All Forum Posts by: Jeremy Taggart

@Adrian J Castro 

IF this was something that would make or break the deal for you then you should ask for proof of rent payments during the due diligence period to show the tenants are paid up on rents. Property management companies can easily pull up tenant ledgers and even mom and pop landlords should have some sort of rent collection they could show. 

This can be a tricky one on the 2-4 unit properties though since it's usually not standard process (at least in my market) on the due diligence with them kind of being lumped in the residential space. If you are bidding on a property that has a ton of interest and has other bids the seller might tell you to pound sand if you are asking for proof of rent payments. So it could cost you the deal if it's a really good property that would be great in the long term.

If you are buying say your first property and don't have a ton of funds set aside to deal with an eviction and getting the apartment re rented then you may want to err on the side of caution and verify that prior to close even if it might cost you getting some of the best deals. Otherwise kind of just have to chalk it up as a risk that you might have to deal with buying tenant occupied properties if you do want to get the best deals that come up since you likely won't be the only person interested in it. 

If the PM isn't even responding to you may want to find another for going forward at least. As far as getting the tenant out you can try cash for keys and see if they will just leave without having to go through the eviction process. I can't imagine if this is a new property manager that wasn't managing the property before that they would want to deal with this eviction since it wasn't a tenant they placed, so that could be why they aren't very responsive. 

@Alicia Williams Pittsburgh has become pretty popular for out of state investing. Most of our clients on the agent side are out of state at this point. Good rent/price ratios especially on multi family. You can hit the 1% rule or higher in most areas for something turnkey/close to it. 

Average price point of about $60-$125k/unit on multi family and $100-$200k for single family in the areas that are cash flow positive using standard 20-25% down financing.

Cash flow friendly now with good upside for future rent/appreciation growth in the right areas with the tech scene starting to develop here too (mainly from Carnegie Mellon University)

I've built a portfolio here over the last 9 years that I could live off at this point if I wanted to, so it's been a good market for me on the investor side getting to work optional within a decade. Likely would take much longer to do that in most other markets in the country.  

@Evan Hooke Yup a single family where you rent rooms out or a 2-4 unit where you live in one unit and rent the others out. Even though you are still living for free now with your parents the CoC ROI of a house hack once you factor in cash flow, appreciation, loan paydown, and depreciation is going to be one of the highest risk adjusted returns you can get. Main reason being you are putting such little money down to get into it. The sooner you start the clock of owning assets the better it gets over time as the loans get paid down and the values/rents go up.

My strategy all of my 20's was 1 house hack per year along with BRRRRs. Combining the two I think is the best strategy when you are young especially in a cheaper market like Cleveland which is similar to Pittsburgh where I am. I have to imagine you can find 2-4 unit properties where the rents cover your mortgage while you are living there there as well. 

@Evan Hooke House hack if you can. It's a no brainer when you are first starting out, especially in your market being a cheaper one. If you can find something that needs a big reno and use a 203k loan you can combine that with BRRRR.

If you find a good agent that invests themselves they should be able to provide you with deal flow. I know for our clients we are sending them stuff both on and off the market since we are investors ourselves we are already looking at stuff on a daily basis so know if something might be a good deal or not. 

If you want to try out going direct to seller I like driving for dollars as a good starter strategy that is pretty easy to implement. Deal Machine is the app I use for that and has worked well for me. 

@Allen Ramirez I'd say it depends on your cash position and the numbers of your local market. If you can't find a market with very good rent/price ratios near you then you will need a lot more money in order to refinance out of them since you won't be able to rely on the property itself to cover the debt needed to get your money back out. Cheaper areas with better rent/price ratios could help with this but then you have the downside of it not being in your backyard which comes with additional risk/expenses. I tend to prefer multi family since the rent/price ratios are better if you can find any of those nearby to you. Pros and cons to each. Depends on your timeline too just might take longer to achieve your cash flow goals if you are doing it in a more expensive market. 

@Frank Meyer Those are usually more cash flow friendly compared to the 2-3 units especially with todays interest rates so I like that. 

@Pramod Prasad yeah same thing there would just be a matter of factoring in the cost into their numbers. That would make it more appealing to do the electric though since you would get that as a benefit as well so would be more of a 2 birds with one stone situation. 

@Delilah McMahan It's just getting a lot tougher in general to make the numbers pencil as a result of increased competition for flipping houses. Make sure you are on all of the local wholesaler's lists since they can provide good opportunities. I am also a fan of driving for dollars when it comes to sourcing your own off market deals. The on market stuff you usually just have to make sure you watch like a hawk and jump on anything that looks good or scout the lingering listings and try and get something under contract at a much lower price if it's been sitting a bit the seller might be more willing to accept a price quite a bit below their asking price. You can also try and go into higher priced areas where a lot of other investors might not have the resources to get into but that presents higher risk as well so you would want to make sure you are well capitalized, really know that space in your local market, or have a partner prior to getting into the higher priced areas. 

@Eunha An Idk if you read Brandon Turner's book on managing rental properties but that's a great book to read that covers the A to Z in property management/leasing. I use all of the concepts he teaches in that book to this day in my own business. You can also reach out to local property management companies a lot of them can probably use help with leasing and potentially the management side of things as well if you wanted to learn more hands on. The nice part about that business is you can kind of do it part time on the side. I did it myself at the beginning when I had just left my w2 job and was building my agent business. 

@Frank Meyer small multis can be a great place to start. I have a lot of those in my own portfolio. Can qualify for 30 year fixed loans and tend to cash flow better than single family homes. That and you have the option to house hack them so increases your flexibility on the front and back end when going to sell.