All Forum Posts by: Samuel Eddinger

I agree with @Brandon Rush and @Joseph Salzillo.  Other towns to look at are East Hartford and Manchester.  All of these towns are C class to C+ class.  Avoid Hartford, Waterbury, Bridgeport as those towns are D class and will require lots more work and hand holding of the tenants.

@Kris Laku - Go to https://civilinquiry.jud.ct.go... and you can search by any Connecticut town.  From there you will get the name of the owner.  You may need to do an owner search from somewhere like https://www.vgsi.com/connectic... to find their address (in case you want to do mailings).  You may also need to look at the CT assessor's database if vision appraisal doesn't work.  You could probably do a phone number reverse lookup from a company like propstream but I haven't gotten to that point yet.  DM me if you want to discuss this further.

There are a couple but I think they are all credit unions.  PenFed may have been one of them.  I would call local credit unions and see if they do that.  Beware, the rate will be higher than for owner occupied.

@Seth Alexanderowicz - As a CT investor myself, what you will learn is that duplexes are sometimes worse investments than single family homes.  You are still responsible for water (your number is low), landscaping, snow removal, and trash that you would not be responsible for if you owned a single family.  I'd be happy to speak specifically about the deal if you are interested.

Nice job.  Where in Connecticut did you invest.  I'm from Central CT.

My property management money charges based on collected rents.  It helps align my interest with that of the owner.  We are only successful when we help the owner be successful by collecting the rent and keeping the property occupied.  We also do not sign year management agreements but rather allow them to go month to month so we have to continue to earn your trust.  If you do not feel like your property management company has your best interest at heart, start interviewing others.

It really doesn't matter.  If you sell the property just note that there is a finished basement that is not counted in the square feet.  If it is to rent, just include the finished square feet.

There are a number of meetups by @Brandon Rush, @Scott Hollister, Warren Juall and others.  There is also CTREIA which is very valuable as you start your real estate journey.

I use Appfolio but it has the same issue you describe.  ACHs do not clear day one.  We just pay out to our owner's the amount that has cleared the account at that time.  This way we do not have issues with bouncing our account.  There are no good solutions with any property management company.  I believe they hold the funds for a couple days to make sure it clears and to collect a few days interest.

@Derek Liebhauser - I've posted similar topics on here a couple times but never got much interest.  I have some strong opinions about this.

I think there are five different people in every market that defines the supply/demand.1: Savvy Investor,2: Non-Savvy Investor, 3: Savvy homeowner, 4: Non-Savvy homeowner with money, 5: Non-Savvy homeowner without money.

As interest rates rise, savvy investors recalculate there expected return and redefine the purchase price as needing to be lower.  This prices them out of the market.  Non-savvy investors (flippers, wholesalers) keep buying because they only look at ARVs that price based on today's expected sale not a future where interest rates affect affordability.  Savvy homeowners also understand the effect of interest rates and the affect of affordability.  These could be a net neutral to the market since they have to sell and buy concurrently which could price them out of selling because they refinanced recently and do not want to pay the extra interest (people downsizing and upsizing).  Non-Savvy homeowners with money will just buy regardless and do not consider interest rates.  Non-Savvy homeowners without money will be priced out because the interest rate will affect their debt to equity ratios.

As interest rates rise, Savvy investors start to exit the market (I'm not planning to buy for a few years or until market forces change and I own 21 properties).  Non-Savvy homeowners without money are also priced out as they can no longer afford the same property they were looking for a few months ago.  With that said, FOMO happens heavy for Savvy homeowners and Non-Savvy homeowners with money as they think, If I do not buy now, I may never be able to afford a property again since interest rates are rising.  Non-savvy investors are always buying and do not realize they could get burned since the end buyer needs a mortgage to purchase the property.

From this, the initial increase in interest rates could lead to an increase in housing prices as people rush for the last chance to pick up a property before interest rates get even higher.  After that FOMO wears off, prices do not decrease until the supply picks up.  This will happen as people put property on the market for sale but assume the crazy high prices are what the market conditions are.

As inventory levels start to increase, the owner's that really need to sell will start to capitulate and reduce prices.  If inventory levels continue increasing, the market will continue to go down until there is a new stable point on the supply/demand curve.

Ultimately, real estate should be evaluated at something like the CAP rate minus the prevailing interest rate. As interest rates rise, CAP rates should start to go up as well so that the investor can make the profit on the property.

With all this said, people are emotional when selling as well.  People that think, if I had only sold 6 months ago may ultimately decide to pull the property from the market in lieu of "losing" that additional income.  This can cause a market to stay elevated more than you would expect until they eventually need to sell or reconsider those emotional reactions.