomes (but then only the lowest credit score counts for qualification purposes) vs using only one with the higher score (but then there is not enough income).

It sounds like you are renting the place to someone who is then re-renting/subletting it to 6 other individuals??? I’d tread carefully here… Your lease should be with the actual occupants as long as they qualify with this other person from California who could act as a co-signer / guarantor

What is the local market like? If everyone is charging extra for pool (heating or otherwise), add that fee to your guesta as an option. If it is an expected amenity that comes with the place, you’ll get plenty of negative reviews on the extras. Pretend you are going to the area for a weekend, look at what is available, and whether or not “pool” is extra. That’s what all guests will do when looking for a place to stay

The most sure way to get the answer is to call many many banks, credit unions, and brokers. That’ll give you an idea of what you can borrow 

@Alan Curry - all depends on your timeline. If you plan on staying with your job for the next 10 years, passive invesments (hire a team) with a focus on appreciation is your play. If you plan on leaving your job, you should start looking at cash flow, rehabs or other forced appreciation opportunities. Being "active" while working full time with kids in school won't work - you'll be spread too thin. If your have enough capital, try both - buy a passive investment focused on appreciation and a more active one that you'll either rehab (although the current market conditions might not be ideal unless you'll be living in the subject property) or add value by splitting into multiple units, adding an ADU / DADU, etc. That'll give you an idea of what is what and you can alter your strategy from there

An additional bedroom will outdo an extra “living space” in terms of extra cost vs increased market value