All Forum Posts by: Steve Kim

@Leslie Frieze I'm a new aspiring REI and I lived in the Chicagoland area. I just wanted to comment that I'm impressed that you would be willing to invest in that area. If you do, please keep us updated on how it's working out. My fear from that area is that the tenant will be delinquent with their rent and could become potential squatters.

@Mike H. I'm a newly aspiring REI looking for my first deal and I would like to ask you some questions if you have the time. Are you finding these homes off market or on MLS? Are you targeting SFH or MFH? I've been looking on MLS and I'm not finding a lot worth pursuing as you stated. Most opportunities that I'm seeing are in more smaller towns which are outside my drive-able range (unless I take a half day). Are you using a property manager at this stage or are you self managing?How are you finding your rehab costs in your area to average?

Thanks everyone for your input. I believe I am going to avoid the rural properties at this time. I'm continuing to search for a property that makes sense and meets my credentials. Thanks again for your comments as they have been very helpful! I'll post back when I find another property that looks like a good opportunity.

@Jarrod Kohl & @Ralph R. & @Antoine Martel

@Anthony Dooley Does this apply to refinancing? IE: Could you purchase a $50K home with cash using the 70% rule for $35K then refinance it?

@Ralph R. Thanks for the heads up! This will definitely force me to consider this scenario in further depth.

@Jarrod Kohl

Sorry, I explained it poorly. I plan to purchase this property with cash at a lower cost due to no contingencies and the property being on the market for a while and then refinance it to pull the equity so can go after other properties. The property is in pretty good shape as you stated, so I won't need to renovate it and I won't have to kick out the current tenants and will keep the rent amount. I stated that the expenses is almost non-existent, which wasn't accurate. I was trying to convey that the expenses look to be very low, but I should get an accurate figure.

Let me know if what I wrote isn't a sound plan.

Thanks!

@Ralph R. Thanks for your insights. It does make me worried when thinking about long term vacancy, but since the property is such a low cost, the mortgage+tax would be ~$125-$135 I would be able to continue paying for it without any issues. You said that your property is now being rented long term. Knowing where you are now, would you stop yourself from purchasing that rural property?

@Antoine Martel You are correct. I was thinking rural because I can buy the property with full cash and am hoping to be able to get it at 70% because it's been on the market for a while and there's no contingencies.  The numbers made sense to me because, the property is rented for $1030 for both units and the expenses are basically non-existent. The mortgage and tax would be ~$125. I was thinking this property would be a great way to gain cash flow so that I can start to gather capital for the bigger purchases / quickly get another rural cash flowing property.

When I looked for quads in my area, they are going for around $400K - $600K and the cash flow were all showing negative numbers unless I would be able to get the property at ~%65 the list price. I don't have the capital to offer a full cash purchase so I can't leverage a no-contingent deal. The value adds are most of the properties that I was looking at didn't have individual unit water / electric meters, which I could install and save on expenses which would bring the NOI into the positives, but I don't know how much it would cost to get the properties sub-metered.

Hello, I'm new to BP and REI. I have been listening to podcasts and reading books and I believe I found a great investment opportunity. However, there are some things that I am concerned about and would appreciate some guidance.

Since the property is in a rural area, my plan is to buy the duplex with a cash offer with the 70% rule. I then plan to 'refinance' the property and take the equity and continue with the BRRRR plan. The property is selling for ~$50K and current renters are paying ~$500/month per unit.

I'm worried about several factors:

1. The population growth is on a negative trend. (Since this is a cash flow buy & hold property I'm worried that maintaining tenants in the long term could be an issue.) Should I stop here since the property is not at a growing market?

2. I'm not living there, I will have to use a property management company. I only see 2 property management companies in the area, but they don't have a website and 1 realtor site. Could someone help me with several guidelines on how to choose the proper PM?

Thank you in advance,

Steve K.