All Forum Posts by: Todd Anderson

@Kyle Knudsen  I agree with Denver, with a 1031 you must move all the proceeds to a new "like kind" property.  In my experience it cannot be used as construction funding.  I would reach out to @Dave Foster to confirm.  

Best of luck

@Elan Adler,

Thanks for the story of your experience.  Over the long hold I would expect that you will find a good appreciation.  When I talk with investors about the build to rent opportunities in the sunbelt we talk about finding areas of growth like you have found.  Nation wide we are still a long way behind on numbers of homes needed.  When you find a good market that shows steady growth, you get in the way of obvious appreciation.  

I would agree that the Cap Ex numbers for new construction are far lower than other homes.  most of the investors that I work with are planning on moving the investment before most of that Cap Ex would be needed.  

This type of investment works well for the investor that is not looking for another job. As others have said, no REI is totally passive, if you find the right group with all venders in place, the investors that I work with find it can be a pleasant transaction.

Best of luck with the investment

@Paul Whitney, You will get many ideas on this forum.  All have there good and bad.  

I would suggest to look for some where that is a growing market,  where there is good solid population growth.  This will get you in the best position for both rent growth and appreciation.  Cash flow is certainly important and I would not suggest an investment that does not have cashflow, but not all cash flowing units are in an area of appreciation.  

I would also look for an area that has good landlord laws.  there are may places to invest that are moving the landlord laws in the wrong direction.  Even though you are not planning to manage the property this will effect the management and resale.

Last look for a situation that will work well with the 1031 exchange.  I work with investors all the time that find that looking towards Build to Rent new construction is a good fit for an exchange.    This works well with the timing and value restrictions that are involved with a 1031

Feel free to connect if you have more questions.  

Best of luck.

 Feel free to reach out and we can connect and talk about your specific goals.

@Ethan Slater, Thank you for your service and welcome to BP.

As others have said I think your thought of house hacking in your stage is great. I have worked with a number of new investors that use this strategy to get started. As others have stated using a VA loan gives you quite an advantage to get into the deal. Take a look at what markets you are planning on starting in and make sure it is a growing market where the appreciation is obvious. This will let you capture equity as well as make it easer to cashflow. It will also alow you to use the equity as it grows to add to your portfolio.

Best of luck

@Sebastien Tinsley, Welcome to BP and the REI world.

It sounds like you are in a great position at your age.  There are a number of groups that meet in the Central Florida area.  That is a good next step to get an idea of good markets, and Deals.  You can then get help setting up your team and narrowing down your strategy.  Great comments be @Nathan Gesner,  most important, take action!  

I talk with investors all the time that get stuck in the numbers and never take action.  If you wait for the perfect deal it will never come.  In a buy and hold strategy most real estate deals
will work over time.  

Best of luck!

@Brian Stinson I have always used insurance for a disaster.  I would like to be in control of my money, so I have always gone with the highest deductible posable and maximized cashflow.  Then create a maintenance account.  You can grow that account to what ever you are comfortable with.  Then you are in control of that money.

Dealing with an insurance came is never easy, and sometimes it can be downright a pain.  I have found it much easer to handle small things my self.  This also keeps down your premiums.  

Best of luck.

Brady,

When I do my screening for new tenants I would weight the rental history the most.  How a tenant pays, keeps the house and acts as a neighbor is the most important thing to look for.  

I would be honest with the tenant.  Go meet them and have a conversation about rent.  Let them know that you will be needing to get the rent closer to market rent.  See what they feel about their ability to pay.  Keeping a good tenant will be the most important thing you can do when starting out.  

The 3X income to rent is a rule of thumb like all others.  Real life does not follow rules of thumb, they are there to give guidance.  Some of the best tenants I have had did not fit all the rules of thumb.

Best of luck.

Lenny,

Good for you for thinking about your future and welcome to BP.  Going down the path of house hacking would be the advice that I would give anyone in your position.  Find a single family, or even better a duplex that you can live in and fix up.  In your situation you may be moving areas.  This is something you can do in multiple cities.  Do this every year if you can.  It won't be long you can look back and see a nice portfolio.  Then you can combine or exchange for a better or more consolidated/ better proforming area.  

I bounced around the minors in hockey and I wish I still owned all the places that I stayed.  

Best of luck on your road!

Devin,

Congrats with the win!  Development is a fun and frustrating venture, but Real Estate is still a good place to find a win.  It is always good business to stay conservative on numbers.  

Learn from the exercise and do better on the next.

Good luck!