All Forum Posts by: Tiffany J.

You need to get to a point where you can analyze rehab costs yourself. Have your contractor walk your first few properties with you so you can get a good idea of things to look for, big ticket, items, and what things will cost.

If you're just looking for a quick estimate, try taking a video of the property during a walkthrough and sending it to your contractor, along with a general gist of what needs to be done.

As for finding a contractor, I'd ask fellow investors - that could be your realtor, lender, friends/coworkers, people you meet at meetups, etc.

those are big questions - probably too much to cover in a single thread - super quick responses

how do you estimate the cost of repairs - specifically, and in detail

Do you put the house under contract, bring a contractor in, and then back out of the deal if the costs of repairs are too high? - you could if your contract allows for it, but you'd really want to try not to do that - if you have to do that, you've wasted everyone's time - you really want to know in advance that it's going to work, and then just refine your estimates later

How do you find a contractor that is trustworthy? - referrals, or find one yourself and vet them

Institutional, Wall Street-er, if you will, here. 

Mass market analysis is alright for a preliminary search to vet properties but scouring the market is arguably just as quick and effective once you get good at it.

Knowing how to search on Zillow or Realtor is already going to discredit 90%+ of places, then a two second look at a listing will discredit another 90%+, meaning the cream of the crop will rise in a matter of minutes, regardless of how you're searching when you equip yourself with the right tools.

Here's my beef with mass market: it's good but it misses things. Let's say the software uses the equivalent of Zillow's Zestimate to forecast rental revenue & expenses, they're off by ~10%+ - fine, it's a good start. It's not good enough to give investors important fundamentals: how CAPEX will affect IRR, terminal cap rates (TCR), area growth, crime, actual figures for vacancy, absorption, expenses, etc.

Not to mention that you're unequivocally not going to find every on- and off-market listing on mass market or a search engine like Mashvisor. 

Tried and tested, my greatest deals have been found directly from the source in which they've been listed, with conviction and fast action.  That said, there's value to be found everywhere!  Happy hunting.

The problem is this is a single property calculator. We use mass analysis where it does these calculations for thousands of listings in the market daily. 

Most guru’s do this in the background so their organization can find the actual best deals. They won’t show you that part. Why would they? They don’t want the mass mom and pop small investors out there to see how they actually do it! They want you to buy books and webinars, and their inside group. And instead they provide single property calculators. You would have to enter hundreds of properties daily to see how they compare and pick the true outliers.

Most investors don’t understand this type of mass analysis. We call it total market analysis where every single property is underwritten and analyzed every day. It’s what the institutional “Wall Street” investors do. They don’t sit there and calculate one property at a time. 

Hope this explains it a bit more. 

Quote from @Peter Vekselman:

@Tiffany J.        big problem with real estate is that mistakes cost time and money.  and no one has unlimited of either.  and usually at the beginning we tend to have less of both.

it is difficult to know everything there is to know when you are a newbie.

so having someone by your side you trust and someone who knows what they are doing in my opinion is the best option.

one way to get this done is to connect with some successful investors in your area and see how you can help them in their businesses in return for some solid hand holding on your first few deals.

Quote from @Becca F.:

@Tiffany J.

My mentors were two investor friends, both who built up enough of a portfolio to quit/retire early from W2 jobs. I learned a lot about property management from them (I self manage one SFH) and local landlord-tenant laws.

If you can connect at local RE meetups with experienced investors, that would be another way to see what they're doing. I found it helpful to do a local renovation and walk throughs with a contractor - I knew nothing about construction before. You can also run some practice deals with rehab costs, monthly expenses, projected rent, etc. Sometimes you just have to take action instead of reading more books (I've read one book) but be cautious and always do your due diligence when considering making an offer .

As Nicholas commented, make sure you have the funds to invest. The social media gurus say "get started with no money, use other people's money." If someone is down to their last $20,000 or has an unstable job, that's a terrible idea to invest in real estate. If you're doing conventional loans, lenders love people with stable W2 jobs. I like to have 6 months of reserves for each property and another $10,000 for each property.

Quote from @Mark Williams:

Quote from @Tiffany J.:

Hi! I've been studying real estate since 2020 off and on and I think I'm finally ready to actually do something. I've been reading books and listening to podcasts. My main concern is that I don't know what I don't know. Did you have a mentor when you first started? Or is it enough to just teach yourself and then go out and do it?

Hi Tiffany, It's great that you've been dedicating time to study real estate since 2020. While you've gathered valuable knowledge, it's completely natural to have some uncertainties when taking the leap into actual investments. Having guidance or advice from experienced individuals can certainly be a tremendous asset in navigating the complexities of real estate.

Many successful real estate investors have benefited from such guidance, which can provide insights into the specific challenges you might face in your chosen niche or market. However, it's not a requirement to have this kind of support to get started. Some people choose to teach themselves and learn as they go.

Regardless of your approach, building a solid network and connecting with others in the real estate industry, whether through local real estate investment groups or online forums, can provide valuable support and insights. Remember, everyone's journey is unique, and there's no one-size-fits-all answer. Ultimately, the key is to be proactive, stay informed, and be open to learning from both your successes and challenges in the real estate investment world.