All Forum Posts by: Samuel Eddinger

@John Schiaroli - In this game, you are either deal limited or cash limited. In this case, you cannot find a deal so you are deal limited. You have two options, lower your CAP rate or cash on cash threshold, or change what you invest in that will meet your threshold.

I own a PM company and 21 income properties and have become deal limited.  I choose to expand my search to commercial properties and now I have additional opportunities again.  I can also choose to expand where I will buy.  I am investing in some flips.  This has again made me cash limited.  

I live in CT and invest exclusively in CT.  Happy to have a phone call if interested.

@Veronique Leroy - Pay yourself first!  If you would take away the headache for 10%, than higher a property manager.  If you would do it for the 10%, than you are the PM and you should pay yourself for the work you do.  

Once your time is worth more than the 10% than you should hire.  Until that comes, you should continue to self manage.

@Shashank Viswanadha - With that interest rate, you would be crazy to sell! Interest rate on the buy is at 6% now. HELOC is definitely an option to tap into the additional equity. I'm also a CT guy so reach out if you want to chat more.

I live in CT.  Mason + dehumidifier is the solution.  Sometimes, you need to dig out and put in curtain drains.  When really bad (sloped towards house),  you need to trench and run the water another direction.

I'd be happy to connect with you and recommend some meetups.  If you want to do owner financed deals prepare to WORK.  I own 21 properties, 53 units, a property management company managing 300 units, just started a flip business and am looking to buy a big commercial building so I'm very familiar with investing and CT.

We manage basically class C properties and in Connecticut, there is a lot of old buildings that take a lot of attention. We also have been attracting owners with properties that need a lot of attention. For well maintained SFR, I'd say I'm probably overstaffed but with us and the turnover we are experiencing with new owners and selling owners, I think we are staffed correctly. We did recently update our lease and PMA to try to bring in more revenue to justify the increase in staff.

I would find a mentor and gain as much as you can from then.  That will help you not make the same mistakes they made and accelerate your growth immensely.  After you think you have learned enough, then you will have the confidence to go off on your own.

As an investor, I can feel the lack of confidence and I don't know any 19 year olds with no real estate experience having the confidence to quickly close a deal!

@Peter Pierzchala - I run a property management company in CT.  My advice to everyone I talk to is the same; Sell if you do not want to hold long term and double down if you do.  Unfortunately many of my clients take my advice and have successfully exited.  I'm happy for them.

As you say, Simsbury is a great area. I would expect that over long periods of time your property would continue to appreciate in value. You make money in four ways in real estate; 1: cash flow, 2: equity paydown, 3: equity appreciation, 4: depreciation on your taxes. Using a HELOC would keep cash flow strong since you will not have to pay any principal. You would not have any equity paydown in this scenario but you would have the continue equity appreciation and depreciation on your taxes.

The other consideration is doing it yourself and having another job.  Most of my clients self managed and didn't need a property manager until they REALLY needed a property manager.  Pricing in a property management company at 10% and paying yourself the 10% to do the work is important.  That way if you don't like it, you have budgeted the 10% to a company to handle for you.

If you want to increase your investing in real estate, it probably makes sense to hold (I still own quite a few SFH). If you never intended to invest in real estate, sell and redeploy the cash into the market or other vehicles.

I'd be happy to have a phone call if you want.  Just DM me.

I'm looking for seven items when evaluating a location for purchase.

Price - do the numbers make sense

Location - would I be comfortable living there with my family.

Layout - is a tenant going to go into the property thinking "why did they do that".  Examples would be a 3 bedroom with only a stand up shower, a sink in the pantry, a 3 bedroom, 1 bathroom with the bathroom between the two bedroom and no secondary access, washer/dryer in the kitchen, etc.

Laundry - ability to put in hookups in the basement if not possible in the unit itself.  Good tenants do not want to go to the laundromat.

Parking - Some tenants have nice cars and do not want to park on the street.

Split utilities - Having the tenant responsible for electricity and heat is extremely important so you can keep your costs in check.  Having the heat on and the windows open is real when tenants don't pay for heat!  Space heater usage when tenants pay for heat but not electric is also real!

Back yard - This one I worry about the least but some people want to enjoy company with friends outside and/or have a cookout.  This is a bonus but not something I automatically disqualify for.

The rule of thumb that I've heard from better Property Management Companies than mine is that for residential doors (not HOA communities), you should have 1 body for each 50 to 75 units. For 200 doors, there should be about 3 staff supporting that. The total number of people are responsible for all direct tasks (owner facing, vendor facing, tenant facing, accounting, leasing).

We have about 300 units and have 6 full time staff.  We just hired another staff and are working to reduce our backlog.  Especially right now, more staff is better as everything in property management is harder.  We also are a proactive property management company that does property reviews, lease renewals, and is proactive with raising rents, etc.  All of that takes additional support as opposed to reactive property managers that are just reacting to one emergency after another.