All Forum Posts by: Nick Leamon

Well I think this is something that you and your husband need to discuss further and really dig into what fears/thoughts make him not want to invest in real estate.

I am a buy and hold investor and I have had to have these kinds of conversations with my wife as well.

What does he mean by he likes liquidity? I personally hold more money in cash as reserves for all my properties than i ever did before investing, so while i have a lot of net worth tied up in real estate the actual cash I have access to is actually higher. 

Also I am about to procure a line of credit on some equity i have in a couple of properties, It will cost me nothing until i use it but is 100% liquid and can have it in my account instantly. Again I would not have had this before investing in real estate.

Also, his desire for liquidity may just make you change your strategy to buying single family since there is the largest market of buyers for that type of property, and at least right now in my area everything is so hot if i wanted to sell I doubt it would take more than 30 days to sell a property and liquidate my money.

But he may not know these things or see how they will effect y'alls financial situation. Or (like me) you may just have to have larger reserves than you personal would have to make him feel comfortable. Or he may want the liquitity because in his mind he is planning to buy a boat or car. So I say just continue to have conversations and talk through what is important to both of y'all

Hope this helps,

Nick Leamon

There are a lot of ways i use to find the market rent for my properties

1. Check the zillow zestament for rent and see what it says for the property

2. Check rentometer.com for the rent

3. Look at things for rent in the area around the property on zillow/realtor and find what similar prperties are listed for. i.e. if yours is a duplex and each side is 2 bed 1 bath and you see that single family homes that are 2 bed and 1 bath are renting for $1000/month you know yours will rent for slightly less.

4. Call agents act as a perspective tenant moving to the area ask "what is the rent on a 3 bed 2 bath house?"

5. I always watch the properties that have the same floor plan in my neighbor hood and when they rent and for how much to know what my floorplan is going for.

There are many other ways but i tend to find if you cross reference 2 or 3 of the above and are getting around the same number that is going to be the market rent.

Hope this helps,

Nick Leamon

I use Chase quickpay for some of my tenants that also bank at Chase it is really easy there are no fees and you only have to give them your email address for them to be able to send you money.

Hey BP Nation,

I was wanting to hear from everyone who attends REIA's in their area what the format for their meet up was and what you liked/disliked about it? I.E. can we put together a best practices for REIA's

So for your REIA:

Where? (where do you meet? Back room at a restaurant? Bar? House? Rented space?)

Duration? (how long do the meet ups last)

Frequency? (how often does your REIA meet?)

Format? (what is the agenda. open mingling? presentation? sales pitch? speaker?)

Grub/refreshments? (is there food/drinks. is it catered or do attendees pay for it?)

Extra? (anything different or unique about your REIA? Sharing appraisals/data?)

What part of the REIA do you find most useful/enjoyable? and what part do you like the least?

Thanks in advance,

Nick Leamon

This is always tough, I had the same issue when I went from buying SFH to buying my first multi-family home.

Take a zero off all the numbers and see if it still is a good deal, i.e. a $200,000 deal. Since that seems to be your typical level of deal, then you can say its as good as these deals I have done(or better), but on a 10x scale.

I would never suggest someone invest in something they are uncomfortable with, but it seems to me like you are comfortable with the investment, but the size of the numbers involved is psyching you out.

You got this, and after you do this deal, $2mil deals will be your new comfort level.

Best of luck, and keep us posted on how it goes.

Thanks @Jason Hirko for the info and clarification on the insurance policy,

The niche that I am looking at is 1000-1300 Sqft new construction that is basically a reception area, Bathroom, break room and 4 offices, all already built out. It seems to be a pretty standard set up for either health care or professional businesses. Do you think I would still need to offer T/I money for this type of property?

Do you include an accelerator in the lease to raise the rent each year if they sign a multi year lease?

In your experience how long do your commercial spaces sit empty between tenants? for my residential properties its usually between 0-30 days, for commercial are we talking 30-90 days, 90-180, or 6 months to a year? trying to make sure i have the right amount of reserves in place.

Thanks again,

Nick Leamon

Hey BP nation,

I was wondering if anyone here has invested in any commercial office space. I have never invested in commercial space, but the friend that approached me with the information is reliable, but I am looking to verify the info and see if i am missing anything.

1. Typically the minimum Lease in commercial office space is 3 years

2. Commercial office space rates are quoted by the year.  For example office space is my area is $24/Sqft plus expenses, meaning a 1000 Sqft property would rent for $24,000/year, or $2000/month plus expenses

3. Triple Net Leases are common (at least in my area north Dallas) which means the Tenant pays utilities, HOA and TAXES on the property and that is above the $24/sqft rent

4. Does the tenant typically pay for insurance? is this like a rental house where they get a renters policy and I get a dwelling and fire policy? any ball park on rates for a dwelling and fire new construction 1000-1500 sqft?

5. I would assume to account for longer vacancy rates in this space because the number of potential renters is less but have yall found that yo be true? what is a typical vacancy between tenants?

6. Besides repairs and cap ex what other expenses am I missing that isn't passed on to the tenant?

7. Anything else i am missing? or you wish you knew before investing in commercial office space? or things that are significantly different from single family rentals?

Thanks

Welcome @Brian Wallace 

This community is amazing I hope you can leverage it to achieve your goals, you seem super motivated, keep us posted on your progress!

@Robin Boyer I think investing in foreclosures or pre-foreclosures is a great way to get started, and get a great deal on a property, I don't think they are any scarier than a normal deal if you do your due diligence. I personally have never bought a foreclosure (at least so far) but not because I am avoiding it, an opportunity just hasn't presented itself. Let me know how the 1031 Exchange goes I think I might be looking to do one of those in a year or so.

Awesome @Bret Blackburn!

I have 2 SFH in the DFW area, and started looking last year for my first multi, and like you it took about 6 months to find something that was in a good area and not ridiculously overpriced, but we finally got it closed, keep up the good work and keep us informed.