All Forum Posts by: DJ Snow

Thank you. I'm wishing you well too!

You are absolutely right. Thanks! 

@Brent Paul Thanks

@Dylan H This was bought before all the new rules were implemented. That's why it made sense to leverage non-HOA properties instead.

@Joseph Furman Yes, I have. 

@Matt Jones I got in using creative strategies (mostly based on seller financing) and got out when it became difficult to BnB w/o getting hit w/ the 33% fees, etc. 

It just makes more sense to me to use the money on a non-HOA property to increase profit margins since I have my own cleaning crew, check-in, and handyman. I was leaving money on the table.

@karen chenaille Me too! 

Investment Info:

Other buy & hold investment in Pensacola Bch.

Purchase price: $354,000
Cash invested: $53,000

This was a seller financed deal that would have been perfect had I known then what I know now. It was a 2/2.5 unit facing the Gulf of Mexico and the Bay w/ views of the sunset. The location was pretty decent and had 8 pools, 8 hot tubs, spa, fitness center, restaurant, tennis courts, and more.

What made you interested in investing in this type of deal?

Always wanted a beachfront property

How did you find this deal and how did you negotiate it?

Seller financed deal

How did you finance this deal?

Out of pocket financing

How did you add value to the deal?

Eventually, I dropped the price and put it on Airbnb where it instantly went to 98% booked and covering all expenses, etc. It was perfect until HOA got upset and started adding $75 check-in fees, 33% of each deal, and not wanting Airbnb rentals.

What was the outcome?

I got out of the deal altogether and I'm focusing on finding beachfront properties with no gate access and/or HOA.

Lessons learned? Challenges?

The biggest lesson is that the rules of real estate are constantly changing and if you own or leverage (completely) the property you can run into situations like this. It was an eye-opener for me and taught me to analyze deals better, control them, and don't put my money in the deals unless I can recoup it quickly. Thankfully, it made me a smarter investor.

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $174,900
Cash invested: $12,000

This was another investment property bought in 20017 w/ about $12K out of pocket. It has been rented by the same person for since '07 for $900/month. It has been converted into a 2-year lease to own option w/ $40K upfront and the remaining balance paid at closing. Tenant has added an alarm system, ring doorbell, fence, and has kept up all maintenance since they moved in. The property is now worth about a little over $200k based on Zillow.

What made you interested in investing in this type of deal?

Honestly, it was a different type of deal that I had never done before (pre-construction).

How did you find this deal and how did you negotiate it?

A builder and negotiated through a realtor.

How did you finance this deal?

Conventional financing via Fannie Mac

How did you add value to the deal?

I have put anything more into this property since it was built in '07. I had a long-term tenant w/ excellent credit ready. They have added an alarm, ring doorbell, fence, etc.

What was the outcome?

We just implemented a 2-year lease to own option w/ $40k upfront and the remaining due in 2-years.

Lessons learned? Challenges?

Be sure to put the lease option in place upfront with specifics detailed out so that you don't have to hold it any longer than you want. This was supposed to be a 5-year lease to own deal initially. There were and are many lessons being learned on this deal.

Investment Info:

Single-family residence buy & hold investment in Houston.

Purchase price: $64,900
Cash invested: $6,847

This was a great investment with a 10-year interest only loan which allowed it to be rented at 900-1100/month for more than 11-years. The extra money allowed for future investments while covering all maintenance, etc.

Relax and enjoy the patio with family and friends. Two car garage and space for your washer and dryer. Great location Near Westpark Toll & energy corridor.

What made you interested in investing in this type of deal?

It was a great first home for the summer and rental property while I was away.

How did you find this deal and how did you negotiate it?

A realtor

How did you finance this deal?

Traditional financing w/ 10-year interest only

How did you add value to the deal?

Upgraded the property with granite, new appliances, carpet, and paint.

What was the outcome?

Great 11-year rental income before selling when the Houston market began to take off.

Lessons learned? Challenges?

I sold too soon and left money on the table. There weren't really any challenges. All renters were well vetted and worth the 10% the property manager charged. Since this was my first deal I was really lucky and had no real issues but have learned over time that I made a ton of mistakes. It would have been beneficial to know about BiggerPockets during past deals.